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Burford Capital’s new push to take minority stakes in U.S. law firms is already meeting resistance from tort-reform advocates and insurer-aligned groups, who argue the structure could blur loyalties inside the attorney-client relationship. The plan, described by Burford’s chief development officer Travis Lenkner as “strategic minority investments” to help firms scale, would rely on managed service organizations (MSOs) that house back-office assets while leaving legal work to a lawyer-owned entity. Supporters cast it as a lawyer-friendly alternative to private equity; skeptics see a back-door end-run around state bars’ bans on non-lawyer ownership.

An article in Insurance Journal reports that critics, including the Florida Justice Reform Institute’s William Large, warn MSO-style deals could tilt decision-making toward investors focused on “big verdicts,” threatening firm independence and client interests. Only Arizona permits direct non-lawyer ownership today, and while Utah and Washington, D.C., have loosened rules at the margins, most states still enforce bright-line prohibitions.

The debate has sharpened as disclosure and licensing regimes proliferate: at least 16 states now require some level of third-party funding transparency. The Insurance Journal piece also notes a recent Texas Bar ethics opinion that green-lights MSOs for law-firm services under narrow conditions, though it doesn’t answer the broader question of outside investors’ influence. For its part, Burford says it understands the ethical guardrails and intends to be a passive investor focused on firm growth and operational support.

For the legal finance industry, the MSO path signals a pivotal test. If bars and courts accept these structures, capital could flow directly into firm operations—potentially accelerating portfolio origination, technology spend, and fee-earner leverage. If regulators balk, expect renewed calls for explicit rulemaking on ownership, disclosure, and control—alongside creative alternatives (credit facilities, revenue shares, and hybrid portfolios) to replicate MSO-like benefits without the governance controversy.

A high-stakes governance fight is spilling into the UK’s largest group action. BHP has demanded clarity over hedge fund Gramercy Funds Management’s role at Pogust Goodhead, the claimant firm fronting a £36 billion suit tied to Brazil’s 2015 Mariana dam disaster. The miner’s counsel at Slaughter and May points to recent leadership turmoil at the firm and questions whether a non-lawyer financier can exert de facto control over litigation strategy—an issue that cuts to the heart of legal ethics and England & Wales’ restrictions on who can direct claims.

Financial Times reports that Gramercy, which finances Pogust, has just extended $65 million more to the firm after the removal of CEO-cofounder Tom Goodhead. BHP wants answers on independence and management oversight as the case nears a pivotal High Court ruling. For its part, Pogust says it remains independent and committed to its clients, while Gramercy rejects any suggestion it owns or manages the firm. The backdrop is familiar to funders: courts’ increasing scrutiny of who calls the shots when capital underwrites complex, bet-the-company litigation. Prior settlement overtures from BHP and Vale—reported at $1.4 billion—were rebuffed as insufficient relative to the claim’s scale and alleged harm.

Beyond this case, the episode underscores a larger question: how far can financing arrangements go before they collide with the long-standing principle that lawyers—and only lawyers—control litigation? The answer matters well beyond Mariana. If courts or legislators tighten the definition of control, expect deal terms, governance covenants, and disclosure norms in UK funding to evolve quickly. For cross-border mass-harm claims, the line between support and steer is narrowing—and being tested in real time.

A new opt-out competition claim aims squarely at Amazon, alleging price-parity tactics inflated costs for more than 45 million UK consumers. The Association of Consumer Support Organisations has filed for certification in the Competition Appeal Tribunal, instructing Stephenson Harwood with counsel from Monckton Chambers. The claim asserts Amazon’s marketplace policies restricted third-party sellers from offering better prices elsewhere—costs that, ACSO says, consumers ultimately bore.

The Global Legal Post notes a third-party litigation funder—confirmed as a member of the Association of Litigation Funders—is bankrolling the action, with identity to be revealed at certification. That disclosure posture aligns with the CAT’s funder-transparency expectations post-PACCAR while preserving competitive sensitivity during the early phase. On the defense side, Amazon labeled the case “without merit,” and emphasized consumer benefits and seller support on its platform. For claimant-side practitioners, the case illustrates how funders continue to underwrite large opt-out competition claims notwithstanding shifting case law on damages-based LFAs; structures are adjusting, not retreating.

If certified, the case will test funder appetite for big-ticket consumer competition matters amid the UK government’s newly announced review of the collective actions regime. It could also influence how funders structure returns (percentage vs. multiple, hybrids) to thread the needle between tribunal oversight and commercial viability. Watch for whether the CAT’s scrutiny of fees and “just and reasonable” outcomes further standardizes funding terms across UK opt-out claims.

A Texas bankruptcy judge has voided a $2.3 million litigation funding agreement between GLS Capital and a Chapter 11 liquidation trust, in a decision that may reverberate across the bankruptcy and legal funding sectors.

