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Commercial

Australian Arbitration Week 2020

How exactly is international arbitration changing? The International Arbitration Conference set out to answer that very question. This year’s conference shined a light on how Australia became a favored destination for funded arbitrations around the globe. Omni Bridgeway participated in the event, which was held virtually. One hot topic was how third-party funding is changing international arbitration. In Australia, for example, the government has enacted legislation viewed as too restrictive by some funders. But in Singapore or Hong Kong, rules governing third-party funding have been welcoming to the practice. This lack of uniformity around the world has led to confusion, sometimes leaving meritorious cases unfunded. Other issues discussed included conflicts of interest and disclosure. Increasingly, new legislation requires disclosure of at least some aspects of litigation funding agreements. Some say that increased disclosure will reduce the appearance of conflicts of interest. ACICA Rule 53 is of particular interest because it includes the costs of obtaining legal funding as a recoverable expense. This rule would be especially impactful in Australia, where large class actions against big businesses are common. Cost was another hot topic. Specifically, how legal funding impacts security-for-cost orders. Also discussed was the changing relationships between contingency, conditional fee arrangements, and funding. This included portfolio arrangements and different ways to share risk. This led to a discussion of the newly-formed ILFA, and its push for greater transparency in the industry. Other topics included diversity in the industry, specifically the Arbitral Women diversity initiative. This Brisbane-based group publishes news, facts, and statistics, while engaging in various online diversity initiatives. The ‘Equal Representation in Arbitration’ pledge is a call-to-action and rallying cry. Soon, it will also be a set of guidelines to help corporates and firms pursue diversity in a productive way.
Commercial

Burford Launches on the NYSE

Burford Capital is turning heads with its newly-minted listing on the New York Stock Exchange. This NYSE listing is the first of its kind for a Litigation Funding firm. Business Insider explains that the NYSE listing is a clear sign that this type of legal funding has entered mainstream consciousness. It cements the industry as one that’s here to stay, rather than a temporary fix for trying economic times. Burford specializes in funding legal action against large corporations in exchange for a share of any reward. This type of third-party funding is offered on a non-recourse basis, allowing for different rules than are applied to traditional loans.
Commercial

Work Product Ruling Stymies Google’s Request to See Funding Contract

A California judge ruled this week that a litigation funding agreement between Impact Engine Inc and an unnamed funder is work product and therefore protected by privilege.  Law.com explains that concerns over the relevance of the agreement to a patent infringement suit against Google have been raised by lawyers at Quinn Emanuel. Judge Cathy Ann Bencivengo agreed that the funding agreement may have some impact on the case. This stands true even though Impact Engine’s lawyers did share information with the funders, work-product privilege was never waived. Bencivengo explained that the documents show an expectation from both parties that the information contained would not be released. This case could have far-reaching implications for litigation funders. Rules regarding disclosure remain vague.
Commercial

Africa’s Largest Class Action Targets Anglo American

A case representing roughly 100,000 women and children targets African mining company Anglo American. With litigation funding provided by Augusta Ventures, the case will pursue claims that those living near the Kabwe lead mines were poisoned. Law.com details that South African firm Mbuyisa Moleele and international firm Leigh Day brought the suit against the Anglo American subsidiary, Anglo American South Africa. Those impacted are seeking that the toxic land be cleaned up, that medical screening of children and pregnant women is funded, and financial remuneration. One lawyer involved with the case referred to the situation as an ‘ongoing public health disaster’ brought about by ‘flagrant disregard’ for the community. 
Commercial

Therium Access Named Finalist for ‘Best Pro Bono Initiative’ by The Lawyer Magazine

Therium Access has been named a finalist for ‘best pro bono initiative’ by The Lawyer. The program was launched to provide increased access to justice through investment—providing needed capital to the most vulnerable. Founded in 2009, Therium began as a funder who worked with clients pursuing cases against commercial businesses. It soon became obvious, however, that there were many clients in need of help even though their cases were not against businesses with deep pockets. Co-founder Neil Purslow explains succinctly, “Justice should be available to everyone, but the reality is that it isn’t. This can lead to devastating consequences for families and for the most vulnerable in our society.” He goes on to explain that while lawyers often donate their time, monetary support is also needed to pursue cases—especially those that are large and time-consuming. 
Commercial

