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Commercial

Claimants Sought for Possible Tyro Payments Class Action

An investigation of claims is underway as Bannister Law Class Actions determines whether a class action against Tyro Payments Limited is warranted. Tyro is a powerhouse provider of payment acceptance logistics, currently serving more than 32,000 businesses in Australia. Bannister Law details that in January of this year, many businesses have been unable to utilize Tyro’s services due to connectivity issues on Tyro’s end. This left businesses unable to accept credit or debit card payments—drastically reducing revenue and depleting consumer confidence. Those whose businesses have been impacted by Tyro are being asked to sign up as potential claimants in the class action. There is no cost to potential claimants as Court House Capital is funding the action. Compensation may include damages for:
  • loss of sales revenue
  • losses and damages suffered when seeking replacement services
  • loss of service fees for services not provided
  • loss of goodwill and customer satisfaction
Eligible parties include those who had business contracts with Tyro before January 5th, 2021. Those who had connectivity issues from January of this year onward, and those who endured business losses due to Tyro issues. The claims in the potential case are as follows:
  • Tyro breached statutory warranties, which imply that services will be provided with appropriate skill and care.
  • The services provided are unacceptable and do not achieve their intended purpose.
  • Any reasonable consumer would be dissatisfied with the services provided by Tyro, and that the company is in breach of contract.
  • Tyro stated that its services have less than .1 percent of downtime, which was not accurate for many impacted customers.
Court House Capital is an Australian litigation funder located in Sydney. They focus on insolvency claims, commercial litigation, and class actions in Australia and New Zealand. Court House Capital is currently investigating multiple potential class actions.
Announcements Commercial

Pathfinder Minerals books annual loss as it pursues Mozambique claim

Mining company Pathfinder Minerals booked a full-year, as it continues to pursue a legal claim over ownership rights in Mozambique. Pre-tax losses for the year through December amounted to £0.67 million, compared to a year-on-year loss of £0.87 million. 'With a new chief executive appointed during 2020 and fundraises during the first half of 2021, Pathfinder is in the strongest position it has been in for several years to recover value through a substantial claim against the government of Mozambique under the Mozambique-United Kingdom Bilateral Investment Treaty,' chairman Dennis Edmonds said. 'With estimated losses in connection with the diversion of its licence, including lost profits, exceeding $621 million, a legal opinion from counsel in the company's favour, and the means to progress a claim to the point of securing third-party litigation funding, the opportunity for Pathfinder is clear.' 'Pathfinder has also broadened its horizon to actively consider exploring additional opportunities in advance of, in parallel with, or subsequent to, a resolution of the expropriation.'
Announcements Commercial

Flight PS752 Class Action Certification Order

The Honourable Justice Glustein signed the Flight PS752 Class Action certification order for the class action arising from the downing of UIA Flight PS752. On January 8, 2020, UIA Flight PS752 was shot down moments after takeoff from Iran on its way to Canada via Ukraine. There were no survivors.
The class action is on behalf of the passengers and the passengers' families. It alleges the Islamic Republic of Iran, the Islamic Revolutionary Guard Corps (IRGC) (collectively the Iran Defendants) and Ukraine International Airlines PJSC (UIA) are legally responsible for the downing of Flight PS752. Previously, the Court found the class action is "the preferable procedure for the resolution of the common issues in an action and provides a fair, efficient, and manageable method for advancing the class members' claims." "We are grateful the court made another order in our favour" said representative plaintiff Vahid Hezarkhani, whose sister-in-law and brother-in-law were on Flight PS752. "This is another major litigation milestone as we prosecute the class action for the passengers and their families. We will continue to work with the various stakeholders as we seek justice and compensation" said Tom Arndt, of TWA Law, class counsel representing the class members. The class action was commenced January 20, 2020. In September 2020 the court approved the third-party litigation funding agreement with Galactic Litigation Funders. In November 2020, the court determined that the Class Action and TWA Law were the best class action and best law firm positioned to advance the interests of the victims and their families, permitting this class action to go forward, staying similar actions commenced by other counsel. Formal notice of certification will be published shortly. Class Members and interested individuals are encouraged to consult the case specific website regarding progress of the litigation: www.flightps752.ca
Commercial

