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Case Developments Commercial

Federal Court of Australia Rules Litigation Funding Not Managed Investment Scheme

An Australian Federal Court has ruled that litigation finance agreements do not fall under rules regulating managed investment schemes under the Corporations Act of 2001. Many litigation finance scholars are hailing the decision as a win for the industry.  According to the ruling, the characterization of litigation funding arrangements as managed investment schemes, "is a case of placing a square peg into a round hole." Furthermore, the ruling suggests that for litigation funding to be considered responsible to the Corporations Act of 2001, the agreement would need to embody strict characteristics both in context and purpose.  Click here to read more about the ruling in detail.
Commercial Regulatory Issues

Insurance Europe Joins Associations Calling for Regulation 

Actuarial Post reports that Insurance Europe has joined a group of associations lobbying European Union legislations to engage regulation to rein in unsavory third party litigation funding practices. According to the Actuarial Post, the profit model behind litigation finance can foster social inflation. The report suggests that third party funders are forced to consolidate profit models, sometimes at the disadvantage of claimants. Actuarial Post says that key advantages can emerge from the European Union enabling regulation to police third party funders. Other associations involved with the letter include Europe (A4E), AmCham EU, BUSINESSEUROPE, DIGITALEUROPE, DOT Europe, EFPIA, Eurochambres, EuroCommerce, European Banking Federation, European Justice Forum, Insurance Europe, MedTech Europe and the U.S. Chamber Institute for Legal Reform.
Commercial People Moves

Omni Bridgeway Names Mark Wells Global Head of Portfolio Management 

Mark Wells has been named the Global Head of Portfolio Management at Omni Bridgeway. From Omni's London Office, Mr. Wells will be tasked with expanding the firm’s capital management structures, while also leading the financial structures team.  Mr. Wells comes to Omni from Calunius Capital. Previously, Mr. Wells spent two decades in derivatives trading at JP Morgan Chase and Toronto Dominion.  Mr. Wells says that he plans to help lead Omni Bridgeway's continued growth, particularly in the EMEA region.
Commercial Deals

International Legal Finance Association on Increasing Liquidity

The Global Legal Post reports that litigation financiers are experiencing increased cash flows with assets jumping more than 11% over the last year. With the jump in figures, Gary Barnett (Executive Director, International Legal Finance Association) says litigation finance is being widely accepted as a professional financial utility to access justice. Global Legal Post says that hedge funds are starting to look to litigation finance as an investment vehicle. Meanwhile, only 10% of cases presented to funders ultimately obtain funding. Funders are also considering a wide variety of additional products and services to offer potential customers.  Raymond van Hulst (EMEA Executive Director at Omni Bridgeway) warns that high liquidity may suffer in the near future. This, as inflation and interest rates are rising. Mr. van Hulst suggests that given these constraints, only the most attractive litigation finance franchises will be successful over the long term.
Announcements Commercial Deals

DLA Piper launches global partnership with UNHCR

DLA Piper today announces a new partnership with the UN Refugee Agency (UNHCR) that will see the two organisations working collaboratively to develop innovative responses to the global refugee crisis, enhance refugee integration and advocate for impactful, systemic change. During the first three years, DLA Piper will provide pro bono support worth over $3.7m and contribute financially to the agency’s global programmes.

The partnership has been developed in collaboration with UK for UNHCR, an organisation responsible for developing humanitarian partnerships with British corporations that support global relief efforts for refugees.

DLA Piper and UNHCR already have a long-established relationship spanning over ten years. Since 2012, the firm has provided more than 8,500 hours pro bono legal support valued at over USD 3,000,000 to UNHCR. This new phase of the partnership will focus on the co-development of innovative responses to the refugee crisis, including innovative finance models and impact investment, among other key areas.

According to UNHCR, there are now more than 100 million people who have been forcibly displaced from their homes. The number of displaced people has increased every year over the past decade and now stands at the highest level since records began. These unprecedented levels of displacement represent a global humanitarian emergency. The impact is especially pronounced on children, who account for 30% of the world's population, but 42% of all forcibly displaced people.

DLA Piper has long-standing commitment to working to protect the rights of refugees, displaced people and those who are stateless, with a particular focus on supporting the most vulnerable groups, including women, children and LGBT+ people. Human displacement has a number of components that are relevant to businesses as it affects how companies manage the relationship with their workforce, their value chain, the societies in which they operate and the political environment. Over the past ten years, the firm has worked to address the root causes and consequences of displacement by providing legal recognition for people on the move and supporting inclusion into destination countries.

This partnership with UNHCR is an extension of this work and DLA Piper’s ongoing commitment to protecting and upholding the rights of displaced people.

