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Commercial

Q&A With Litigation Funder Susanna Taylor

Susanna Taylor is a Senior Investment Manager with LCM, and has been a commercial litigator for over 20 years. She answered a few questions from Tom Balmer, Director of Business Development at TLS. JD Supra details the finer points of their discussion, beginning with a general comment on how her firm, Litigation Capital Management, has done so well. Taylor credits her company’s successful growth to three specific things:
  • Formulating an assertive strategy for short and long-term growth.
  • A welcoming and professional corporate culture where people feel valued.
  • Compiling a staff of experts at the top of their game.
Taylor states that it’s vital to develop a strategy that fits your personality and strengths, and then utilize that to get the results you want. Also, taking time to build and grow a network from existing contacts is essential. Networks aren’t just made of potential clients. They can encompass anyone who might call on you for your expertise, and anyone you might call on as well. When asked for advice for young, green lawyers, Taylors’s response was simple. Follow your interests and find yourself a mentor. Then do all you can to surround yourself with those succeeding in your desired area. Listen more than you talk, and learn all you can while you can. Taylor’s own experience included work in the Crown Solicitor’s Office, which is where she developed an interest in litigation. From there, she worked at Hammonds in London and then onto Norton Rose Fulbright, where she focused on commercial claims and class action. In 2014, she took her advanced skillset to LCM, and has been successful there ever since.
Commercial

The Evolution and Expansion of Litigation Finance

The concept of Litigation Finance is a simple one. A plaintiff with a valid claim can seek third-party financing to take that claim to court. If the claim is successful, the funder gets an agreed-upon percentage of the award, or a multiple of the investment, or some combination thereof. If the claim isn’t successful, the funder walks away with nothing. That simple model has grown by leaps and bounds in recent years, and is now even more powerful given the pandemic and subsequent lockdown. Above the Law explains that Litigation Finance is growing in many directions. These days, firms and businesses turn to litigation funding to manage risk, adjust balance sheets, or free up capital for other uses. Three areas, in particular, are growing rapidly. Corporate entities are typically able to fund their own litigation. But they’re taking advantage of the opportunities that litigation funding can offer. Even strong lawsuits are unpredictable, and company shareholders might not be in favor of pursuing litigation. Funding is accounted for differently on balance sheets than, say, a traditional loan. So some large businesses use litigation funding as a way to improve valuation. Portfolio funding refers to a circumstance when a third-party funder arranges to bankroll a portfolio of cases, rather than provide funds for a single claim. Returns on this type of funding can be sporadic and unpredictable. But they can also be highly lucrative, over time. Portfolio funding is particularly valuable for firms that take on contingency cases—since it provides reliable cash flow. Claim selling is another way people use Litigation Finance to improve cashflow. A funder might agree to purchase the interest in a claim. This can be incredibly helpful for those who can’t wait years for the court process and collection to happen. As the practice of Litigation Finance grows and develops, we can expect legal professionals to find new ways to make use of it.
Announcements Consumer

Tribeca Capital Group, LLC, Converts COVID-19 Wrongful Termination Claims into Cash with Lawsuit Fundings

NEW YORK, Aug. 12, 2020 /PRNewswire/ -- Tribeca Capital Group, LLC, a pioneer in pre-settlement litigation funding, announces that it is now advancing funds to claimants who have lost their livelihoods through wrongful termination, the employer's mishandling of wage and benefit claims, and other employment issues arising from the pandemic crisis. "It wasn't long after the coronavirus reached our shores that we started hearing about mass layoffs and furloughs. Unemployment levels suddenly jumped to double digits, and over the course of weeks, Americans had filed more than 6 million unemployment claims. With so many losing their jobs, it was inevitable that we would discover some layoffs and furloughs were being conducted unlawfully," said Tribeca's founder, Rory Donadio. Some companies affected by so-called shelter-in-place or lockdown orders laid off substantial numbers in their workforces without observing mandatory federal and state reduction in force rules. Other companies have fired employees for wanting to wear personal protective equipment or for calling out unsafe working conditions. Some have fired workers or denied them federally mandated sick leave for exhibiting symptoms of COVID-19 or for caring for a family member stricken with the virus. Still others have refused to pay back wages or compensate laid off employees for unused benefits. "We've seen employers commit egregious acts like reducing an employee's wages by the amount of their stimulus checks or by denying them the severance guaranteed by their employment contracts," says Donadio. "There's no doubt that this pandemic is unprecedented and has stretched employers to the breaking point. Employers have a responsibility to their workforce, which a majority of employers take seriously even under the direst of circumstances. Unfortunately, not all employers share respect for federal and state laws and employment contracts that are designed to protect employees." Wronged former employees are hit by a double whammy. Not only have they been personally wronged, they have lost their sources of income. Donadio explains, "The ex-employee files a lawsuit seeking compensation for the wrongs they endured and replacement wages to help them survive and provide for their families. In the meantime, they turn to litigation funding companies like Tribeca to fill in the gaps. Based on a thorough evaluation of the claim, Tribeca can often provide the plaintiff a one-time advance to get them over a hump or an ongoing payment to supplement unemployment benefits." If you or a family member suffered a wrongful termination or reduction in wages, Tribeca may be able to help. Hundreds of plaintiffs have turned to Tribeca to convert their court cases into cash when they needed it most. If you need help funding your case, contact Rory Donadio, Tribeca Capital Group, LLC, at 866-388-2288 or visit our website for more information: tribecalawsuitloans.com
Announcements Consumer

