Legal Business

Deutsche Bank’s longstanding legal chief Slatter quits to launch consultancy


Long lauded as a key leader within the in-house community, Deutsche Bank’s global head of strategy for legal Emma Slatter, is to leave the bank after 20 years.

An internal memo seen by Legal Business was circulated today (May 31) by co-general counsel Simon Dodds and Christof von Dryander announcing that Slatter will leave the bank later this year to set up as a consultant advising on a range of business ventures, and continuing to pursue her pro bono interests.

The bank’s legal division has not yet appointed a successor as Slatter will remain with the bank until the end of June.

Slatter, who features in the 2016 GC Power List, was most recently UK regional general counsel until her appointment to head of strategy. She was a key figurehead charged with resolving Deutsche Bank’s legal problems.

During her tenure as GC Slatter headed a 150-strong legal team across Birmingham and London. She supported the bank through a number of challenging regulatory investigations, and has overseen many changes in how the legal team operates.

Cited in the memo as ‘one of the senior leaders of the legal department,’ Dodds and von Dryander added: ‘We would like to thank Emma for her distinguished service to the bank and to legal, her commitment and wise counsel, and wish her the best of success in her new ventures.’

Other recent exits from the bank include supervisory board member Georg Thoma who stepped down two years before his contract ended in April this year.

General counsel Richard Walker left last December after coming under fire from German financial regulator Bafin due to a report published by the Wall Street Journal that detailed the bank’s handling of the Libor manipulation saga.

For more on Emma Slatter’s career at Deutsche Bank see: GC Power List 2016: Financial Services

Legal Business

City firms called on as SFO launches Euribor prosecution against Deutsche Bank and Barclays staff


K&L Gates, Stephenson Harwood, Herbert Smith Freehills are among the City law firms instructed as the Serious Fraud Office (SFO) today (13 November) issued the first criminal proceedings against ten former employees of Deutsche Bank and Barclays accused of manipulating the Euro Interbank Offered Rate (Euribor).

Employees from both banks have been charged with ‘conspiracy to defraud’ following the SFO’s ongoing investigation into the manipulation of Euribor, which saw European regulators accuse banks of colluding to manipulate the key interest rate benchmark in an attempt to influence the prices of financial instruments.

The criminal proceedings come after Deutsche Bank, Barclays, Royal Bank of Scotland and Société Générale admitted their involvement in a Euribor cartel in 2013. The banks, excluding Barclays, accepted a fine of £850m between them.

Deutsche Bank employees accused include high profile trader Christian Bittar, as well as Achim Kraemer, Andreas Hauschild, Joerg Vogt, Ardalan Gharagozlou and Kai-Uwe Kappauf. They will be represented by K&L Gates, Howard Kennedy, Hickman Rose, Stephenson Harwood, Kingsley Napley, and Brown Rudnick respectively.

Barclays Bank employees Colin Bermingham, Philippe Moryoussef, Sisse Bohart and Carlo Palombo will be defended by Herbert Smith Freehills, Hickman Rose, Morton L Wagner, and Simon Muirhead and Burton respectively.

Emma Deacon of 5 Paper Buildings and James Waddington QC of 9-12 Bell Yard will represent the SFO.

The SFO said criminal proceedings will be issued against other individuals ‘in due course’. The charges are the first in the SFO’s investigation of interest rate manipulation that relate to Euribor.

The defendants will make their first appearance at Westminster Magistrates’ Court on 11 January 2016 while the SFO’s investigation continues.

The proceedings follows recent success for the SFO, which secured the conviction of former UBS and Citigroup yen derivatives trader Tom Hayes, in August of conspiracy to defraud in the Yen Libor setting process and sentenced to 14 years in prison.

Legal Business

Under fire Walker to step down as Deutsche Bank’s general counsel by year-end


After a management reshuffle earlier this summer that saw legal affairs chief Christian Sewing reassigned, Deutsche Bank has confirmed that general counsel (GC) Richard Walker will leave the bank at the year-end.

