Should I sign? Some thoughts on the Leigh Day action against FI

I’ve had a few questions from traders about what to do regarding the Leigh Day group action against Football Index. I’m writing this to show my own decision making process.

I’m not part of the @fi_action group and I’m not a lawyer. This is not legal advice! You have to make your own mind up at the end of that day – it’s your money.

Who are we dealing with?

Leigh Day are the law firm that is working on behalf of traders coordinated largely through the @fi_action group, to carry out an investigation into the events leading up to the collapse of Football Index (FI) and administration of BetIndex (the parent company). Leigh Day are working with Clean Up Gambling, a lobbying group that are pushing for a root and branch change to gambling laws in the Gambling Act Review which is currently making its way through Parliament.

Leigh Day was established in 1987 and is one of the UK’s most prominent human rights lawyers, specialising in group claims such as this. The firm’s ethos is ‘to ensure that the ordinary person has just as good quality legal advice as our state bodies, insurers, and multi-nationals.’

Examples of successful previous claims include:

  • Acting on behalf of 5,000 Kenyan nationals who were subjected to torture and other forms of ill-treatment at the hands of the British colonial administration during the Kenya Emergency in the 1950s – securing £19.9 million in compensation.
  • Acting for almost 400 British former servicemen for experiments that were carried out on them by the Ministry of Defence at Porton Down – securing a settlement of £3 million.
  • Acting for the Bodo Community in Nigeria are massive oil spills from a Shell oil pipeline spilled at least 560,000 barrels of oil into the Community’s land, destroying their livelihoods – securing a £55 million settlement.

If you want a lawyer fighting a case like this, it seems like these are the people you want in your corner.

Having said that, they have been caught up in some controversy too:

What’s actually happening?

Leigh Day say that they have begun their investigation which will include looking at the events leading up to the collapse of the platform, the conduct of various Directors of BetIndex Limited, plus associated and parent companies and the role of the Gambling Commission itself. The purpose of the investigation is to determine if there are any viable legal routes which might assist traders in recovering money from the platform or receiving compensation.

And they’ve already been busy. Steps they have taken in the last week include:

  • appointing a specialist barrister team to advise on the administration process and how we might best protect your position in that process, as well as potential claims against individual Directors personally, including, misrepresentation / fraudulent misrepresentation / civil fraud / unlawful means conspiracy / deceit
  • writing to the Gambling Commission to ask for an urgent meeting with them to make sure that your interests are firmly on their radar,
  • writing to Oliver Dowden MP to ask for an urgent meeting to discuss how his office intends to respond to the crisis,
  • speaking and writing to the anticipated Administrators to advise them that we represent over 5,000 interested individuals and again to make sure that your interests are firmly on their radar,
  • attending the Jersey Royal Court on 18 March 2021 on your behalf to observe the first step of the formal administration proceedings (they’ve also said they’ll be attending the High Court hearing in London today).

Note that they represent over 5,000 interested traders at this point. This is a collection action – a group action (known as a class action in the American legal system). It looks to me like the only sensible way to take on a company as big as FI and a case as complex as this – there’s no way we could do this on our own and the costs would be prohibitive.

By working as a group all the legal advice and documentation can be shared between us. They can also pick individual test cases from within the group to make the case as strong as possible, with us all benefiting from the decisions. So it’s the most cost-effective use of resources and gives us the strongest position to start from.

Remember that the Leigh Day action is only one part of what’s happening. The administrators have been appointed to look at ways to salvage the business and MPs are piling pressure on the Gambling Commission, who are also investigating.

We now know that there is £4.5 million ringfenced account which has been set aside (our cash balances) so I see no reason that money won’t be returned to us. It’s possible that other action may be taken which returns further monies to us without the need for legal action – no one really knows that yet – and if that does happen, that would largely remove the need for Leigh Day to step in (unless they wanted to pursue compensation for distress caused, I suppose). These are still early days and this whole thing is likely to rumble on for months, if not years, before we see any sort of outcome.

What do traders need to do next?

The cost of Leigh Day’s work so far has been covered by Clean Up Gambling. Interested traders are now receiving further details from them about their approach (a client care letter) and will shortly receive the funding agreement – the no-win-no fee agreement. To become part of the group action, traders need to confirm their acceptance of these.

It’s worth unpicking what is set out in the letter that’s been sent to traders. However, I’m conscious that the documentation is marked as private and confidential so I’m going to talk in broad terms only – just a few bullet points!

  • This is agreement is for the first stage – investigating whether there is a potential claim to take forward or other avenues to explore to recover costs/compensation.
  • If the investigation concludes that there are no viable legal claims, traders will not be charged any fees. You will not be financially worse off for joining the investigation.
  • If the investigation concludes that there are viable legal claims, they will explore ways to fund these, such as via a third-party funder who will finance the costs in return for a fee in the event of success.
  • If you sign up at this point, you can cancel within 14 days if you change your mind.

So to be clear, no one is being charged for being part of this investigation. If legal action is taken, then any costs should be covered from the defendants (and I would guess we would have another opportunity at that point to decide if we want to remain part of the action).

I say ‘should’ because the information on costs/fees is a not exactly straightforward. As I understand it, a ‘no win no fee’ agreement can take different forms and can include agreements where some costs are due in any event, even if you don’t win. As well as the costs, there is likely to be a ‘success fee’ added on top (this is the amount, as a percentage, we would have to pay Leigh Day out of our settlement).

I’ve seen people querying what the success fee might be. I’d imagine it’s likely to be somewhere between 25% and 40% at least – so not an insubstantial amount and we need to be realistic about that. Of course, if it’s the only way we’re going to get the money back, it’s better than getting nothing at all (and it’s reasonable to expect them to charge us for their work).

This should all be explained in due course, so I’m not going to dwell on the unknown, but I will be taking a close look at the fee documentation when it comes across.

Based on all of the above, I’m happy to add my name to the investigation – it feels like a no-brainer at this point. I will be looking closely over the fee agreement and any updates that come through in the meantime to check I’m fully aware of what I’m signing up to but I think that Leigh Day represent a more than competent pair of hands to handle this for us. If nothing else, we should know by now that it’s vital to read through the terms and conditions before signing up to things – so make sure you do that, for your own peace of mind if nothing else.

If you haven’t joined the action yet, you can find more information here:

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