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PREMIER LITIGATION FINANCE FIRM ROCADE LLC PARTNERS WITH BARINGS AND EJF CAPITAL

Rocade LLC (“Rocade” or the “Company”) today announced its launch as a specialty finance company focused on litigation finance with a long-term investment approach, in partnership with Barings LLC (“Barings”), one of the world’s leading investment managers.

Under the terms of the transaction, funds affiliated with Barings have made a significant equity investment into the Company. EJF Capital LLC (“EJF Capital”), which launched Rocade’s predecessor vehicle, Rocade Capital LLC in 2014 with a highly skilled management team, will support the platform and remain a material shareholder in the newly formed entity alongside management, which will transition to the Company.

Headquartered in the Washington, D.C. area, Rocade provides flexible law firm financing solutions, with facilities ranging in size from $10 million to over $100 million which are secured by contingent fees receivable or other litigation assets. Under this new organizational structure, Rocade will benefit from having a robust and patient capital base backed by Barings, enabling it to provide flexible, long-term capital solutions to growing law firms, while leveraging the team’s combination of deep sector expertise and financial structuring capabilities.

Brian Roth, Chief Executive Officer and Chief Investment Officer of Rocade, said, “Uniting with Barings in our vision for a permanent capital vehicle is an incredible milestone for Rocade, as this long-term investment horizon sets us apart and will meaningfully enhance our alignment with the firms in which we invest. The strength of our combined experience and expanded financial resources empowers us with scale and flexibility to continue our trajectory as a leading litigation credit provider in the rapidly evolving litigation finance industry.”

“We are thrilled to partner with Rocade to cement its status as a leading litigation finance provider,” said Bryan High, Head of Capital Solutions at Barings. “Brian and the outstanding team of professionals at Rocade have built a best-in-class, technology-enabled platform that meets the needs of many law firms as they navigate increasingly complex litigation. Rocade’s deep relationships, strong credit culture, and market-leading expertise powerfully complement Barings’ permanent capital base and long-term investment approach.”

“This expanded capital base allows us to scale our platform more quickly while maintaining our focus on asset quality,” added Jacob Cantrell, Chief Risk Officer of Rocade. “Our core team, process, and product will remain the same while we continue to invest in technology to improve our decision process and drive efficiency. Adding the strength, diversity, and scale of resources available across the Barings private credit team to these core strategies offers Rocade more long-term flexibility and reliability for our law firm partners.”

Emanuel Friedman, Co-Founder and Co-CEO of EJF Capital, commented, “We are pleased to participate in the continued success of Brian and his team, who have built a terrific platform that has differentiated itself through an institutional approach to a niche asset class and a data-driven process for understanding complex situations. I look forward to partnering with an innovative and dynamic capital partner in Barings, and I am confident that Rocade is well positioned for a highly successful next chapter with a renewed focus on becoming a dominant player in the space over the long-term.”

Fried, Frank, Harris, Shriver & Jacobson LLP served as legal advisor to EJF Capital. Dechert LLP served as legal advisor to Barings. Nixon Peabody LLP and Cooley LLP served as legal advisor to Rocade and management.

About Rocade

The Company, which operates as Rocade Capital, is a private credit firm which provides flexible growth capital for plaintiff law firms in order to finance case acquisition, manage working capital or realize settled cases.  Since Rocade’s predecessor was founded in 2014 by EJF Capital, the platform has funded approximately $900 million of loans to leading law firms within mass tort and other complex litigation, unlocking potential for dozens of growing law firms.  Its flexibility, industry expertise, track record and long-term focus position it to be a leading law firm lender.  Rocade has an experienced team of professionals, located in the Washington, DC area and Houston, TX, which includes both finance industry veterans as well as litigation experts. For more information, please visit https://rocadecapital.com/.

About Barings

Barings is a $347+ billion* global investment manager sourcing differentiated opportunities and building long-term portfolios across public and private fixed income, real estate, and specialist equity markets. With investment professionals based in North America, Europe and Asia Pacific, the firm, a subsidiary of MassMutual, aims to serve its clients, communities and employees, and is committed to sustainable practices and responsible investment.

