Crowdfunding Nation

Sunday National, 30th January 2022.

“I’m launching a crowdfunder and we’re going to court.” Even a few years ago, you’d hardly ever hear this phrase. Now the idea of funding legal actions through popular contributions – getting your trial by social media – has gained considerable traction. But until now, nobody has tried to put a number on it.

So I’ve been doing some research, published in the Edinburgh Law Review this week. I wanted to know three main things. How much is crowdfunded litigation worth in Scotland? Just how many folk are involved? And what kind of cases attract funding from the crowd?

Here are some of the headlines: between January 2015 and August last year, sixty-three crowdfunding campaigns were launched in Scotland. Some attracted paltry support – but the big campaigns pulled in hundreds of thousands of pounds. In total, this legal crowdfunding raised over £2.3 million during the last five years, with contributions coming in from around 80,000 people.

This is a significant change. Strategic litigation isn’t new – but historically, Scotland hasn’t seen a lot of it. Until 2011, strict rules on standing meant Scots courts were reluctant to hear public interest cases. But now, this kind of litigation is fairly common. And you can understand why.

The Scotland Act gives campaigners new legal tools to work with. There have been some obvious successes. Boris Johnson’s attempt to prorogue parliament was stymied by the UK Supreme Court after crowdfunding launched the case in Edinburgh. In the last year, Lord Braid decided that the coronavirus restrictions on worship were unlawful, after an action was got up by a congregation of congregations, arguing the public health restrictions infringed their right to freedom of worship.

The evidence suggests Scotland may have been something of an early adopter when it comes to sourcing legal fees from the crowd. Four of Alistair Carmichael’s constituents blazed a trail in 2015, using a rarely invoked provision of the Representation of the People Act law to contest his election. To the surprise of many lawyers, the case had legs. While the Northern Isles MP ultimately retained his seat, the Orkney four kicked off the crowdfunding trend, and, the case still holds the record for contributor numbers, winning the backing of just under 10,500 people. 

The study also attempted to work out the main character of the legal actions being crowdfunded. What are these cases about? Of the sixty-three crowdfunders identified, twenty-nine (46%) involved some kind of judicial review proceedings, eight (13%) were for defence funds for criminal, six concerned defamation cases (9.5%), with the balance being made up of a diverse array of legal issues.

They including families wanting to be able to participate in fatal accident inquiries after the death of a loved one, individuals facing immigration cases, eviction from their homes, or legal actions for debts, and otherwise being unable to defend themselves. All of human life is here.

But the big-value cases are the ones you’ll have heard of, involving politicians, political writers, or political controversies. Brexit. Covid restrictions. Independence. Disputes about sex and gender. In Scotland at least, high value crowdfunding looks like the continuous of politics by other means.  

Legal crowdfunding is sometimes presented as a way of empowering the powerless, allowing people who would otherwise struggle to pay their way to a legal remedy to afford a day in court. And it certainly can operate in that way. Without strong support from social media, for example, it is inconceivable that the recent “people’s action on section 30” would have got up off the ground, never mind into the Court of Session.

When Wildcat Haven slapped a writ on former Green MSP and land activist Andy Wightman, without the cash he raised to hire a crack legal team, he might have found himself turning Perry Mason and hoping for the best, or throwing in the towel because the costs – and risks – of defending and losing the case were so high. 

But the Wightman case is an interesting example of how successful crowdfunding tipped the balance of power back in his favour. Having launched their defamation case against him, making extravagant demands for damages to the tune of £750,000, when the case came to trial, the company were telling a different story, pleading penury, and was forced to rely on the lay advocacy of one of their directors against the Dean of the Faculty of Advocates. They lost, and were left with cost liabilities the court accountants are still working through. They’re almost certainly to the tune of hundreds of thousands of pounds.

This was an entirely self-inflicted injury. If the company hadn’t taken a notion for predatory litigation, none of this would have happened. But it is a salutary tale of what happens to a case when the money dries up and the professional help deserts you. The fact Andy was able to attract this support also illustrates the importance of social capital here too. What are the chances a less prominent figure would attract this kind of backing? Slim, I should have thought.

More fundamentally, these sums also raise questions about the cost of civil justice in this country. While crowdfunding is one way of accumulating the funding needed, the sums involved also illustrate how inaccessible legal remedies remain for many people.

At the conclusion of Martin Keatings’ civil case arguing that a hypothetical independence referendum Bill was hypothetically within Holyrood’s powers, the Lord President himself said the going rate of £130,000 for the case – in which “no substantial dispute of fact” arose – gave “considerable cause for concern in relation to access to justice.”

Given the rise in litigation crowdfunding – we need to be alive to the virtues and potential vices of this new way of extending access to justice. Transparency is sometimes a real problem. What happens to the money if the legal case never happens, or settles before trial? Most crowdfunding pitches don’t say. What happens if you win your case and get awarded your costs? Vanishingly few appeals for cash specify where excess funds end up. The opportunities for abuse here should be obvious.

And what is the case about and what are its chances of success? Campaigners asking people to contribute to a cause will understandably want to accentuate the positive and talk up their chances of winning the day in court.  

Take the example of Marcus Ball. He raised over £456,000 to mount a private prosecution against Boris Johnson. The charge? Misconduct in public office. The nature of the wrongdoing? Lying, naturally. Which lies? The Brexit ones this time: NHS funding commitments on battle buses. The case crashed into oblivion in the High Court, dismissed as being without legal foundation – an outcome any reasonably sober lawyer knew was bound to happen.

To me, this seems like a remarkable amount of money to squander on a doomed legal action. Did contributors really understand the hopelessness of the legal position they were pouring their cash into? How candid should folk launching case like this be with the public? And what are the professional responsibilities of the lawyers in this context, if they stand to benefit from the litigation, but know the funding pitch is shaky or overly-optimistic?

And then there’s the question of who the beneficiaries are. When Alex Salmond launched his crowdfunder, it was clear who was asking for contributions and why. But there are some remarkable examples of people turning over bags and bags of cash to complete strangers on the promise the sums will find their ways to a named beneficiary.

In July last year, BBC Panorama journalist John Ware indicating he intended to sue Jeremy Corbyn. The case came on the back of Labour’s anti-Semitism saga, which was the subject of a documentary by Ware in 2019. In response to press reports that litigation was in contemplation, an individual with no obvious or official connection to Corbyn set up a GoFundMe page, which blasted through its £20,000 target, taking in £374,000 for “Jeremy’s Legal Fund.”  Ware never did take up that case. It still isn’t entirely clear what the ultimate fate of this fighting fund will be. That’s a lot of money to be resting in someone’s bank account. But it is also a lot of money to give to a randomer based on very limited information.

Outside the legal domain, we’ve seen shameless examples of crowdfunding scams in recent years. A high-profile tragedy is reported in the media, prompting strong feeling on social media. Your enterprising scammer sees an opportunity, and sets up a crowdfund purportedly for the benefit of a bereaved family. Well-meaning people dig deep – and the scammer makes off with all the money sympathy earns. The grieving family doesn’t see a penny.

I’m not suggesting anyone involved in the campaigns I’ve mentioned has done anything wrong – but it’s remarkable how much money the public are prepared to turn over to complete strangers, trusting their good faith, because the campaign they’re championing seems to align with their values.  We can hope most crowdfunders handle their contributions responsibly – but if human nature teaches us anything, it should be that unscrupulous people can and will exploit the trust of others, given an opportunity.  We have consumer protection laws for a reason.

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