Uber: Group action
Documents created to enable a litigation funder to decide whether to fund a group action are not covered by litigation privilege, the High Court has ruled.
It indicates that the decision to fund litigation “is not itself conduct of litigation”, lawyers have warned.
According to reports of an ex tempore ruling in litigation between 13,000 black cab drivers and Uber, Mr Justice Birt ruled that the claimants and their funder could not claim litigation privilege.
The claim alleges that, in applying to Transport for London for a private hire vehicle operators’ licence, Uber misrepresented the nature of its business operating model and, on that basis, the licence should not have been granted.
The taxi drivers, as well as an individual as assignee of the claims of two now liquidated minicab businesses, say this had caused them loss by unlawful means conspiracy between mid-2012 and March 2018.
The claims, valued at over £300m, were not issued until May and June 2024, however, and the claimants are relying on section 32 of the Limitation Act 1980 to justify issuing more than six years later on the basis that they could not reasonably have discovered the alleged wrongdoing until sometime after June 2018.
After the High Court ordered limitation to be tried as a preliminary issue, Uber sought disclosure of documents passing between the claimants’ solicitors, Mishcon De Reya, their then funder and the Licensed Taxi Drivers Association between late 2017 and October 2018.
This was when Mishcon was engaged by the funder to explore a potential claim against Uber, and before Mishcon had been instructed by any of the claimants.
Uber contended that these documents could potentially show that it was possible for the claimants to embark on the preliminaries to litigation earlier than they did.
Birt J held that the documents were likely to contain relevant material and that a substantial number of them might attract legal advice privilege.
Herbert Smith Freehill Kramer, the City giant acting for Uber, reported: “However, the court rejected the claimants’ assertion of litigation privilege.
“The claimants’ position was that any communications made for the dominant purpose of assessing whether it was worthwhile to bring litigation against Uber were also made for the dominant purpose of conducting that litigation.
“They argued that since a claimant assessing the merits and viability of a potential claim would be able to claim litigation privilege, there was no sound basis for holding that a funder should not be able to do so in similar circumstances.”
The judge held that, even accepting that litigation was in contemplation at the relevant time, the dominant purpose of the communications – on the claimants’ own evidence – was instead to enable the funder to decide whether to fund the claim.
“The court drew a distinction between a party assessing whether to bring their own claim (which would be subject to litigation privilege) and a funder assessing whether to support someone else’s claim.
“A funder’s decision whether to fund someone else’s litigation did not amount to conducting that litigation, and therefore did not satisfy the dominant purpose test.”
Alice Nash, a barrister at Hailsham Chambers, cautioned that “anyone proposing to bring proceedings with the help of litigation funding would be well advised to give careful thought to potential disclosure issues at an early stage before deciding how and when to share information”.
In their briefing, partner Tom Snelling and paralegal Olivia Ward at City firm Signature Litigation said “the message is clear” from the ruling that the decision to fund litigation “is not itself conduct of litigation”.
They went on: “This case serves as an important reminder to would-be claimants seeking litigation funding that any communications with funders may be disclosable, and to consider carefully what information is provided.
“This decision is also beneficial for any defendants seeking to challenge group claims, as it provides another avenue for obtaining information which may reveal the claimants’ true state of knowledge, and may provide them with a second bite of the cherry.”
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