7KBW has three cases listed in The Lawyer’s Top 20 Cases of 2022.
The Executive Counsel to the Financial Reporting Council v KPMG, Peter Noel Meehan, Alistair Wright, Richard William Kitchen, Adam David Bennett, Pratik Paw, Stuart Peter and James Smith
FRC Tribunal – 10 January, 25 days
Big Four giant KPMG, along with several of its former and current employees, is due to appear before the Financial Reporting Council (FRC) Tribunal in January over allegations of misconduct.
The complaint regards the provision of allegedly false and misleading information in connection with the FRC’s inspections of two audits carried out by KPMG; the first concerns the financial statements of Carillion up until the end of 2016 and the second regards the audit of Regenersis for the end of June 2014.
The FRC’s investigation opened in November 2018 after KPMG self-reported certain matters relating to the review of Carillion. The scope of the investigation was expanded in July 2019 to include the inspection of Regenersis’ audit after KPMG again self-reported certain matters relating to it.
The individuals include Peter Meehan, the engagement partner for the Carillion audit, and Stuart Smith, the engagement partner concerned with Regenersis. The allegations in the formal complaint are made against each of the individuals only in respect of their own conduct. As scrutiny of the Big Four grows, this will be the case to watch among the auditors next year.
For the defendant, KPMG
7KBW’s James Brocklebank QC and Ralph Morley, instructed by Linklaters partner Nick Porter, managing associate Cristina Paparozzi and associate Beth George
Stonegate Pub Company Ltd v MS Amlin Corporate Member, Liberty Mutual Insurance Europe SA and Zurich Insurance
High Court, Commercial Court – June/July, 10 days
The owner of Slug & Lettuce, Walkabout, Be At One and several other pub chains is seeking £845m from major insurers MS Amlin, Liberty Mutual and Zurich over business interruption losses caused by the pandemic.
According to Stonegate, the insurers recognise that policies should pay out but argue their liability is limited to £17.5m – of which £14.5m has already been paid.
The trial will address key issues surrounding business interruption coverage following Covid-19 chaos, particularly those that remain unresolved by the Supreme Court’s earlier findings in favour of policyholders in the first insurance test case brought by the Financial Conduct Authority.
Questions around aggregation and causation under the insurance policy, plus the impact of furlough and other UK Government support schemes on available indemnity are expected to be considered by the court. The dispute will no doubt offer guidance to emerging spats between hospitality giants and insurers, including claims brought by Greggs and various eateries.
For the defendants, MS Amlin Corporate Member, Liberty Mutual Insurance Europe SE, Zurich Insurance
7KBW’s Gavin Kealey QC, Adam Fenton QC, Sushma Ananda and Henry Moore, instructed by DAC Beachcroft partner Chris Wilkes
Maroil Trading Inc and others v Cally Shipholdings and others v Burford Capital (UK)
High Court, Commercial Court – 10 October, eight to nine weeks
Various backstories stem out of this litigation, which is set for a showdown in the Commercial Court this October. The parties have been sparring with each other for well over a decade, when a group of companies led by Cally Shipholdings brought an action against Wilmer Ruperti, the owner of Maroil Trading, alleging the taking of secret profits. A settlement in 2013 required Ruperti to pay $40m in instalments, but there have been subsequent proceedings brought since over the enforcement of these agreements.
The most recent claim sees Maroil Trading argue that Burford’s Daniel Hall, who had been engaged by Cally Shipholdings to investigate Ruperti’s assets, provided copies of certain enforcement documents to another client years later. Hall is the co-head of Burford’s global corporate intelligence, asset trading and enforcement business. In one of the more explosive allegations, it is claimed that Hall traded these sensitive documents for a sex tape, and he’s been dragged into the overall lawsuit as a result.
The claimants argue the document sharing represents a breach by the defendants of a previous settlement agreement. They claim they are entitled to damages and losses caused by a worldwide freezing order, obtained in 2017, and prompted by details seen in the traded documents. The defendants deny any breach or liability, paving the way for the next stage of this long-running battle.
For the defendants, Cally Shipholdings and others
7KBW’s Jonathan Gaisman QC, David Allen QC and Keir Howie, instructed by Reed Smith partners Stephen Kirkpatrick and Thor Maalouf in London, and Miami partner Ed Mullins
