Disclosure – document collection risks – Cabo Concepts Ltd & Anor v MGA Entertainment (UK) Ltd & Anor

The High Court’s judgment in Cabo Concepts Ltd & Anor v MGA Entertainment (UK) Ltd & Anor [2026] EWHC 768 (Ch) (31 March 2026) concerned a costs application where serious deficiencies and failings been identified in both parties disclosure. Here, we summarise those disclosure issues which are a reminder about the risks of how documents are collected.

The case

The underlying claim concerned allegations that MGA blocked the UK launch of Cabo’s “Worldeez” toy through anticompetitive conduct and unjustified threats of patent infringement. A trial listed for June–July 2022 was vacated weeks before starting because of serious deficiencies in disclosure by MGA. That adjournment led to an indemnity costs order against MGA and a payment on account of £578,444.17.

After the case eventually proceeded to trial, MGA sought to revisit that costs order, relying on later‑discovered disclosure breaches by Cabo, particularly concerning WhatsApp data, and inaccuracies in a solicitor’s disclosure evidence. The sanctions application, heard in January 2026, addressed whether later‑discovered disclosure failings (by Cabo) justified varying a final costs order (made against MGA).

Disclosure Issues: 

Disclosure was governed by Practice Direction 51U (the Disclosure Pilot, now PD 57AD). In July 2021, the Court ordered both parties to capture data from identified custodians and repositories and to report on their processes.

In-House Data Collection

The adjournment in 2022 was driven by a “suite of technical failures” in the harvesting exercise that had been conducted by MGA’s internal IT team, without supervision from e-disclosure specialists. Initially at least 84,000 potentially relevant emails from a key custodian had not been harvested with at least 8,700 new documents identified for review. By the consequential hearing, the scale of the problem had expanded; around 800,000 documents had been missed. A court ordered re‑run of disclosure using an e‑disclosure provider identified over 7.5 million previously unharvested documents, leading to the late production of 47,656 documents, around 80% of MGA’s total disclosure.

WhatsApp Messages 

After MGA's solicitors queried Cabo’s WhatsApp processes in April 2023, Cabo engaged its disclosure provider to recollect mobile data. This uncovered 98 additional chats, over 4,000 images, and a “Top Secret” group chat spanning 583 pages. Further issues included email harvesting errors and late production of a 2019 settlement agreement.

Clients may in principle carry out their own searches for relevant material as there is no duty on solicitors to search clients’ mobile phones themselves, or to require a third‑party disclosure provider to do so. However, the solicitor must take reasonable steps to advise and assist the client by giving clear instructions, ensuring the client understands the scope of the disclosure duties, and properly supervising the search process (the level of explanation and supervision depending on the circumstances) (Myers v Elman [1940] AC 282, 322; Matthews and Malek, Disclosure (6^th ed, 2024)).

Here, custodians had manually searched their own phones, without clear written instructions, without any supervision, and without any audit trail. The solicitor had relied on informal assurances, rooted in longstanding client relationships, rather than verification and did not follow up when circumstances should have put him on notice that further searches should be undertaken.

This approach fell short of the solicitor’s duty under CPR PD 51U paragraph 3.2(2) (now CPR PD 57AD paragraph 3.2(2)) "to take reasonable steps to advise and assist the party to comply with its Disclosure Duties". The October 2021 disclosure certificate, suggesting WhatsApp data had been searched in a “responsible and conscientious manner”, was held to be materially inaccurate. While the court rejected any suggestion of dishonesty, it found the evidence misleading and reflective of a process conducted in entirely the wrong way. 

Costs finality preserved

Despite these findings, the court refused to vary the July 2022 indemnity costs order. Procedurally, the correct route was CPR r 40.8A rather than CPR r 3.1(7), following Motorola v Hytera [2025] EWCA Civ 1667. Substantively, the principle of finality carried decisive weight. This was not a case where later events “destroyed” the basis of the original order; unpicking final costs decisions as further disclosure defects surface would be unworkable in complex litigation.

That said, Cabo accepted - and the court ordered - that it must pay MGA’s costs attributable to Cabo’s own disclosure breaches and the review of late‑produced material.

The case illustrates that collection of documents can be a high-risk activity requiring parties and solicitors to be cognisant of their duties and to consider carefully the appropriate methods to collect documents.

For more information about the law, technology and practice of disclosure, contact Tom Whittaker, Harry Keaveney or Jacob Berger.