Fred Goodwin, the former CEO of Royal Bank of Scotland (RBS) stripped of a knighthood for his role in the bank's near collapse, is among several former RBS directors fighting claims they were at fault for the lender's troubles.
Goodwin, alongside former RBS chairman Sir Tom McKillop and ex-RBS investment banking chief Johnny Cameron, as well as the bank itself, are being accused by the RBS Shareholders' Action Group of misleading investors over a £12bn rights issue completed only months before the bank was forced to ask for an emergency bail-out.
The group, represented by lawyers Herbert Smith, deny the bank made "untrue or misleading statements" in the prospectus for the capital-raising in 2008.
Instead, they argue they were floored by "unforeseeable and entirely unprecedented" events sparked by the failure of Lehman Brothers.
They say they will "vigorously defend themselves" against a claim for £3bn by the action group, which represents thousands of retail investors.
Just six months after the successful rights issue, huge losses at RBS forced the lender to start taking £45.5bn of emergency funding from the UK government to stay afloat.
Goodwin and his former colleagues say the prospectus at the time did not contain any untrue or misleading statements, nor any major omissions.
Instead, they argue RBS was hit by the almost unprecedented changes in market conditions brought about by the failure of Lehman Brothers in September 2008.
"It was the effect of the extreme and unforeseen market dislocation, which had a calamitous impact on RBS and its share price, in late 2008," a Herbert Smith letter reads.
"... it is wrong and unfair for you to seek to assert that because such dislocation occurred and impacted RBS in the way it did, matters must have been known within RBS in April 2008 during the rights issue period, which were not properly disclosed in the prospectus."
No preferred charging model
To 1,552 families and businesses
HL and Liberty SIPP slowest
Lifetime and annual allowances