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Announcements Consumer

Baker Street Funding Announces Lawsuit Loans At All Time High

NEW YORK (PRWEB) JANUARY 15, 2020: Baker Street Funding is a legal funding firm located in New York City that specializes in providing plaintiffs and attorneys with pre and post-settlement funding. The driving force behind this organization is Daniel DiGiaimo, the CEO and President. Mr. DiGiaimo has an impressive back-ground in financial services and previously worked at Morgan Stanley, Merrill Lynch and Oppenheimer & Co. Holding a minor in Law and a BA in Finance from PACE University, Mr. DiGiaimo manages all funding decisions and is responsible for the success of the company.

Baker Street Funding is not your regular litigation funding company and their unique ability to diversify risk and foster strategic partnerships with major players within the legal funding industry, sets them apart from the competition.

Baker Street Funding is extremely well-capitalized and can deliver quick financing decisions to help attorneys and their clients focus on what matters most. Their staff of experienced litigators is well aware of how litigation and arbitration process work. They understand the pressure that clients can be under during high stakes arbitration and they are helping them with timely financial support and guidance to get the most out of their claim. They have helped thousands of Americans obtain the best settlement funding solutions and have provided those clients with a total of $50 million in funding in the past year alone. Plaintiffs and their attorneys can enjoy flexible terms at the lowest rates. When it comes to litigation funding, no one is better.

At Baker Street Funding, each and every person is treated with dignity and respect and not just like another case. They focus on providing their clients with a lawsuit cash advance on the future proceeds of their pending settlements. The process takes as little as 24 hours from the moment when they receive a copy of the case documents to the moment of wiring out the funds.

Although third-party litigation funding is quite a new phenomenon in the United States, it managed to take off quickly and become an important part of the legal landscape. “Our plaintiff funding business, where we provide personal injury plaintiffs with liquidity, in order for principal and a set rate of return to be paid upon successful settlement of their claim, has grown enormously in the past two years. We only work with a fraction of personal injury plaintiffs nationwide and if the economy takes a turn for the worse, there will be more plaintiffs in need of immediate capital. Investors see that as a great compliment to a portfolio of domestic equities and fixed in-come. As far as the importance to plaintiffs and counsel, quite simply the liquidity that we provide allows the plaintiff to continue to fight for a settlement that they deserve. It is a well-known tactic of insurers to drag out cases as long as possible in order to force the plaintiff into taking a smaller settlement. We help even the playing field.”, said Daniel DiGiaimo, CEO of Baker Street Funding.

Baker Street Funding is America’s no.1 preferred pre-settlement funding firm and considered one of the best pre-settlement funding companies nationwide. A settlement advance is also known as a non-recourse financing agreement, which means that if the client loses the case, he or she is not obliged to pay the company back. Baker Street Funding provides immediately available cash to customers they believe they have strong enough cases to win and pay back. Clients who choose them for litigation funding can enjoy a series of benefits such as no credit check, no job required, fast approval and funding, no risk, and contracts that advance from as little as $1,500 to $5 million or more.

At Baker Street Funding, many types of cases are considered. They list a number of case types on their website that they have funded previously but are always looking for new and interesting cases. Typically, they offer services such as personal injury pre-settlement funding, post-settlement funding, lawsuit advances, settled case funding, case cost funding, litigation funding, disbursement funding, bundled settlement advances, surgery funding, malpractice pre-settlement funding, premises liability settlement funding, and more.

The team of professionals working at Baker Street Funding is committed to providing their customers with accurate real-time updates on their applications and to lend a compassionate ear in their time of need. They believe everyone deserves a better financial future and they are here to deliver more value to their clients’ lives.

