A Dorsey & Whitney team lead by Tim Maloney and Matthew Blower has concluded a highly favorable settlement on behalf of Watchstone Group PLC (“Watchstone”)  in its vigorous 3-year defense of a £637m claim pursued by Slater & Gordon ("S&G “), one of the world’s largest consumer law firms.  S&G was suing Watchstone for fraudulent misrepresentation, deceit and breach of warranty. Settlement was reached immediately before commencement of a 9-week trial in the London Commercial Court.

The following Announcement was made by Watchstone to the London Stock Exchange on 21 October 2019:

Under the Settlement, which was made without admission of liability by either party, all of S&G's claims or potential claims for alleged breaches of warranty, deceit and fraudulent misrepresentation against Watchstone its present and former directors officers and agents relating to the historic sale of the Group's professional services division ("S&G Claims") in May 2015 have been unconditionally withdrawn. Watchstone has also agreed not to pursue its counterclaim against S&G (details of which were announced on 29 August 2019).

The Settlement provides for £11m of the £50m currently held in escrow to be released to S&G with the balance of £39m and accrued interest being released to Watchstone. No application for costs will be made by either party.

Watchstone does not accept that there was a proper basis for the S&G Claims and S&G does not accept that there was a proper basis for the counterclaim.

Richard Rose, Non-executive Chairman of Watchstone said: "We are pleased with the resolution of this matter. Whilst Watchstone remains firmly of the view that the legal action commenced by the other side was without merit, the board believes that a settlement at this level is in shareholders' interests as it brings certainty. It also releases a significant cash sum that has been locked in escrow and unavailable to us for some considerable time. The decision was made with consideration of the costs of pursuing the Company's defence and counterclaim at trial and to the inherent uncertainty of the outcome of any legal process."