An article in Bloomberg Law reports that Chief Bankruptcy Judge Stacey G. Jernigan ruled the funding deal—entered into by trustee David Gonzales—was an "abuse of discretion," finding it failed to benefit creditors and lacked proper court oversight. The deal gave GLS the right to nearly $7 million in repayment (a 3x return), plus 12% of any proceeds beyond that, and included a $75,000 broker fee. Judge Jernigan noted that the financing appeared structured in a way that made it difficult for creditors to receive any meaningful recovery, commenting that “it’s hard to see how the juice will ever be worth the squeeze.”

The judge was particularly troubled by the trustee’s failure to seek prior court approval and disclose the agreement, which she found to be a serious breach of duty. As a result, she not only voided the agreement but also removed Gonzales from his trustee position. GLS Capital and the trustee have both signaled plans to appeal.

Ken Epstein, a litigation finance broker and former investment manager at Omni Bridgeway, suggested this ruling is more of an outlier than a trendsetter. While he acknowledged that courts may struggle with understanding litigation finance, he emphasized that most funders approach these agreements with appropriate safeguards.

Burford Capital—a leading litigation funder with a market cap around $3 billion—is currently in talks with several U.S. law firms to acquire minority stakes. The firm sees opportunity amid shifting ownership regulations in the legal market.

An article in Pymnts notes that because most U.S. states prohibit non-lawyers from owning law firms due to ethical rules, Burford is proposing a structure known as a Managed Service Organization (MSO). Under this model, a law firm splits into two entities: one lawyer-owned entity handles legal work, while the MSO—potentially investor-owned—manages back-office services. This structure allows capital injection without breaching ownership restrictions.

Burford co‑founder Jonathan Molot declined to name the firms in talks and revealed no specific investment commitments yet—expectations depend on opportunities.

This move isn't framed as a private equity takeover. Instead, Burford presents itself as a "lawyer's orientation and mentality," intending to offer capital, governance, and strategic guidance—such as investing in AI and operational infrastructure—via board participation.

One of LFJ's most popular posts is this 2020 piece from Ed Truant, Founder of Slingshot Capital, on the sizing of the commercial litigation funding industry. William Weisman from Parabellum Capital has just published an updated version for 2025.

Writing in NatLaw Review, Weisman notes that the commercial litigation funding industry is often misrepresented as a burgeoning asset class—typically pegged at a headline figure of $16 billion. But that AUM total is misleading. According to Westfleet Advisors, which publishes the most comprehensive annual analysis, the true picture is far smaller. In 2024, U.S. commercial litigation funders had $16.1 billion in assets under management—yet actual new annual commitments totaled only $2.3 billion, down roughly 16% from 2023 and 20% from 2022.

What's more, in terms of AUM, mainstream asset classes dwarf litigation funding. Public equities command about $60 trillion, commercial real estate about $27 trillion, and private credit around $1.6 trillion. In contrast, commercial litigation funding sits at just $16 billion—making it more than 100× smaller than private credit, 200× smaller than private equity, and 1,500× smaller than commercial real estate.

While undeniably valuable for small to mid-sized businesses pursuing meritorious claims they couldn’t otherwise afford, the industry’s overall reach is extremely limited. It raises important questions about the appropriateness of broad regulation targeting an industry that remains a rounding error in global finance.

This analysis highlights a central tension: while litigation funding plays a critical role in access to justice, its modest scale suggests policymakers should avoid heavy-handed regulation. Instead, targeted, tailored rules—focused on transparency and case-level risks—may be more appropriate and proportionate for such a specialized and niche market.

Steven Cooklin, founder and CEO of Manolete Partners, has stepped down after a remarkable 40‑year tenure in the litigation funding sector, marking the end of a defining leadership era for the firm. In his 16 years guiding Manolete, Cooklin steered the company through its foundation in 2009, its 2018 IPO, and multiple waves of market turbulence, not least the Covid‑related slump in insolvency proceedings that severely impacted litigation funding operations.

The Global Legal Post reports that Cooklin’s departure aligns with Manolete’s renewed financial vigor, with the company having refinanced its debt with HSBC, delivered record revenue of £30.5 million for the year ended 31 March, and invested in 282 new UK insolvency cases. A landmark moment was the firm’s first cartel claim settlement in the Trucks Cartel litigation, netting £3.2 million.

Stepping into Cooklin’s role is long‑time managing director Mena Halton, who joined Manolete in 2014 and has been at the forefront of its legal strategy. With roots at Dentons and Rothman Pantall, Halton is celebrated for her expertise in contentious insolvency matters.

Manolete’s strategic repositioning comes at a pivotal time—Halton takes over a firm that has restored momentum and financial stability. Her leadership credentials suggest a seamless transition and promising path forward.

Cooklin reportedly remains a major shareholder and will be available to advise the board.