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Inventor Leverages Litigation Funding to Beat Microsoft

August 2, 2022

Inventor Leverages Litigation Funding to Beat Microsoft

One of the great benefits of third-party legal funding is the ability for small companies and even individuals to fight on a level playing field against the world’s largest corporations. This dynamic was made evident in a recent case, where a US inventor was able to achieve a $10 million award for patent infringement from Microsoft, after enlisting the support of a litigation funder. Detailed in an article by Bloomberg Law, inventor Michael Kaufman has been in a decade-long struggle to receive compensation, after he alleged that Microsoft infringed his technology patent by using it in their Visual Studios Software. However, it wasn’t until he and attorney Ronald Abramson sought funding from Woodsford Litigation Funding that he was able to take Microsoft to court with previously inaccessible financial resources to fight the case. Whilst Microsoft initially claimed it had not used the patented product to a significant degree in 2019, lawyers for Abramson discovered that this was only true for the previous year, and Microsoft had in fact been substantially using the product in prior years. After an appeal in federal court, the panel opinion stated that Kaufman should have received royalties from the product usage dating back to 2011. Whilst victories in patent infringement cases for individual inventors is rare, Nicole Morris, a professor at Emory School of Law, highlighted that in situations where they can receive third-party funding, inventors are determined litigants due to their desire to see their own invention and work recognised.
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Case Developments Commercial

Home Office-Funded Class Action Against Motorola Gets Green Light

By John Freund |

In a significant development for UK collective actions, the Competition Appeal Tribunal (CAT) has granted a Collective Proceedings Order (CPO) in the landmark case Spottiswoode v Airwave Solutions & Motorola. The case—brought by Clare Spottiswoode CBE—accuses Motorola of abusing its dominant position in the UK's emergency services network by charging excessive prices through its Airwave network, which the Home Office claims resulted in £1.1 billion in overcharges to UK taxpayers.

According to iclg, the class action is being funded by the UK Home Office itself, which is also the complainant in an associated CMA enforcement action. In its judgment, the CAT concluded that Spottiswoode is an appropriate class representative, and that the claim—which covers a proposed class of over 100,000 public service bodies—is suitable for collective proceedings. The case will proceed on an opt-out basis for UK entities, with opt-in available for overseas claimants.

The Tribunal emphasized that funding by a government department does not compromise the independence of the class representative, and that the Home Office’s funding arrangement complies with legal and procedural requirements. Notably, the judgment paves the way for governmental entities to play a dual role—as both complainant and funder—in future competition-based collective actions.

This case raises fascinating implications for the legal funding industry. It challenges traditional notions of third-party funders and opens the door to more creative and strategic funding models initiated by government entities themselves, particularly in cases with broad public interest and regulatory overlap.

Case Developments Commercial

UK Supreme Court Upholds Key Class Action Win for Funders in Apple Case

By John Freund |

The UK Supreme Court has declined to hear Apple’s appeal in Apple Inc and others v Gutmann, leaving intact a Court of Appeal decision that significantly strengthens the position of litigation funders in collective proceedings before the Competition Appeal Tribunal (CAT).

An article in Law Gazette reports that the Supreme Court refused Apple’s petition on the grounds that it did not raise an arguable point of law, effectively endorsing the lower court’s April 2025 decision. That ruling affirmed that litigation funders can be paid directly from damages recovered in a class action before distributions are made to class members. The decision resolved longstanding ambiguity surrounding Sections 47C(3) and (6) of the Competition Act 1998 and Rule 93 of the CAT Rules 2015.

The Court of Appeal held that the CAT has wide discretionary authority to order payments to class representatives for costs, fees, and disbursements, provided such allocations are deemed fair and reasonable under the tribunal’s supervisory jurisdiction. This was a pivotal victory for claimant-side funders, who have long warned that being last in line for recovery—after damages are disbursed—posed unacceptable risk in UK opt-out cases.

Law firm Charles Lyndon, counsel for class representative Justin Gutmann, welcomed the Supreme Court’s decision not to revisit the matter, stating that it brings “welcome certainty” to the evolving collective proceedings regime and affirms the CAT’s broad discretion in addressing complex, end-of-case allocation scenarios.

This decision is expected to have a profound impact on the UK’s competition class action landscape. Funders now have greater confidence in the recoverability of their investments, potentially spurring more funding activity in CAT proceedings. The ruling may also prompt defendants to reconsider their settlement calculus, knowing that funders now enjoy a more secure repayment pathway.

Case Developments Commercial

Elite Colleges Challenge Lawyers’ Litigation Funding in Major Antitrust Case

By John Freund |

Elite U.S. universities embroiled in a high-stakes antitrust class action are now targeting the use of third‑party litigation funding by plaintiffs’ counsel in a bid to derail class certification. At issue is whether a lead firm’s reliance on external financing renders it “inadequate” under class action rules — a novel approach that raises fresh procedural and policy questions.

An article in Reuters notes the the suit alleges that Cornell, Penn, MIT, Georgetown, Notre Dame and others favored wealthy applicants over students needing financial aid, plaintiffs’ counsel (led by Gilbert Litigators & Counselors, or GLC) is facing attacks over transparency and risk allocation. The universities contend that GLC mischaracterized its financial exposure by not fully disclosing its funding arrangements. GLC responds that it only uses outside funding for a portion of its fees (covering 40% of its own, and under 16% of the aggregate) and that no court has previously held that use of funding makes class counsel inadequate. A judge has already found the funding documents “potentially relevant” to the certification motion, underscoring the stakes.

Legal commentators call this a new twist in class litigation — rather than questioning the merits or fairness of funding, defendants are now probing its procedural footprint. The case also dovetails with a broader trend: litigation funders are becoming more visible and controversial, particularly when their support is used by class‑action counsel. Reuters Meanwhile, in adjacent news, law firms are consolidating and AI‑driven tools for plaintiffs’ practices are attracting investor capital — further reshaping the economics of litigation.

This challenge could force courts nationwide to reinterpret adequacy standards in class actions, potentially chilling the use of external funding. It may also provoke funders, defense firms, and plaintiffs to recalibrate disclosure rules and risk-sharing norms across major litigation.