Innsworth bankrolls £1bn opt-out action against Rightmove

Litigation funder Innsworth is bankrolling a £1 billion opt-out class action claim against Rightmove, in the latest test of the UK’s collective actions and litigation funding regime in a post-PACCAR world.

The case, brought by US class actions specialist Scott + Scott and led by former CMA panel member Jeremy Newman, will be filed at the Competition Appeal Tribunal (CAT) and seeks to recover alleged overpayments on excessively high Rightmove subscription fees over the past six years.

The allegation

Newman said: "Rightmove knows that, due to its first-mover status, its product is considered a 'must-have' for estate agents."

"It exploits its dominance of the online property portal market in the UK to charge excessively and unfairly high subscription fees, both at face value and when compared with its competitors. Estate agents have had to absorb consistent, excessive price increases on a regular basis."

Levelling the playing field

Ian Garrard, managing director of Innsworth Advisors said: "Jeremy’s claim is about levelling the playing field for businesses up and down the country, deterring anti-competitive behaviour and correcting the imbalance between big and small in the property sector."

He added: "Without the opt-out collective actions regime, it would be much harder - or even impossible - for SMEs to seek redress for anti-competitive behaviour."

A funding model under scrutiny

In the wake of the Supreme Court’s landmark decision on percentage-based return structures, there has been a chilling effect on litigation funding, creating a more selective and risk-sensitive environment for collective claims. Twenty firms wrote to the justice secretary in October urging the government to overturn the PACCAR ruling amid a slowdown in class actions.

Innsworth’s involvement is significant because collective proceedings have been shaped heavily by the post-PACCAR uncertainty around litigation funding mechanics.

Garrard noted that the claim comes "at a time of considerable uncertainty for the opt out regime" and stressed that businesses within the class "will not have to pay a penny towards the claim."

Innsworth making waves

Innsworth, owned by US hedge fund Elliott, has been increasingly active in high-profile UK collective actions, including the Merricks v Mastercard claim and a £2.7 billion case against Amazon representing UK-domiciled third-party sellers arguing abuses of dominance in Amazon’s marketplace.

The funder has since challenged the distribution mechanics of the £200 million Mastercard settlement - significantly lower than the billions originally sought - arguing the CAT’s decision to cut the funder’s return without a clear framework risked undermining confidence in future investments of large-scale claims.

This Rightmove claim will be closely watched as another test of what types of claims funders still consider viable. It comes just weeks after a Hausfeld-led opt-out action against Apple - backed by funder Vannin - succeeded in the CAT, leaving the tech giant facing up to £1.5 billion in potential damages to UK consumers over App Store fees.