Peter de Verneuil Smith QC, Philip Hinks and Dominic Kennelly (instructed by Morgan, Lewis & Bockius UK LLP) have successfully opposed an application by Tesco plc to strike out claims brought against it by Manning & Napier Fund, Inc. and Exeter Trust Company under s.90A of the Financial Services and Markets Act 2000. The claims follow Tesco’s announcement in 2014 that its profits had been overstated in a number of previous accounting periods, resulting in a deferred prosecution agreement between the SFO and Tesco’s main subsidiary, as well as criminal prosecutions against a number of former Tesco employees.
The decision is one of the very few authorities to have considered s.90A to date. It is the first occasion on which the Courts have had to grapple with the issue of title to sue under s.90A, and in particular with the question of which entities within a custody chain in respect of intermediated securities have the right to bring a claim against the issuer under s.90A.
The judgment is available here.