The Solicitors Regulation Authority (SRA) has found a ‘concerning’ level of ignorance among solicitors around their obligation to report potentially abusive litigation.

The finding is the result of a review on conduct in disputes produced by the regulator that calls on law firms to do more to combat SLAPPs – strategic lawsuits against public participation – which it describes as a form of abusive litigation intended to prevent publication on matters of public importance, such as investigative journalism. 

The regulator, whose authority extends to England and Wales, issued a warning on SLAPPs last November against a background of growing public scrutiny of Russian oligarchs and businesses allegedly using litigation brought in UK courts as a means of silencing their critics. 

It noted that before Russia’s invasion of Ukraine it had received ‘very few’ reports about SLAPPs but had seen a ‘significant increase’ since and currently has approximately 40 open investigations into concerns around them. 

For the review the regulator visited 25 law firms on both the claimant and defendant side last autumn before issuing the warning, saying that given the concern around SLAPPs it only looked at those that provide legal advice on reputation management. 

It found that at 11 of the firms, the head of department with overall responsibility for reputation management matters was not aware of the SRA’s guidance on reporting and notification obligations relating to potential misconduct in disputes. The regulator also spoke with a fee earner at all but one of the firms and found that only six were aware of the guidance. 

The SRA didn’t find evidence of SLAPPs in the 50 files it reviewed but in three cases a law firm had not reported conduct by another firm that potentially amounted to abusive litigation, which it said it would investigate further. 

Some firms misunderstood when it would be appropriate to make a report, while serveral heads of department noted an increasing trend of firms threatening to make a report to the SRA for alleged breaches of its Codes of Conduct where there was no basis to do so. 

‘Where the threat to make a report to us was intended to inappropriately influence the course of a matter, we regard this as an abusive litigation tactic and will take such circumstances seriously,’ the SRA said.

The review also found that while many fee earners demonstrated a good general understanding of SLAPPs, there was a ‘concerning’ variation in knowledge and training - for example, some fee earners thought that a SLAPP could only be bought against an individual.

Eight fee earners said they had not received any training on how to conduct fair and appropriate litigation, with the SRA responding that it expects firms to ‘do more and make sure fee earners are aware of their regulatory obligations when conducting litigation’. 

The regulator acknowledged that while law firms are not obliged to have policies and procedures in place on how to deal with litigation or reputation management matters, it views such policies as ‘an important tool’ to make sure staff understand the specific risks in this area. 

In a follow up review the SRA said it would take a steps including asessing whether firms have provided training on SLAPPs and conduct in disputes; the steps taken by firms to prevent the possible illegitimate funding of SLAPP cases; and the relationships between law firms, 'reputation managers', PR companies and private investigators. 

Analysis

CM Murray partner Andrew Pavlovic, who specialises in SRA professional discipline and regulatory investigations, notes: 

“Although the headline to the SRA’s review states that firms ‘need to do more on SLAPPS’, the SRA found no evidence of SLAPPS in the files it reviewed and concludes that its review found ‘good practice’. The concerns identified related to a lack of policies, procedures or training in place to help firms identify SLAPPS or other forms of abusive litigation, and a lack of understanding about reporting obligations, and specifically the obligation to report opponent’s solicitors to the SRA where they consider their opponent is conducting a SLAPP or acting in an abusive manner.

 “Despite the commonly expressed assertion that solicitors are acting as “hired guns”, without any regard for their regulatory obligations or duties to the Court, eleven heads of department and six fee earners reported to the SRA occasions where they had told a prospective claimant they could not pursue litigation because it was abusive or unfair.

 “In light of these findings, it will be interesting to see how many of the 40 cases of alleged SLAPPS that the SRA is currently investigating actually result in disciplinary action. The SRA is under increasing pressure from parliament to take actions in respect of SLAPPS, but the results of this review suggest that, in general, firms are aware of their regulatory obligations, and that cases where firms are involved in SLAPPS are likely to be the exception rather than the rule."

Further reading: 

Slapps: beyond the slogans

Reforms aimed to curb strategic lawsuits against public participation could easily create more problems than they resolve, argues Jon Oakley