Houzhu Insights | Mastercard Class Action Reaches Key Milestone with £200 Million Settlement Approval; Bombay High Court Affirms Legality of TPF...

News and Conference Information

• One of the largest class actions in UK history, Merricks v Mastercard, has recently seen a major development. The UK Competition Appeal Tribunal (CAT) has formally approved the £200 million settlement, marking a key milestone in the case, even though arbitration between litigation funder Innsworth and class representative Mr. Merricks remains ongoing. The settlement is divided into three parts: the first portion of £100 million is allocated for consumer compensation and will be distributed by Epiq. If 5% of class members submit claims, each could receive £45, with a maximum cap of £70 per individual. The second portion, £45.57 million, is reserved for Innsworth to cover its principal investment and minimum return. The remaining £54.43 million forms the third portion, designated for Innsworth’ s profit share and to top up the first fund should there be higher-than-expected claims. Any surplus will be donated to a consumer charity or the Access to Justice Foundation.
• Earlier this month, the Bombay High Court ruled that third-party litigation funding is not inherently illegal and does not violate Section 23 of the Indian Contract Act. The case originated from a 2005 application by the Rizvi Education Society and the Kailash Seva Sadan Trust seeking to amalgamate, which was approved by the Assistant Charity Commissioner. The amalgamation was later challenged by the Brihan Mumbai Municipal Corporation and quashed by the Civil Court on the grounds that it constituted “champertous litigation”. The High Court set aside the Civil Court’s decision, citing a Supreme Court precedent that, while lawyers are generally prohibited from funding their clients’ litigation, non-lawyer third parties may finance litigation and be repaid after its outcome -- such arrangements do not violate public policy or the Contract Act.
• Australian litigation funder Litigation Capital Management (LCM) is considering a potential class action against former executives of the Australian Securities Exchange (ASX) over the failed upgrade of its CHESS clearing and settlement system. It is reported that LCM is seeking a lead shareholder to act as representative plaintiff, but has not confirmed whether a formal investigation or legal proceedings have been initiated. 
• Becca Hogan and Rory Spillman of UK law firm Signature Litigation recently wrote that the UK’s litigation funding market continues to evolve, with CFAs (Conditional Fee Agreements) and third-party litigation funding emerging as the two main models. Both rely on successful outcomes, but under CFAs, lawyers bear the risk, whereas third-party funding involves external funders who invest and share in the returns. The article highlights the 2023 UK Supreme Court decision in PACCAR, which ruled that certain funding agreements qualify as DBAs (Damages-Based Agreements) and are therefore unenforceable unless compliant -- causing significant disruption. A bill intended to address this, the Litigation Funding Agreements (Enforceability) Bill, stalled due to the general election. The Labor government is expected to revisit the issue after the Civil Justice Council (CJC) publishes its forthcoming report. The authors also note that while the EU is pushing for mandatory disclosure of litigation funding arrangements, the UK currently requires disclosure only in limited circumstances, and future regulatory directions remain uncertain. 
• IMN will convene the “Financing, Structuring & Investing in Litigation Finance” Forum in New York City on June 3, 2025, bringing together global leaders in litigation funding, law firms, corporate claimants, and investors. Through panel discussions, roundtables, and speed networking sessions, the forum will explore key topics such as emerging market trends, drivers of investment decisions, the impact of technology, regulatory developments, and mass tort litigation.
• Certum Group has joined ILFA as its 30th member.

[Reference]

[2]https://www.verdictum.in/court-updates/high-courts/bombay-high-court/third-party-funding-of-litigation-not-illegal-2025-bhc-as-21629-rizvi-education-society-v-brihan-mumbai-municipal-corporation-1577221