Sony Interactive Entertainment Ltd & Anor v Alex Neill Class Representative Ltd (Rev1) [2025] EWCA Civ 841 (24 July 2025)

Sony Interactive Entertainment Ltd & Anor v Alex Neill Class Representative Ltd (Rev1) [2025] EWCA Civ 841 (24 July 2025)

LFAs where the funder’s fee is calculated as a multiple of outlay, even if capped by or payable from proceeds, are not DBAs under s.58AA(3)(a)(ii) CLSA and are enforceable. A cap or payment from proceeds is ancillary and does not determine the amount of the funder’s fee for the purposes of the statutory definition. Contingent percentage-based clauses that only operate if the law changes do not render the agreement a DBA. Severance of unenforceable terms is permissible where expressly provided and does not alter the contract’s fundamental nature.

Citation
[2025] EWCA Civ 841
Parties
Appellant / Defendant: Sony Interactive Entertainment Europe Limited; Appellant / Defendant: Sony Interactive Entertainment Network Europe Limited; Respondent / Class Representative: Alex Neill Class Representative Limited; Appellant / Defendant: Visa Inc.; Appellant / Defendant: Visa International Service Association; Appellant / Defendant: Visa Europe Limited; Appellant / Defendant: Visa Europe Services LLC; Appellant / Defendant: Visa UK Limited; Respondent / Class Representative: Commercial and Interregional Card Claims I Limited; Respondent / Class Representative: Commercial and Interregional Card Claims II Limited; Appellant / Defendant: Mastercard Incorporated; Appellant / Defendant: Mastercard International Incorporated; Appellant / Defendant: Mastercard Europe SA; Appellant / Defendant: Mastercard / Europay UK Limited; Appellant / Defendant: Mastercard UK Management Services Limited; Appellant / Defendant: Mastercard Europe Services Limited; Appellant / Defendant: Apple Inc; Appellant / Defendant: Apple Distribution International Limited; Appellant / Defendant: Apple Retail UK Limited; Respondent / Class Representative: Dr Rachael Kent; Respondent / Class Representative: Mr Justin Gutmann; Intervener: The Competition and Markets Authority
Jurisdiction
England and Wales
Judgment Date
24 July 2025
Procedural Posture
Appeal (civil) / Court of Appeal Judgment Following Appeals From Competition Appeal Tribunal
Outcome
Appeals dismissed
Legal Topics
Litigation Funding Agreements, Damages Based Agreements, Collective Proceedings, Enforceability of Contracts, Severance of Contractual Terms
Competition Law Civil Procedure Contract Law Litigation Funding Agreements Damages Based Agreements Collective Proceedings Enforceability of Contracts Severance of Contractual Terms

Case Brief

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Parties

Sony Interactive Entertainment Europe Limited

Appellant / Defendant

Sony Interactive Entertainment Network Europe Limited

Appellant / Defendant

Alex Neill Class Representative Limited

Respondent / Class Representative

Visa Inc.

Appellant / Defendant

Visa International Service Association

Appellant / Defendant

Visa Europe Limited

Appellant / Defendant

Visa Europe Services LLC

Appellant / Defendant

Visa UK Limited

Appellant / Defendant

Commercial and Interregional Card Claims I Limited

Respondent / Class Representative

Commercial and Interregional Card Claims II Limited

Respondent / Class Representative

Mastercard Incorporated

Appellant / Defendant

Mastercard International Incorporated

Appellant / Defendant

Mastercard Europe SA

Appellant / Defendant

Mastercard / Europay UK Limited

Appellant / Defendant

Mastercard UK Management Services Limited

Appellant / Defendant

Mastercard Europe Services Limited

Appellant / Defendant

Apple Inc

Appellant / Defendant

Apple Distribution International Limited

Appellant / Defendant

Apple Retail UK Limited

Appellant / Defendant

Dr Rachael Kent

Respondent / Class Representative

Mr Justin Gutmann

Respondent / Class Representative

The Competition and Markets Authority

Intervener

Procedural Posture

Appeal (civil) / Court of Appeal Judgment Following Appeals From Competition Appeal Tribunal

Legal Issues

  1. 1 Whether litigation funding agreements (LFAs) capped by proceeds are damages-based agreements (DBAs) under s.58AA Courts and Legal Services Act 1990 and thus unenforceable
  2. 2 Whether alternative percentage-based recovery clauses contingent on change in law render LFAs DBAs or unenforceable
  3. 3 Whether unenforceable or unlawful parts of LFAs can be severed

Ratio Decidendi

LFAs where the funder’s fee is calculated as a multiple of outlay, even if capped by or payable from proceeds, are not DBAs under s.58AA(3)(a)(ii) CLSA and are enforceable. A cap or payment from proceeds is ancillary and does not determine the amount of the funder’s fee for the purposes of the statutory definition. Contingent percentage-based clauses that only operate if the law changes do not render the agreement a DBA. Severance of unenforceable terms is permissible where expressly provided and does not alter the contract’s fundamental nature.

Court Disposition

Appeals dismissed

Orders

  • The appeals of Sony, Visa, Mastercard, and Apple are dismissed.
  • The revised LFAs in each case are not DBAs and are enforceable.