Walker, a former partner at Cadwalader, Wickersham & Taft and director of enforcement at the US Securities and Exchange Commission, will be replaced by his two deputies Simon Dodds and Christof von Dryander. Both take on the role having previously served as joint deputy GC since 2013.

In a statement the bank said: ‘At his own request, Richard Walker will retire from his role as General Counsel, effective at the end of the year. He will become a senior adviser to the Bank in the role of Vice Chairman. He will also remain on the Group Executive Committee. Richard Walker helped the Bank navigate exceptionally challenging times during his fourteen years of service as General Counsel.’

Deutsche Bank’s management, including Walker came under criticism from German financial regulator Bafin, in a report published by the Wall Street Journal, over its handling of the Libor manipulation saga and investigations it carried out.

The German lender was fined £1.7bn for Libor and Euribor misconduct in April by US and UK regulators with the Financial Conduct Authority saying the size of the fine was partly due to the lender providing ‘misleading information’ and giving ‘a false attestation’ regarding the adequacy of its Libor controls. The bank also suffered a sharp fall in profits after setting aside litigation expenses of €1.5bn in the first quarter of this year.

The news comes after the bank in June realigned responsibilities on its managing board which included moving legal affairs chief Christian Sewing, to head of private and business clients, succeeding Rainer Neske who departed the bank on June 30. At the time, the bank didn’t respond to requests for comment over whether Walker would remain in his role.

Last month [July 2015], a raft of firms bagged spots as the bank finalised its legal panel arrangements. Freshfields Bruckhaus Deringer, Allen & Overy, Hogan Lovells, White & Case and Ashurst, were among those to have retained their spots.

Legal Business

Raft of firms bag spots as Deutsche Bank finalises legal panel arrangements


A host of law firms have been awarded positions as Deutsche Bank’s go-to advisers with the lender having finalised its global legal panel after kicking the process off at the end of last year.

Freshfields Bruckhaus Deringer, Allen & Overy, Hogan Lovells, White & Case and Ashurst are all understood to have retained their spots on the German banking goliath’s rota. Other firms named include Cleary Gottlieb Steen & Hamilton and Latham & Watkins.

The legal panel itself divides the firms regionally between the Europe, the Middle East and Africa; the US; and Asia.

The review was handled by the banks general counsel Richard Walker, alongside Christian Sewing who is responsible for private and business clients, legal, and the incident management group. Sewing was assigned to the role in May after Rainer Neske left the bank on 30 June through mutual agreement.

The panel review, which is typically carried out every two years kicked off in December 2014 and was initially set to conclude by the end of January 2015. The last panel shakeup concluded at the end of 2012 when US firm White & Case returned as a go-to advisor.

Deutsche Bank was previously fined £1.7bn for Libor rigging and in April, the bank suffered a sharp fall in profits after setting aside litigation expenses of €1.5bn in the first quarter of this year. Its litigation reserves were €4.8bn at the end of last year’s quarter.

Legal Business

After seven months in the job Deutsche Bank reassigns legal affairs chief


Having received fines from investigations relating to Libor manipulation and the unexpected resignation of its joint chief executives this week, Deutsche Bank has shaken up its legal department and reassigned its legal affairs chief Christian Sewing.

In late May the bank decided to realign responsibilities on its managing board which included moving Sewing, responsible for legal, as head of private and business clients for legal and incident management, succeeding Rainer Neske who will leave the bank on June 30 through mutual agreement.

The move is unusual as it comes only seven months after the German lender appointed Sewing as legal chief from his previous role as global head of group audit in what appeared to be attempts to deal with investigations and lawsuits.

Meanwhile general counsel Richard Walker, a former partner in Cadwalader, Wickersham & Taft and director of enforcement at the US Securities and Exchange Commission, is no longer listed on the bank’s board. Appointed to the group in 2012, he was singled out last year in a report urging the bank to make changes in senior management following the Libor scandal. Deutsche Bank did not return a request for comment when asked whether Walker will remain in his position.