*Assets under management as of December 31, 2022.

About EJF Capital

EJF Capital LLC is a global alternative asset management firm headquartered outside of Washington, D.C. with offices in London, England and Shanghai, China. EJF has over 70 employees, including a seasoned investment team of over 30 professionals. The firm was founded in 2005 by Manny Friedman and Neal Wilson. To learn more, please visit http://ejfcap.com.

Commercial

Omni Bridgeway Emphasizes Funder Support for Judgement Enforcement

The mark of successful litigation is not limited to the simple terms of a favorable judgement or ruling, as plaintiffs must often measure their success by the ability to enforce a judgement and the collect on any award or damages that were ordered. However, enforcement is rarely a straightforward matter, and as litigation funders seek to provide added value to their clients, experience and expertise in judgement enforcement will be a valuable asset. In a new blog post by Omni Bridgeway, Gabe Bluestone and Jeff Newton emphasize that in the current economic climate, plaintiffs are likely to find it increasingly challenging to enforce judgements and secure the financial awards they are owed. In order to navigate these difficult circumstances, the authors argue that utilizing a funder with a dedicated enforcement team or even seeking specialist enforcement funding will be a useful tool for claimants dealing with resistant debtors. Bluestone and Newton state that while this should always be considered at the start of any litigation, enforcement expertise and specialist funding can be incredibly useful at any stage of the litigation process. This kind of support can range from enforcement planning that seeks to proactively prevent issues with collection, funding for plaintiffs that are in financial difficulty during the enforcement process, or insolvency funding where debtors take advantage of bankruptcy protections.
Commercial People Moves

Lionfish’s Owner Replaces Chief Executive

As LFJ reported in December, the prominent UK funder Lionfish is facing a challenging road ahead as its owner, RBG Holdings, announced that it would be reviewing the strategy for its litigation finance arm. Outlined by reporting in City A.M., RBG recently announced the firing of chief executive Nicola Fouston, who is being replaced by chief operating officer, John Divers. RBG stated that it had fired Foulston due to “cultural concerns and the execution of the group’s strategy”, and that the board had “lost confidence” in her leadership. With the company’s share price continuing to suffer after this latest announcement, RBG has maintained that it would continue with a strategy to limit its exposure to funding commitments through Lionfish.
Announcements Commercial People Moves

Omni Bridgeway continues US expansion with new operations in Miami and Chicago

Omni Bridgeway is delighted to announce the expansion of its operations into Chicago and Miami with the additions of investment managers and office heads, Maryanne Woo in Chicago and Lauren Alexander in Miami. We also welcome Enrique Molina, who joins Omni Bridgeway as an Investment Manager in Miami.

Maryanne joins Omni Bridgeway to continue building out the company's Midwest presence. She has over two decades of experience as a trial attorney in Chicago, handling complex disputes in state and federal courts involving product liability, multi-district litigation, mass tort, and shareholder derivatives issues. Prior to joining Omni Bridgeway, she was a litigation partner at Reed Smith LLP, where she focused on issues surrounding disruptive technology and artificial intelligence.

In Miami, Lauren brings local market knowledge and subject matter expertise in key areas such as bankruptcy, restructuring, multidistrict litigation, and commercial disputes. She has nearly 15 years of litigation experience in the Miami office of Weil Gotshal & Manges LLP, where she represented clients in a range of matters relating to contract disputes, business torts, antitrust, fraud, and asset valuation disputes.

Enrique joins Omni Bridgeway from King & Spalding in Miami, where he focused on international arbitration and litigation. With more than 6 years of experience, Enrique has handled numerous investor-state disputes involving Latin American parties in a broad range of industries including energy, mining, banking, and transportation.

"We are thrilled to continue our nationwide growth in Chicago and Miami, two of the fastest growing litigation markets in the US," said Jim Batson, Omni Bridgeway Managing Director and co-Chief Investment Officer for the US. "With Lauren and Enrique on board, we are excited to become one of the first commercial litigation funders to provide on-the-ground resources and expertise for law firms and corporations in Miami."