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Commercial Investor's Corner Slingshot Capital Special Features

Implications of Portfolio Financings on Litigation Finance Returns

The following article is the first in an ongoing column titled 'Investor Insights.'  Brought to you by Ed Truant, founder and content manager of Slingshot Capital, 'Investor Insights' will provide thoughtful and engaging perspectives on all aspects of investing in litigation finance.  Executive Summary
  • Portfolio financings represent as much as 62% of all US commercial litigation finance investments
  • Strong growth trend for Law Firm and Corporate portfolios
  • Law firms recognize the inherent value in incubating portfolios
  • Not prevalent in non-contingent fee jurisdictions
Investor Insights
  • Potential effect of reducing overall investor returns relative to a portfolio of single case risks
  • Investors benefit from better risk-adjusted returns than single case investing
  • Cross-collateralized nature significantly reduces risk & shifts value to law firm
  • Portfolio financings may limit upside potential for investors
  • Review the portfolio composition (single vs. portfolio), past and future, to set return expectations.
One of the most significant trends in litigation finance for fund managers over the last few years has been the strong trend toward “portfolio financings”. Litigation finance can be broadly segmented between single case investments and portfolio financing investments. Single case is a reference to the provision of litigation finance to a single litigation, the outcome of which is completely dependent on the idiosyncratic case risk and binary litigation process risk.  Portfolio financing is a reference to the aggregation and cross-collateralization (typically) of a portfolio of cases, whether Law Firm or Corporate, whereby the results are determined by the performance of the portfolio as opposed to a single case. The trend has been so significant, that according to WestFleet’s 2019 Buyer’s Guide, Law Firm portfolio financings now account for 47% of capital commitments and Corporate portfolios account for 15% of commitments, for an aggregate of 62% of the commitments of the US industry. Why is Portfolio Financing Growing So Quickly? 
  1. The primary growth driver of portfolio financings is that the industry, arguably, started in the area of single case financings and is now evolving its offerings into a more complex and larger area of litigation finance. It is typical for an industry to begin with the financings of single exposures, and then as the industry gets more comfortable and gains deeper experience, it evolves into other larger applications like portfolio financing.
  2. The second driver is that as litigation funders have expanded their capital base, they have had to look further afield in terms of where they can effectively invest their capital at scale. To this end, portfolio financings are an ideal way for litigation funders to put large amounts of capital to work quickly and in a better risk-adjusted way than undertaking the laborious task of assembling a series of single case investments into a portfolio.
  3. One of the knocks against litigation finance is a low degree of capital deployment. Managers are motivated to reduce risk by slowly investing capital into the case in a measured way so as to mitigate loss of capital. Unfortunately, this negatively impacts the amount of capital they deploy and is inversely proportional to the effect their management fees have on returns. Portfolio financings, on the other hand, allow litigation funders to commit large amounts of capital and also expedite the deployment of capital, as they typically replace dollars that have been deployed (actual or notional) previously by the law firm. One could view a portfolio as a series of cases that have been ‘incubated’ by the law firm, and are now ready to be invested in by a litigation funder.
  4. Law firms have, astutely, come to realize there is value in (i) originating cases, arguably one of the most difficult and expensive services litigation funders provide, and (ii) applying modern portfolio theory to a series of cases and cross-collateralizing the pool, both to the benefit of the law firm. Progressive law firms married the new availability of large amounts of capital with the value inherent in their incubated portfolios and parlayed that into significant portfolio financings at a reasonable cost of capital, thereby capturing some of the economics for themselves.
  5. As awareness for litigation finance has grown throughout the legal community, awareness has also grown for plaintiff bar firms with large portfolios of cases. This market has also evolved and extended into corporate portfolios (LCM, an Australian litigation finance manager, is actively pursuing corporate portfolios). Accordingly, the increased awareness of the industry in general has also increased awareness for portfolio financing opportunities.
What Does it All Mean for Investors in the Asset Class? The following quote from Burford’s 2018 capital markets event sums it up nicely: “When we moved from single cases to portfolio investments, people wondered whether returns would decline, but they went up” This statement suggests that on a risk-adjusted basis, portfolio financings deliver superior outcomes. However, when you look at Burford’s return profile over a long period of time, you will see that relatively few single case investments contributed to their overall multiple of capital, with the Pedersen & Teinver claims being considerable contributors. In fact, the size of the gross dollar returns of these single case investments dwarfs the rest of the portfolio and skews the overall results. Burford makes the point in their disclosures that removing these outliers disrupts the core of their strategy, which is more akin to venture capital. As with all portfolios, one needs to assess the outliers. Yet having witnessed a large number of portfolio results, I would suggest the return profile of a portfolio is more aligned to the approach, strategy, size and nature of cases in which the manager has chosen to invest, as opposed to the notion that portfolio financings produce inherently superior results than investing in a cross-section of single cases. Some funders produce very consistent results in terms of returns and duration, whereas other strategies are more volatile; it just depends on what risk profile you are willing to accept (i.e. are you looking for venture capital or leveraged buy-out type returns). I think it is fair to say that the public domain lacks enough data to determine whether portfolio financings are better risk-adjusted returns than a diversified portfolio of single cases. However, when you consider that most portfolio financings are cross-collateralized, this single feature does have a significant impact on risk. The question then becomes how much return does the Law Firm or Corporation extract for delivering a fully originated portfolio with cross-collateralization features. I would expect that over a large portfolio of transactions, portfolio financings will outperform in terms of returns in relation to volatility, and that single cases will outperform in terms of returns, but at the expense of higher volatility. The other aspect that is difficult to control in comparing results of two sets of portfolios is whether the nature of the cases (case type, life cycle, jurisdiction, size, etc.) are common across the single case control group and the portfolio financings group. We may never know the answer, but logic dictates that portfolio financings should be lower returning, lower volatility investments, as compared to a portfolio of single cases – the key difference being the cross-collateralization feature. Investor Insights When reviewing fund manager results one should look closely at the composition of the portfolio to understand what portion is being derived from portfolios compared to single cases.  It will also be important to note the trending in these case types.  If the manager is scaling its operations, as many currently are, their motivations are to deploy large amounts of capital quickly in large portfolios with lower risk.  While this is a prudent approach for the manager, one then has to determine whether the historic return profile based on a portfolio of single case exposures is indicative of a future portfolio which will be mainly comprised of portfolio financings.  The portfolio financings will have a different risk-reward dynamic and so investors will need to model their return expectations accordingly.  Either way, I expect the return profile for litigation finance to remain robust both in the areas of single cases and portfolios and continue to believe that diversification is a key success factor to prudent investing in the commercial litigation finance asset class. Edward Truant is the founder of Slingshot Capital Inc. and an investor in the consumer and commercial litigation finance industry.
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Consumer

