Clarity & Calm Post-PACCAR (Sony Interactive Entertainment Europe Ltd and another company v Alex Neill Class Representative Ltd and other cases)
Dispute Resolution analysis: This judgment concerned the enforceability of Litigation Funding Agreements (LFAs) in various collective proceedings in the Competition Appeal Tribunal (CAT) (Sony; CICC; Kent; Gutmann Batteries) that were amended following the Supreme Court’s judgment in R (PACCAR) (PACCAR). The Court of Appeal concluded that LFAs where the funder’s remuneration is calculated based on a multiple of their outlay are not damages-based agreements (DBAs) and are, thus, enforceable. The court similarly concluded that this position was not affected by the inclusion of provisions that: (i) capped the funder’s remuneration based on the recovered damages/proceeds; and (ii) entitled the funder to a percentage-based return if and to the extent applicable by law. The judgment should provide much needed clarity on the enforceability of revised LFAs for the majority of UK collective proceedings post-PACCAR. Written by Leo Kitchen (Partner) & Ben Edwards (Associate) of Quinn Emanuel Urquhart & Sullivan UK LLP.