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Director Mohsin Patel comments on how the reversal of last year’s PACCAR ruling will impact ongoing and future cases, in Global Competition Review

Following the news that the UK government is set to reverse last year’s controversial Supreme Court ruling on litigation funding, Director Mohsin Patel comments on the impact of this decision on future cases and how this legislation is likely to be enacted.

Mohsin’s comments were published in Global Competition Review, 4 March 2024, and can be found here.

“I expect the legislation to make clear that Litigation Funding Agreements are not subject to the DBA Regulations and to (hopefully) have retrospective effect.

“This will likely not have a significant impact, as many funders are already including language in their LFAs to allow for a percentage of recoveries instead of a multiple “only to the extent enforceable and permitted by applicable law” – language which was held to be permissible in Alex Neill Class Representative Ltd. v. Sony Interactive Entertainment Europe Ltd.

“Given that the amendment to Clause 126 of the Digital Markets, Competition and Consumer Bill – which seeks to reverse PACCAR but only in the context of opt-out CAT claims – is currently in the final stages in the House of Lords it would be sensible to widen the scope of the amendment to include all types of claims. However, the Government recently declined to do so saying that the bill ‘is not the appropriate vehicle to deliver this aim,’ and that ‘the Ministry of Justice is actively considering options for a wider response’.

“It is therefore perhaps more likely that this will be dealt with separately and before the next election as the Government seeks to secure any ‘wins’ it can to support its campaign for re-election.”