Litigation Finance Can Help GC’s Maintain Control

Is an existential threat to the legal world looming? A survey of over 1,000 GC’s suggests that many of them fear the future promises smaller budgets, heavier workloads, and more pronounced risk for in-house legal teams. For many businesses, litigation funding can be a vital part of the solution. Omni Bridgeway details that legal funding can be used for a variety of fiduciary benefits, including reduction of outgoing expenses, mitigating risk, monetizing IP or ongoing litigation. What’s more—an experienced funder is likely to have new ideas, strategies, and tech that companies can use to gain a competitive advantage. GC’s are often tasked with reducing risk and costs simultaneously. That’s a tall order in the best of times, but can seem impossible after a pandemic. Reducing expenses relating to outside counsel is something with which an experienced litigation funder can assist. Funders can also evaluate potential litigation to determine how they can best be managed. After all, funders have as much motivation to manage cases as effectively as GC’s, because their goal is, of course, successful litigation that leads to profit all around. Funders are, therefore, experienced in evaluating the merits and potential of a case. Any GC can tell you that pursuing litigation is expensive, and a drain on resources. But when that litigation is funded by a third party, the balance sheet shows lower expenses and higher income, even when recovery or awards aren’t especially high. Portfolio funding of curated cases can also bring in capital on a predictable basis, so balance sheets aren’t impacted by the speed of the court. The non-recourse funding that third-party litigation funders provide can be a valuable resource for businesses feeling the COVID crunch. No matter what financial catastrophes loom on the horizon, a litigation funder can help GC’s manage capital, mitigate risk, and provide a steady income stream for the future.
Commercial

Ford’s Powershift Clutch is Still Not Up to Snuff

Auto giant Ford is back under scrutiny for its powershift clutch system. After one couple received compensation from Ford to replace their transmission—nearly three dozen other car owners reported similar problems to Fair Go. TV New Zealand details that a car’s transmission is expected to last roughly 200,000 km, provided it is properly cared for and serviced. Initially, Ford told Fair Go that it would address the powershift clutch issues even for cars that were no longer in warranty or had been serviced by non-Ford shops. However, car owners stated that they did not receive any help. Some customers were told to seek legal advice.  After Ford made several public statements that failed to address the issues, Fair Go attempted one more time to reach Ford—which ultimately claimed that its database of service records differed significantly from the information provided by disgruntled customers. One mechanic, Lyall Bennet, stated that the real problem may not be the powershift clutch, but rather with plastic parts that disintegrate and break down over time. That means that regular servicing and fresh oil won’t impact the problems customers are having. Meanwhile, Ford maintains that it won’t compensate customers who did not have their cars properly serviced. Of course, the issues with Ford’s powershift clutch are neither new nor undocumented. In every likelihood, a class action against the automaker is on the horizon. Potential claimants are being assembled, and the legal team at McLean Law is seeking out litigation funding so the action can move forward without cost to claimants.
Commercial

Wirecard Insolvency Class Action Grows More Complex

The aftermath of Wirecard’s insolvency has grown even more complicated since the payment company liquidated with nearly $2 billion in the red. Over 20,000 people impacted by the Wirecard collapse plan to sue the company. The plaintiffs are backed by litigation funder, Litfin. Accounting Web details that Wirecard, just prior to the declared insolvency, revealed that capital supposedly in Asia did not actually exist. Some management personnel were arrested, while Jan Marsalek, former COO, remains at large and is wanted by Interpol. Now, a special report is pointing the finger at Ernst & Young, which was tasked with evaluating the business. The report suggests, among other things, that Wirecard may have violated reporting standards with regard to its Asian business dealings. The confidential report also found evidence suggesting that EY audits between 2014-2016 were lax and missed several common indicators of fraud, and that auditors often took managers at their word on compliance issues. EY denies wrongdoing, claiming that they too were victims of fraudulent conduct by Wirecard and others. David Parker, a payment tech expert, asserts that the report shows what could be crippling failings by EY. As Arthur Andersen was taken down in the Enron scandal, so may EY be hit hard by the revelations coming out of this investigation and the subsequent collective action. It’s unclear whether the full report will be published publicly, as German lawmakers have yet to decide. The findings are no doubt an embarrassment to lawmakers, as they reveal woeful lapses in professionalism that are likely to impact public trust. At the same time, a successful collective action could go a long way toward restoring public perception that fraud will be punished and investors protected. Just another way that litigation funding protects victims and results in net gains for the communities it serves.
Announcements Commercial

