ZipTracker: Controlled Explosions

Today's newsletter is a 7 min read:

• ⚖️ In Court: Court cases featuring Bird & Bird, DAC Beachcroft, Hogan Lovells, Lewis Silkin, Mishcon de Reya and more!
• 🤝 Deals Time: Deals featuring BCLP, Dechert, DLA Piper, Hogan Lovells, Linklaters, Clifford Chance, Addleshaw Goddard, Freshfields, Goodwin and more!

⚖️ In Court

Controlled Explosions

Summary: The University of Exeter is arguing that Allianz Insurance should cover damages to student housing caused by a German World War II bomb that was detonated in a controlled explosion.

Background to the case: A German World War II bomb was discovered on a construction site close to the University of Exeter's campus in February 2021. The bomb was detonated in a controlled explosion, but nearby student housing complexes were damaged in the process. Allianz Insurance is now suing the university to declare that it does not have to cover the damage under a war exemption clause in the university's property policy.

Key Points to note:

• The university argues that the buildings were not "doomed" to be damaged by the bomb exploding as there was no evidence to suggest the bomb was at risk of exploding until it was destroyed by a military bomb disposal team.
• The university argued that the dropping of the bomb only created the context in which the explosion took place, as the bomb had not exploded or caused any damage for nearly 80 years before it was discovered.
• Judge Nigel Bird must decide whether the dropping of the bomb was the "proximate cause" of the explosion based on a test set out by the U.K. Supreme Court in Financial Conduct Authority v. Arch Insurance.
• The test lawsuit was brought by the Financial Conduct Authority over business losses caused by the COVID-19 pandemic.

Who advised on this?

• Allianz Insurance PLC is represented by Isabel Hitching KC of Crown Office Chambers, instructed by DAC Beachcroft.
• The University of Exeter is represented by David Pliener of Gatehouse Chambers, instructed by Fenchurch Law.

⚖️ In Court

The Start of Data Class Actions?

Summary: Consumers are preparing to take legal action against Meta Platforms, the parent company of Facebook, in the UK’s Competition Appeal Tribunal, over what they claim are its anti-competitive data collection policies.

Background to the case: The lawsuit, headed by Dr. Liza Lovdahl Gormsen, a competition law academic, seeks to bring claims on behalf of 44 million people. A four-day hearing on whether to certify the class is scheduled to begin at the CAT on Monday.

Key Points to note:

• The case is the first of its kind as it asks the tribunal to grapple with issues of data privacy rather than just competition.
• The key argument is Meta's alleged abuse of its dominant position in the market by imposing unfair terms and prices on users.
• The UK Supreme Court limited the scope for class actions in Lloyd v. Google. It made it harder and very challenging from a financial standpoint to bring traditional privacy class actions to the High Court.
• The Supreme Court emphasized that representative actions can only be used if the entitlement to damages can be calculated on a basis that is common to all members of the class and no individualised assessment is needed.
• Where an individual assessment is needed, in which each claimant would have to individually prove the breach caused them harm, thus ramping up the costs.
• Due to these higher thresholds in the High Court, we are starting to see an increase in large-scale claims for torts or privacy (like this one) go through the CAT.

Who advised on this?

• Gormsen is represented by Ronit Kreisberger KC and Nikolaus Grubeck of Monckton Chambers, Sarah Ford KC of Brick Court Chambers and Greg Adey of One Essex Court, instructed by Katherine Vernon, Leo Kitchen and Trevor Soames of Quinn Emanuel Urquhart & Sullivan.
• Meta is represented by Marie Demetriou KC and David Bailey of Brick Court Chambers and Ben Williams KC of 4 New Square, instructed by Stephen Wisking, Kim Dietzel and Miriam Everett of Herbert Smith Freehills.

⚖️ In Court

Gaming Infringement

Summary: NetEasem, a Chinese tech giant, has denied allegations that its mobile game Hyper Front infringes on Riot Games' copyright for Valorant in the UK. NetEase claims that many similarities between the two games are common to the genre and not protected by copyright.

Background to the case: In October 2021, Riot Games filed a lawsuit against NetEase, claiming that the tech giant's mobile game Hyper Front infringed its copyright for Valorant in the UK. Riot Games noted similarities in the core gameplay, user interface design, and game modes of the two games.

Key Points to note:

• NetEase claims that many similarities between the two games are common to the genre and not protected by copyright.
• They also argue that Riot Games has not properly identified which specific aspects of Valorant are covered by copyright and that the onus is on Riot to prove what exactly it owns.
• NetEase argues that many similarities between the two games are also present in Activision Blizzard's Overwatch, another team-based online shooter that NetEase said was the key inspiration for both games.
• NetEase denied that they copied substantial parts of Valorant "in a way that copyright protects."

Who advised on this?

• NetEase is represented by Andrew Norris KC and Gwilym Harbottle of Hogarth Chambers, instructed by Lewis Silkin.
• Riot Games is represented by Michael Hicks of Hogarth Chambers, instructed by Sara Ashby of Wiggin.