Colorado Court Unseals Litigation Funding Agreement, Orders Mediation Between Parties

In List Interactive, Ltd. v. Knights of Columbus, Judge R. Brooke Jackson denied a motion to restrict public access to litigation funding agreements, finding that the content of the agreements are in the public interest. Judge Jackson confirmed that dollar amounts and specific terms may constitute trade secrets, but ruled that restricting access to the entire agreement is 'grossly overbroad.' As reported in Reason.com, consumer litigation funders Theano Ventures, LLC and Themistius Ventures, LLC, are claiming that they are entitled to a portion of funds deposited withe court. Yet the law firm in the case is claiming first lien position. The funders have argued that the law firm subordinated its position in a letter that was issued to the plaintiff. That letter, along with the litigation funding agreement, have been entered into evidence as Exhibits B and C, as part of an effort to compel arbitration in New York. The court has now found that those exhibits must be unsealed for the public to view. The underlying claim alleges that the funders breached Colorado state usury laws, which cap interest rates on loans at 45%. The effective interest rate of the funding is over 90%, according to the law firm, which cites Oasis Legal Fin. Group v. Coffman, 361 P.3d 400 (Colo. 2015). In that case, the Colorado Supreme Court asserted that loans from litigation funders are subject to the state's lending statutes (the court characterized these transactions as loans, despite Oasis' argument that their funding amounts to an investment). The plaintiff, all three of the plaintiff's counsel, and the litigation funders are claiming entitlement to the over $750,000 in funds on deposit at the court registry. The court is suggesting mediation, and currently awaiting response from the parties if that is an acceptable path forward.
Commercial

