A shortened version of this article was first published by ISS for their EME security litigation report, which can be found here.
Over the past five years, the U.K. has transformed into a leading forum for securities litigation. What began as tentative steps around RBS and Tesco has matured into a repeatable, increasingly sophisticated pathway for institutional investors and public pension funds to pursue meaningful recoveries against issuers who mislead the market. For global investors, the choice is no longer whether such claims are viable – it is whether they can afford not to participate.
A maturing regime with tested tools
Sections 90 and 90A of the Financial Services and Markets Act 2000 (FSMA) are now tried and tested. Claimant law firms, litigation funders, and expert economists have built specialist practices around these provisions. Existing disclosure rules have made access to company documents more structured and efficient, while courts have long had the power to order phased trials – with the potential, in appropriate circumstances, to resolve liability first with quantum and reliance following later – offering clarity and efficiency to large and complex actions.
For investors, this means that securities litigation in London is no longer experimental; it is professionalised, resourced, and credible.
Why participation matters
- Direct financial recoveries. With billions in investor losses tied to misstatements across sectors (financial services, energy, retail, etc.), opting in gives institutions a path to recoup losses that would otherwise be written off.
- Portfolio stewardship. Asset owners face growing scrutiny over how they protect beneficiaries. Participating in well-structured securities claims demonstrates proactive governance and accountability.
- Level playing field. Global peers – especially US, Dutch, German, and Australian funds – routinely participate in these cases. UK actions are increasingly coordinated cross-border. In addition, as result of broader governmental development and policy shifts, there has been a marked decline in enforcement by regulators leaving a burgeoning gap. This provides an opportunity for institutional investors and trustees of public pension funds to fill this enforcement gap to level the playing field for market participants, seeking redress and recovering money, and protecting the value of their plan’s assets. Failure to engage risks falling behind in fiduciary standards.
- No-upfront-cost access. Third-party funding and ATE insurance mean participation does not require capital outlay; economics are structured to align interests and protect investors from downside risk.
Key recent developments investors should note
The central doctrinal battleground has been s.90A reliance. In late 2024, the High Court (in the “dark pools” litigation against Barclays) struck out listed-securities claims that depended on “passive” investor theories, holding that active reliance must be shown and clarifying the “dishonest delay” gateway for omissions claims. That decision materially raised the pleading and evidence bar for some claimant cohorts.
But 2025 has not been one-way traffic. A subsequent High Court decision (in the Standard Chartered securities litigation) declined to impose a categorical restriction on passive investors proceeding under s.90A/Schedule 10A, re-opening questions about how certain investors (i.e., index tracking funds or mandate-driven purchasers) may meet reliance – fact-sensitively and at later stages. That decision now progresses to the Court of Appeal, which should result in “reliance certainty”, both as how to plead as well as to define the breadth of claimant participants.
Another 2025 milestone has been the first detailed quantum judgment in a s.90A case (in the Autonomy litigation). Whatever one’s view on merits, that judgment puts structure around valuation, inflation, and confounding factor analysis in a U.K. securities context – sharpening expert approaches and settlement modelling. Investors now benefit from clearer valuation frameworks, and it also helps inform book-building, portfolio loss calculations, and trial budgets which in turn arguably strengthens settlement leverage.
Moreover, third-party funding and ATE insurance have professionalised UK securities claims, enabling earlier launch and tighter project management. As repeat claims move through the system, issuers and insurers increasingly see the commercial logic of settlement – often before trial. Institutional participation strengthens bargaining power and increases the likelihood of recovery.
The bottom line for institutional investors
The UK is no longer a passive outpost of global securities litigation – it is an active recovery market in its own right. Each new decision adds clarity, reduces risk, and increases the pressure on issuers to account for misconduct.
Opting-in is not speculative; it is stewardship. Investors who fail to engage risk leaving value on the table, neglecting fiduciary duties, and sending the wrong signal on governance. Teams that integrate these threads – legal theory, procedural engineering, data-rich quantum, and funding discipline – will set the pace in the next wave of claims. Those who do participate not only enhance portfolio recoveries but also shape the future contours of shareholder rights in the UK and beyond.
Written by John Evans, Noah Wortman and Steve Mash.
About Walgate Litigation Management
Founded in 2025, Walgate Litigation Management is a wholly owned Fladgate entity that specialises in the identification and management of securities and consumer group actions. It was constituted to identify claims, secure funding for actions to be conducted by Fladgate and support the Dispute Resolution Department in managing those matters once successfully funded.