⚖️ In Court

Podcast Defamation

Summary:

The High Court has denied a request by an American relationship expert, Nicole Daedone, and her company, OneTaste, to add further libel claims to a defamation lawsuit targeting a BBC podcast that accused them of running a "destructive sex cult." The High Court did, however, allow Daedone's business partner, Rachel Cherwitz, to pursue her libel claims.

Background to the case:

The Institute of OM LLC and OM IP Co. filed a defamation lawsuit against the BBC in November 2021, claiming that the podcast, "The Orgasm Cult," accused them of using "practices and programs that knowingly and deliberately manipulated and exploited vulnerable women causing them irreparable damage and lifelong trauma." Nicole Daedone and her company, OneTaste, sought to add additional libel allegations to the lawsuit.

Key Points to note:

• The High Court denied Nicole Daedone and OneTaste's request to add further libel claims to the existing defamation lawsuit but did allow Daedone's business partner, Rachel Cherwitz, to pursue her libel claims.
• The court held that Daedone was aware of the original claim at the time it was filed, but her business partner, Rachel Cherwitz, did not learn about the case until months later.
• Daedone and OneTaste relied on exemptions from the one-year time bar to try to convince the court to allow them to add their libel claims to the lawsuit, but the court found "no cogent reasons" for the delays in bringing their claims.

Who advised on this?

• Nicole Daedone, Rachel Cherwitz, OneTaste Inc., Institute of OM and OM IP are represented by Sara Mansoori KC and Zoe McCallum of Matrix Chambers, instructed by Mishcon de Reya.
• The BBC is represented by Catrin Evans KC of Matrix Chambers and Ben Gallop of 5RB, instructed by in-house counsel.

🤝 Deals Time

Foody Deal

Summary: Private investment firm McWin announced on Tuesday that it will acquire a majority stake in Germany's Italian-themed restaurant chain L'Osteria in a deal valued at €400 million.

Key Points to note:

• McWin will acquire a majority stake in L'Osteria in a deal valued at €400 million.
• The acquisition will support L'Osteria's expansion in both Germany and new and existing markets across Europe.
• McWin currently manages over $1.09 billion in assets and is also an investor in other food chains giants such as Burger King Germany and Popeyes Central and Eastern Europe.
• With the acquisition of L'Osteria, McWin and its affiliates have a total of 1,500 restaurants in their portfolios.

Who advised on this?

• Bryan Cave Leighton Paisner advised McWin.
• Dechert team advised L'Osteria.

🤝 Deals Time

Merge and Delist

Summary: Professional consultancy firm RPS Group completed its £636 million merger with engineering services provider Tetra Tech on Tuesday. Following completion, RPS shares were removed from the London Stock Exchange.

Key Points to note:

• RPS shares have been removed from the London Stock Exchange.
• RPS Group completed a £636 million merger with Tetra. The merger was guided by Hogan Lovells and DLA Piper.
• Tetra and RPS cleared the last few hurdles in their merger in December after they won backing from the Investment Security Unit, part of the UK government's Business Department. The transaction also won similar clearance from Australia's foreign investment review board.
• Tetra had competed against a rival bid from WSP Global, a Canadian construction consultancy, which valued RPS at £591 million.

Who advised on this?

• DLA Piper advised RPS
• Hogan Lovells advised Tetra Tech.
• Linklaters advised WSP.

🤝 Deals Time

Retirement Deals

Summary: Legal & General Assurance Society has agreed to a £430 million buy-in transaction with Tioxide Pension Fund, the retirement scheme of chemicals business Venator Group.

Key Points to note:

• Legal & General Assurance Society has agreed to a £430 million buy-in transaction with Tioxide Pension Fund, the retirement scheme of chemicals business Venator Group.
• The agreement was reached in November, and Legal & General will now take on the liabilities of about 2,700 retirees and deferred members.
• Legal & General Investment Management, a unit of the parent Legal & General Group PLC, has handled part of the retirement fund's assets since 1995.
• 2023 is expected to be a strong year for deals in the pensions insurance sector. Experts predict that more deals could be carried out in 2023 than ever before if funding levels at pension plans remain strong.

Who advised on this?

• Clifford Chance advised Legal & General Assurance Society.
• Addleshaw Goddard advised the trustee of the Tioxide Pension Fund.

🤝 Deals Time

Warehouse Time

Summary: German-based warehouse business Jungheinrich is acquiring private equity-backed Storage Solutions for $375 million.

Key Points to note:

• Jungheinrich will finance the transaction with cash and debt with little impact on the value of the company.
• Storage Solutions' market coverage will give Jungheinrich access to key logistics hubs in the U.S.
• It will allow Jungheinrich to enter the warehousing and automation market in the U.S. Storage Solutions provides new and used warehouse equipment including robots, conveyor belts, and packaging machines.
• Jungheinrich CEO Lars Brzoska said in a statement that the acquisition is an excellent opportunity to expand its geographic footprint in the U.S. and adds a strong strategic platform for growth in warehouse automation across the region.
• Jungheinrich currently has a partnership with Mitsubishi Logisnext Americas to distribute its forklifts. This deal, the company said, will not impact the partnership and instead will sit alongside the new acquisition.

Who advised on this?

• Freshfields Bruckhaus Deringer advised Jungheinrich.
• Goodwin Procter advised Storage Solutions.