The news also follows Deutsche Bank’s £1.7bn fine for Libor rigging and the announcement in April of a sharp fall in profits after setting aside litigation expenses of €1.5bn in the first quarter of this year. Its litigation reserves were €4.8bn at the end of last year’s quarter. Joint chief executives Anshu Jain and Jürgen Fitschen this week expectantly resigned, although Jain will continue to advise the bank as a consultant until early next year.

Legal Business

Rumbling on: Barclays sets aside £800m to cover foreign exchange penalties as Deutsche profits hit by legal costs


Despite the spate of large scale settlements banks continue to set aside large provisions for legal spend with the latest, Barclays, setting aside £800m for investigations and litigation primarily relating to foreign exchange manipulation while Deutsche Bank put aside €1.5bn in the first quarter of 2015.

The figure has been released as the bank announced a 26% decrease in quarterly statutory profits to £1.34bn with it also setting aside an additional £150m provision for PPI redress. The last quarter of 2014 saw Barclays’ provision of funds set aside for Forex liabilities swell to £1.25bn. An additional £200m was allocated to redress customers mis-sold payment protection insurance. The Forex provision was enough to lead to a sharp fall in the booked profit of Barclays’ investment banking arm.

In November it opted out of a major settlement reached by five banks with UK and US regulators for allegedly failing to stop traders from trying to manipulate the foreign exchange market, with HSBC, Royal Bank of Scotland, UBS, JP Morgan Chase and Citibank collectively levied a £2bn fine.

The news follows Deutsche Bank’s announcement days ago of a sharp fall in profits after setting aside litigation expenses of €1.5bn in the first quarter of this year. Its litigation reserves were €4.8bn at the end of last year’s quarter.

On the latest results, Barclays’ group chief executive Antony Jenkins said: ‘Resolving legacy conduct issues is also an important part of our plan to transform Barclays. We are working hard to expedite their settlement and have taken further provisions of £800m this quarter, primarily relating to Foreign Exchange. While we still have much to do, I am pleased with how we’ve begun 2015.’

Barclays also saw a departure last month from its legal team with Nick Mirabella-Williams, senior vice president for global sourcing and supplier management, departing for the Co-operative Bank where he now serves as its head of professional services procurement. At Barclays, Mirabella-Williams jointly founded the Barclays Commercial Management Programme – a collaboration initiative between the bank’s sourcing and legal functions and was responsible for spend management, developing savings initiatives and risk and governance frameworks.

Legal Business

Deutsche Bank

  • Group general counsel: Richard Walker.
  • General counsel for the UK and western Europe: Emma Slatter.
  • Team headcount: 100 lawyers in London, 600 globally.

In common with many global financial institutions, Deutsche Bank has been at the centre of the regulatory cyclone for years and its 100-strong London legal team has played an instrumental role in tightening the investment bank’s governance, liaising with regulators and running high-stakes, post-Lehman litigation.

Under the leadership of GC for the UK and western Europe, Emma Slatter, the team has set up a new legal risk management function, which works with all areas of Deutsche Bank’s legal team and oversees the bank’s legal risk control framework. The banking group’s European legal team has had a reputation as a progressive and proactive operation dating back to Slatter’s well-regarded predecessor, Simon Dodds.

Further innovation includes rolling out a forward-looking legal risk assessment programme across all the bank’s businesses. The team is working closely with the government on regulatory affairs, with a legal team at Deutsche Bank at the vanguard of its lobbying activities.

Post-Lehman cases include a Court of Appeal ruling in 2014 that investment fund Sebastian Holdings must pay Deutsche Bank $243m, after the High Court threw out an $8bn compensation claim against the bank. Over the last 12 months, the litigation and regulatory team has grown by 50%.

