Various Claimants v G4S Limited

In complex group litigation under section 90A of FSMA 2000 and Schedule 10A, a split trial may be ordered as a pragmatic case-management measure where common liability issues are sufficiently discrete from reliance, causation, quantum and limitation. The court should assess manageability, costs, duplication, appeal risk, prejudice, fairness and the overriding objective. Sampling may run in parallel, provided it captures material differences between claimants, including relevant periods, reliance models, knowledge, limitation characteristics and communications. Further information may be required where it is reasonably necessary and proportionate to understand the case, facilitate disclosure and promote settlement.

These were three sets of claims by investors seeking compensation for losses allegedly arising from misleading or incomplete published information concerning G4S, and from dishonest delay in publishing information. The claims concerned alleged wrongful billing and an alleged financial-model fraud involving contracts performed by a subsidiary. At the first CMC, the court considered whether to order a split trial, establish a sampling process and require further information under Part 18. The claimants proposed a first trial on common defendant-side issues, including false statements, omissions, delay, PDMR status, knowledge and dishonesty. G4S argued that the decision should be deferred pending fuller disclosure and witness evidence.

The court ordered a split trial broadly on the claimants’ proposed structure, together with a parallel process for sampling and further information. A further CMC was directed to consider claimant witness statements and any legal issues suitable for trial 1.

1. Sampling. Sampling was appropriate in principle for the large group of claims, but it had to capture material differences between claimants. The criteria included relevant periods, PDMR status and knowledge, direct and indirect reliance, reliance on particular statements or documents as a whole, omissions, claimant-specific limitation issues, document-retention practices, and relevant meetings or communications. The process had to be collaborative, proportionate and supervised by the court.
2. Further information. Under paragraph 14.1(c) of the Commercial Court Guide and paragraph 1.2 of PD 18, information could be required where strictly necessary, or reasonably necessary and proportionate, to understand the case or prepare a response. Claimants were required to clarify what individuals relied on, when and on what statements, and to identify meetings or direct communications relied on. They were also to clarify reliance on later or historic published information and distinguish market reliance from price reliance.
3. Split trial. The power to order a split trial had to be exercised in accordance with the overriding objective. Following the useful guidance in Electrical Waste Recycling v Philips Electronics [2012] EWHC 38 (Ch), the relevant considerations included the realism of a single trial, possible savings and settlement, costs, bifurcated appeals, trial preparation, definability of the split, duplication, expert evidence, delay, prejudice and fairness. Common issues such as PDMR status, knowledge and dishonesty were sufficiently discrete for trial 1, while reliance was factually complex and likely to require substantial claimant evidence.
4. The court declined to determine the disputed construction of reliance in Schedule 10A, which had been advanced by reference to ACL Netherlands v Lynch [2022] EWHC 1178. Legal questions should generally not be decided without the factual context necessary for their resolution.