Recently, the Court declined to strike out or grant summary judgment in a case involving Standard Chartered's alleged historic non-compliance with Iran sanctions, leaving key legal questions to be resolved at trial in October 2026.
In March 2025, Mr Justice Green handed down his decision on whether or not to strike out and/or grant reverse summary judgment in respect of a significant part of the claims in Persons Identified in Schedule 1 v Standard Chartered PLC [2025] EWHC 698.
The underlying litigation concerns Standard Chartered’s alleged historic non-compliance with Iran sanctions. Institutional investors claim the bank’s reports and disclosures were untrue or misleading, or omitted critical information, on the extent of the misconduct which artificially inflated Standard Chartered’s share price and ultimately caused them loss.
Standard Chartered applied to strike out:
- A set of claims where the Claimants claim to have relied on information published to the market by Standard Chartered rather than reading or considering the information themselves (the "Common Reliance Claims”).
- A second set of claims alleging that Standard Chartered had dishonestly delayed the publication of information (the “Delay Claims”)
The strike out application followed the decision in Allianz Funds Multi-Strategy Trust and Ors v Barclays plc, where Barclays obtained strike out of claims against it over losses sustained following an investigation into an alleged dark pool training system. Those claims were brought on a similar basis and were struck out on the basis that: (a) reliance cannot be satisfied in respect of published information which the Claimants did not read or consider; and (b) dishonest delay only imposes liability upon an issuer where the publication of the information has actually taken place.
The Barclays decision prompted a series of strike-out applications by defendants in similar claims, and Standard Chartered was the first of these to be heard. While the Barclays decision was considered in some detail, and Mr Justice Green acknowledged the importance of judicial comity, the Judge still refused to strike out or grant reverse summary judgment.
The Common Reliance Claims
The Common Reliance Claims involve 949 funds (68% of the total Claimants) claiming around £760 million and are based on section 90A and Schedule 10A Financial Services and Markets Act 2000 (“FSMA”). This requires claimants to show that they acquired or held shares based on their reliance on published information. However, the claims here assume that the investors had not read or directly relied on the published information. Rather, they rely on the price set by the market having taken account of the published information. The price of the shares is said to reflect that other market participants had read and considered the published information, which meant the shares were being traded based on the truthfulness and accuracy of that information.
This indirect interpretation of reliance is evidently important for passive investors, and the Claimants argued that s.90A FSMA was intended to grant a remedy in particular to tracker funds to protect investors and deter misconduct in the market by issuers.
Mr Justice Green acknowledged that the Barclays decision concluded that a claimant was required to prove that they read, or were aware of at least the gist of, the representation and understood it in the sense in which it was alleged to be false. However, the Judge ultimately came to a different conclusion, but principally on case management grounds. He noted that he did not have to consider that the Barclays case was wrong in any event “before deciding in this case that the right thing to do is not to strike out the Common Reliance Claims.”
Mr Justice Green thought it “would be to ignore reality to suggest that this is not a live and possibly developing area of law.” There had been no decision on the meaning of “reliance” in this context and certain elements of the test of reliance at common law “are not fully established.” For instance, it was not clear where Parliament had intended to draw the line on indirect reliance between a claimant relying on a broker’s report and a claimant relying solely on a movement in price as a result of third parties reading published information. Such disputed legal questions should be resolved on the basis of actual facts at trial. He decided that the Claimants should have the opportunity of putting the Common Reliance claims forward for a decision based on all the evidence, even though “it may be an uphill struggle” given the difficulties the claims face.
He also found “points of distinction” with the Barclays case that were also relevant to the exercise of judicial discretion on the strike out because the Barclays decision removed 60% of the claim value while a similar decision here would not have substantially reduced the burden of the trial itself.
Dishonest Delay Claims
The Delay Claims are based on s.90 and Schedule 10 FSMA. Here, Mr Justice Green had “more doubts” about whether the Barclays decision was correct as to whether the corrective information had to be published. It would be “a little extraordinary that such an apparently straightforward condition of liability- that there has to have been a later corrective publication – was not clearly spelled out” in the relevant part of the legislation.
He also found that this “novel point of law” was better decided on the basis of the actual facts at trial, rather than assumed or hypothetical facts.
Impact
This decision does not rule out the potential for passive investors to plead reliance and pursue claims under s.90A FSMA and Schedule 10A FSMA where untrue or misleading statements have been made in information published to the market. However, significant uncertainty remains in relation to the relevant legal tests. While Standard Chartered and Barclays differ in outcome, it is important to remember that Standard Chartered was also decided on case management grounds (i.e., whether it was premature to strike out the claim) and the questions arising will be preserved until the full trial takes place over 76 days starting in October 2026. In the meantime, however, it seems clear that such complex questions may not be resolved on an interim basis.
Written by:
David Walker
General Counsel UK
