A group set up to sue Tesco over last year's accounting scandal has drafted in a highly respected commercial lawyer for what could turn into a multi-billion pound lawsuit.
Philip Marshall QC represented Paddy McKillen in his epic battle with the Barclay brothers over ownership of the Claridge’s, Connaught and Berkeley hotels, grilled Bernie Ecclestone in the High Court for three days over the questionable sale of the Formula One business to CVC and fought for the largest group of fraud actions ever to be brought in the High Court against Kazakhstan’s BTA Bank.
He will advise the various institutional investors who have been signed up by the Tesco Shareholder Claims (TSC) group and a formal claim is expected to be filed later this year.
The revelation is another blow to Tesco, which is under intense scrutiny and investigations by the Serious Fraud Office, the Groceries Code Adjudicator and the Financial Reporting Council.
Last month chief executive Dave Lewis dumped the company’s auditor of 32 years, PwC, for failing to spot the accounting scandal that saw the supermarket’s commercial division notching up profits from supplier payments before they had been received.
An internal report by Freshfields and Deloitte found that £263 million had been “misstated” over at least the last three years, although this figure was revised up to £326 million last month as further discrepancies were found in the supermarket’s Irish business.
The TSC, along with British law firm McGuireWoods and US attorneys Scott + Scott, which are filing a similar claim on behalf of US shareholders, claim the scandal wiped between 50p and 70p permanently from the value of the shares, meaning the total bill could be as high as £1.9 billion.
David Scott, managing partner at Scott + Scott, said: “Tesco committed serious violations when it overstated its profits. We intend to pursue Tesco in order to help our clients recoup their losses.”
Marshall will boost the cause following his performances in several, high-profile cases. In 2013 he rattled Ecclestone in court, accusing him of “fabricating” evidence in an unsuccessful attempt by German media company Constantin Medien to sue the F1 boss. Marshall also represented Liverpool FC directors when the club was sold to Fenway Sports Group in 2010.
Tesco declined to comment.
The news comes as the supermarket lost its battle with residents of Belsize Park, where Tesco was hoping to build a new store. Andrew Thornton, who runs the local Budgens store, revealed the plans were pulled last night.Reuse content