Andrew Crossley, the sole proprietor of ACS:Law Solicitors (ACS:Law), could be ordered to pay court costs running into thousands, after a judge ruled that a ‘wasted costs’ action could proceed against him.
The ‘wasted cost’ order was sought by Guy Tritton, a barrister instructed by Ralli Solicitors (Ralli) to act on behalf of five people alleged by ACS:Law to have illegally downloaded and shared pornography over the internet.
ACS:Law was acting on behalf of its client MEDIA C.A.T. Ralli said the bill for mounting its defence of the five was roughly £90,000.
What are wasted costs?
Though rare, wasted cost orders are granted in instances where a legal professional is thought to have acted improperly, unreasonably or negligently and their conduct has caused a party to incur unnecessary costs.
The ‘wasted cost’ ruling against Andrew Crossley was given by Judge Birss, QC, in the Patents County Court yesterday. One of the reasons it was awarded was that the revenue sharing arrangements – or the Basic Agreements – between ACS:Law and MEDIA C.A.T were deemed by the judge to be ‘improper’.
Since 2009, ACS:Law, on behalf of a number of its clients, has been sending out thousands of letters to people, accusing them of illegally file sharing copyright protected material and threatening them legal action unless they paid compensation of approximately £500.
In this instance, ACS:Law agreed to receive 65% of the revenues generated by these letters against MEDIA C.A.T’s 35%.
Take a look at our Which? guide for more information on file sharing
Handing down the judgement, Judge Birss, said: ‘I am quite satisfied to the standard necessary for this stage of a wasted costs application that Mr Crossley is responsible for the Basic Agreements and has thereby acted in breach of the rule 2.04 of the Solicitors’ Code of Conduct.
‘I should record that even if, which would surprise me greatly, the revenue sharing arrangements Mr Crossley put in place do not violate the letter of the rules.’
He added: ‘As regards causation, since the Basic Agreements underlie the whole case, the totality of the defendants’ costs of these proceedings have been caused by them and have been wasted as a result.
‘Without the revenue sharing arrangements embodied in the Basic Agreements the defendants would never have been written to or sued. These claims would not have happened and none of their costs would have been incurred.
‘By entering into these arrangements Mr Crossley caused the defendants to incur unnecessary costs, the costs of defending themselves.’
Deborah Prince, head of Which’s in-house legal team, said: ‘We are pleased to see that the courts have taken such a robust view and decided to go so far as to consider Andrew Crossley personally by making him pay the legal costs consumers who were claiming their innocence of the file sharing allegations.
‘Given that it is a legal firm that is claiming fees against him, it is highly likely that they will make sure that they will get their payment if a wasted costs order is made in due course.
Less than three hours after the judgement was announced, Andrew Crossley sought permission to appeal against it. Judge Birss refused the request. A date will now be set in June for the matter to come back before the courts.
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