Wirral Council (As Administering Authority of Merseyside Pension Fund) v Indivior PLC

A representative claim is not preferred merely because the representative rule’s same interest threshold is met. The court retains a broad discretion under CPR 19.8, to be exercised in accordance with the overriding objective.

Where feasible multi-party proceedings are also available, the court must weigh the advantages and disadvantages of each procedure. It may require claimant-side issues, such as standing, reliance, causation and quantum, to progress alongside common issues. A representative procedure must not be used to prevent that case management or to facilitate speculative claims and book-building. A bifurcated representative process remains possible in an appropriate case, but it is not compelled by Lloyd v Google LLC.

Wirral Council, as administering authority of the Merseyside Pension Fund, brought representative proceedings under CPR 19.8 on behalf of institutional and retail investors alleging fraudulent statements and dishonest omissions in published information concerning Indivior PLC and Reckitt Benckiser Group PLC. The claims relied on sections 90 and 90A and Schedule 10A of Financial Services and Markets Act 2000.

Many investors had also issued ordinary multi-party proceedings. The High Court, applying the overriding objective, struck out the representative proceedings: [2023] EWHC 3114 (Comm). The issue on appeal was whether the availability of a bifurcated representative process, and the asserted benefits for investors, required the representative proceedings to continue despite the parallel multi-party claims.

1. Appeal dismissed. The judge had an unfettered discretion under CPR 19.8, subject only to exercising it in accordance with the overriding objective. Satisfaction of the same interest requirement entitled Wirral to commence the representative proceedings, but did not create a presumption that they should continue or a hierarchy favouring that procedure.
2. Where feasible multi-party proceedings are available, the court must compare the advantages and disadvantages of the two procedural routes. Relevant considerations included the court’s ability to manage the claims from start to finish, preserve documents and evidence, avoid a standing start at a later trial, maintain a fair allocation of the litigation burden, and facilitate settlement.
3. The court was entitled to consider the management of other securities claims. In those cases, common defendant-side issues had been tried first, while claimants were required, where appropriate, to provide some progress on individual issues. That approach could expose claims which did not satisfy the statutory requirements, including the reliance requirement.
4. The representative proceedings would determine only whether there were untrue or misleading statements or omissions. Reliance was an essential ingredient of the claims under section 90A and Schedule 10A of Financial Services and Markets Act 2000. The refusal to identify how many claimants relied only on market, price or index reliance deprived the court of the ability to test whether substantial numbers had any sustainable claim. That risk was inimical to the overriding objective and could encourage speculative litigation and book-building.
5. The asserted access-to-justice disadvantage for retail investors was artificial on the evidence. The funders gave no cogent explanation for funding retail investors in the representative proceedings but not the multi-party proceedings. Case management, sampling or limited evidence could address undue burdens. Prudential Assurance Co Ltd v Newman Industries Ltd showed that bifurcation was possible in an appropriate case, but its unusual facts did not require bifurcation at the outset here. Commission Recovery Ltd v Marks & Clerk LLP was distinguishable because representative proceedings there were effectively the only route and the outstanding individual issues were materially narrower.
6. The multi-party proceedings remained feasible and allowed Wirral to seek bifurcation at the first case management conference. The managing court could still order individual disclosure or evidence in tandem. The High Court’s decision was within the generous ambit of its discretion, and there was no basis for appellate interference.

• Court of Appeal (Civil Division): appeal dismissed. The court upheld the exercise of discretion striking out the representative proceedings and leaving the claims to proceed, if pursued, through the multi-party proceedings.
• High Court of Justice, Commercial Court (Financial List): representative proceedings struck out under CPR 19.8, in favour of the parallel multi-party proceedings: [2023] EWHC 3114 (Comm) .