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8 October 2014
Multi-millionaire mathematician faces an 'astronomical' £19m legal bill
A multi-millionaire mathematician turned hedge fund boss faces an “astronomical” £19 million pound legal bill after losing the latest round of a bitter and costly court battle with his estranged wife.
In what is thought to be among the most expensive legal bills ever sustained as part of a British divorce case, Dr Martin Coward has lost his Appeal Court battle against the costs he was ordered to pay following the loss in May last year of the struggle for control of the hedge fund Ikos he founded in 1992 with his ex-wife Elena Ambrosiadou.
In May last year, a judge in the High Court ruled that the software Dr Coward developed while at Ikos was owned by the business which his estranged wife now runs.
Today at the Court of Appeal, Mr. Justice David Richards sitting with Lord Justice Moore-Bick and Lord Justice Ryder, upheld the High Court's decision and said the costs £6m incurred by Dr Coward and £13 million by Ikos “dwarf the great majority of civil claims, including most claims in the High Court".
Marilyn Stowe, senior partner at Stowe Family Law, the largest specialist family law film in the UK, described it as a “mind boggling, absolutely eye watering amount”.
She said: “Judges will be absolutely mortified and horrified that costs can reach that level.
“This isn’t a run of the mill, bog standard case. This is litigation at the highest level. This is a very bitterly fought case for years.”
Ms Stowe, who has been practising as a solicitor for over three decades, added: “I have never heard of a case involving such phenomenal amounts. It is astronomical."
She explained why the costs were so high compared to ordinary divorce cases: “Commercial litigation is considerably more expensive than family litigation. It is on a different scale.
“Once you have invoked a civil jurisdiction and you are involving enormous commercial assets and instructing very big commercial lawyers to litigate. With all the attendant costs you can expect an enormous bill.”
Frances Hughes, a leading family lawyer and partner at Hughes Fowler Carruthers, said: "This is a satellite litigation, it is a corporate issue arising out of the broader divorce settlement. The costs are very high but there is a lot to play for.
"The costs of commercial litigation is considerably higher than divorce litigation, and adds exponentially to the costs of the divorce."
Miss Ambrosiadou, one of the world’s most successful hedge fund managers, was awarded rights to the Ikos hedge fund she set up with former husband Dr Coward last May.
In the bitter court proceedings Dr Coward claimed the software was his and he was entitled to half the fortune generated by the company.
But his ex-wife won her claim that as he wrote the software while working for the family business it remained the company's property under the terms of an agreement signed when he left.
Judges at the High Court ruled in Miss Ambrosiadou's favour that Ikos, where she is chief executive, owns the rights to software created by him.
Ikos, which at its peak was managing funds of more than £2.1 billion, was created by the couple more than two decades ago and reportedly led to them amassing a wealth of £200 million.
Mr. Justice David Richards acknowledged that the three week case raised complex, technical and factual and legal issues but even so, said that "the costs seem very large”.
The judges found that Dr Coward was liable for those costs, but with the costs of Ikos more than double those of Dr Coward's, they said the onus was on the hedge fund "to establish that its costs were both reasonable and proportionate”.