Slatter comments: ‘It’s great when you do succeed but the outcome isn’t necessarily in the hands of the lawyers. It’s nice to highlight success but equally the team might do an outstanding job and just don’t get the result.’

Legal Business

Guest post: ‘Individuals matter’ – A conversation with Deutsche Bank’s Asia Pacific GC Joe Longo


Last month I had the pleasure of being on a panel in Europe with Joe Longo, the general counsel for Asia-Pacific of Deutsche Bank. Joe had some particularly thought-provoking and hard-headed observations about the changing dynamics between law firms and clients. I thought it would be worth drawing Joe out a bit more extensively than was possible on our panel, so we found time recently to chat across the 12-hour time zone difference (Joe in Hong Kong, me in New York).

First, a bit of more what/where/when background on Joe.

At Deutsche Bank, Joe is responsible for the direction and coordination of legal support for the Bank’s businesses throughout Asia-Pacific. Before moving to Hong Kong in 2002, Joe was special counsel at legacy Freehills in Sydney and before that was national enforcement director at the Australian Securities & Investments Commission.

I started by asking Joe to describe at a macro level some of the changes he’s seen since the Global Financial Crisis (GFC). What follows is my synopsis of our conversation, understanding that unless phrases are in direct quotation marks it’s not Joe’s words verbatim:

The buy-side/sell-side dynamics have changed very dramatically, although some of the trends were in place earlier. Remember that 2005-7 were really boom years for the legal industry. With the GFC, the power shifted to buy-side in a big, and permanent, way. Everything changed in 2008-10, accompanied by lots of debate about whether this was the New Normal.

We now all accept it wasn’t a short-term dip but a long-term change in the dynamics. In-house departments are no longer growing and indeed are being restructured. Joe thinks that Deutsche Bank has a reputation for being a bit of a leader in how it goes about retaining law firms and get value for money (‘frankly,’ as he put it).

But across the corporate world, at most sophisticated corporations and major banks, the legal department is not being left to its own devices in retaining law firms. There’s far more accountability for the financial aspects of retainers or relationships. Finance departments, auditors, and others, are a lot more interested in why we chose particular firms, or one firm over another, and what did we do to satisfy ourselves that the fees are competitive.

An effective approach to this, requires one to enter the world of ‘procurement’ with appropriate systems, processes, and documentation. Most in-house lawyers have had little experience with this until quite recently; things have become quite a bit more sophisticated with competitive tendering, processes for getting fees paid, standardized terms and conditions for retainers, setting out, for example what the Bank will and will not pay for, and defining standards, for example, with respect to data protection.

BM: How do law firms react to this?

Most law firms are cooperative and it’s not as though all the changes came at once; they’ve been incremental. Most firms, frankly, wanted to continue to get work from Deutsche Bank and therefore wanted to cooperate. Sure, a few firms Deutsche Bank wanted to work with were resistant, but in general firms have cooperated.

It’s a rapidly changing area but one thing that is not changing is there’s constant downward pressure on price and fees. I don’t see any relief from that. In practical economic terms, firms wanting to obtain inflation-adjusted fee increases, without having achieved efficiencies in service, will not be given a sympathetic hearing.

BM: Is the pressure limited to fees or does it go beyond that?

It’s not just about the size of the fee for service, but Deutsche Bank and others are interested in the law firm’s business model: Where the work is done, how document reviews are done and by whom, what is the profile and background of the lawyers (in terms of seniority and price) that are being put on our matters. Deutsche Bank wants to understand who they’re going to work with, and that can often be in India or elsewhere – wherever data and document analysis can be done.

Deutsche Bank and other corporations are experimenting with unbundling, with contract based providers, with using secondments more frequently, and other initiatives designed to promote efficiency. It is a learning process for everyone. Frankly, Joe suspects the vast majority of the work is still done in the traditional way, approaching a single law firm to get the work done, but not for too much longer: In-house counsel are being pressured to be more innovative.

