Clifford Chance

Securities litigation gathers momentum in the UK

23 October 2019

Shareholders can bring claims against listed companies to recover losses suffered as a result of a drop in the price of their shares (a ‘stock drop’), often caused by a corporate scandal or other misfeasance being revealed to the market.

The shareholder class action brought against The Royal Bank of Scotland by investors who had bought shares in RBS’ rights issue in 2008 (known as the Rights Issue Litigation) represented a watershed moment in the development of UK securities litigation. Although it settled on the eve of trial, the Rights Issue Litigation was the proof of concept: it is possible to successfully pursue high-value, complex shareholder class actions to trial (or, at least, settlement) under the UK’s legal and procedural framework.

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