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Case Developments Commercial

Billionaire Leon Black Accuses Co-Founder of Malicious Smear Campaign

Is Josh Harris, co-founder of Apollo Global Management, engaged in a plot to take down his former partner? Leon Black thinks so. He’s currently fighting a civil claim from his former mistress, Guzel Ganieva, who has accused him of sexual assault. Black is adamant that she is extorting him and that the years-long affair was consensual. Fortune explains that Black has filed a countersuit against his former lover, saying that an unnamed litigation funder and an as-yet-unidentified public relations team have joined forces, specifically to malign him publicly. Allegations against Harris assert that he used a PR firm to spread misleading information about Black’s business relationship with criminal sexual predator Jeffrey Epstein. Black was cleared of wrongdoing by a review commissioned initiated by Apollo, and appointed Marc Rowan as CEO last year. This effectively left Harris in the cold, possibly spurring his alleged campaign of harassment. How likely is it that a litigation funder would engage in a coordinated effort to smear someone? Surely such a gamble could reflect poorly on everyone involved, regardless of the outcome. We will keep an eye on any further developments. 
Announcements Commercial Fundraising

LexShares Raises $100 Million Litigation Finance Fund

 LexShares, a tech-enabled leader in litigation finance, today announced the oversubscribed closing of LexShares Marketplace Fund II (LMFII), a $100 million fund dedicated to investments in commercial legal claims. LexShares’ deployment of the fund will be overseen by new chief executive officer, Cayse Llorens, who joined the firm’s senior leadership team in 2021.

Investment in the fund was led by Titan Advisors, a $4.5 billion alternative investments firm, with additional participation from several institutional investors and select family offices.

“We are excited about our participation in LexShares Marketplace Fund II and our relationship with LexShares,” said Rob Wilson, Titan Advisors’ Director of Insurance Dedicated Funds. “We feel LexShares’ increasing prominence in an industry with multi-decade growth potential supports the objectives we share with our investors. We believe in LexShares’ mission to use technology to source high-quality investment opportunities and, more broadly, to use capital to empower litigants with valid claims to fully access the promise of the civil justice system.”

The successful closing of LMFII follows another major milestone for the litigation funder. In 2021, LexShares received a majority investment from Brockhurst Capital Partners, a Chicago-based private equity firm focused on specialty finance. As part of the investment, Brockhurst’s founding partner, Mr. Llorens, was named LexShares’ CEO. An accomplished technology entrepreneur and investor, Mr. Llorens will guide the firm’s strategic direction while spearheading LexShares’ deployment of LMFII.

Before founding Brockhurst, Mr. Llorens was a venture capital investor at Invest Detroit Ventures, OCA Ventures, and Hyde Park Venture Partners. Previously, he led software engineering teams through the $240 million IPO of R1 RCM, the $1.8 billion acquisition of Coyote Logistics by UPS, and the $400 million acquisition of BSwift by Aetna. Mr. Llorens graduated summa cum laude in computer engineering from the University of Illinois Urbana-Champaign and earned his MBA with honors from the University of Chicago Booth School of Business.

Mr. Llorens joins the LexShares management team and board of directors alongside the firm’s co-founders, president Jay Greenberg and chief investment officer Max Volsky.

“Over the past eight years, LexShares has become one of the most active litigation funders in the market, using technology-driven insights to help our team source more than 140 investments,” said Mr. Llorens. “From the start, LexShares has sought to facilitate greater participation in the legal system while expanding access to a growing asset class. Backed by this fresh capital, we will continue to explore new applications of technology where it meets the law, strengthening LexShares’ position as a leader in the middle market of commercial litigation finance.” 

About LexShares

LexShares is a leading technology platform for litigation finance, with an innovative approach to originating and financing high-value commercial legal claims. LexShares funds litigation-related matters, primarily originated by its proprietary Diamond Mine software, through both its online marketplace and dedicated litigation finance funds. Founded in 2014, the company is privately owned with principal offices in Boston and New York. For more information, visit

lexshares.com.

About LexShares Marketplace Fund II

LexShares Marketplace Fund II (LMFII) is the company’s second discretionary fund dedicated to providing access to a portfolio of litigation-related assets. LMFII has retained Seward & Kissel LLP as its legal counsel, BDO USA, LLP for tax and auditing services, and SS&C Technologies Inc. as its fund administrator.

This release may contain “forward looking statements” which are not guaranteed. Investment opportunities posted on LexShares are offered by WealthForge Securities, LLC, a registered broker-dealer and member FINRA / SIPC. LexShares and WealthForge are separate entities. Investment opportunities offered by LexShares are “private placements'' of securities that are not publicly traded, are not able to be voluntarily redeemed or sold, and are intended for investors who do not need a liquid investment. Investments in legal claims are speculative, carry a high degree of risk and may result in loss of entire investment.

