Cambridge Analytica's administrators misled judge, High Court told
Eyebrow-raising claim will be heard in full early next year
Lawyers for a man who sued the Cambridge Analytica group for £20,000 claiming misuse of his personal data have suggested the controversial data-mining biz misled a High Court judge when the companies were put into administration.
In a hearing at the High Court today, barrister Andreas Gledhill told Insolvency Judge Barnett: "On an application for an administration order, the applicant bears an obligation for frank disclosure. That extends… to telling the court about [legal] proceedings threatened against the companies. We say that for reasons that are not easy to understand, disclosure of none of that was made to Mr Justice Hildyard."
In a cramped hearing room at the Rolls Building in London's Fetter Lane, home of the Business and Property Courts, Judge Barnett ordered that a full hearing of the claims will take place in early 2019.
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Gledhill was representing Professor David Carroll, a US citizen who previously made a Subject Access Request (SAR) under the Data Protection Act 1998 for copies of whatever info Cambridge Analytica (CA) held on him. When the firm's answer didn't satisfy him, Carroll filed a lawsuit against it. His claim was said in a witness statement shown to the court to be worth "between £5,000 to £20,000".
Arguing against this on behalf of CA's administrators, barrister Mark Watson-Gandy told the court in a written submission: "Professor Carroll gives no good reason for not following the usual rule as regards appointment... a firm of administrators would have necessarily needed to be selected by them (or their lawyers) who would have had to certify that they believed one of the statutory purposes could be met before any application was made. This cannot amount to a sensible reason to challenge let alone suspect a lack of independence."
At today's hearing, Carroll wanted a court order granting him access to legal documents used when CA was put into administration. Judge Barnett ordered the documents to be handed over by CA's administrators in mid-January.
Responding, Watson-Gandy told the court that Carroll "was not a qualifying floating chargeholder, he had not served a winding-up petition, he was not any of those who are the traditional respondents to an application [for administration]."
Gledhill said in court that Mr Justice Hildyard, the judge who had earlier granted CA's legal motion to be put into administration, "wasn't told" that CA's administrators (Vincent Green and Mark Newman of liquidator Crowe LLP) were, allegedly, not "independent" of CA. In a Companies House filing dated 13 July 2018 made on behalf of one of the CA group of companies, SCL Social Ltd, Crowe said that before CA's directors formally decided to kill the company off, Green had helped them prepare "outcome statements". Those statements were to help the directors decide whether to liquidate the firm or put it into administration.
In the Companies House filing, Crowe added that Green "was still required to act in his dealings with the company in accordance with the Insolvency Code of Ethics" despite not having been appointed by the High Court as an administrator at the time.
"Most concerning," said a witness statement shown to the court by Carroll's solicitor Ravi Naik of ITN Solicitors, "was that the [CA] Companies' parent, Emerdata, has funded the pre-administration and administration costs".
Naik's statement said Emerdata paid nearly £62k to secure the High Court administration orders "with the intention they should be reimbursed if funds become available", and that Emerdata paid Crowe UK LLP £221,792.50 "to partially discharge" the full administration fees of £350k plus VAT.
Barrister Matthew Abraham represented the Information Commissioner's Office at the hearing. The ICO is prosecuting CA over its alleged failure to respond in full to Carroll's Subject Access Request. That case will be heard at Westminster Magistrates' Court in early January. A related appeal filed at the First-Tier Tribunal by CA company SCL Elections Ltd against a similar ICO order has been discontinued. ®