Litigation Funding in India is Growing

According to the Amendments to the Code of Civil Procedure, 1908, (Order XXV Rule 3), litigation funding in India is permissible, in that non-lawyers are not restricted from accepting remuneration upon a completed claim. With recent litigation funding partnerships in the engineering and construction sectors, it seems litigation funding in India is poised for growth. As reported in Mondaq, litigation in India is often costly and time-consuming. Many in the world's second-most populous nation have called for reforms to the justice system, chief among those is the continued expansion of litigation funding to provide access to justice. Currently, lawyers are restricted from taking cases on contingency, which limits the options for an impecunious plaintiff. As LFJ has reported, large construction firms like Hindustan Construction Company Limited and Patel Engineering have kicked off the litigation funding renaissance in India by assigning their claims to investors. Construction and engineering firms are ripe for funding, because many are at or near insolvency, and burdened by the prospect of excess litigation. And when the claims are against government entities (as is the case in the aforementioned examples), the prospect of a payout should the claims succeed is virtually guaranteed. Based on the above trends, it's likely we will see continued growth of litigation funding in the Indian market. How much growth and to what extent funding penetrates the total addressable litigation market in India is anyone's guess. But for now at least, India is certainly worth keeping an eye on.
Commercial

Should Lawyers Partnering with Funders Have Skin in the Game?

Among the chief concerns over the rise of litigation funding are the potential growth of frivolous lawsuits, and funder control over case decisions. While those worries haven't exactly panned out as many industry skeptics had imagined, they remain nagging concerns as the funding industry continues to expand with new entrants and capital sources. One unifying solution to both of these ethical problems is to mandate that lawyers who partner with litigation funders operate on success-based fee arrangements. As reported in Bloomberg Law, When funders compensate the law firm regardless of case outcome, incentives become mis-aligned, which can lead to dubious ethical practices. It stands to reason then, that forcing a lawyer to have 'skin in the game' when partnering with a funder solves many an ethical quandary. First, the prospect of a frivolous lawsuit grows far less likely, given that the attorney must operate on a contingency basis (of course, the funder is already operating on such a basis, which makes the likelihood of a funded frivolous suit extremely low in the first place). Secondly, if lawyers operate on success-based fee arrangements when partnering with funders, they are less likely to permit a funder to control case decisions, as that would conceivably impact their likelihood of success. The broader ethical debate around litigation funding has largely been resolved (the Chamber of Commerce's efforts notwithstanding). Yet nuts-and-bolts ethical questions still remain, and those must be addressed if litigation funding is to really become a mainstream asset class.
Announcements Commercial

Harbour Litigation Funding expands European team with hire of Theo Paeffgen

Theo Paeffgen joins Harbour Litigation Funding today as a Director of Litigation Funding focusing on Continental Europe. Prior to joining Harbour, Theo was Regional Managing Director (DACH) at Vannin Capital, having acted as CEO of FORIS, a German focused litigation funder.

Before moving into litigation funding, Theo qualified as German Rechtsanwalt and solicitor and advised clients in his practice for more than 20 years as well as worked in a number of senior corporate roles.

Theo is based in Harbour’s London office but will travel regularly to Europe to meet law firms and clients. Theo’s hire underscores Harbour’s commitment to growth and serving its clients across Europe.

Ellora MacPherson, Chief Investment Officer commented: “Theo joining the team is really exciting news. We have made investments in Continental Europe in the past and have a good network across the region, but Theo can help take us to the next level. It will allow us to build our relationships across the continent and create funding solutions to support our clients in their pursuit of justice.”

Theo added: “I am delighted to be joining Harbour. I look forward to building on Harbour’s already excellent reputation in Continental Europe and working with the team. I am excited to grow this already market leading litigation funder.”

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Announcements Commercial

Delta Capital Partners Management LLC, Chicago-Based Litigation Finance Firm, Announces New Offices and Hires

CHICAGO, Jan. 8, 2020 --Delta Capital Partners Management LLC, a private equity and advisory firm specializing in litigation finance, today announced major milestones in its growth.

Christopher DeLise, Delta’s Managing Principal, CEO and CO-CIO, stated, “Delta has met its key business objectives for 2019 by hiring top-tier professionals, building out our geographic footprint, and joining forces with a top-tier global financial partner.  These developments have strengthened Delta’s AUM and the successful completion of recoveries for claimants, Delta and the firm’s investors. We look forward to continuing to provide world-class services to our investors and clients in 2020.”

