The High Court has held that reliance issues should be heard at the second trial, with defendant liability issues to be heard in the first, in a claim brought pursuant to s.90A and Sch.10A of the Financial Services and Markets Act (FSMA): Various Claimants v G4S Limited [2022] EWHC 1742 (Ch).
In securities class actions, claimants will often seek to postpone issues involving reliance, causation, quantum and limitation to a second trial. This has the double advantage of (a) enabling the claimants to postpone incurring a significant portion of their costs until after the question of liability has been determined; and (b) making the defendant’s conduct the sole focus of the first trial.
Defendants will generally seek to resist this split, noting the potential for unfairness in the allocation of the litigation burden, as well as the potential for the claimants’ witnesses to be influenced by the findings in respect of liability when preparing their evidence in relation to reliance. Furthermore, to the extent findings are made against the defendant in the first trial, the overall length of the process would likely be significantly longer than if there was no split.
For more information on this case, see this post on our Banking Litigation Notes blog.
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