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A Cautionary Tale

By March 22, 2017January 29th, 2021Litigation

A claimant who secured £2 in nominal damages has been told they face a substantial costs bill for turning down an earlier offer to settle.

In Marathon Asset Management LLP & Anor v Seddon & Ors, Mr Justice Leggatt said investment management business Marathon had in effect suffered a defeat in failing to secure £15m claimed from two departing staff members.

James Seddon and Luke Bridgeman were both pursued in the courts for misuse of data after files were copied before their departure from the business, but after a nine-day hearing Leggatt ruled last month that damages should be minimal because Marathon suffered no loss.

In the judgment, it emerged that Seddon and Bridgeman had made a joint offer to settle the claim for £1.5m in February 2016.

In a recent case of Marathon Asset Management LLP & Anor v Seddon & Ors, the Claimant issued a claim for misuse of confidential information.  Mr Seddon and Mr Bridgeman were pursued for copying files before leaving Marathon Asset Management LLP.  The case raised a number of important issues which are to be considered when litigating.This was a case that turned on the disclosure of evidence which had been taken by Mr Seddon and Mr Bridgeman.  The case was heard before Mr Justice Leggatt.  In his Judgment Leggatt set out “A party which pursues a claim for damages for misuse of confidential information without evidence of any significant misuse, but in the expectation that such evidence will or may be uncovered through the litigation process, takes the risk that such evidence will not be uncovered because it does not in fact exist,”  Whilst this seem like common sense, it is important that parties consider this.  The point Mr Justice Legatt made in his Judgment was that in order to litigate you must have evidence of your case and not be dependent on the disclosure of evidence in the course of proceedings, which may or may not exist.It was found that whilst confidential information had been taken by Mr Seddon and Mr Bridgeman, there was no loss to Marathon Asset Managment LLP (“the Claimant”).  Whilst Marathon Asset Management could establish liability, they failed in the quantum of the case.  The Judge awarded just £2 nominal damaged to Marathon Asset Management LLP.To add insult to injury, Mr Seddon and Mr Bridgeman had made an offer for settlement prior to the proceedings, in February 2016 in the sum of £1.5m. This offer was not accepted.  This then led the judge to award costs in favour of Mr Seddon as the offer was not beaten at trial and if the offer had been accepted then the entire litigation would not have been necessary.  Leggatt ordered that Seddon should be entitled to recover 50% of his costs of defending the initial misuse claim, and the whole of his costs from February 2016 when the action was begun.Therefore the Claimant having entered into litigation was awarded £2.  The Claimant incurred their own legal costs in the litigation and also the costs of the Defendants due to the rejection of the offer made prior to the litigation.  This case is another important reminder to approach litigation carefully.  An ill-thought through case is bound to fail and the cost of failure is high. When considering any litigation the cautionary tale here would tell us that a thorough cost-benefit analysis be carried out and throughout all stages of litigation risk analysis should be undertaken.

Alison Rocca

Author Alison Rocca

Alison is a solicitor in our Litigation department.

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