The Libyan Investment Authority v Societe Generale SA & Ors

A confidentiality club is an exceptional departure from unrestricted inspection of disclosure. The party seeking it must establish a real risk of deliberate or inadvertent collateral use. Any restriction must go no further than necessary.

Where disclosure creates a real and immediate risk to life or protection from inhuman treatment, the court must protect those absolute rights. Otherwise, the court balances the severity of the risk, the importance and nature of the information, the need for party representation and practical litigation considerations. A risk dependent on an undefined future choice is not necessarily immediate.

The claimant alleged that payments made by the first to fourth defendants to the fifth defendant were connected with bribery and corruption in transactions involving the claimant. Earlier case-management orders required disclosure of banking records identifying payment recipients and established an interim confidentiality club.

The court determined whether the club should continue for Persons D, L, N and R, and whether Mr Ali Baruni, a consultant and member of the claimant’s litigation committee, should be admitted. The central issues were whether disclosure created a real and immediate risk to life, limb or property, and whether Mr Baruni’s admission created a real risk of disclosure.

1. Confidentiality clubs. The ordinary position is unrestricted inspection of disclosure, subject to the implied undertaking against collateral use. A confidentiality club requires proof of a real risk of deliberate or inadvertent misuse, and its terms must be no wider than necessary.
2. The court’s power derives from its inherent jurisdiction to regulate procedure in the interests of justice. The court may use a club to protect commercial confidentiality and, where necessary, to respond to risks to life or limb. The same real-risk requirement applies where the club is sought to protect rights under articles 2 or 3 of the European Convention on Human Rights.
3. “Real” means objectively verified and “immediate” means present and continuing, including a risk that will arise from an immediately contemplated course of action. A possible future visit to Libya at an undefined time did not satisfy that requirement. The evidence established a real and immediate risk for Persons L and N, who lived in Libya and fitted the identified risk profile, but not for Persons D and R, who lived outside Libya, had no family there and were not shown likely to travel there in the foreseeable future.
4. Where articles 2 or 3 rights are sufficiently engaged, they are absolute and are not outweighed by ordinary balancing considerations. In other cases, relevant factors include the severity of the identified risk, the desirability of including a representative of each party, the importance and nature of the information, the need for technical or expert knowledge, and practical disruption to the litigation.
5. Mr Baruni was admitted. The court was entitled to presume compliance with his undertaking absent cogent contrary evidence. His residence and substantial ties to the United Kingdom, amenability to the court’s jurisdiction, lack of immediate family in Libya, and role on the claimant’s litigation committee meant that his inclusion did not create a real risk of willing, unwilling or inadvertent disclosure. Client input was necessary for important decisions concerning the identified individuals.
6. The club was maintained for Persons L and N, but not Persons D and R. Mr Baruni was admitted to the club in relation to all relevant individuals.