LONDON May 5 The former CEO of a software
company suing RBS for allegedly conspiring to push the business
into administration faced the dismissal of his case on Friday,
after a judge ruled it was unlikely to succeed based on an
interim hearing in March.
Scottish businessman Neil Mitchell was seeking as much as
128 million pounds ($184 million) in damages on claims that
Royal Bank of Scotland (RBS) conspired in 2007 with
co-defendants KPMG and U.S.-based fund Cerberus Capital
Management to sell assets of his company, Torex Retail
plc, for below their value.
A judge said the case should not proceed on the grounds that
Mitchell's claims did not have a real prospect of being proven,
according to a court ruling seen by Reuters on Friday.
High court Judge Malcolm Davis-White said in his ruling that
some of the claims were "confused, imprecise and unclear to such
an extent that I consider it vexatious" and said he had "serious
doubts as to the truth" of some of his testimony.
The ruling followed an interim hearing in March that sought
to establish whether the case was likely to succeed at trial and
should be allowed to continue.
Mitchell told Reuters he planned to appeal the judge's
decision and that he was determined to go to trial.
"This interim hearing was unfairly conducted as a mini-trial
without the benefits of disclosure, my eight witnesses,
whistleblowers or me giving testimony," Mitchell said.
Mitchell is one of the most prominent and vocal critics of
the bank, and formerly led a large group of customers alleging
they were mistreated by RBS's business restructuring division
during and after the 2008 financial crisis.
RBS welcomed the ruling.
"We have consistently maintained, over a number of years,
that Mr Mitchell's claims are without merit," the bank said in a
statement. "We are pleased that the court has reached that same
view and has rejected the claims in their entirety."
Mitchell alleges RBS pushed Torex Retail into administration
- a form of protection from creditors under which external
managers from KPMG were brought in - in order to force its sale
to Cerberus and so rid its books of a bad loan it was owed by
Torex, documents filed at Britain's High Court of Justice show.
Mitchell said that he had sold assets including a house,
cars and investments trusts for his children to fund the 10-year
pursuit of his claim against the bank.
The state-backed bank has admitted some wrongdoing over its
handling of small businesses, but has said there was no evidence
it pushed companies into bankruptcy.
The lender has set aside 400 million pounds ($518 million)
in a compensation scheme to reimburse some customers who were
($1 = 0.7720 pounds)
(Reporting by Lawrence White and Andrew MacAskill; editing by