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Commercial

Omni Bridgeway Seeks to Protect Litigation Funding in Australia

It’s no secret that not everyone is a proponent of Litigation Finance. In Australia, new regulations threaten to permanently alter how class action suits are managed, and how litigation funding can be used to assist them. Andrew Saker of Omni Bridgeway, a major funder, is speaking out. Global Legal Post explains that in Australia, a coalition of “pro-business” advocates is pressing for change. Their reaction to litigation funding for class actions isn’t unexpected or surprising. Third-party funding of class actions makes it more likely that such businesses, and even the government, will be held accountable for their misdeeds. Earlier this year, a parliamentary inquiry led to an expensive and time-consuming requirement that funders must have an AFSL license and comply with provisions of the managed investment scheme protocols. Omni Bridgeway, a leading funder in Australia, has stated that they welcome improvements to the existing system, and will comply with licensing and disclosure requirements. The funder is also consulting with ASIC in the hopes of making adjustments to existing rules. The problem funders are having with the new rules isn’t so much the extra paperwork—but whether or not the changes are achieving the stated goals. After all, class actions are often expensive, take years to bring to a close, involve a lot of people, and tend to be highly complex. Moreover, the defendants are often large entities with an arsenal of lawyers and monies with which to fight back. With that in mind, Litigation Finance may well be the only viable option when a group is wronged by a large business or government entity.
Commercial

Professionals Speak Out on the State of Patent Law

IP law is a vital part of the Litigation Finance landscape. Patent and intellectual property litigation are industry mainstays, and represent the most-funded legal sector. As such, changes in the IP ecosystem impact the Litigation Finance world as well. Investors Digest assembled a panel of experts to discuss where the markets are headed. The first step in evaluating trends on the state of patent eligibility is to maintain a focus on system-wide changes, rather than on individual cases. Of course, every case is different and may not be indicative of sweeping industry trends. The panel had much to say on the matter. Russell Binns, CEO of Allied Security Trust, thinks there’s a great year ahead. He stated that 2020 will likely provide more clarity, especially in regard to Section 101, which determines which patents are eligible. He also expressed the importance of not treating patent litigation like a commodity—which may be a subtle swipe at Litigation Finance. Annsely Merell Ward, attorney at WilmerHale, is expecting an active market for patent litigation, along with more collaborations including sharing platforms and pools. Similarly, Jamie Underwood, a global IP strategist, predicts a bullish market on a global scale. Patents are being granted in higher numbers, and not just in the US. Currently, Japan, South Korea, Germany, Switzerland, and China have all adopted strong patent systems. Kent Richardson, a partner at Richardson Oliver Law Group, is using internal surveys and data to determine how to proceed. He is confident that patent prices are leveling out and becoming increasingly predictable—which is good for the industry on the whole. Daniel Papst of Papst Licensing agrees with predictions of a bull market. He also points out that an upcoming German Supreme Court ruling may improve efficiency in patent cases. Michael Gulliford of Soryn IP Group states that the totality of the IP world is heading in the right direction.
Announcements Commercial

Omni Bridgeway welcomes Tim DeSieno as Global Director of Distressed Debt and Senior Investment Manager

Omni Bridgeway (ASX:OBL) is delighted to welcome renowned leader in emerging markets debt restructuring, Tim DeSieno as its new Global Director of Distressed Debt and Senior Investment Manager. Mr DeSieno will be based in New York and will be responsible for developing Omni Bridgeway’s global distressed debt business, which the Company has decided is a key part of its strategic growth. Mr DeSieno will also help identify and manage distress-related litigation funding opportunities in emerging markets globally, with a special focus on Latin America. Mr DeSieno has over 30 years’ leading law firm experience advising institutional investors in managing their distressed debt investments around the globe, including most recently as a senior partner at Morgan, Lewis & Bockius LLP. His work for clients has spanned junk bond workouts in the 1980s/1990s, the Asian currency crisis in 1998, the global financial crisis in 2008, and the financial fallout of Covid-19. “Omni Bridgeway is expanding its global footprint and service offering, and principal investing in distressed debt is an important part of our strategy. Mr DeSieno is a highly respected leader in his field of emerging markets debt restructuring, and we are very fortunate to have him join us to spearhead this work. His expertise complements our insolvency, enforcement, and asset tracing teams, and it is particularly relevant in the current economic climate,” said Mr Andrew Saker, CEO of Omni Bridgeway. Tim DeSieno said: “I am beyond excited to join the Omni Bridgeway team. The Company’s successes and strategic growth, including in fields directly related to mine, have made it very attractive. I am confident that the largest dispute finance team in the world will be an excellent platform for creating a distressed debt business and a Latin America-focused litigation finance portfolio. It also does not hurt that I have known and respected Mr Saker for close to two decades – I certainly look forward to teaming up with him again!”
ABOUT OMNI BRIDGEWAY
Omni Bridgeway is the global leader in dispute resolution finance, with expertise in civil and common law legal and recovery systems, and operations spanning Asia, Australia, Canada, Europe, the Middle East, the UK and the US. Omni Bridgeway offers dispute finance from case inception through to post-judgment enforcement and recovery. Since 1986, it has established a record of funding disputes and enforcement proceedings around the world. Omni Bridgeway is listed on the Australian Securities Exchange (ASX:OBL) and includes the leading dispute funders formerly known as IMF Bentham Limited, Bentham IMF and ROLAND ProzessFinanz. It also includes a joint venture with IFC (part of the World Bank Group). Visit omnibridgeway.com to learn more.
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Announcements Commercial

