Sigh of relief within legal community as Supreme Court upholds non-compete clause after four year battle
Following an epic four year legal battle, consumer action law firm Your Lawyers won this morning a Supreme Court action against rival firm Harcus Sinclair (HSLLP). The case was closely monitored by many ,law firms in the City and across the country.
The UK Supreme Court ruled today that a non-compete clause which HSLLP gave is enforceable and HSLLP should not have sought to bring litigation against VW without the permission of Your Lawyers.
The contract included a non-compete clause which stated that HSLLP undertook “not to accept instructions for or to act on behalf of any other group of Claimants in the contemplated Group Action without the express permission of Your Lawyers”.
However, Your Lawyers alleged that this non-compete clause was subsequently breached by HSLLP, because – without Your Lawyers’ knowledge – the firm proceeded to retain clients as part of a rival claimant group and held secret discussions with another solicitors’ firm.
Four your battle
Your Lawyers took HSLLP to the High Court in 2017, which found that Your Lawyers’ had a legitimate interest in protecting their own position.
The Court of Appeal then reversed that finding, after which Lawyers subsequently appealed to the UK Supreme Court who today found that the Court of Appeal was wrong to overturn the judge.
The case was closely monitored by dozens of law firms – particularly smaller ones – within the Square Mile and beyond, as the decision greatly impacts a firm’s ability to either ringfence its current client pool or aggressively recruit new ones.
“This is such an important victory for the dignity and sanctity of the legal profession. We have lived and breathed this case for four long years and were forced to take the matter all the way to the UK Supreme Court to oblige a law firm to honour an agreement,” said Aman Johal, director of Your Lawyers, outside the Supreme Court this morning.
Volkswagen scandal
The VW Emissions Scandal case is one of the largest group actions the UK has ever seen. In total, 1.2m Volkswagen, SEAT, Škoda and Audi diesel cars manufactured between 2009 and 2015 are affected.
The ‘Dieselgate’ scandal was first revealed in September 2015 after Volkswagen was accused of installing illegal “defeat devices” in its EA189 diesel engines.
The devices fitted by Volkswagen cheated the European emissions testing regime. Volkswagen’s actions resulted in over 8m vehicles supplied to consumers across Europe emitting Nitrogen Oxide (NOx) levels that were higher than expected – reportedly, up to 40 times the legal limit in some cases.