Aussie Billionaire Funding Anti-COVID Lockdown Claim

A source has revealed that controversial billionaire Jonathan Munz is funding a challenge to the Victorian government’s recent COVID lockdowns. While not the sole financier, Munz is reportedly sinking at least $1 million into the case. That shouldn’t break the bank, as Munz’s reported assets top $1.5 billion. Sydney Morning Herald reports that two Brisbane court dates have been set to hear the case via video link. The case was filed by Julian Gerner, who owns a popular restaurant and bar. The claim revolves around parts of the Public Health and Wellbeing Act, and the emergency powers it provides. Plaintiffs have suggested that lockdowns are unconstitutional because the constitution implies freedom of movement. A planned defense from Solicitor-General Christine Walker has been postponed. A demurrer is expected to be filed instead. This means that while the constitution may affirm a right to freedom of movement, that is immaterial to the lockdown provisions and the government’s right to impose them. The resolution of this case may determine whether the Public Health and Wellbeing Act is rendered invalid. If that were to happen, a government’s ability to protect citizens during emergencies will be effectively crippled. A separate claim has been filed by Michelle Loielo as of September. She is a restauranteur and is reportedly an aspiring liberal politician. Further submissions are expected to be made to the High Court later this week.
Commercial

Roundtable Discusses Litigation Finance in Offshore Jurisdictions

The use of legal finance is increasing in several important offshore jurisdictions. But how well is that going? Burford Capital’s recent roundtable discusses the effectiveness of legal finance in maximizing recovery in insolvency cases around the globe. Burford’s panel includes Matthew Richardson, director at Grant Thornton (BVI), Ulrich Payne, lawyer at Kobre & Kim, and Ian Lambert, head of litigation, restructuring, and insolvency at HSM. Lambert explains that as always, the purpose of Litigation Finance is to increase access to justice. Legal funding allows for the pursuit of meritorious cases that might otherwise not be possible. This is of particular importance in the wake of COVID-19. Ulrich Payne further notes that liquidators now have a set precedent allowing them to enter into litigation finance agreements—thanks to two recent cases in the Grand Court of the Cayman Islands. What about the overall dearth of case law regarding litigation funding and insolvency? Richardson details that the British Virgin Islands has not heavily relied upon legal funding in insolvency cases. He explains that in his firm, most creditors and shareholders have the funds needed to pursue their case without additional funding. A proposed ‘Private Funding of Legal Services Bill’ is underway, and is expected to clarify specific issues relating to legal funding--such as appropriate rates of return or whether or not funders should have a say in decisions impacting the case. Without additional clarification from BVI courts, British law is the prevailing standard. Ian Lambert details his concern that the bill’s progress is slow, and that overzealous restrictions could make it more difficult for those with legitimate need. Payne sums up the situation, saying that the bill, if passed, would lead to sweeping changes in how litigation funding is addressed and managed in the Cayman Islands. The hope is that the changes will improve access to justice, rather than restrict it.
Announcements Commercial