Delta’s Geographic Reach and Team Expansion

In 2019, Delta increased its presence in several geographies where it had historically done business, by opening offices in Madrid, Prague, Warsaw and Hong Kong.

New Management Team Members 

Daniel Bond, Esq., Managing Director

Daniel Bond has been hired to lead Delta’s intake, evaluation, due diligence, and monitoring efforts to support new investment opportunities. Mr. Bond was previously a Partner at Kirkland Ellis LLP. Mr. Bond has had a 10+ year law firm career with extensive experience in the planning and management of commercial litigation and dispute resolution.

Since 2015, Mr. Bond has been named by Leading Lawyers as an “Emerging Lawyer in Illinois,” an honor given to the top 2% of lawyers who are 40 years old or younger or practicing law 10 years or less, who have proven themselves professional, ethical and experienced at an early point in their legal career.

Michael Makridakis, Esq., Managing Director – Asia, Australia and Offshore Jurisdictions

Michael Makridakis has been hired to lead Delta’s business in Asia, Australia, and in the Offshore Jurisdictions including the Cayman Islands, BVI and the Channel Islands. Mr. Makridakis works out of the firm’s Hong Kong office.

Prior to joining Delta, Mr. Makridakis was Managing Partner and Head of Dispute Resolution & Insolvency of the Hong-Kong office of Carey Olsen. Mr. Makridakis has a broad range of experience with investment funds, both offshore and domestically. Mr. Makridakis has worked extensively with distressed investment funds and has been a commercial litigator for over 15 years with extensive global litigation and arbitration expertise. Prior to launching the Hong-Kong office of Carey Olsen, Mr. Makridakis practiced law in the Cayman Islands, starting his career with Walkers Global in 2008.

Petr Malecek, Esq., Managing Director – Central & Eastern Europe

Petr Malecek has been hired to lead Delta’s business in Central and Eastern Europe. Mr. Malecek works out of the firm’s Warsaw and Prague offices. Mr. Malecek has over 20 years of experience advising corporate and sovereign entities on banking, finance and dispute-related matters in jurisdictions across Central and Eastern Europe and the Middle East.

Prior to joining Delta, Mr. Malecek co-founded a multi-disciplinary advisory practice where his areas of expertise included litigation management, dispute resolution, asset recovery, cross-border leveraged finance and the coordination of the company’s  advisors/practices and external contractors. Previously, Mr. Malecek was a Partner at CMS Cameron Mckenna and ran the banking and finance practices in Warsaw and Kyiv during that time.

Joseph Drozd, Jr., Director – Strategic Initiatives & Investor Relations

Joseph Drozd brings over ten years of experience in investment management and specializes in fundraising and managing a fund’s entire investment process. Before joining Delta, Mr. Drozd was the director of strategy and marketing with a major Chicago-based investment management company.    Joe formerly was a portfolio manager and director of research for a multi-family office in Chicago and previously worked in the alternatives group at Mercer Investments.

Jennifer Conley, Director – Marketing & Communications

Jennifer Conley has been hired to lead Delta’s marketing and communications efforts. Ms. Conley has worked in marketing and business development across the legal and financial services industries for over 13 years. Ms. Conley is responsible for developing marketing and branding strategies, client pitches and proposals, social media initiatives, competitive intelligence research, national conference sponsorships, and client socials.  Prior to joining Delta, Ms. Conley was a Global Practice Development Manager at Winston & Strawn and focused on practice and client development initiatives for the firm.

In addition to the new management team members noted above, Delta also hired several support, finance, accounting, and legal professionals during 2019, including: Daniel Noonan, Alon Polischuk, and Erin Bishop, Esq.

Delta’s Institutional Financial Partner in 2019

In May 2019, Delta entered a joint venture with a prominent Chicago-based asset manager that has made more than 60 investments since 2007.  The firm has had commitments and deployments of over $5 billion since inception and has an AUM of $9 billion.  The firm manages funds with a variety of investment strategies, including private equity, venture capital, specialty financing, distressed bond and credit alternatives, and has invested extensively in litigation finance over the last decade.