Boies Schiller Flexner forming international investor group to recover losses – Greensill / Credit Suisse Supply Chain Finance Funds

Boies Schiller Flexner (UK) LLP ("BSF") is building a group of investors across Europe and Asia who invested in Credit Suisse's US$10bn Supply Chain Finance Funds ("SCFFs").  It is intended that the group will pursue Credit Suisse, including through litigation if necessary, to recover losses suffered with respect to the investments made in or with Greensill Capital. The firm takes the view that investors have credible claims against Credit Suisse for misrepresentation and mis-selling, which should be brought in a co-ordinated manner across jurisdictions. Investors should contact greensill@bsfllp.com for further details. Background Credit Suisse entities pro-actively marketed and sold investments in the SCFFs as cash-equivalent and low risk investments.  In fact, the SCFF assets were notes backed by existing and future trade receivables originated and structured by Greensill Capital. In March 2021, Greensill Capital, the main trading entity and treasury company for the Greensill group, ceased trading and went into administration. Whilst facts continue to emerge, there appear to be multiple failures which led to the collapse, including an over-exposure to certain businesses, financing of risky future (as well as current) receivables, and an inability to maintain insurance coverage. The SCFFs were closed by Credit Suisse on 1 March 2021 and the funds are being liquidated.  It is anticipated that there will be a significant shortfall in recoveries for investors into the funds. The Investor Group BSF is putting together a group of international investors to pursue a cohesive and proportionate litigation strategy to recover losses, namely the shortfall that will not be met through redemptions from the Greensill estate.  This litigation strategy is anticipated to span relevant jurisdictions across Europe and Asia, with BSF acting as global litigation counsel. Investors will be eligible to join the investor group if they held (as at 1 March 2021) or hold (at the time of participation in the group) shares or interests in shares in the SCFFs, being: (i) Credit Suisse (Lux) Supply Chain Finance Fund, (ii) Credit Suisse Nova (Lux) Supply Chain Finance High Income Fund, (iii) Credit Suisse Nova (Lux) Supply Chain Finance Investment Grade Fund, and (iv) Credit Suisse Supply Chain Finance Investment Grade. There is no jurisdictional restriction: investors across Europe and Asia are able to join the group. The Litigation Strategy A cohesive investor group acting together will be well-placed to maximise recoveries with respect to the SCFFs, and protect interim value. Whilst there is uncertainty as to recoveries via the Greensill estate and losses have not yet crystallised, the litigation strategy is designed to recover losses for which Credit Suisse is responsible – both through the sale of the securities as well as its management of the portfolio.  The litigation will focus on mis-selling claims against Credit Suisse entities involved in the structuring and sale of investments, mis-management claims regarding the SCFFs investments, and, potentially, broader conspiracy and other tortious claims. It is anticipated that litigation will be brought in England and potentially Luxembourg and/or Switzerland, making use of case management procedures to maximise the efficiency of a group of investors acting together. BSF can provide detailed advice once an investor is a member of the group (and subject to diligence of the investor's interests in the SCFFs). Risk / Secondary Trading There is significant interest in both third party funding of litigation and of secondary trading in the shares and litigation rights.  BSF is working with various parties in this regard.  Investors interested in secondary trading should take advice to ensure rights and claims are transferred.  BSF can provide further details to interested parties. The BSF team can also arrange third party funding for interested investors, creating zero economic risk in the bringing of proceedings to recover their losses. BSF BSF is an elite litigation practice with significant experience in creditors' rights, class actions and strategic litigation in restructuring and insolvency matters.  It has a track record of delivering value for its clients through strategic litigation in England and across Europe.  BSF and its lawyers have created value for investors through cohesive litigation strategies in respect of the Icelandic banks (Kaupthing, Glitnir, Landsbanki), Lehman (US and UK), bank restructurings and collapses in the UK, Ireland, Cyprus, Greece, Spain, Portugal and Austria, and multiple corporate restructurings. It is currently litigating against Credit Suisse before the English Courts, with respect to the Proindicus debt. The BSF team will be led by Natasha Harrison, Deputy Chair and Managing Partner of BSF, and Fiona Huntriss, Partner.  BSF is working with Luxembourg, Swiss and other local counsel.
Commercial

