Court proceedings have today been issued on behalf of investors in the collapsed Woodford Equity Income fund.
Link Fund Solutions, which suspended the fund in June 2019, has been taken to court by law firm Leigh Day to claim losses suffered by investors in the fund.
Leigh Day issued a claim form on behalf of an initial group of 100 investors in Neil Woodford’s flagship fund out of the estimated 270,000 investors that were locked into the fund when it Link blocked withdrawals.
The law firm, which aims to bring all the claims together under a group litigation order, claims that Link was in breach of rules set the Financial Conduct Authority in the way it managed the fund and that this ultimately led to its collapse.
Boz Michalowska, a partner at Leigh Day, said: “This is a big step forward in the legal action which we hope will allow investors of the Woodford Equity Income fund to get justice and their hard-earned pensions and savings returned to them.
“The legal action brought on behalf of investors by Leigh Day is against Link as the fund’s authorised corporate director, which oversaw the [Woodford Equity Income Fund] on behalf of those individuals who invested in the fund.”
“The claims made by Leigh Day on behalf of investors are that Link was in breach of FCA rules in the way it managed and monitored the fund and this ultimately led to the fund’s collapse, causing ordinary investors loss and damage.”
An official inquiry by the FCA is being carried out into the collapse of the fund but the regulator said it will not report the results until next year at the soonest.
Leigh Day also looked at whether other companies such as investment platform Hargreaves Lansdown could be dragged into a wider compensation case.