Managing Director and co-Chief Investment Officer for the US, Matt Harrison, added, "Maryanne's wide-ranging litigation experience and deep market knowledge are the perfect match for the dynamic Chicago market. Both Miami and Chicago are known for their sophisticated litigators and corporations who need an experienced risk management partner to navigate the financial complexities of high-stakes disputes. Omni Bridgeway is ideally situated to be that partner."

ABOUT OMNI BRIDGEWAY

Omni Bridgeway is the global leader in legal finance and risk management, including dispute and litigation finance from case inception to post-judgment enforcement and recovery. Listed on the ASX, Omni Bridgeway operates from 25 international locations.

Announcements Commercial People Moves

Burford Capital Opens Dubai Office

Burford Capital, the leading global finance and asset management firm focused on law, today announces that it is opening its first Middle East office in Dubai, UAE, to meet increased client demand for legal finance in the region. With the addition of Dubai, Burford now has eight offices in North America, Europe, the Middle East, Asia and Australia.

Managing Director Daniel Hall will lead Burford’s Dubai team in addition to his ongoing co-leadership of Burford’s global asset recovery business. Previously based in Burford’s London office, Hall has relocated to Dubai and leads a team there that includes Joseph Durkin, Senior Vice President, an arbitration specialist and legal finance veteran in the Middle East, and Sylvia Chandel, Vice President, an experienced Middle East banker.

Burford’s Dubai office will provide a full range of legal finance, risk management and asset recovery services to companies, law firms and financial institutions throughout the Middle East.

Christopher Bogart, CEO of Burford Capital, said: “Burford continues to see growing demand for our legal finance capital globally, including in the Middle East. Our new office in Dubai will add a needed Middle East presence to meet client demand. We are pleased to open a physical office with senior-level experts in a region that offers even greater opportunities for the continued global growth of our business.”

Daniel Hall, Burford’s Managing Director in Dubai, said: “We are excited to formally begin our on-the-ground operations in Dubai and the Middle East. After eight years at Burford in London, I am eager to build upon our existing industry-leading work in the region that was previously on a fly-in basis. The team and I look forward to meeting with new potential clients in addition to existing ones as we continue to serve their various needs in arbitration, litigation and recoveries for non-performing loans. We have hit the ground running in the Middle East and Dubai, and I look forward to what’s ahead for us as the top regional and premier global provider of commercial legal finance and asset recovery expertise.” 

About Burford Capital

Burford Capital is the leading global finance and asset management firm focused on law. Its businesses include litigation finance and risk management, asset recovery and a wide range of legal finance and advisory activities. Burford is publicly traded on the New York Stock Exchange (NYSE: BUR) and the London Stock Exchange (LSE: BUR), and it works with companies and law firms around the world from its principal offices in New York, London, Chicago, Washington, DC, Singapore, Sydney, Hong Kong and Dubai.

For more information, please visit www.burfordcapital.com.

Commercial

LegalPay CEO Talks Opportunities and Challenges for Litigation Funding in India

As the global litigation funding market continues to grow, investors are looking to emerging markets and jurisdictions with a high potential for growth in the uptake of third-party funding. Looking forward to the year ahead, the CEO of India’s leading litigation funder has offered his perspective on the nuances of the Indian market for potential investors and funders. Writing in CXOtoday, Kundan Shahi, CEO of LegalPay, highlights the potential of the burgeoning litigation finance market in India, which he describes as having a greater potential in terms of the monetization of claims than other major markets such as London, Hong Kong and Singapore. As a developing economy India is also filled with unique opportunities, with Mr Shahi pointing to the rise in fraudulent and scam activity during the pandemic, as well as the evolution of insolvency regulations as catalysts for a surge in opportunities for third-party investment. Mr Shahi also notes that there are challenges facing funders entering the Indian market due to its legal framework, which may differ from that of traditional markets. He emphasizes the importance of new funders taking a more flexible approach and adapting to client-specific needs in order to succeed. However, Mr Shahi does suggest that the growth in the country’s arbitration and dispute practice will create fresh opportunities, which funders should look to take advantage of.
Commercial Deals

