Engaging litigation investment is a fundamental utility for firms navigating the thorny journey of bankruptcy restructuring. Woodsford has published a new whitepaper with insights into the benefits that litigation finance offers during corporate insolvency reorganization.  According to Woodsford, litigation investment offers creditors and debtors various benefits for the hope of future returns on current distressed assets. Woodsford outlines several examples of bankruptcy litigation finance scenarios as part of the whitepaper.  Furthermore, Woodsford suggests that bankruptcy funding options fit a wide range of scenarios that increase leverage for corporate investors to rise successfully from insolvencies.

London’s specialist competition court, the Competition Appeal Tribunal (CAT), decided in October 2021 that a class action should proceed on behalf of rail passengers who are allegedly being overcharged by the Southeastern and South Western rail franchises by not making ‘boundary fares’ sufficiently available. Southeastern and South Western could have taken last year’s decision as a prompt to do the right thing by their customers and offer compensation. Unfortunately, they sought to delay resolution of the case, and ultimately the payment of compensation, by pursuing an appeal. In yesterday’s unanimous decision of the Court of Appeal, Southeastern’s and South Western’s appeal was dismissed. The class action will proceed. The pursuit of justice for rail passengers has taken a significant step forward. Justin Gutmann, formerly of Citizens Advice, is the Class Representative. His standalone claim against Southeastern and South Western was the first of its kind to be filed in the UK and is estimated to be worth around £93m in damages for rail users. The Court of Appeal’s decision means that millions of passengers who have paid twice for part of their journey on Southeastern and South Western routes because they were not sold a boundary fare, will now automatically be represented at court, unless they choose to withdraw from – or opt out of – the claim. The defendants argued that some consumers might have suffered relatively small damages, some as little as “the price of a takeaway cappuccino”, and that such small losses should be excluded from the claim. The class representative, quite rightly pointed out “for some consumers even a cup of takeaway coffee is meaningful”, and the Court of Appeal clearly agreed. Delivering the single judgment of the Court of Appeal, Lord Justice Green stated: “In mass consumer claims quantum might characteristically be calculated by multiplying very small numbers (the individual claim) with very large numbers (the class) to arrive at a substantial aggregate award. An analysis of whether a claim or category of claims might be nominal or de minimis forms no part of such an exercise. There is no logic in the CAT calculating an aggregate award which is the sum of a multitude of small claims but then slicing off a percentage to reflect the fact that some (or even most) of the claims are small. To allow this would derogate from a central purpose behind the regime which is to vindicate the collective rights of consumers sustaining small losses.” Mr. Gutman’s case is funded by Woodsford, one of the world’s leading ESG and litigation finance businesses, which has provided a significant, multi-million budget for legal fees and other costs. Lord Justice Green acknowledged the access to justice benefits of litigation funding, and rejected the defendants’ arguments that the payment of a return to a litigation was a negative factor. He stated: “to enable mass consumer actions to be viable at all will invariably necessitate the assistance of third-party funders… and the [Court] must therefore recognise that litigation funding is a business and funders will, legitimately, seek a return upon their investment”. Woodsford’s Chief Investment Officer, Charlie Morris commented: “This is an important milestone in the promotion of collective redress in the UK, which allows consumers and small businesses to achieve compensation for the wrongs committed by big business. Woodsford, a business dedicated to holding corporates to account and delivering access to justice, is proud to support Mr. Gutman, who is now much closer to obtaining compensation for the millions of rail passengers.” Steven Friel, Woodsford’s Chief Executive Officer, commented: “This is a huge success for consumer redress in the UK, and I am proud of Woodsford’s significant part in it. This victory in Justin Gutman’s case relating to overcharging on the rail network follows hot on the heels of an important preliminary victory in Mark McLaren’s case relating to car delivery charges. Both are backed by the team here at Woodsford, which is now clearly established as the most successful ESG and litigation finance business in this area of UK collective redress. My only regret is that big corporate defendants continue to use their significant legal and financial resource to fight technical arguments, with the goal of delaying compensation payments to consumers. Now that the Court of Appeal has rejected Southeastern’s and South Western’s appeals, they should settle the case against them and allow rail users to receive the compensation they are owed.” Southeastern and South Western customers can find further information about the case at https://www.boundaryfares.com/

