Legal fees in British Airways data breach case hit £1,000 to £3,400 per person

People who signed up for the British Airways data breach lawsuit via PGMBM, the biggest of the law firms taking part, received their settlement notices yesterday.

We are not allowed to disclose the amount but it was peanuts compared to the huge sums that had been suggested. Here is a press story from January 2021 where one of the law firms involved is suggesting that claimants would receive ‘an average’ of £6,000, implying many would get more. Some chance.

What is not confidential is the bill run up by the lawyers. The size of this bill gives an indication of the scale of the damages it was assumed British Airways would pay, and implies that someone did seriously believe the £6,000 figure.

The level of legal fees charged varies, oddly. I have seen a Category 1 letter, where there was evidence of fraud based on the leak, allocated over £3,400 of legal costs. Another person in Category 1 was allocated just £1,000.

For a Category 2A claim, where there was no proof that the accessed data was used, the legal fees seem to be around £1,100. On top of this, there were expenses of over £150.

Actual expenses were far higher. As we reported back in February, the lawyers lost a court case where they attempted to include the costs of their TV and social media advertising campaigns in their reclaimable expenses.

PGMBM claimed that it had spent £443,000 on advertising so far and intended to spend another £557,000 before the case was heard. At the High Court, Mr Justice Saini decided that this was general marketing expenditure and was not reclaimable from the client. You can read more in the Law Society Gazette here.

Luckily for claimants, their exposure to legal fees and expenses is capped at 35% of the compensation received.

Without going into numbers, 35% of the settlement amount – at least for those in Category 2 who could not prove that their data was stolen – isn’t going to make much of a dent in the £1,000 to £3,400 of legal fees once the third party expenses and the £1m advertising budget is paid. Those who signed up early were promised 100% of their settlement, meaning even less for the lawyers.

PGMBM did say that British Airways has made a ‘contribution’ to these costs so there may be some profit for the lawyers at the end of the day. It certainly isn’t a bonanza though.

British Airways may have played this right. It made a settlement offer which was a fraction of the numbers that had been banded around when the lawsuits were launched. There was a real risk that, if the case had gone to trial, the judge would have decided that BA’s offer was reasonable, that the lawyers should have accepted and that the case should be thrown out.

At the very least, the case would probably have proceeded with a final settlement being made at the offer BA suggested, and with the lawyers being saddled with additional legal fees.

At the end of the day, the case has not been a great result for anyone involved.

Looking at online comment elsewhere, you had people originally claiming they were taking part in the action “purely as a point of principle” before turning angry when it turned out that the proceeds were going to get them a weekend in a Holiday Inn rather than a week-long five star holiday. Meanwhile, BA is hit by a cash outlay at the same time as it has to decide whether to make more redundancies, or otherwise start paying staff not to work, as the end of furlough approaches next month.

In the meantime, keep an eye on your social media feeds for ads asking you to join the easyJet data breach case. A quick Google search for “easyjet data breach claim” brings up various firms claiming you can get £2,000 by signing up. I wouldn’t bet on it.

---

How to earn Avios from UK credit cards (April 2024)

As a reminder, there are various ways of earning Avios points from UK credit cards.  Many cards also have generous sign-up bonuses!

In February 2022, Barclaycard launched two exciting new Barclaycard Avios Mastercard cards with a bonus of up to 25,000 Avios. You can apply here.

You qualify for the bonus on these cards even if you have a British Airways American Express card:

There are two official British Airways American Express cards with attractive sign-up bonuses:

You can also get generous sign-up bonuses by applying for American Express cards which earn Membership Rewards points. These points convert at 1:1 into Avios.

Run your own business?

We recommend Capital on Tap for limited companies. You earn 1 Avios per £1 which is impressive for a Visa card, along with a sign-up bonus worth 10,500 Avios.

SPECIAL OFFER: Until 12th May 2024, the Capital on Tap Business Rewards Visa card is offering a bonus of 30,000 points, convertible into 30,000 Avios. You must have a Limited Company to apply. Click here to learn more and click here to apply.

You should also consider the British Airways Accelerating Business credit card. This is open to sole traders as well as limited companies and has a 30,000 Avios sign-up bonus.

There are also generous bonuses on the two American Express Business cards, with the points converting at 1:1 into Avios. These cards are open to sole traders as well as limited companies.

Click here to read our detailed summary of all UK credit cards which earn Avios. This includes both personal and small business cards.