Daniel Feetham KC and Adam Riley (instructed by Pinder Reaux) for the Defendants
James Pickering KC (sitting as a Deputy High Court Judge):
PART I: INTRODUCTION
PART II: THE BACKGROUND
PART III: THE STRIKE OUT APPLICATION
PART IV: THE INTERIM INJUNCTION APPLICATION
PART V: CONCLUSION
PART I: INTRODUCTION
“Plevin[1]” claims are claims made by members of the public seeking to recover premiums paid in respect of PPI policies on the basis of undisclosed commissions. The nature and volume of Plevin claims is such that they are amenable to being run on a large scale.
In early 2020, Cheval Legal Ltd (“Cheval”) (which is an SRA regulated law firm) and Momenta Holdings (PPI) Ltd (“Momenta”) (which carries on the business of outsourcing professionals, including professionals in the legal sector) entered into an arrangement of sorts in relation to the pursuing of Plevin claims. The precise terms of that arrangement are in dispute but it is uncontroversial that while it was Cheval (as the SRA regulated body) which directed litigation strategy and was (as it was described to me) the “front of house”, it was Momenta (with its supply of legal professionals) which undertook the day to day running of the claims and (as it was also described to me) the “leg work”.
By early this year, however, the relationship between the parties had broken down and, on 5 May 2023, Momenta issued the present claim against, amongst others, Cheval. It is within the context of that claim that Momenta has applied for an interim injunction pending trial (“the Interim Injunction Application”) and Cheval has in turn applied to strike out Momenta’s claim in its entirety (“the Strike Out Application”).
It is these two applications which are the subject of this judgement.
PART II: THE BACKGROUND
The initial discussions
In about 2017, informal discussions began between Momenta, a funder called Spectra Legal Ltd (“Spectra”) and Stephen McGarry, a practising barrister (who was involved as counsel in the original Plevin case) as to ways in which Plevin claims could be pursued on a large scale.
Those discussions continued and by early 2019 there was a plan for – in broad terms – an unspecified authorised law firm to offer the relevant legal services to clients (the potential Plevin claimants) but with the claims being run at an operational level by Momenta. According to Momenta, it was also envisaged that costs and any surplus profits would be shared between them.
The incorporation of Cheval and the alleged JVA
On 9 July 2019, Cheval was incorporated. Various directors were appointed including Philip Ryan[2], a solicitor and, in due course, Mr McGarry[3].
By early 2020, Cheval was on the verge of becoming authorised by the SRA, at which time the various discussions as to the pursuing of Plevin claims continued, albeit now between Momenta and the recently formed Cheval.
In February and March 2020, various further discussions took place. According to Momenta, it was in the course of these further discussions that a legally binding joint venture agreement was entered into as to the pursuing of Plevin claims. As per the previous discussions, Cheval would be the front of house but with Momenta processing the claims on an operational level. Again, as per the previous discussion, after the deduction of relevant costs, any profits would be shared equally between Cheval and Momenta. Further, according to Momenta, any funds received (whether from Spectra as the funder, or as the fruits of any successful claims) would be held in the first instance by Cheval (as the SRA regulated law firm) for both parties in accordance with the above terms as to sharing. Cheval, of course, disputes all of the above.
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