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On 28 March 2025, Mr Justice Jacobs handed down judgment in this substantial Commercial Court claim, dismissing the Claimants’ claim arising out of substantial losses they had made on investments which proved disastrous when the Covid-19 pandemic hit in 2020 and financial markets suffered severe falls.

The Claimants (Italian businessman Matteo di Montezemolo, his father Luca di Montezemolo, and a company through which the di Montezemolo family made investments) contended that these loss-making investments were made on the advice of XY ERS UK Ltd (“XY”), which is part of a corporate group founded and owned by its Chief Executive Officer, Mr Daniele Migani.

The Claimants alleged that they were the victims of a substantial fraud perpetrated by XY, Mr Migani and a colleague of his, Mr Federico Faleschini. They alleged that the fraud was carried out with the assistance and complicity of other Defendants, including:

  1. The Second and Third Defendants, which were the corporate vehicles for a Luxembourg alternative investment fund
    known as the ‘Skew Base Fund’ into which some of the investments complained of had been made. The Second Defendant
    was the ‘general partner’ of the Third Defendant (i.e., the Fund itself). The general partner was indirectly beneficially
    owned by Mr Migani.
  2. The Fourth and Fifth Defendants, which were part of a banking and financial services group of companies with its head
    office in Liechtenstein, and the alternative investment fund manager and portfolio manager of the Skew Base Fund
    respectively. The Fourth and Fifth Defendants were independent of Mr Migani.

The Claimants’ case was that (among other things) they retained XY to provide them with financial advice on their investment portfolio. They claimed that XY presented itself as an independent, unbiased and conflict-free advisor, and was engaged on that basis. Thereafter, over a substantial period of time, XY recommended that the Claimants invest in various financial products, including through the Skew Base Fund, when the general partner of the Fund was indirectly beneficially owned by Mr Migani and other companies beneficially owned by him were paid to provide services directly or indirectly to the general partner.

The Claimants brought claims in unlawful means conspiracy against all of the Defendants. They also brought claims (i) for breach of fiduciary duty against XY; (ii) against Mr Migani for dishonestly assisting the breach of fiduciary duty; and (iii) against XY for breach of various contractual tortious and regulatory duties.

The claims were heard at trial taking place in October to December last year, over a period of 28 court days.

Mr Justice Jacobs held that XY was engaged to provide investment advice and owed fiduciary duties to the Claimants; that XY had represented (including through Mr Migani) that it was independent and provided consulting services which were unbiased and free from conflict of interest; and that those representations were capable of being, and were, continuing representations. However, his Lordship found that Mr Migani had disclosed his interest in the Skew Base Fund to the Claimants. He therefore dismissed the fraud claim, the claim for breach of fiduciary duty/dishonest assistance, and the claim in conspiracy against all of the Defendants. His Lordship held that the claim in conspiracy against the Second and Third Defendants would also have been dismissed in any event on the basis that Mr Migani’s knowledge could not be attributed to them, having found that the decisions of the general partner were taken initially by an independent director and then a Board with a majority of independent directors.

A copy of the judgment can be found here.

Robert Weekes KC and Warren Fitt acted for the Second and Third Defendants.

Gayatri Sarathy acted for the Claimants (with Daniel Saoul KC, Ben Smiley and Dr Benjamin Archer of 4 New Square Chambers).

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