A rise in the availability of third-party funding has led to an increase in speculative shareholder lawsuits against FTSE companies. Investors are reportedly seeking to profit from claims of wrongdoing, with law firms launching group claims for institutional investors.
Over the past year, several blue-chip companies, including gambling firm Entain, British American Tobacco (BAT), and fast fashion retailer Boohoo, have been summoned before the High Court. Entain is facing new legal proceedings from a group of investors, focusing on its deferred prosecution agreement with the Crown Prosecution Service regarding historic bribery and corruption. The trial for this case is not expected to begin until 2029, pending related criminal trials.
London-listed BAT is also facing group lawsuits in the High Court, with shareholders alleging breaches of North Korean sanctions. Additionally, law firm Fox Williams has brought a group action against Boohoo Group, seeking up to £245m in compensation over a 2020 labour scandal. This case is anticipated to go to trial in October 2027.
Aymen Mahmoud, London managing partner of McDermott, stated that the direction of travel in securities litigation is "increasingly clear," citing London's deep capital markets, sophisticated institutional investors, and developed disputes system. Rory Spillman, partner at Signature Litigation, added that procedural clarifications from an increase in cases have also assisted the surge.