Forbes Ventures Plc – Update on Litigation Funding Securitisation

Forbes Ventures is pleased to announce that, further to the announcement of 2 March 2020, it has established a wholly owned UK subsidiary, Forbes Ventures Cell 1 Limited (the “UK Cell”). The UK Cell has been established to acquire UK-issued litigation funding loans, through the assignment of the related receivables - i.e. the litigation funding loans themselves and the interest thereon (“the Securitised Assets”) - to Forbes Ventures CC 1 (the “Maltese Cell”). The Maltese Cell is a Securitisation Cell Company in Malta, which is held in a bankruptcy remote structure and as such is not owned by the Company. To finance this securitisation, the Maltese Cell will shortly be issuing a prospectus relating to the proposed offer (the “Offer”) of 2-year bonds (the “Bonds”) and their admission to trading on the Malta Stock Exchange.  The Offer has an aggregate value of EUR 35 million.  A further announcement will be made at the time of closing of the Offer, which is expected later in September 2020. The net proceeds of the Offer will be paid to the UK Cell as consideration for the assignment of the Securitised Assets  to the Maltese Cell, and will provide the funds for the UK Cell to acquire litigation funds in the UK. Forbes Ventures’ wholly owned subsidiary, Forbes Ventures Investment Management Limited (“FVIM”), acts as originator and collateral agent for the UK Cell and is responsible for the selection and oversight of the Securitised Assets.  FVIM will receive a cash fee for this transaction, upon closing, equivalent to 2% of the funds raised in the Offer. It is the Company’s intention that the infrastructure which it has established for this securitisation will also be used to facilitate the securitisation of both further litigation funding and other assets across a range of industries.  The Company confirms it is in discussion with multiple prospective counterparties from whom it may purchase assets for this purpose. Further announcements will be made upon the Company entering into any such arrangements. The Directors of Forbes accept responsibility for the contents of this announcement.
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Announcements Commercial

Litigation Funder Affiniti Finance Raises £250m for Litigation and Dispute Funding

Affiniti Finance, the UK’s leading Consumer Credit litigation funder announces a £250m capital raise deal with a multi-billion dollar US based fund, which it said would ‘significantly’ increase its ability to fund the large volume of mid-range cases, specifically in the financial mis-selling and personal injury sector in the UK. Affiniti Finance’s current investments include more than 5,000 individual litigation matters, numbers in 2021 are expected to reach in excess of 50,000. The capital raise is backed by a highly diversified global investment manager which is a partner well suited to Affiniti Finance given the investor’s previous experience with legal financing. Chief Executive Officer, Ian Cunningham said: “This new debt line provides a significant increase to our available capital and a boost to our investment capability. This enables us to broaden and accelerate the expansion of our portfolio, with a view to ultimately delivering greater returns for all stakeholders and providing clients with access to justice . We are continuing our capital raise for our new commercial litigation division which will see a further £150M available for large ticket commercial transactions. We are expecting to close this raise by the fourth quarter of this year” 
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Consumer Covid-19

COVID and Medical Malpractice—Is Change Coming?