Therium Co-founder Sees Opportunity Amidst Economic Downturn

One of litigation finance’s most attractive attributes as an asset class is its lack of correlation to traditional markets. However, as one leading funder recently pointed out, litigation funding can go even further and benefit from economic downturns due to a correlated rise in litigious activity. Speaking with City A.M., Therium’s co-founder and chief investment officer, Neil Purslow, offered an optimistic outlook for the litigation funding industry despite the ongoing economic instability. Within the broader surge in litigation due to the economic downturn, Purslow also highlighted that in these difficult market conditions, companies may turn to litigation funders to provide the capital for meritorious litigation that they would struggle to finance given budget constraints. Purslow pointed to the rise in class action lawsuits in the UK as an area of continued growth for the London market, citing continued interest from investors who see litigation finance as a ‘counter-cyclical investment’ in the current market. In addition to these class action cases, Purslow suggested that ESG litigation could become a significant area of investment for funders, as the scope of this activity has increased to a point where ‘ESG is everywhere’.
Announcements Commercial People Moves

Omni Bridgeway announces EMEA leadership and investment management promotions in Amsterdam and London

Omni Bridgeway is pleased to announce the appointment of Hannah van Roessel as Co-Chief Investment Officer – EMEA, and the promotions of Kees de Visser and Alistair Croft. Based in Amsterdam, Hannah will work closely with Raymond van Hulst (Executive Director and Co-CIO EMEA) to jointly lead all aspects of Omni Bridgeway's EMEA operations. With 10 years of experience at Omni Bridgeway, Hannah brings a unique global perspective to her new role, having served as Senior Investment Manager and Director Enforcement first for EMEA and then the US, when she relocated to New York to launch the company's US judgment enforcement business in 2022. Throughout her tenure in the legal finance industry, Hannah has achieved a notable record of success, managing complex multijurisdictional enforcement cases and securing recoveries in contested settings. Before joining Omni Bridgeway, she practiced at leading law firms NautaDutilh and Loyens & Loeff, gaining significant experience with the cross-border recognition and enforcement of arbitral awards in many jurisdictions, in particular against sovereigns and semi-sovereigns. Commenting on Hannah's appointment, Omni Bridgeway Chief Executive Officer, Andrew Saker said, "Hannah is an exceptional talent, with an impressive track record of successfully expanding our business lines into new regions. She has a keen eye for strategy and client development that is the perfect complement to Raymond's experience and expertise in sourcing and structuring complex deals. We could not be better positioned for continued growth with Hannah and Raymond leading our team and business in EMEA." Also in Amsterdam, the company is pleased to announce Kees de Visser has been promoted as Chair of the Investment Committee for EMEA, in which he oversees funding requests as a member of the company's global investment committee. Before joining Omni Bridgeway in 2016, Kees practised law, admitted at De Brauw Blackstone Westbroek where he handled large and high-profile cross-border litigation and enforcement matters and led the firm's private international law team. In London, Alistair Croft has been promoted to Senior Investment Manager with a focus on enforcement, contentious trust and insolvency matters. Prior to joining Omni Bridgeway in 2015, Alistair practised law for over a decade, becoming a barrister and a partner at a leading law firm with a broad practice advising on complex cross-border litigation, fraud, enforcement, and contentious trust matters for UHNWI and insolvency. Raymond van Hulst, said, "I am thrilled to have Hannah on board as Co-CIO, and with the promotion of Kees and Alistair we are poised for continued success in EMEA. In combination with our recent hires in Dubai and Germany as well as our expansion into France we are proud to attract and promote the top talent in the industry. This is core to our strategy of continuing to establish operations in more jurisdictions and markets than any other legal finance provider, in order to best serve our clients with local knowledge and experience."
Commercial Special Features

