The FTSE 100 set aside £31.3bn in the last 12 months to pay litigation legal bills, compensation and regulatory fines, new research by Thomson Reuters has found.
Banks paid out the most, accounting for 56 per cent of the total figure – around £17.4bn – representing a 27 per cent increase on the previous year.
Major legal and regulatory disputes including Libor and Forex manipulation and PPI mis-selling continued to have a significant impact on UK banks’ legal costs.
The Royal Bank of Scotland (RBS) named legal costs associated with mortgage securitisations and interest rate trades as major contributors to the bank’s £1.9bn loss in 2015.
Oil and gas and mining companies came in second, paying £7.9bn in legal liabilities in the last year. BP’s legal costs on the 2010 Deepwater Horizon crisis continued to grow following its 2015 settlement, accounting for a major chunk of all FTSE 100 oil businesses’ legal spend.
Herbert Smith Freehills (HSF) was one of the biggest winners from the uptick in legal costs and claims.
Data from The Lawyer Market Intelligence (LMI) revealed HSF as the most popular adviser to FTSE 100 companies on High Court and Court of Appeal cases in 2015.
Its work for Sky and British American Tobacco in the UK High Courts boosted it up the rankings.
Last year The Lawyer revealed that HSF currently advises 39 FTSE 100 companies in total across all practice areas, more than any other firm.
Hogan Lovells, Addleshaw Goddard, Berwin Leighton Paisner (BLP), Clyde & Co, DLA Piper and Norton Rose Fulbright also advised on a host of cases for the FTSE 100 last year.
Meanwhile magic circle firms trailed this group. Between January 2012 and July 2015 Freshfields Bruckhaus Deringer and Linklaters were instructed on four cases that reached the courtroom by FTSE 100 companies; Clifford Chance was instructed on three cases; and Allen & Overy made no appearances.
A total of 53 firms were instructed by the FTSE 100 in that time period, along with 112 QCs and 116 juniors from around 60 sets.
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