In short, while it’s true today that the bulk of work still goes to traditional law firms, it’s likely that an increasing share of the Bank’s total legal spend will go to non-traditional legal service providers.

BM: What about the high-end work?

Well, it’s true that a lot of Deutsche Bank’s legal work will be performed by the world’s leading global and regional law firms, particularly regarding complex, cross border transactional work, serious regulatory investigations, government-counter-party litigation and contentious regulatory matters. Those matters which have global impact, and so require global reach to properly manage and handle, are likely to go to a top global law firm with the commensurate resources and platform.

But, Joe queries, whether 5-10 years from now there will be so much of this type of work still. For the time being, there does not seem to be any slowdown in the large matters that have a global or regional impact. However, the market should be prepared for the possibility that large scale contentious regulatory work will at some stage begin to abate and the question then arises what is going to replace that work. I’m not saying this work will dry up but it does seem unrealistic to think that it will continue indefinitely.

For the next five years it does seem that complex regulatory work, particularly with respect to financial services, will continued to be a growth area. Moreover, on the transactional side, we should expect attempts to standardize documentation to continue and this will in turn affect demand for bespoke external legal services.

The ‘sliver’

However, as a general proposition, the volume of complex, bespoke work that top law firms are geared up to do, and are fantastic at doing, is not growing as fast as the capacity of the firms to service this work. There is a ‘sliver’ of work that is truly complex and commands high fees. Every top law firm wants to work on highly complex, high-value, cross-border matters. Complexity of the matter and significance to the corporation justify substantial legal fees. But many of the Joe’s of the world are thinking that this type of work isn’t growing. ‘There are a lot of good lawyers out there and they’re not all in the top 20 law firms.’ What will differentiate firms and how they price legal services is going to continue to evolve.

GDP vs. legal spend

Joe suspects no one has collected data on this, but he strongly suspects that the correlation between domestic GDP and the size of the market for legal services of the kind offered by top international law firms is overstated.

Rather, Joe would propose that total country legal spend depends far more on something akin to a ‘rule of law’ quotient in the given country. A strong institutional environment, where policy and rule makers are active, and there is a culture of judicial or quasi judicial enforcement through strong administration and regulation, promotes an environment where lawyers have a vital and practical role to play. Clients are far more likely to require, and be prepared to pay for, sophisticated legal services in such an environment.

In countries like this, the legal profession is expected to be a key player, as systems based on the rule of law generate a lot of work for lawyers. However, the ‘wallet’ for international law firms is not likely to be as large in those countries which do not have a vibrant rule of law.

Moreover, the legal profession itself is at various stages of development and maturity.

Every country in APAC takes a very different approach to practicing law, to documentation, to providing legal support.

Make no mistake: Clearly there are major opportunities, but the way people think about legal services depends so much on culture, the tradition of the rule of law within the country, and the attitude towards lawyers. In places like China there’s a respect for lawyers but that doesn’t mean clients in China are willing to pay the kinds of fees clients will in the US or the UK.

Indigenous talent

Dealing with a part of the world that has two-thirds of the world’s population means encountering some extremely able , highly educated, very ambitious multilingual people, saying ‘we can do this work’—maybe not today or next week, but in the near future as technology and knowledge transfer goes on. Moreover, governments are encouraging and supporting the development of the local legal profession. Major Indian, Japanese, Malaysian, Korean law firms are becoming regional players, and consequently another source of competition for the global incumbents or firm aspiring to become global.

As the macroeconomic phenomena of nation-building, development, urbanization, and infrastructure growth continues, people are moving upmarket into law, medicine, engineering, manufacturing, and so on. Joe has met with lawyers from all around the region, and the forces of globalization, technology, and other demographic forces are all driving the growth and ambitions of local law firms. Clients also drive demand. This won’t happen overnight, but it will happen.

‘Western’ law firms’ role

All these phenomena play into Joe’s telling top law firms coming into AsiaPac to be very specific and focused about what they’re doing in the region.

