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A company with links to Baroness Mone and her husband, Doug Barrowman, has been ordered to pay £122 million in damages after a High Court judge ruled it breached a government contract for the supply of personal protective equipment (PPE) during the COVID-19 pandemic.
The Department of Health and Social Care (DHSC) initiated legal action against PPE Medpro, alleging that the medical gowns supplied failed to meet the required healthcare standards.
The High Court determined that Medpro did not adequately demonstrate that its surgical gowns, intended for use by NHS workers, had undergone a validated sterilization process.
Chancellor Rachel Reeves stated that stripping Baroness Mone of her peerage was beyond her jurisdiction.
Speaking on BBC Radio 5 Live, Reeves expressed her hope that Baroness Mone “won’t be back in the House of Lords.”
Peerages can only be revoked through an act of Parliament. While a life peerage is typically held for life, Baroness Mone could choose to resign her membership in the House of Lords.
Reeves affirmed her commitment to “do everything” within her power “to get that money back,” emphasizing that the funds belong “in our schools, in our hospitals, and in our communities.”
During the onset of the COVID-19 pandemic in 2020, the government urgently sought to secure PPE supplies as the nation entered lockdown, and hospitals reported shortages of protective gear for medical personnel.
PPE Medpro, established in May 2020 by a consortium led by Doug Barrowman, secured its initial government contract to supply masks through a “VIP lane” after a recommendation from Baroness Mone.
The court judgment revealed that the government subsequently ordered 25 million sterile gowns from Medpro, which were delivered in August and October 2020, having been manufactured in China.
However, shortly before Christmas that year, the DHSC issued a notice to the company rejecting the gowns and requesting a refund.
The judgment stated that the government deemed the gowns “not contractually compliant” following inspection, with subsequent tests allegedly revealing that “a number of them were not sterile.”
Paul Stanley KC, representing the government, informed the court that 103 out of 140 tested gowns failed to meet standards.
This led to the government initiating legal proceedings in the High Court in 2022, alleging that the gowns did not adhere to the agreed contract specifications.
Medpro, however, maintained that it had fulfilled its contractual obligations and that the gowns were indeed sterile.
Baroness Mone, a former Conservative peer and lingerie entrepreneur, previously denied direct financial gain from the contracts but admitted in December 2023 that she stood to benefit from tens of millions of pounds in profit.
She also conceded in an interview with the BBC that she and her husband had misrepresented their involvement with Medpro to avoid “press intrusion.”
The court determined that the firm’s director, Anthony Page, enlisted the “big gun” – Baroness Mone – during negotiations to secure the gown contract.
In Wednesday’s ruling, Justice Cockerill acknowledged the “complex” nature of the contract between Medpro and the government, but concluded that the company was obligated to demonstrate a “validated sterilisation process.”
“That was not complied with by Medpro,” she stated. “It followed that Medpro had breached the contract.”
The ruling further noted the absence of the required “notified body number” on the gowns to indicate sterilization and that Medpro had failed to provide evidence of such a process.
Medpro had also contended that the government could have sold the gowns or repurposed them for non-sterile or isolation use.
During the proceedings, the company asserted that any lack of sterility or valid sterility marking “did not prevent the said gowns from being used within the NHS or from being sold to third parties outside of the EU.”
Justice Cockerill identified issues with this argument, including the fact that the NHS did not require additional isolation gowns.
However, she observed that the DHSC did not effectively reject the gowns within a reasonable timeframe and dismissed the government’s claim for £8.65 million in storage costs due to insufficient evidence.
The judge ordered the company to pay £121,999,219 in damages, plus interest. However, it remains unclear how Medpro will fulfill this obligation, as the company appointed administrators the day before the court decision.
The company’s most recent financial statements indicated shareholders’ funds of only £666,025.
The court stipulated that the firm had until October 15th to pay the damages to the government.
Following the judgment, Chancellor Rachel Reeves stated that the government was collaborating with administrators and “all different authorities” to recover the funds.
In response to the ruling, Baroness Mone described it as “shocking but all too predictable.”
“It is nothing less than an Establishment win for the Government in a case that was too big for them to lose,” she stated in a social media post.
A spokesperson for Mr. Barrowman characterized the ruling as “a travesty of justice.”
“[Mrs Justice Cockerill’s] judgment bears little resemblance to what actually took place during the month-long trial, where PPE Medpro convincingly demonstrated that its gowns were sterile,” the spokesperson added.
Baroness Mone was once recognized as one of the UK’s most successful businesswomen, having created the Ultimo bra in the late 1990s.
In 2015, then-Prime Minister David Cameron appointed her as the government’s “entrepreneurship tsar,” and she subsequently became a Conservative peer.
The following year, she announced her relationship with Mr. Barrowman, a billionaire businessman who founded The Knocks Group of Companies and served as a director of Aston Management Limited.
In December 2022, Baroness Mone requested a leave of absence from the House of Lords.
Neither Baroness Mone nor Mr. Barrowman were present in court for the decision.
A separate investigation into Medpro was launched in May 2021 by the National Crime Agency (NCA) regarding suspected criminal offenses related to the procurement of PPE.
An NCA spokesperson confirmed on Wednesday that its investigation is ongoing.
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