Freshfields Bruckhaus Deringer is facing a potential negligence claim worth more than £68m from the Department for Transport (DfT) for advice it gave the organisation in 2006 in relation to a rail franchise agreement with Stagecoach South Western Trains (SSWT).

The firm received a letter before action from the Employment, Commercial and Companies Division of the Treasury Solicitor's Department, dated 13 June 2011, which accuses the firm of negligently deleting a clause in the agreement that resulted in the DfT having to pay out £66.9m to SSWT, as well as £1.3m in costs incurred dealing with the dispute and arbitration proceedings.

The dispute centred on the period over which revenue shortfalls at SSWT should be assessed and the amount of revenue support compensation receivable from the Government. The letter alleged that Freshfields' deletion of the clause was spotted by SSWT's lawyers, Herbert Smith, with the company subsequently claiming revenue support compensation from the Government.