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Case Developments Commercial

Therium Funds High-Profile Claim By Malaysian Royal Heirs

A litigation funding giant has found itself in opposition to the Malaysian government, by funding a lawsuit by the heirs to the Sultanate of Sulu, in a claim valued at $14.92 billion. Whilst high-profile cases are not foreign to the world of litigation finance, it is certainly a unique position for a funder to be involved in a dispute between a country’s royal family and the state’s government. Profiled in an in-depth feature by The Edge Markets, the claim by the heirs of the late Sultan Jamalul Kiram II comes as a result of an arbitration judgement by a French court, which ruled the Malaysian government was required to pay the nearly $15 billion in damages. This was a result of the state failing to make an annual payment agreed to in an 1878 accord over sovereign land rights, which the government ceased paying in 2013 due to armed militants occupying the area. When the government refused to compensate the heirs of the Sultan for those stated damages, bailiffs working on instruction from the plaintiffs seized two companies belonging to the state-run oil corporation Petroliam Nasional Bhd. While the Paris Court of Appeal has issued a temporary halt on the initial arbitration ruling, the heirs’ legal team led by Paul Cohen, of 4-5 Gray’s Inn Square chambers, have stated that the halt is only enforceable in Paris. While this matter is far from resolved, it is clear there is an appetite among high-profile funders to attach themselves to such cases where the opportunity to gain a significant financial return is available.
Commercial Deals

Top Australian Funder Sees Opportunities in a Post-COVID Market

The impact and the effects of the COVID-19 pandemic are still unfolding across the globe, and its disruption of key industries may result in a follow-on surge in class action cases. Whilst most businesses fought to stay profitable or even afloat, the financial support offered by many governments around the world also helped support businesses that had fundamental flaws or failings pre-pandemic. Interviewed by The Australian Financial Review, the executive chairman of CASL, John Walker, predicts an influx in class actions now that businesses will once again come under tight scrutiny of their activities. This prediction comes with the added weight of CASL building a sizable war chest of $155 million to fund such litigation, with Mr Walker highlighting the area of ESG as a potential firestorm of future claims. Mr Walker also linked the expected rise in claims to the potential for even greater levels of third-party funding due to the continuing increase in inflation, and with investors looking for safer bets than equity investments. Despite regulatory tightening on the funding industry by the previous Australian government, he also expects the new administration to make gradual, if not immediate, changes that will widen access and opportunity for claimants seeking external funding.
Commercial Deals

The Stage Is Set For A Boom In Litigation Funding in Scotland

With instability at the highest levels of government in Westminster, and an economic downturn preoccupying the minds of everyone from Canary Wharf to the small business owner on the high street, flexibility in third-party funding legislation is likely to drive a surge in litigation. This is particularly true in Scotland, where previous regional legislation had prevented a wider adoption of litigation financing. But now local as well as national funders are standing by to support a rise in the number of claims being filed. Writing in The Scotsman, Edward Gratwick, a legal director at Addleshaw Goddard, sees the industry moving in one direction: upward. He notes that since Scotland’s Civil Litigation Act came into law in 2020, the types of litigation finance agreements that have been allowed in this jurisdiction have significantly expanded. As a result, potential claimants who were shut out of the system due to a lack of capital, are now able to seek justice with the help of an enthusiastic cadre of funders. Mr Gratwick also highlights that while under previous regulatory structures, these funding agreements mostly revolved around insolvency cases, we should expect to see a variety of commercial cases take advantage of funding opportunities. This is further reinforced by the growth of new startup funders specifically catering to regional UK markets, as well as London-based firms hoping to find new revenue channels outside the capital.
Commercial Legal Innovation

2022 Thought Leaders in Litigation Finance 

Since 1996, Who's Who Legal has been examining the International legal scene to decipher trends in litigation finance innovation development. In a new research report, WWL Thought Leaders: Third Party Funding 2022 explores the latest cutting edge insights into the global litigation investment marketplace.  WhoseWhoLegal.com features Eric Blìnderman (CEO at Therium Capital Management) and James Little (Principal of Drumcliffe) in Q&A sessions on the evolution of litigation investment. Blinderman and Little are considered LF pioneers, well-regarded within the industry. Click here to read more.
The LFJ Podcast
Hosted By Jason Bertoldi |
In this episode, we spoke with Jason Bertoldi, Head of Contingent Risk Solutions for WTW, one of the world’s largest insurance brokers. Jason discussed the marketplace for contingent risk insurance and the various uses cases for contingent risk insurance products, why claimants and funders would want to insure a case that has a high probability of success, how insurance carriers weight the different underwriting factors, and how he sees the contingent risk insurance sector evolving from here. [podcast_episode episode="10179" content="title,player,details"]
Commercial

Omni Bridgeway on Defense Side Financing

The vulnerabilities of being on the defense side of litigation are immense. According to a new Omni Bridgeway research report, there are opportunities for claimants to leverage world class defense side opportunities as part of portfolio strategies.  Jason Levine (Investment Manager and US Legal Counsel at Omni Bridgeway) highlights that settlement is normally the likely outcome of litigation; funders can express returns in a variety of ways. Shifting upfront litigation exposure to the funders is oftentimes a worthwhile investment for claimants looking to diversify their risk exposure.  Similarly, defense side funding opportunities hedge against abusive litigation from opportunistic adversaries. Check out Omni Bridgeway's conversion on defense side litigation here. 
Case Developments Commercial

Bundled Class Against Apple APP and Google PLAY Stores

Czech-based funder LitFin has announced a bundled action against Google and Apple concerning their application store download purchase agreements. LitFin alleges that Google and Apple have abused their market dominance by inflating in-app commissions at or above 30%.  According to LitFin, Google and Apple have been subject to intense litigation that have assessed billions of dollars in fines and levies against their application store terms and developer revenue share policies.  LitFin suggests that both the Apple APP and Google PLAY stores have engaged in monopolistic behavior. LitFin's class action lawsuit aims to set precedent for more equitable and fair dealing in application design and product innovation.  Click here to find out more. 
Commercial

Ethics and Values Behind Litigation Finance Products and Services 

Above the Law profiles thoughts and ideas behind ethical communication of third party funding products during attorney-client discussion. Marla Decker argues that clients often have a material benefit in engaging legal finance options for strong case claims.  Ms. Decker argues that all attorney-client conversations should embrace ethical duty and care when it comes to financial benefits of litigation finance. Monetization of claim awards is a unique opportunity for many to expand bottom line growth. Therefore, Ms. Decker suggests that it is an ethical imperative for values-focused attorneys to properly discuss third party funding options with clients.  Click here to learn more about Ms. Decker's insights.   
Commercial Regulatory Issues

The Argument Against Forced Legal Finance Agreement Disclosure 

Keith Sharfman (Professor at St. John's University School of Law) has a new feature arguing against mandatory litigation finance agreement disclosure in the 94 New York State Bar Journal 36. Mr. Sharfman's article covers unique approaches to legislation targeted at third party funders and their clients.  Sharfman's research concludes that financial privacy is subject to degradation under forced litigation agreement disclosure rules. Furthermore, Mr. Sharfman alludes to the notion that claimants who have not received funding face discriminatory acts from adversaries who may take advantage of those who have not received funding.  Mr. Sharfman therefore suggests that lawmakers reject mandatory legal funding agreement disclosure.