In a landmark ruling on 25 February, the High Court has dismissed implied misrepresentation claims against Nat West Markets and a syndicate of banks in relation to the alleged manipulation of the Euro Interbank Offered Rate (EURIBOR) benchmark. This judgment in the case of Marme Inversiones v Natwest Markets plc & Others [2019] EWHC 366 (Comm), comes hard on the heels of last year's Court of Appeal rejection of similar, LIBOR-related, implied misrepresentation claims made against RBS by Property Alliance Group, and the conviction in absentia of French national Philippe Moryoussef, who was sentenced to eight years for his part in manipulating/attempting to manipulate EURIBOR whilst at Barclays.

The Spanish SPV, Marme, bought the Spanish headquarters of the Santander Group in September 2008 using, in part, a €1.575 billion loan from a syndicate of eight banks. The interest payable was fixed by reference to EURIBOR and was hedged by interest rate swaps.

In a lengthy written judgment, the Honourable Mr Justice Picken decided that EURIBOR-related representations alleged by Marme, such as that Natwest Markets (formerly RBS) had not sought to manipulate EURIBOR at the time of the loan, could not be implied into the contractual arrangements between Marme and the banks. Even though, therefore, the knowledge of Mr Moryoussef, who had briefly joined Natwest Markets, would have falsified such a representation, Marme could not rely on it. The judge further decided that Marme could not have rescinded the deal because, by its conduct, it had affirmed the loan, and it could not rescind the related swaps without first rescinding the loan. Finally, even if Marme had known the truth about the alleged EURIBOR manipulation, it was unable to show that the terms of the deal would have changed.