CFO’s and Litigation Finance: The Time is Ripe for Adoption

One of the holy grails of litigation funding has long been for funders to convince CFOs to view litigation through a commercial lens, and unlock the value of their legal assets. While straightforward and practical, the evolution of the CFO mindset on this issue has been slow to materialize. Many in the litigation funding community blame cultural norms—old habits are simply hard to break, which is especially true when things are going swimmingly. But with inflation upon us and a recession looming, the time is ripe for CFOs to reconsider their firm’s relationship to litigation funding. Research from Burford Capital in June of 2021 found that 75% of companies with over $1 billion in annual revenues reported unenforced judgments worth $20-$100 million in FY 2020, while at the same time, just 24% said they apply quantitative financial modelling to make decisions about litigation, as they do in other areas of the business. That research is now a couple of years old, but it underscores both the need for litigation funding, and the challenge that funders face when trying to convince CFOs to think differently about litigation. Change may finally be afoot. A recent global survey of CFOs conducted by Everest Group found improving cash flow continues to be a priority for a large majority of CFOs. As one respondent noted: “As the business environment continues to throw up shocks prompted by geopolitical uncertainty and sector disruption, CFOs should ensure that, as well as technological evolution, change management becomes a culture rather than a one-off exercise.” Indeed, macroeconomic constraints are forcing CFOs to re-prioritize. Gartner recently identified the Top-10 priorities for CFOs in 2023, based on Deloitte’s Autumn 2022 European CFO survey. The Top-5 among those are:
  • Coping with complex systems
  • Protecting margins and balance sheets
  • Acquiring and retaining talent
  • Raising capital
  • Finding focus
The second point stands out in relation to litigation funding—“protecting margins and balance sheets” is exactly the pitch that funders have been making to the CFO community for years now. PricewaterhouseCoopers conducted its own survey, and highlights the main topics on the CFOs agenda for 2023:
  • Navigate economic uncertainty
  • Enable growth
  • Take action on ESG
  • Accelerate transformation
  • Cultivate finance talent
  • Build trust and purpose
Responses such as ‘navigate economic uncertainty’ and ‘accelerate transformation’ should be music to every litigation funder’s ears. It’s clear based on the above data that litigation funding maintains a product/market fit, in that it addresses some of the core pain points CFOs are currently facing. That said, many CFOs still need to be brought to the table as to how their firms can benefit from the use of litigation funding. Advantages of Unlocking Capital Buried in Legal Claims Susanna Taylor, Head of Investments at Litigation Capital Management, highlights what she considers to be four core benefits of litigation funding for CFOs:
  1. Protecting the value of the business from the cost impact of litigation
  • “If the same case was financed by a third-party funder, then the business will not carry these legal expenses […] The operating profit in each year will be higher and the accounts will be a more accurate reflection of actual business performance.”
  • “Further, once the claim is successful, the company will be able to include the proceeds as profit which has been generated at zero cost.”
  1. Protecting the business from significant litigation risk
  • “The funder carries 100% of the financial risk involved in pursuing the claim and if the claim is unsuccessful, the funder will receive nothing. […] Litigation finance can include the offer of an indemnity against adverse costs and an agreement to meet an order for security for costs.”
  • “Using third-party litigation finance also removes uncertainty in forecasting legal spend, which can be highly variable and difficult to predict.”
  1. Insulating the business from unexpected claims
  • “Litigation brought against a company is an unwelcome consequence of doing business. These claims are almost always unexpected, unbudgeted and require action.”
  • “Importantly it offers the corporate client the opportunity to offset the costs and risks involved in defending claims, as well as allowing the business to apply its capital into growth operations rather than on uncertain litigation.”
  1. Unlocking the value that resides in claims
  • “Litigation finance allows companies to recognize the value in a piece of litigation at a time which suits them best.”
  • “These funds provided to the company can ‘plug the gap’ in expected EBITDA at no cost to the company.”
