International firm Herbert Smith Freehills and Royal Bank of Scotland have been criticised for their part in an ‘unfocused’ and ‘diffuse’ disclosure process during a £4bn shareholder battle.
A High Court judge was forced to adjourn the case for three months with ‘great reluctance’ after RBS claimed if would be unfair if the trial proceeded under its current timetable due to the enormous disclosure process.
Although Mr Justice Hildyard (pictured) agreed to delay the start date of the trial, he said the largest part of the blame for the extent of the process should be apportioned to the bank and its legal advisers.
‘Something has gone wrong,’ he said, adding that the process had been ‘determined and confused’ by the use of ‘vast armies without sufficient focus’.
He said: ‘Indicative of this, to my mind, was the delay and difficulty which seems to have been experienced by the defendant’s legal team in producing a satisfactory organogram [chart],’ to identify who is responsible for reviewing the documents.
This has, he said, resulted in ‘what appears to be an unfocused disclosure process, which has fanned out exponentially and extravagantly without sufficient control and direction’.
He also described the evidence by RBS as ‘unsettling and less than compelling’, in particular highlighting evidence by Kirsten Massey, a partner at HSF, where she described the proceedings as ‘incredibly broad and complicated’.
When responding to RBS’s request for a delay, the shareholders said the bank was choosing to re-review every single disclosed document, which they argued was an ‘optional luxury’.
Hildyard agreed that the need for analysis by senior members of RBS’s legal team was ‘far more extensive’ than should be necessary and ‘disastrously disruptive’ to the process of compiling witness statements.
He said that the lack of explanation about the need for the disclosure analysis was worrying, especially given ‘the apparently small budget for witness statements’ spent by the legal team, which raised questions about what had been done so far.
But despite his concerns, Hildyard agreed to revise the start date from December 2016 to 6 March 2017 as he said there would be a ‘sufficient risk of unfairness’ to RBS if he were to grant just a short adjournment.
But he acknowledged that this delay would prejudice the claimants, as their costs ‘rise inexorably with every day that passes before the trial’.