Simon Levine, Global Co-CEO, DLA Piper, said: “We are honoured to enhance our partnership with UNHCR. This is a unique opportunity to contribute to the organisation’s work and, ultimately, support displaced people all over the world. The current crisis in Ukraine is just one example of why UNHCR’s work is so critical.

“Legal protections are especially important when people’s lives are uprooted and they face challenges such as lack of basic shelter, violence, exploitation and restrictions on freedom of movement. As part of this new phase of the partnership, we will be working with UNHCR to support a fairer, more effective system, to develop new approaches and to help foster inclusion as people rebuild their lives.”

Jean-Pierre Douglas-Henry, Managing Director, Sustainability & Resilience, DLA Piper added: “This exciting partnership means we can amplify our work to protect the rights of displaced people globally. The partnership will involve innovative approaches to long-term issues that we hope will lead to positive and lasting change. At this crucial time our firm is excited to be collaborating with an organisation that is focused on building a better future for refugees.”

Emma Cherniavsky, Chief Executive of UK for UNHCR said: “We greatly value this new partnership with DLA Piper which builds on ten years of valuable support for UNHCR’s work. People fleeing conflict and persecution are amongst the most vulnerable people in the world, with many on the front lines of the climate crisis or facing significant barriers to employment, and DLA’s partnership will help deliver innovative solutions to support them.”

About DLA Piper

DLA Piper is a global law firm with lawyers located in more than 40 countries throughout the Americas, Europe, the Middle East, Africa and Asia Pacific, positioning us to help clients with their legal needs around the world. In certain jurisdictions, this information may be considered attorney advertising. dlapiper.com

Commercial Deals

Video: Aera-IP on Litigation Finance in Europe and Abroad  

Patent and trademark litigation is forecast to increase as Europe’s Unified Patent Court (UPC) opens in Q4-22, or Q1-23. Aera-IP is a Nordic consultancy focused on serving clients with various EU IP claims. Aera-IP has published a series of videos profiling what legal professionals should expect when the UPC opens, and what funding opportunities may be available to inventors.  Aera-IP’s video discussions on the future of IP litigation are expansive, with four features totaling nearly two hours of discussion. Aera-IP features Stephanie Southwick (Investment Manager and Legal Counsel at Omni Bridgeway), in a near half-hour video discussing litigation investment insights for funding EU IP claims.  With the opening of Europe’s UPC, many are forecasting a wide range of international patent and trademark claims that could set historic precedent in terms of inventor protections. Click here to check out Aera-IP’s video discussions.
Commercial Legal Innovation

The Value of Appellate Funding 

The time and effort behind multi-year litigation is at the mercy of the appeals process. Litigation finance is rapidly being engaged to fund various approaches to the appeals process. Furthermore, quality appeals financing is often engaged in the form of judgment preservation insurance.    Woodsford has published the firm’s approach to investing in cases associated with appellate proceedings.  Bringing a case to court is contingent on financial planning and liquidity. The same can be said for navigating the appeals process. The concept of navigating the appeal of an award is generally not part of per-appeal litigation investment contracts. Those seeking to overturn claim awards via the appeals process may find it daunting  to be on the other end of claimants and their litigation funders, with ample resources at their disposal.  Adversaries often seek to leverage appellate pre-settlements as a negotiation exercise. Judgment preservation insurance is being embraced as a tool that mitigates recovery delays associated with the appeals process.
Commercial Legal Innovation

New York as Capital of International Arbitration Demand

Serving as the center of global finance, New York may soon grow to become the world’s capital of international arbitration proceedings. Today, New York is ranked sixth in the world for arbitration proceedings, tied with Beijing, China. New insights published by Burford Capital suggest that market forces are fostering a scenario for New York to move up arbitral ranks as world markets seek relative stability. This, as New York’s court system has historically been recognized as one of the world’s most legitimate, while also embracing responsible legal innovation.  Buford Capital’s research profiles international arbitration as the most agreeable way to settle cross-border disputes. Global jurisdictions such as Latin America, the Caribbean, the Middle East and North Africa are expected to experience an increase in claims seeking international arbitration as a solution to settle differences.  As global financial markets are forecast to ebb and flow over the near future, Burford seems to suggest that New York legal innovation has systematically survived the test of time. Making New York an agreeable destination for quality international arbitration proceedings.    Burford’s research points to a forecasted increase in international arbitration surrounding the construction industry. Similar to leading quality innovation in law, New York is also home to some of the world’s most notable success in construction. As investment in construction-based international arbitration proceedings is expected to increase, New York may take advantage of market share opportunities where possible.