In an article for Global Banking and Finance Review, Ellora McPherson, Managing Director & Chief Investment Officer of Harbour Litigation Funding, points to the need for CFOs to consider alternative solutions in order generate value, which is especially true during today’s tumultuous economic climate. According to McPherson: “The macroeconomic lifecycle has no bearing on the outcome of disputes and litigation as an asset class itself it has little correlation to the wider market. This means that litigation funders have the capital to pursue meritorious claims at difficult times even when the businesses with the claims do not.” Commercial disputes are often worth tens or hundreds of millions of dollars. These legal claims are simply too valuable as assets not to be leveraged during times of economic upheaval. “It is now no longer a question of whether CFOs can afford to advance these claims,” says McPherson, “but whether they can afford to ignore these assets on their books any longer.” How CFOs Should Approach Funders If CFOs are to be swayed by the high-level arguments posed by funders as to the advantages of legal finance, they must first get comfortable with frontline interactions—what exactly should CFOs expect from a litigation funding partnership? What should they be on the lookout for, and what sets one funder apart from another? The lowest-hanging fruit answer here is cost of capital, but that is obvious. Beyond mere capital requirements, lies a plethora of differentiators which CFOs must account for when approaching and selecting the most appropriate funder for their legal claim (or portfolio of claims):
  • Flexibility. CFOs should select a litigation funder who will be their partner, not just their capital provider. Similar to an agreement with a lender, CFOs don’t want a funder who will balk the moment a curveball is thrown, especially if that curveball comes from somewhere out of your control (as is often the case with legal claims). Funder flexibility and adaptability is an important trait when considering the long-term relationship at stake.
  • Funder Capitalization. Per the aforementioned point, legal claims often take longer than anticipated, or tumble down rabbit holes no one saw coming. Does your funder have enough liquidity to backstop unforeseen circumstances? What is their policy during such a contingency? These are critical questions to ask.
  • Legal Sector Expertise. This is important for two reasons: firstly, so the funder understands the bespoke challenges posed by a given sector and doesn’t get cold feet should the case run up against those issues along the way, and secondly, so the funder can help consult on case strategy, should the claimant and law firm request (most funders are ex-lawyers, after all).
  • Enforcement. Winning a case is one thing, but collecting on the reward is quite another. Does the funder have a track record of enforcing victories—either via a third-party or in-house enforcement team?
  • Reputation. CFOs should consult with past clients to get a sense of how the funder interacts with both the client and the law firm. This is a triangular relationship, and it’s important that all sides work together towards a successful outcome.
Ultimately, Litigation Finance offers an opportunity to monetize what would otherwise remain an illiquid asset, and deploy that capital into a core business activity, thus increasing the enterprise value. That is an invaluable tool for any CFO looking to unlock value without having to resort to traditional capitalization methods, such as approaching lenders or equity partners. The CFO Roadmap Even companies with ample cash to cover attorney fees and expenses can benefit from the instant liquidity provided by litigation funders. Why wait years to unlock the value of a legal claim, when that capital can be put to work immediately? What’s more, the prevalence of litigation funding permits corporations to pursue litigation that they would otherwise leave on the table, and also to reject low-ball settlement offers which they might otherwise accept due to concerns over duration risk and case expense. For CFOs who want to understand if their firm is a strong candidate for litigation funding, there are several steps they can take:
  • Review the company’s litigation history. Have prior legal costs or outcomes influenced management’s thinking about pursuing potential legal matters? Perhaps it is time for a reevaluation of the firm’s approach to litigation.
  • Consult with internal legal staff to identify any matters that may have been deferred for one reason or another, and assess whether those prospective claims might represent strong candidates for litigation funding.
  • Speak with litigation funders or advisory firms to determine a full cost/benefit analysis, including estimates, milestones, duration risk, IRR/ROI potential, and more.
  • Understand the internal resource commitment your team is making, should you take on additional litigation with the help of a funder.
CFOs who follow the above roadmap stand to benefit by repositioning their legal department from a cost center to a profit center. This simple shift in mindset will help strengthen the balance sheet by producing higher net income, lower expenses, and an advancement of business strategies—all without the onerous conditions of a traditional loan.