Commercial

Maximizing Global Litigation Portfolios

Burford Capital is a worldwide leader in legal asset management and litigation finance. With a footprint in New York, Hong Kong, Singapore, Sydney and Washington, Buford’s legacy is pegged to innovating law structures and philosophies.  The Buford Quarterly recently profiled thoughts and ideas focused on maximizing litigation finance portfolios. Buford’s Craig Batchelor directs the firm’s investment underwriting risk. Batchelor further outlines some strategies for accelerating legal capital via litigation funding.  Here are some key takeaways from Batchelor’s findings: 
  • Litigation finance portfolio management is not understood by most. Therefore, experts must teach and learn from global thought leaders on litigation finance portfolio management structures. 
  • Data should be engaged to assess how litigation assets may appreciate over time, via clever execution of portfolio planning.
  • Prioritization of litigation assets is best focused on winning at the beginning, for exponential legacy portfolio returns. 
  • Mergers, acquisitions and competition based litigation funding is currently undervalued, according to Batchelor. 
Check out the Buford Quarterly to learn more on litigation finance portfolio management.   
Commercial

New Woodsford Guide, Litigation Funding 2022

Woodsford released a new guide titled, “Litigation Funding 2022.” The guide explores the practice of law across 23 jurisdictions worldwide. This is the sixth Litigation Funding edition by Woodsford.   Woodsford’s guide covers global jurisdictions from Spain, Sweden, Japan and India, as litigation funding across the planet continues to mature. Australia’s government is exhibiting some legislative pushback to litigation investors, something Woodsford teases as an, “attack on the access to justice.” Broadly, Woodsford reports that litigation funding is being embraced through innovation. One such example is that the British Virgin Islands approved it’s first litigation funding agreement back in 2020. Similarly, the Cayman Islands enacted the Private Funding Legal Services Act in 2021, which is considered a major achievement for the Caymans. Likewise, Singapore’s International Commercial Court has approved its own third party funding framework.  In New York there is resounding support for litigation funders, service providers and their investors. Experts are hailing third party funding as a mechanism to level the playing field and create new channels for justice to prosper.  Woodsford profiles ligaition finance as a significant contributor to the legal fabric of the world. Check out Woodsford’s complete guide to learn more. 
Announcements Commercial Deals

Nivalion and Litigium Capital enter into strategic partnership in the Nordics

Nivalion, Europe’s leading provider of legal finance solutions, and Sweden-based legal financing firm Litigium Capital have entered into a strategic partnership. The partnership comprises funding of disputes and provision of legal financing solutions in Denmark, Finland, Norway and Sweden as well as financing Nordic clients globally. Within the scope of the partnership, Nivalion and Litigium Capital will work closely together on a non-exclusive basis and aim to co-fund cases of all sizes. The partnership will be seamless for clients, who can contact either firm with the assurance that no information will be shared between Nivalion and Litigium Capital without the prior consent of the client. Stefan Kirsten, Nivalion’s Global Head of Origination, says: “The Nordics have been a key growth area for Nivalion for years and a market we appreciate for many reasons. Having worked together with Litigium Capital on several joint projects with great satisfaction, we are thrilled to announce this next step. We are firmly convinced that this partnership is a great match, and we look forward to driving the continued development of the Nordic legal finance market, making Northern Europe an-other stronghold for Nivalion.” Thony Lindström Härdin, CEO and co-founder of Litigium Capital, says: “We are honoured to join forces with Nivalion, which in our view has the leader jersey within legal financing in Continental Europe. The cooperation thus far has been a win-win and we have no doubt that a partnership will be highly beneficial for the Nordic market as a whole. We see a strong and growing interest for our services from all Nordic countries and expect an exciting journey ahead.” About Nivalion Nivalion is a Swiss legal finance provider with offices in Zug, Munich, Frankfurt and Vienna. We focus onfundingcomplexlitigationand arbitrationdisputes in Europe,theAmericas and Asia-Pacific, including direct and secondary funding of individual cases, case portfolios and law firms. Our team includes 29 professionals with substantial experience in dispute financing and private practice in leading financial institutions and law firms, offering the financial strength of its Swiss core investors. Nivalion is a member of the International Legal Finance Association (ILFA) and is committed to and compliant with the ICCA Queen Mary Task Force Best Practices, the ILFA Best Practices and the SIArb Third Party Funding Guidelines. More information on www.nivalion.com. About Litigium Capital Litigium Capital is a Swedish investment company dedicated to legal financing. We focus on funding litigation and arbitration disputes in the Nordics, as well as funding Nordic clients on a global basis. Combining legal and financial expertise for superior risk assessments and customer service, our vision is to make legal financing a natural tool for companies of all sizes in the Nordics. More infor-mation on www.litigiumcapital.com.
Case Developments Commercial