About Delta Capital Partners Management LLC

Delta Capital Partners Management LLC is a US-based private equity and advisory firm specializing in litigation finance, judgment enforcement, asset recovery and related strategies serving claimants, law firms and other professional service firms, and businesses across the globe. The firm provides capital and expertise that enables their clients to de-risk, focus on their core businesses, and significantly enhance the probability of a successful and timely resolution of their and/or their clients’ claims.

Contact:

Delta Capital Partners

Jennifer Conley, 312-481-8194

jconley@deltacph.com

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Commercial

Funded Class Actions Fill New Zealand’s Litigation Calendar in 2020

A bevy of funded class actions are making their way through New Zealand courts in 2020, sparking debate on issues such as opt-in/opt-out, and other procedural components of how the nascent class action regime should operate. As reported in the NZ Herald, one of the key cases to watch in 2020 is the Southern Response claim, where the Supreme Court issued a landmark ruling approving of opt-out status. Up to that point, class actions had been opt-in only. Opt-out benefits litigation funders and makes their financial projections easier, as it certifies that all potential plaintiffs are covered by the action unless they specifically opt-out. That eliminates the need for book-building which can be costly and time-consuming. But the opt-out status of the Southern Response claim isn't set in stone. The high court has asked the NZ Law Society and the NZ Bar Association for their feedback on the decision to certify the class as opt-out. Meanwhile, another big claim looms, as both LPF Group and IMF Bentham are battling to fund a class action against the now-defunct CBL Corporation. A court is expected to choose between the two funded claims, and many are curious as to how the civil case brought by the Financial Markets Authority will impact the selected claim, if at all. There is also an increase in both insolvency-related and construction-related disputes, as New Zealand's class action climate continues to surge, much akin to what neighboring Australia has been experiencing these past several years. The High Court Rules Committee is requesting feedback on procedural matters as relates to access to justice, and the Law Commission has confirmed it will make recommendations to the government by next year. On the table are a shortening of the High Court trial process, an investigative process for specific claims, and the streamlining of trial processes.
Commercial

Are Juris Capital’s Public Sector Union Lawsuits Motivated by Politics or Profit?

Jonathan Mitchell of Mitchell Law PLLC has filed 21 class actions against public sector unions over the past two years, which have been bankrolled by Chicago-based Juris Capital. Now some are questioning the motivation behind these lawsuits - if their intent is to turn a profit, or to squash public sector unions altogether. As reported in The Intercept, Mitchell filed nearly two-dozen lawsuits in various states prior to the Supreme Court ruling in Janus v. AFCSME. That ruling found that public sector unions may not collect fees from employees who do not wish to participate in the union. Previously, public sector unions charged agency fees, whereby workers were forced to pay for union representation, regardless of whether they wanted that representation or not. Mitchell's lawsuits are aimed at recouping hundreds of millions of dollars in public sector union dues paid by workers who did not wish to be represented in the first place. Thanks to the Northern District of California's mandate that all funding agreements in class actions be disclosed to the court, Mitchell was forced to disclose the fact that Juris Capital is his litigation funder. Juris is led by David Desser, and reportedly backed by a pair of hedge funds and other private investors. Thus far, public sector unions have won most of the early battles, with circuit courts finding that they acted in good faith and therefore need not repay workers for dues collected (some claims have been settled prior to a court ruling). However, the claims now move to the appellate stage, which many feel could be a stepping stone to the Supreme Court. With the lengthy time-to-conclusion, some are contending that the suits are part of an orchestrated campaign to crush public sector unions. Mitchell, however, insists that his lawsuits are part of no such campaign; that he brought them at his own behest. The extent of Juris' participation in a politically motivated anti-union campaign remains unclear, given that the firm is a litigation funder and therefore motivated by profit as opposed to politics. All of this aside, the real question here is: does it really matter? These claims are either meritorious or not, a decision which the Supreme Court will likely ultimately decide. In the meantime, public sector unions are complaining about the cost of the claims, which is a reasonable gripe. Perhaps someone should alert them to the rise in defense-side funding...