Absolute law firm size matters only in terms of global investigations—LIBOR, FX, other matters with a global component—in these contexts you have to deal with people, systems, jurisdictions, and material that could be anywhere in the world. So a law firm with a geographic footprint to match really does matter. There are so many people to be interviewed, so much data to be collected, and decision makers are scattered all over the world.

In some other contexts, highly complex, bespoke work often requires expertise found only in the larger firms because they have the ability to support it.

For other matters, you care about individual expertise and in many countries, while local firms may be quite small—5-10 partners, the expertise required for particular transactions or matters can be found there. From a client perspective, the local expertise is what matters if that is what is required to achieve the best result.

BM: So do you hire the lawyer or the law firm? I’m asking, frankly, about lateral partner movement

Individuals matter when you’re talking about the ‘sliver’ work; that has to be the case almost by definition. There are some issues or matters or kinds of work where you can fairly say that in that market there are four or five, maybe seven or eight, ‘go to’ people.

In those situations if those teams start moving around to another firm, you’ll follow them. Deutsche Bank has done this, in Hong Kong and elsewhere, because we had a lot of confidence in that team and those partners.

But it’s more nuanced because Deutsche Bank would also be close to the firm they left and remain close to that firm; depending on how agile and nimble the firm is they can build a fresh team and recover. So yes, it’s true that work can follow a team around but it’s a very competitive, agile, innovative market. The firm that lost a team can recover its share of our legal spend leveraging an existing and likely long standing institutional relationship.

What’s my take on all this? A few points in particular struck me as particularly salient and worth keeping in mind as we all—law firm partners, corporate GC’s, and our business-side clients—navigate the post-GFC world.

GDP is not correlated with legal spending, the density of the legal infrastructure, or, needless to say, the rule of law itself and the role of lawyers in the economy. Too often, those of us in the US and the UK—and countries such as Canada, Australia, and many more that are part of the great British Empire diaspora—tend to ignore or forget this. Just because our environment is different doesn’t mean it’s the only environment.

As fast-moving as our world is (how many times did Joe use words like ‘agile,’ ‘nimble,’ ‘dynamic,’ and so on?), law firms and clients are in this together and we need to cooperate on ways to increase productivity and efficiency together.

That said, the hard business reality is that law firms need to deliver compelling value as determined by the client; the days of tailoring engagements to suit the preferences and strengths of the law firm, sometimes by digging more deeply into the client’s wallet, are ancient history.

Above all, did you notice how Joe approaches the world from the perspective of business and not of law? I didn’t ask him about this but in reflecting on our conversation it struck me. As far as Joe is concerned, Deutsche Bank doesn’t have legal problems; it has business problems.

Law firms talk a good game about understanding their clients’ businesses. It seems to me most have barely scratched the surface.

Bruce MacEwen is the president of Adam Smith, Esq. You can read his blog here.

Legal Business

Adviser review: Firms vie for spots as Deutsche Bank assesses its global legal panel


German banking goliath Deutsche Bank has opened a review of its global legal panel with it set to conclude by the end of January 2015.

Deutsche Bank typically reviews its global legal panel every two years, with the last panel shakeup concluded at the end of 2012 when White & Case returned as a go-to advisor. A source close to the process told Legal Business: ‘The panel review is ongoing and should conclude by the end of January 2015.’

The review is being handled by Deutsche Bank’s general counsel Richard Walker, with influential global head of group audit Christian Sewing, who is set to join the management board in the New Year and take responsibility for legal, also heavily involved.

London-headquartered firms Allen & Overy (A&O), Clifford Chance and Linklaters are all currently on the panel and are understood to be involved in the current retendering process. Latham & Watkins are also on the current panel.

Legal woes continue to hold the German bank back, with legal costs blamed for Deutsche Bank’s £72.6m of net losses for the three months to the end of September.

