According to an analysis by Eversheds Sutherland, the UK Court of Appeal delivered a significant judgment in Gutmann v Apple, clarifying the payment of litigation funders in competition class actions. The court affirmed that the Competition Appeal Tribunal (CAT) possesses the authority to order that funders are paid their agreed
share of damages from a collective award before any distribution is made to the class members.
The analysis highlights that this decision addresses concerns about high class member uptake impacting funder returns. The Court of Appeal explicitly stated that there is “absolutely nothing wrong” with a class representative entering into a Litigation Funding Agreement (LFA) structured on this basis.
The analysis emphasises the CAT’s overarching supervisory powers to manage funder payments, irrespective of LFA terms. This is a key development for the growing UK competition class action landscape.
Eversheds Sutherland further points out that a remaining aspect of the appeal, concerning the enforceability of the LFA in light of the Supreme Court’s PACCAR decision, is scheduled for a hearing in June 2025. This upcoming hearing will be critical for litigation funding arrangements in this area.
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