International law firm Bird & Bird has secured an important victory today for XY UK and its owner Mr D Migani, in GI GLOBINVESTMENT, MDM and LDM vs XY UK.
The XY Group, a financial technology and consultancy business, provided services to the Montezemolo family between 2016 and 2020. Matteo Cordero di Montezemolo and Luca Cordero di Montezemolo are prominent Italian businessmen and ultra-high net worth professional investors. Luca Cordero di Montezemolo is famous for having held senior roles in one of the EU’s largest banks (Unicredit) and led many other high-profile companies, including standing as Chairman of Ferrari between 1991-2014.
They made allegations of deceit, dishonesty and serious wrongdoing against Mr Migani, including that he provided ‘seriously flawed’ financial advice which resulted in the loss of approximately €50 million.
Mr Justice Jacobs found that the Montezemolo’s claims were baseless: “When one stands back from the detail of the case based on the allegations of fraudulent investment representations, there are a number of features which in my view make the case an improbable one.”
Mr Justice Jacobs recognised that the cause of Montezemolo family’s losses was instead the exceptional and unprecedented market turbulence caused by the onset of the COVID-19 pandemic as well as other geopolitical and economic factors, such as spikes in oil prices, which occurred simultaneously in early 2020 and had a major impact on the financial markets.
Mr Justice Jacobs said: “Prior to the market turmoil caused by the Covid pandemic in early 2020, investors were making substantial returns from their investments in these Compartments… If the Covid pandemic had not hit, with its significant impact on financial markets, the Claimants would no doubt have continued to enjoy the strong returns that their investments in these Compartments were capable of achieving… I also consider that that the Claimants did indeed understand the essential risks that were involved in these investments.”
Speaking today, Mr Migani said: “I welcome the High Court in London’s decision to unequivocally dismiss all allegations of fraud and negligence, as well as the 50 million euro damages claim. This ruling confirms the legitimacy of my actions as well as those of XY and its affiliated companies.”
“The Court has clearly stated that the losses suffered by some investors were solely the result of the pandemic-driven market collapse, with no liability attributed to me, my team, or my companies.”
“The judge confirmed that the claimants were fully aware of the investment structure and its potential risks, acknowledged my role as owner of the Skew Base fund’s General Partner, concluded that XY’s proposed strategies—oriented toward ‘safeguard’—were in line with the claimants’ objectives, and found that no retrocessions had ever been paid.”
“This confirms the professionalism, legitimacy, and transparency with which I, XY, and our affiliated companies operate.”
Adam Cloherty KC of XXIV Old Buildings commented: “I am delighted after almost 4 years and a 7 week trial, to have secured the dismissal of all claims against XY, Dr Migani and our other clients.”
Bird & Bird Dispute Resolution Partner Sophie Eyre who led the team said: “I am exceptionally pleased that after a lengthy and detailed trial with 18 witnesses giving oral evidence, the English Court has dismissed all these claims of fraud and negligence in their entirety against Dr Migani and all other defendants and allowed the counterclaim for unpaid fees.”
