Travelport Ltd & Ors v WEX Inc [2020] EWHC 2670 (Comm) (12 October 2020)

Travelport Ltd & Ors v WEX Inc [2020] EWHC 2670 (Comm) (12 October 2020)

The court held that the relevant industry for comparison under the MAE clause is not limited to the 'travel payments industry' as defined by the claimants, but encompasses a broader group of participants. The claimants failed to establish a distinct, clearly defined industry for the purposes of the carve-out exception. The burden of proof regarding the MAE condition rests with WEX. No MAE has occurred or is reasonably expected to occur within the meaning of the SPA, and WEX is obliged to close the transaction.

Citation
[2020] EWHC 2670 (Comm)
Parties
Claimant: Travelport Limited; Claimant: Anthony Hynes; Claimant: Bryan Lewis; Claimant: Edward Chandler; Claimant: Peter Golby; Claimant: Pat Hall; Claimant: Tim Lewis; Claimant: Sam Mendelsohn; Claimant: Mario Natoli; Claimant: Lori Owens; Claimant: Matt Arthur; Claimant: Erica Martin; Claimant: Robert Bishop; Claimant: Mr Adam Rhys Olding and 112 other Claimants; Defendant: WEX Inc
Jurisdiction
England and Wales
Judgment Date
12 October 2020
Procedural Posture
Commercial Claim / Preliminary Issues Trial
Outcome
Claim allowed
Legal Topics
Material Adverse Effect Clauses, Share Purchase Agreements, Burden of Proof, Specific Performance, Construction of Contractual Terms
Contract Law Commercial Law Material Adverse Effect Clauses Share Purchase Agreements Burden of Proof Specific Performance Construction of Contractual Terms

Case Brief

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Parties

Travelport Limited

Claimant

Anthony Hynes

Claimant

Bryan Lewis

Claimant

Edward Chandler

Claimant

Peter Golby

Claimant

Pat Hall

Claimant

Tim Lewis

Claimant

Sam Mendelsohn

Claimant

Mario Natoli

Claimant

Lori Owens

Claimant

Matt Arthur

Claimant

Erica Martin

Claimant

Robert Bishop

Claimant

Mr Adam Rhys Olding and 112 other Claimants

Claimant

WEX Inc

Defendant

Procedural Posture

Commercial Claim / Preliminary Issues Trial

Legal Issues

  1. 1 Has a Material Adverse Effect occurred or is reasonably expected to occur under the SPA?
  2. 2 What is the proper construction of the MAE definition and its carve-outs and exceptions?
  3. 3 Which party bears the burden of proof regarding the MAE condition?

Ratio Decidendi

The court held that the relevant industry for comparison under the MAE clause is not limited to the 'travel payments industry' as defined by the claimants, but encompasses a broader group of participants. The claimants failed to establish a distinct, clearly defined industry for the purposes of the carve-out exception. The burden of proof regarding the MAE condition rests with WEX. No MAE has occurred or is reasonably expected to occur within the meaning of the SPA, and WEX is obliged to close the transaction.

Court Disposition

Claim allowed

Orders

  • Declaration that no Material Adverse Effect has occurred or is reasonably expected under the SPA
  • Order for specific performance requiring WEX to close the transaction