Since the impact of COVID, clinics and hospitals are besieged by new patients they can scarcely accommodate. Beds are full, basic supplies like PPE have run short, and even the best minds in medicine cannot agree on how to stop the spread of the virus. The only thing worse than being sick or injured may be to have that illness or injury exacerbated by an error by a medical professional. The Post offers a warning about potential changes to the way medical malpractice is adjudicated. Medical malpractice claims are increasingly funded by third-party litigation funders. Funders and plaintiffs can enter an agreement for non-recourse funding for legal and other expenses relating to a malpractice claim. If the case is successful, the funder gets an agreed-upon percentage of the award. Outside of the US, some countries are making big changes in how medical malpractice cases are addressed. In Denmark, it is free to file a medical malpractice claim. The medical caregivers are not being personally sued, leading to a speedier and less adversarial system where everyone is more inclined to participate and share information. Perhaps most importantly, The Danes focus on two things: If the treatment itself was lacking, and if a “severe or rare medical event occurred.” The claim is then evaluated by medical reviewers and the information therein is made publicly available. COVID is already spurring calls for fairness when it comes to access to the internet for the impoverished. Could we see similar calls emerge for those in need of malpractice lawsuits? Any emerging trend is worth keeping an eye on, since any mimicking of policies in Demark would likely to reduce opportunities for litigation funders.
Commercial

Insurers’ Balance Sheets Improve as ACA Risk Corridor Payments are Finally Underway

The Judgement Fund is used by the Bureau of Fiscal Services to provide remuneration to plaintiffs who successfully sue the federal government of the US. This arm of the US Treasury Department has been given leave by the Supreme Court to use the fund to pay insurers. Think Advisor explains that the payments are being sent out, as promised by the ACA. The payments had been delayed for years, leading to hardships and even closures for the businesses involved, though their purpose was to help struggling insurers. Why weren’t the payments made when originally scheduled? The government claimed that Congress refused to allot money for the program in the budget—ostensibly as part of a plan to keep the ACA from working properly. This left the fund roughly $12 billion short of where it needed to be. In April, SCOTUS ruled that Congress' failing to provide funds in no way relieves the government from its responsibility to make payments. Risk corridor program payments are estimated to average $800 for each individual with major medical coverage. One estimate puts the number of Americans with individual major medical insurance at roughly 15 million.
Commercial

HESTA Backs 21 Class Actions on Behalf of Shareholders

Litigation Finance is deepening its presence in the shareholder class action scene—challenging businesses when those who invest in them lose money. HESTA, a health-industry-specific fund, is now funding 21 class-action suits representing shareholders. The New Daily reports that HESTA isn’t just seeking big payouts, though they have earned about $32 million from various successful cases. The funding group has stated clearly that in addition to recovering losses, they hope to encourage improved accountability and more oversight into corporate governance. As of December of last year, changes in funding laws necessitate input from big investors in order to see a class action to its conclusion. Doing away with common fund orders means litigation funders need to ensure that enough claimants have signed on to a given case. The skirmish involving common fund orders was brought about by Westpac, ostensibly in the hopes of getting rid of one class action in particular. A recent claim was triggered after Westpac was accused of millions of illegal fund transfers that appear to violate counterterrorism and money-laundering laws. In addition to abolishing common fund orders, regulations for litigation funders also changed—requiring their own licenses due to their new designation as managed investment schemes. Industry professionals are averse to these new changes, according to Allsopp. He explains that the federal government went ahead with a flurry of changes that came against counsel from ASIC and prior to the completion of a Parliamentary inquiry.
Commercial

International Arbitration Opportunities Through Litigation Finance

Multinational companies are choosing international arbitration to settle disputes in greater numbers than ever. For those who make this choice, Litigation Finance can take the financial stress out of the ordeal. Third-party legal funding can be used commercially and internationally. Omni Bridgeway details that in 2019, there were 869 new arbitration cases, according to stats from the International Chamber of Commerce. Over 1/3 of new cases were valued at more than $10 million. Moreover, of the 10 most-commonly chosen venues for international arbitration—half were located outside Europe or North America. Firms and companies involved in international arbitration can certainly benefit from litigation funding. When arbitration is the chosen path for an international dispute in cases like treaties, or a business bringing a claim against a government—funding can lighten the financial load significantly. Funding may also mitigate the longer case lengths and lower settlements that can occur. Now more than ever, international entities are looking for funding for a broad portfolio of cases. This presents opportunities for businesses to better manage finances while reducing the overall risk for funders. If one plans to make use of Litigation Finance, it’s important to understand the criteria by which funders select cases. Criteria include the probability of success as the main factor, followed by the potential expenditure versus the amount of a potential award. Experienced funders will have their own metrics or algorithms to determine this. Also considered are the success rate of the legal team involved, the jurisdiction, the potential time-frame of the case, and the probability of collecting an award or settlement. If there’s a tribunal, its efficacy will factor in as well. Enforceability is an ongoing concern for international cases—so funders with global enforcement experience are particularly desirable. All of these factors can impact the funder’s bottom line—which is particularly important given the non-recourse nature of litigation funding.