The District Court in Amsterdam has delivered a significant decision in a ground-breaking ESG action brought against Airbus. The action is organised and funded by the ESG team at Woodsford. Airbus SE is a European headquartered, multinational aerospace corporation. Airbus designs, manufactures and sells civil and military aerospace products worldwide. In one of the most egregious breakdowns of ESG in recent years, it came to light in the course of investigations by the French Parquet National Financier, the U.K. Serious Fraud Office, and the US Department of Justice that Airbus had engaged in bribery and corruption on a global scale. In January 2020, Airbus agreed to pay penalties of approximately US$4 billion plus interest and costs to resolve foreign bribery charges with US, French and UK authorities. These matters led to a significant drop in Airbus’ share price. Airbus investors who suffered significant losses as a result of these breakdowns in ESG, and Airbus’ failure to disclose them to the market in a timely manner, fall into two main categories - those who trade in Airbus securities within the US, and those who trade in Airbus securities in Europe (France, Germany and Spain). In May 2022, Airbus agreed a multimillion-dollar settlement (subject to U.S. court approval) in the US with investors who fall into the former category. However, the vast majority of affected investors fall into the latter category. Airbus has not yet settled with, and has therefore not yet been held accountable to, investors who trade Airbus securities in Europe. Woodsford brought the above ESG failings, and Airbus’ failure to disclose them to the market in a timely manner, to the attention of major international, institutional investors, and has organised them into a special purpose entity, called Airbus Investors Recovery Limited (AIRL), to engage with Airbus. AIRL has commenced legal proceedings against Airbus in Amsterdam. Woodsford also supports Airbus Investor Recovery Stichting (AIRS), which is also litigating against Airbus. AIRL and AIRS are advised and represented by the Amsterdam office of international law firm Scott+Scott. Unfortunately, it is common for big corporates to react to investor concerns by delaying and obfuscating ESG actions like this. In a move that would have delayed AIRL’s Dutch action, Airbus asked the District Court in Amsterdam to refer the case to the European Court of Justice (ECJ), and to stay (i.e. suspend) the Dutch action pending the outcome of the ECJ referral. Further, Airbus argued that, contrary to AIRL’s simple suggestion that Dutch law should apply to the case on the basis inter alia that Airbus has its statutory seat in The Netherlands, Airbus argued that some combination of French, German and Spanish law might apply. This could have led to delay and unnecessary complications in the resolution of the litigation. In a decision dated 27 July 2022, the Dutch court found against Airbus, and has agreed with AIRL, on these points. The matter will proceed before the Dutch court, and Dutch law will apply. There will not be a reference to the ECJ and there is no reason to otherwise stay the proceedings. Airbus was not granted leave to appeal the decision. The Dutch court therefore will now address the merits of the matter with Airbus being required to make substantive submissions later this year. Steven Friel of Woodsford commented: “This is an important milestone in AIRL’s efforts to hold Airbus to account for the losses suffered by investors due to catastrophic breakdowns in ESG at Airbus. I hope that Airbus takes the decision of the Amsterdam court as a prompt to engage seriously with AIRL with a view to settling these proceedings. It is in the interests of all concerned that this unfortunate episode in Airbus’ corporate history is finally brought to an end.” About Woodsford Since 2010 Woodsford has been helping to hold corporates to account for their egregious behaviour. Whether it is helping consumers achieve collective redress, ensuring that inventors and universities are properly compensated when Big Tech infringes intellectual property rights, or helping shareholders in collaborative, escalated engagement up to and including litigation with listed companies, Woodsford is committed to ESG and access to justice. Working with most of the world’s leading law firms, our strength lies in the combination of our legal experience, investment, business and technical expertise, together with significant financial resources.