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Commercial Regulatory Issues

Video: Liberty Mutual on Global Litigation Finance Transparency 

Mike Fallon (President of Major Accounts at Liberty Mutual Global Risk Solutions) spoke with Meg Green at Engage RIMS 2022 in San Francisco about the impact social inflation has on litigation finance. Mr. Fallon suggests that greater transparency is necessary from Liberty Mutual Global’s perspective. Mr. Fallon’s interview with Ms. Green suggests that during jury deliberations, jurors should be aware of fundamental funding arrangements that brought the case to court. Fallon notes that social inflation is a byproduct of COVID-19 supply chain disruptions. Mr. Fallon also describes how litigation finance is a prime utility for many who require investment dollars to bring a case to completion.  Click here to watch the interview.
Commercial

The Attorney’s Litigation Finance Lexicon Handbook 

As the global litigation finance industry flourishes, new phrases, old phrases and modified legal vernacular are molding new products and services. This, as litigation investors build legacy franchises. As industry innovation continues exponentially, it is key for attorneys to have a model guide or handbook to familiarize themselves with conversational industry terms.  Lake Whillans has collated 54 of the litigation finance terms that make the industry go ‘round. Litigation Finance Journal has organized the terms below, click the hyperlink to be directed to Lake Whillans’ definition for reference. 
Commercial Regulatory Issues

Council of Bars and Law Societies of Europe on Private Litigation Funding 

Representing bars and law associations of 45 countries and over 1M attorneys, the Council of Bars and Law Societies of Europe (CCBE) has published insights into third party litigation funding best practices. CCBE’s report is in response to the European Parliament’s draft on responsible frameworks for nurturing the future of third party funding. As an added bonus, Litigation Finance Journal has collated 25 highlights to CCBE’s findings.  According to CCBE, funding agreements should be developed around client interest and avoid complications associated with conflicts of interest.  CCBE states that third party funders should be regulated under European law, but also stresses the importance of ancillary legal service providers falling under similar provisions of regulation. CCBE makes comments on the nature of nonprofit organizations and suggests clearer definitions associated with nonprofit client/attorney relationship protections.  CCBE warns of situations where conflicts of interests are generated between a complicated network of counterparties striving to drive returns against ethical provisions of the law.  Click here to read CCBE’s findings, along with our 25 highlights to the report. 
Commercial Deals

Insolvency Funding in France 

French insolvency proceedings have unique opportunities, according to Insolvency and Restructuring International. Third party funders can be engaged to help companies navigate insolvency proceedings. Oftentimes, French third party funders help companies in the form of cash advance proceeds, yet they also purchase the legal claims of insolvent companies, in the hopes of earning a hefty ROI on the legal claim.  Insolvency and Restructuring International Vol.16 features Alexandra Szekely and Chloé Delamourd’s research into third party insolvency vehicle engagement in France.  Their research covers instances where an insolvency agreement is reached and then purchased back from the original seller, among other unique third party funding instances under French law. For example, the research suggests that third party insolvency funders have prime opportunities to capture value from the receivables of a firm under bankruptcy proceedings.  Click here to read more on the latest insights spanning French insolvency law. 
Case Developments Commercial

Law Society of Scotland on Post Office Scandal Litigation 

The Law Society of Scotland shares a new debrief of the Post Office scandal. The story goes: When the Horizon computer system found over 736 sub-postmasters were allegedly grifting from the United Kingdom’s postal budgets, they were summarily punished. However, Horizon’s back office capabilities were later found to contain bugs and other system defects that allegedly found workers at fault by mistake. Enter litigation funding, a utility that many of the former post office workers found necessary to clear their name.  According to the Law Society of Scotland, February of 2022 saw the initiation of a public debate and investigation on the totality of the Post Office scandal’s effects. The whole affair is being dubbed an extreme case of United Kingdom justice malfeasance. Furthermore, the Law Society explains that about 10% of the 736 criminal records have been overturned. A class of 555 claimants have won restitution, totaling £20,000 each.  Click here to read more about the Law Society of Scotland’s take on the Post Office Scandal.
Commercial

The Legal 500 Lists the UKs Top Litigation Financiers 

Editor's note--Legal 500 first published the below rankings in 2021. This ranking has resurfaced in 2022, though to our knowledge Legal 500 has yet to update its rankings, nor has it published its methodology.  The inaugural edition of the Legal 500 list of top litigation finance franchises in the United Kingdom has been published. Legal 500 likens litigation investment to tennis, in that winners are decided by those who hit the ball out of bounds less than their rivals. The Legal 500 says top litigation investors look to make four to ten times the cost of investment when choosing claims for funding.  The Legal 500 alludes to innovation in the litigation finance space, and cites portfolio funding as the crux of a successful legacy franchise. With safety in numbers, the best-performing litigation investors are navigating market ebbs and flows through portfolio risk mitigation. Litigation Finance Journal has collated a list of the Legal 500’s leading UK litigation financiers below: 

Rankings Table

First Tier
  • Burford
  • Harbour
  • Therium
Second Tier
  • Augusta
  • LCM
  • Omni Bridgeway
  • Vannin Capital
Third Tier
  • Bench Walk Advisors
  • Balance Legal Capital
  • Woodsford
Commercial

Video: Mass Tort Finance Innovation 

Max Volsky (co-founder, chief investment officer and general counsel at Lexshares), recently profield how Lexshares approaches funding mass tort claims. According to Mr. Volsky, Lexshares often funds firm portfolios composed of meritorious mass tort claims. Mr. Volsky says that Lexshares’ products and services are designed for individual attorneys and large law firms alike.  In the video interview, Mr. Volsky walks through various scenarios of the Lexshares mass tort review process. Volsky says that the non-recourse nature of litigation finance is an attractive feature for many, as opposed to traditional finance options. Volksy says that if a story is interesting and the case has value, Lexshare is happy to consider these characteristics for mass tort funding review.  Click here to watch the full mass tort interview with Mr. Volsky.
Commercial Regulatory Issues

The Arkin Cap Debate 

The Arkin Cap has traditionally been a guide associated with governerning the costs of litigation finance agreements. However, over a series of recent rulings, justices in the United Kingdom allude to their own autonomy, given individual case nuances. This implies that the concept of the Arkin Cap is not guaranteed in any litigation.  Insights outlined by Stewarts Law profile though surrounding the Arkin Cap as a binding rule. With various organizational matters part of litigation finance agreements, modern interpretation of the Arkin Cap has evolved. For example, the Arkin case included a litigation finance agreement that only covered a portion of case costs.  Since the Arkin case, similar scenarios have occurred, where justices have precluded the Arkin Cap under other contractual arrangements. Click here to learn more about the latest Arkin Cap debates.    
Case Developments Commercial

Global Electricity Cartel Faces Class Action 

Burford Capital is funding litigation exploration of a potential claim that alleges that some of the world’s largest electricity cable makers conspired to inflate cable prices in a fraud paid for by millions of consumers in the United Kingdom. The higher costs of the alleged cable fraud have been passed onto consumers since April, 2001.  According to reports on the matter, a similar cartel operated between 1999 and 2009, in which $319M in fines were awarded. Given that consumers pay for the high voltage cables as part of their utility bills, the new case aims to recover damages and court costs associated with any modern electricity cartel operating at the expense of United Kingdom consumers.  Click here to learn more about the case.