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High Court litigation involving FTSE100 at five-year high

The number of disputes that came before the High Court in London involving FTSE100 companies last year rose 6% to a five-year high, according to research carried out by Thomson Reuters' legal business division.15 May 2017

There were 279 High Court cases involving FTSE100 businesses in the year ending 30 June 2016, up from 264 the previous year. This is more than double the number of cases five years ago, when there were 114 disputes involving the biggest listed companies, Thomson Reuters said.

The number of disputes involving banks that went before the High Court rose by 14% last year to 179 cases, up from 132 the year before and more than double the number of cases involving banks in 2013/14. Banks were involved in 64% of the High Court cases involving FTSE100 companies last year, compared to 50% in the previous year.

Thomson Reuters said the rise in the number of court cases was due to the increased legal risks facing UK-listed companies, which are now operating in a larger number of jurisdictions.

High Court disputes involving banks last year included cases concerning the mis-selling of complex financial products, Libor manipulation claims and loan agreement disputes, Thomson Reuters said.

Raichel Hopkinson, head of the Practical Law Dispute Resolution Service at Thomson Reuters, said that a rise in the availability of litigation funding might also be behind the spike in banking cases.

Banks were defendants in around 75% of cases they were involved in, according to the new figures.

“Increasingly it seems that banks involved in litigation are less concerned about the sort of adverse publicity that can be associated with the public disclosures and cross examination that come with court hearings," Hopkinson said. "Whether this is because the claims are perceived as unmeritorious or because banks no longer feel quite as sensitive to exposure, having been in the spotlight for so long, it is difficult to say.”

In contrast to the financial services sector, there was a small drop in the number of cases involving oil and gas companies. These dropped from 13 cases in 2014/15 to 11 cases last year, according to Thomson Reuters.