Allegations that intellectual property law firms earn millions of pounds a year in commissions secretly paid by patent renewal businesses are to be tested in a group claim following a Court of Appeal decision.

In Commission Recovery Limited v Marks & Clerk LLP and Long Acre Renewals the Court of Appeal ruled that a claim by Commission Recovery Limited may go ahead as a representative action against IP specialist Marks & Clerk. It is the first appellate ruling on the representative action regime since the Supreme Court’s 2021 judgment in Lloyd v Google. 

Commission Recovery Limited (CRL) is a company established to bring the claim against Marks & Clerk in relation to commissions allegedly paid secretly by IP manager CPA Global to Marks & Clerk in return for referring clients to CPA. In bringing the group claim, CRL argued that its case was representative of other clients impacted by Marks & Clerk’s alleged actions. 

Marks & Clerk and Long Acre Renewals had argued that the potential claimants did not meet the ‘same interest’ requirement needed for group claims. However, dismissing Marks & Clerk’s appeal, Lord Justice Nugee found that there was 'an issue common to all members of the class and no relevant conflict between them. It follows that the members of the class have the “same interest” in the claim for the purposes of [Civil Procedure Rule 19.8] … and that the rule therefore applies.’

Lord Justice Snowden and Sir Geoffrey Vos, master of the rolls, agreed.  

In a statement, a spokesperson for Marks & Clerk said: 'We are disappointed by the judgment, but we maintain our position that CRL mischaracterises the relationship that our firm had with CPA during the period in question - and the work that was done for our then clients – whilst attempting to use the representative action system in an unsuitable and financially-motivated manner. These points remain open following the judgment, and we therefore look forward to showing the High Court at trial why CRL’s complaint cannot be properly advanced on a representative basis.’

David Greene, co-president of the Collective Redress Lawyers Association, said that in upholding a High Court decision to allow the claim to proceed as a representative action, ’the Court of Appeal has provided very helpful clarity in an important developing area of law’. 

 

John Machell KC and Russell Hopkins, instructed by Clifford Chance LLP, appeared for Marks & Clerk; Nico Leslie and Christopher Monaghan, instructed by Signature Litigation LLP, for Commission Recovery Ltd.