Are There Caveats to the Widespread Embrace of Litigation Funding?

Third-party litigation funding has grown significantly in recent years. This relatively new industry got its start during the last financial crisis, and has expanded and adapted to meet the needs of lawyers, plaintiffs, and businesses during COVID. The practice has its share of detractors, but overall it’s viewed by courts as a net gain for the community, as it increases access to justice for those who could not otherwise afford it. International Business Times recently dissected what they see as the most significant concerns about Litigation Finance as an industry. In the UK, champerty restrictions were abolished in the 1960s, provided that funders are restricted from having control or influence over the cases they fund. Transparency is a major facet of instilling confidence in legal funding, along with assurances that the practice won’t result in court dockets clogged with frivolous cases. Of course, no funder wants to bankroll a case without merit. While it may be true that funders might take on a risky case with a potentially high ROI, those funders risk losing their entire investment if the case is not won. Litigation funders currently follow a code of conduct formed from the output of various working groups. This was encouraged by Lord Justice Jackson in 2013, during his endorsement of third-party litigation funding. Joining a professional funding association like ALF or ILFA requires signing a Code of Conduct. However, following the code is not legally mandated, and there are no legal penalties for deviation from it. Self-regulation of the industry may soon give way to increased legislation, as has already happened in Australia, for example. As litigation funding is clearly here to stay, the hope is that the industry itself will continue to cooperate with legislators to formulate a legal structure through which funding can thrive and plaintiffs in need can reap the benefits.
Announcements Commercial

Augusta Ventures completes new £250m fundraising as investors back strong market surge in legal and corporate sectors

Augusta Ventures, a specialist asset manager focussed on the litigation and dispute funding sector, has closed its third pool of funding with £250m of new commitments (including Augusta Ventures co-investment), bringing the firm’s AuM to £585m and enabling the firm to fund an unprecedented pipeline of opportunities in high value litigation and dispute scenarios. The fundraising, which was oversubscribed, was supported by Beach Point Capital Management, the anchor investor in the previous Augusta Ventures funding, and two new investors, Magnetar Capital, who will act as anchor in this funding, and Northleaf Capital Partners. Louis Young, Chief Executive Officer of Augusta Ventures, said: “We are delighted to announce this new £250m capital raising as Augusta seeks to expand its capital resources to meet the increased demand for legal related finance across all sectors and geographies. We have never seen so many strong opportunities.    It is particularly satisfying to see both the continued support of existing investors as well as the addition of two new institutions who have deep experience in the sector. This validates the quality of our investment platform and the amount of the new commitments reflects the depth of the investment pipeline.”  Hitesh Patel, Non Executive Chairman of Augusta Ventures, said:  “Augusta’s largest capital raising initiative signals its intention to rapidly expand its portfolio of investors and funding cases. Augusta has deep expertise in the litigation funding market, and this new funding will enable us to provide Claimants and law firms with even greater access to funding that de-risks litigation for Claimants and facilitates access to justice”. I am excited about working with a talented team at Augusta and its investors and the future prospects of expanding the company’s operations and assets under management.”