High Court Reduces £3M+ Claim to £21K

A London High Court recently ruled that a litigation funder had no material evidence to achieve a successful claim. Henceforth, the Court reduced a £3M+ litigation finance claim down to just over £21K in a recent ruling.  LawGezette.co.uk reports that the litigation firm, Candey, had no reason to break the rules of the court when the funding agreement went sour. According to Candey, the trouble started when the client revoked an agreed retainer. The client was upset when Candey allegedly refused the client’s rights of privilege in returning private bank statements.  Candey sued its former client for proposed fraud and misrepresentation; specifically a type of deceit that would violate retainer contingencies. Candey argued that the retainer had specific implied terms. However, the High Court noted that in any legal matter between a client and solicitor, a retainer is not a prerequisite, nor is it required. The Court suggested that the retainer is not subject to ‘good faith’ duty.  Overall, it appears that the High Court found Candey’s petition had little or no chance of success. 
Commercial Deals

Is Tennis Australia Paying Legal Fees for Novak Djokovic? And if so, Why?

Multiple unnamed sources have asserted that Tennis Australia, funded by taxpayers, is covering the legal fees of 20-time Grand Slam winner Novak Djokovic. Organizers of the Australian Open are believed to have agreed to cover expenses for the Serbian tennis star as they battle for him to compete in Melbourne. But is it fair to foist that responsibility onto taxpayers? There must be a better way!

Daily Mail explains that Djokovic left Australia last week after an 11-day legal skirmish over an exemption to the COVID vaccine mandate. A team of expensive lawyers was hired to represent Djokovic as he attempted to defend his title.

Tennis Australia has not made a statement denying allegations that it paid the legal fees. The estimated total for the legal fees is about half a million dollars. Astronomical as that number is, it doesn’t account for any possible appeals. Despite the high price tag, Djokovic’s visa was canceled last Friday.

For Australian taxpayers, this is a lose-lose situation. Paying Djokovic’s legal fees is bad enough, but had the government had to pay, taxpayers would have covered that as well.

Perhaps the question we should be asking is—why is the government footing the legal bills of a tennis start from Serbia? Surely third-party legal funding would make more sense than asking Australian taxpayers to cover those expenses. Australia is a global leader in litigation funding, and Djokovic would likely find ample opportunity to enter a litigation funding agreement that would cover his expenses with non-recourse funds.

A statement from Tennis Australia affirms that the organization respects the Immigration Minister’s decision to revoke Djokovic’s visa. It went on to say that the priority is to put on a great sporting event and that this incident has become a distraction for both fans and players. The statement concluded by asserting that the focus should now be on the game.

Commercial Regulatory Issues

Enforcing and Monetizing Arbitral Awards in Brazil

Understanding the difference between monetization and enforcement is essential when developing a strategy to navigate a situation requiring an award to be enforced. This was discussed by Annie Lespérance, Head of the Latin American group at Omni Bridgeway. Also speaking were Henrique Forssell and Wieger Wielinga. Omni Bridgeway details that from a funding perspective, enforcement involves a funder who provides non-recourse financing to pay the cost of enforcement. After a successful recovery, expenses and a return on investment will be collected by the funder. A monetization agreement involves funders paying an advance to the claimant, plus the costs of enforcement. Funders will still receive a share of the award—or they may buy out the award or judgment to become the primary award holder. Ideally, most funders would prefer to keep their relationship with award holders active, since they are likely to have information that’s helpful to enforcement. How does enforcement work? Claimants are encouraged to consider how to enforce a judgment at the beginning of a case. Precautionary measures can then be taken early on, including stopping the sale or transfer of assets. An investigation is vital, and building a team of experienced investigators specializing in enforcement is a good start. Once the team gathers strong evidence with which to convince a court, many courts are willing to take steps to compel defendants to pay a judgment. A strong team can induce even the most reticent debtor to pay. The Brazilian economy is expansive and complex. Debtors can use sophisticated means to hide assets from creditors—offshore accounts, trusts, foreign bank accounts, and unscrupulous third parties devoted to helping clients avoid paying their debts. Courts in Brazil also tend to recognize and enforce judgements made in global jurisdictions. The ability to freeze accounts without going to banks directly, for example, is one way Brazil succeeds in defeating reticent debtors.
Commercial Fundraising

London Startup Legal Utopia Begins Crowdfunding for GBP 200K

Legal Utopia, a London LawTech startup, recently launched a Seedrs crowdfunding campaign. It is hoping to raise GBP 200,000 in capital to further its mission to disrupt the legal industry. B Daily News reports that Legal Utopia uses AI to empower small businesses and consumers, and will use the funds to branch out into litigation funding, collective actions, and to grow its workforce. The startup uses analysis of over 100,000 cases to find the best legal services matches for clients. Legal Utopia received its first grant in 2018, and has since developed cutting-edge AI in collaboration with respected global law firms.