Weil, Gotshal & Manges, which recently advised Deutsche Bank on its involvement in the $15bn takeover of car rental company Hertz by a private equity consortium, and Freshfields Bruckhaus Deringer, which successfully defended the bank against an $8bn claim brought at the English High Court by Norwegian billionaire Alexander Vik, have strengthened their relationships with the bank over the last 12 months. Both are considered shoo-ins for Deutsche Bank’s global legal panel, with the Magic Circle firm also picked to advise the bank on investigations into its role in attempting to fix foreign exchange markets.

Hogan Lovells, Simmons & Simmons, CMS Cameron McKenna and Ashurst all made it onto Deutsche Bank’s list of preferred legal advisers in EMEA, alongside longstanding advisers Slaughter and May, Clifford Chance, Linklaters, A&O, Freshfields Bruckhaus Deringer and White & Case.

The bank recently revamped its German legal panel last year, with US firms Latham & Watkins, White & Case and Cleary Gottlieb Steen & Hamilton taking up spots beside A&O, Linklaters, Clifford Chance, Hengeler Mueller, Gleiss Lutz and CMS Hasche Sigle. Former Linklaters corporate partner Florian Drinhausen, now co-deputy GC at Deutsche Bank for Germany and Central & Eastern Europe, led that process.

Legal Business

Freshfields wins Deutsche Bank $243m pay out from Sebastian Holdings


The UK Court of Appeal has ruled that investment fund Sebastian Holdings must pay Germany’s Deutsche Bank $243m after losing a case at the High Court last year, or risk its appeal being struck out.

Norwegian businessman Alexander Vik’s Sebastian Holdings will have its appeal against the decision, which awarded the German bank damages for forcing Deutsche to make large margin calls to cover Lehman Brothers in 2008, stayed for the next 28 days and has been warned that case will be struck out if payment is not made in that time frame.

The decision is a further blow to Sebastian Holdings, which is being advised by Travers Smith partner Andrew King, after failing with an $8bn counter-claim against the German bank last year.

Freshfields Bruckhaus Deringer litigation duo Andrew Hart and Tom Snelling, who instructed David Foxton QC of Essex Court Chambers and Sonia Tolaney QC of 3VB as counsel, succeeded in enforcing payment of the $243m together with accrued interested, along with an order that Sebastian Holdings pay £34.5m in costs and £1.9m as security for DB’s costs of the investment bank’s proposed appeal. Travers Smith instructed David Railton QC of Fountain Court Chambers.

The decision was handed down by Lord Justice Longmore and Lord Justice Tomlinson, both of whom agreed with Deutsche’s concern over how Sebastian Holdings had sought to dissipate its assets in order to avoid paying a judgment it knew the German Bank would have to seek.

Lord Justice Tomlinson said in the judgment: ‘Standing back from the arguments, it is in my judgment difficult to think of a case which could present more compelling reason for making the order sought.’

‘Accordingly I would order SHI to pay into court the judgment sum, together with interest accrued to the date of this judgment, as a condition of further pursuit of the application for permission to appeal and, if permission is granted, the appeal.  I would further direct that SHI’s Appellant’s Notice and its application for permission to appeal be struck out if payment is not made within 28 days.’

Should it succeed in its appeal, SHI intends to pursue its counterclaim in an amount of up to about US$600m. It does not pursue the entirety of the counterclaim which was advanced, without success, at trial in the sum of about $8bn.

Snelling said: ‘By forcing SHI to pay over $250 million into court to continue its appeal, today’s judgment rightly reinforces to parties litigating in the UK that orders of its Courts are to be respected. The Court of Appeal has said that it is unacceptable for SHI to try and pursue an appeal whilst at the same time continuing to disobey the orders of the court to pay the judgment debt and costs. The Court of Appeal considered it difficult to think of a case which could present a more compelling reason for making today’s decision.’

For more on key banking litigation landscape, see Hunting titans – the disputes outlook as watchdogs and claimants target banking giants