ANGLO AMERICAN SUED ON BEHALF OF CHILDREN AND WOMEN POISONED BY THE WORLD’S BIGGEST TOXIC LEAD MINE

Lawyers from Mbuyisa Moleele and Leigh Day today announced that a class action lawsuit has been filed against Anglo American South Africa Limited (“AASA”), a subsidiary of London-headquartered multinational mining company Anglo American Plc (LSE: AAL, JSE: AGL), in the Gauteng Division of the High Court of South Africa. The action has been filed on behalf of a class estimated to comprise more than100,000 individuals in the Kabwe District of Zambia who are believed to have been poisoned by lead. The application is brought by 13 representative plaintiffs on behalf of children under 18, and girlsand women who have been or may become pregnant in the future. The claimants – principally young children – are suffering from alarming levels of lead poisoning which, depending on various factors including the blood lead level (“BLL”), causes a range of significant conditions, from psychological, intellectual and behavioural damage to serious and permanent physical damage to their bodily organs, neurological systems and fertility. In extreme cases, serious brain damage and deaths occur. In pregnant women, lead they ingested as children is absorbed into their bones and released during pregnancy. Women are also exposed to lead during pregnancy from the surrounding environment. Lead is known to cross the placenta, resulting in the unborn child being subjected to the same concentration of lead as the mother. Notonly can the baby’s health be damaged, lead causes pregnant women to have a higher risk of pre-eclampsia; gestational hypertension and miscarriage. Generations of children have been poisoned by the operations of the Kabwe mine, originally known as Broken Hill, which caused widespread contamination of the soil, dust, water, and vegetation. The main sources of this poisonous lead were from the smelter, ore processing and tailings dumps. The BLLs of the vast majority of children in Kabwe exceed the BLL limit of 5 micrograms per decilitre set by the U.S. Center forDisease Control. A substantial proportion of the children have BLLs in excess of 45 ug/dl, the limit at which medical treatment is required. There are numerous cases of young children (including among the representative plaintiffs) with BLLs in excess of 100 ug/dl, at which serious brain damage and death may occur. The Kabwe mine was part of AASA group from 1925 until 1974 and was one of the world’s most productive lead mines during this time. It is alleged in the class action that AASA is liable, including for the following, because of AASA’s role in controlling, managing, supervising and advising on the technical, medical and safety aspects of the mine’s operations:
  1. a) Substantial emissions of lead into the local environment were due to deficiencies in the design and systems of operation and control of lead, which AASA failed to ensure were rectified;
  2. b) AASA failed to ensure the clean-up of the communities’ contaminated land; and
  3. c) Accordingtoexperts1, aroundtwothirds of the leadcurrently inthe local environment is likely to have been deposited there between 1925 and 1974 when the mining operation was transferred to ZCCM, a Zambian state-owned company, in 1974.
The class action seeks to pursue remedies in the form of compensation for these children, as well as girls and women with lead poisoning who have or may become pregnant in the future. Also sought is (a) blood lead screening for children and pregnant women in Kabwe, and (b) clean up and remediation of the area to ensure the health of future generations of children and pregnant women is not jeopardised. Richard Meeran, Partner & Head of the International Department at Leigh Day, said: “From the 1950s, Anglo American publicly committed to making a lasting contribution to communities in which it operated. Its current human rights policy is to contribute to remediation when its business has contributed to adverse human rights impacts. This ongoing public health disaster is the result of a flagrant disregard for the health of the local community, which is totally at odds with those grand public pronouncements.” Zanele Mbuyisa, Partner at Mbuyisa Moleele, added: “AASA is considered amining giant that has been instrumental inbuilding theeconomies ofvarious countries, but it also has to be acknowledged that their operations have caused the decimation of communities and long-lasting damage to the health of those communities.” Mbuyisa Moleele is a Johannesburg-based law firm led by Zanele Mbuyisa, and Leigh Day is a leading international law firm specialising in human rights and mass environmental tort claims. Both firms have a proven track record of litigating complex international class actions on behalf of victims from disadvantaged backgrounds. The case is being funded by Augusta Ventures, the UK’s largest litigation fund by volume of claims. More information about this matter can be found at www.childrenofkabwe.com.
Commercial

Law Firms and In-House Counsel Predict Spike in Litigation Funding

A recent study of in-house counsel and private attorneys affirms that the use of litigation funding is up more than 100% since 2017. Burford Capital released the study of roughly 500 legal professionals, which confirms the explosive popularity of the practice. Law.com explains that in-house counsel respondents are reporting tens of millions in unenforced judgments. Using legal finance to turn dormant value into liquid assets makes sense, especially when economic conditions necessitate savvy bookkeeping. Strikingly, over half of lawyers surveyed stated that their companies have abandoned solid claims because of potential litigation costs. This means that a need for third-party funding is widespread and ongoing, especially as pricing options dwindle in the wake of COVID. In the coming months, it’s clear that risk-sharing will be the order of the day.