Key Takeaways from LFJ’s Special Digital Event “Litigation Finance: Investor Perspectives”

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North Carolina has become the first US state to prohibit third-party litigation funding outright, with its Prohibit Litigation Investments Act taking effect on June 22, 2026. The law makes it unlawful for any person to provide money — whether as a direct payment, advancement, loan, or investment — for civil proceeding expenses in exchange for a right to repayment that is contingent in any respect on the outcome of the proceeding.
As reported by JD Supra, the statute applies broadly across civil actions, arbitrations, mediations, and administrative proceedings, and covers contracts entered into, renewed, or amended on or after the effective date. It carves out exclusions for contingency-fee legal services, non-contingent loans, attorney cost advancements under the Rules of Professional Conduct, and funding arrangements that carry no outcome-contingent return.
The penalties are significant. Offending contracts become void, the Attorney General may seek injunctions and civil penalties of up to $50,000 per violation, and injured parties may recover damages — including treble statutory damages — plus court costs and attorney fees. Insurers and risk managers have praised the measure as a landmark curb on litigation abuse.
The law's sweeping language has also raised concerns beyond the funding sector. Practitioners warn that it creates uncertainty around routine corporate advancement and indemnification of directors, officers, and LLC members, potentially conflicting with longstanding protections under the state's Business Corporation Act.
Burford Capital's shares have fallen nearly 50% after the US Court of Appeals for the Second Circuit overturned a $16 billion judgment against Argentina in the long-running YPF case — a ruling that had represented the single largest asset on the litigation funder's books. The reversal marks one of the most consequential setbacks the litigation finance industry has seen, given how central the award had become to Burford's valuation.
As reported by City AM, the Second Circuit reversed a 2023 decision by the US District Court for the Southern District of New York that had ordered Argentina to pay roughly $16 billion to two minority shareholders, Petersen Energía and Eton Park, whose claims were financed by Burford. The dispute stems from Argentina's 2012 expropriation of a 51% stake in oil major YPF from Spain's Repsol.
The appeals court found that the plaintiffs' breach-of-contract claims failed as a matter of Argentine law, justifying the reversal. The market reaction was immediate: Burford's stock dropped nearly 50% on the NYSE and more than 46% in London — its steepest decline since July 2020.
The parties have 14 days to apply for a rehearing, and Burford has signaled that it may petition the US Supreme Court or pursue investment treaty arbitration. For an industry that has increasingly leaned on marquee, high-value judgments to demonstrate returns, the ruling is a stark reminder of the binary risk embedded in single-case exposure.
Omni Bridgeway has secured top-tier recognition in the Chambers and Partners Litigation Support Guide 2026, earning Band 1 rankings in both Litigation Funding and Global Asset Tracing and Recovery. The recognition arrives as the ASX-listed funder marks its 40th anniversary, underscoring its standing as one of the largest and longest-established players in global legal finance.
According to Omni Bridgeway, the firm was ranked Band 1 across International Arbitration, US Intellectual Property, Europe, Singapore, the Middle East, and Canada, and Band 2 in the United Kingdom, United States, and Latin America. With operations spanning 24 international locations, the funder positions itself as a global leader in legal finance and risk management.
Central to Omni Bridgeway's pitch is an end-to-end capability that runs from case inception through post-judgment enforcement and recovery — a breadth reflected in its separate Band 1 ranking for global asset tracing and recovery, an area demanding cross-border coordination and strategic execution. The firm emphasizes disciplined capital deployment and a focus on realized outcomes across jurisdictions.
The Chambers rankings, based on months of independent research and confidential client interviews, are among the legal industry's most closely watched benchmarks. One client, quoted in connection with the recognition, likened litigation funding to investing: "sometimes money is just money, but other times, you have a partner that cares about their investment and wants it to grow." For Omni Bridgeway, four decades in, the results reaffirm a market-leading position as the funding sector continues to professionalize and expand.