Legal-Bay Announces Update to California Wildfires Negligence Claims

SACRAMENTO, Calif., Aug. 13, 2020 /PRNewswire/ -- Legal Bay Lawsuit Funding reports that California utility company PG&E recently admitted negligence in the 2018 Camp Fire that killed 84 people and destroyed the entire town of Paradise. The fire devastated hundreds of lives and wreaked billions of dollars in property damage, and was the single most destructive wildfire in California's history. After two entire years of litigation, PG&E entered a guilty plea and will pay $13.5 billion to people who lost homes and businesses from wildfires started by its equipment. Additionally, Governor Newsom recently signed into law a $20 billion fund to assist in the displaced residents' recovery. Additional lawsuits are expected to be filed. As California enters their wildfire season once again, the Gold Fire in the rural northeastern part of the state has already burned through several hundred acres, and residents are currently being evacuated. Those who have been displaced can apply for aid through the Wildfire Assistance Program, a fund intended to help anyone who needs financial assistance with housing costs or daily living expenses while they rebuild their lives. If you or a loved one need an immediate cash advance, you can apply HERE or call: 877.571.0405 Chris Janish, CEO of Legal-Bay, commented on the recent wildfire lawsuits, "Victims of these disasters need to rebuild their homes and their lives now, but their cases are lagging in the court system. Legal-Bay is proud to offer pre-settlement funding to plaintiffs so they can survive until their wildfire lawsuit makes it to trial." If you have filed a wildfire lawsuit and need an immediate cash advance against your pending settlement, you can apply HERE or call: 877.571.0405 If you have not yet filed yet and need help finding a lawyer or law firm that specializes in wildfire lawsuits, Legal-Bay can offer referrals. Legal-Bay's programs are non-recourse lawsuit cash advances, also known as case funding, which means you only repay the lawsuit cash advance money if you win your case. None of the lawsuit money programs should be considered to be a lawsuit loan, lawsuit loans, settlement loans, settlement loan, pre-settlement loans, or a pre settlement loan.
Announcements Commercial

DLA PIPER AND LCM COLLABORATE WITH NEW THIRD-PARTY FUNDER FOR DLA PIPER CLIENTS

DLA Piper has entered into a non-exclusive arrangement with publicly listed disputes financier Litigation Capital Management (LCM), and a newly formed litigation funder, Aldersgate Funding Limited to offer clients of DLA Piper access to £150m for funding large-scale litigation and arbitration. This will be offered on a financial risk-free (non-recourse) basis with a streamlined approval process embedded within the offering. Intended to be available in all applicable international jurisdictions, Aldersgate Funding has been structured to provide DLA Piper clients "best-in-class" funding terms, fast decision-making and enhanced due diligence that will allow actions to be pursued without any financial downside to claimants. With access to funding secured from LCM and Aldersgate Funding, DLA Piper will be able to provide the firm's clients with non-recourse finance for 100% of the costs of bringing a claim and additionally the ability to ‘source in’ adverse cost cover and security for costs as necessary. LCM, which is listed on the London Stock Exchange’s AIM market, has a proven and successful track-record spanning more than two decades of providing bespoke financing solutions, including corporate portfolios, to clients in various industry sectors across Europe, the Middle East, Africa, and Asia-Pacific. This funding offering opens up the opportunity to DLA Piper clients to pursue claims that would have otherwise been untenable due to capital constraints. Aldersgate Funding will be led by former DLA Piper Corporate partner Jim Holding. Jean-Pierre Douglas Henry and Jamie Curle (DLA Piper Co-Heads of Global Litigation & Regulatory and UK Litigation & Arbitration respectively) have spearheaded the portfolio funding initiative which has ultimately led to the creation of Aldersgate Funding. They will continue to lead DLA Piper’s engagement in this area and for this offering in particular. Former Global Co-Chair of Litigation & Regulatory at DLA Piper, Stephen Sly, has retired from the Firm and will also serve as Chairman of the Investment Committee of Aldersgate Funding, bringing decades of disputes experience to the table. DLA Piper will be offering this funding service as part of its enhanced legal offering named Law&. Speaking on the collaboration, Simon Levine, Global Co-CEO, DLA Piper commented: "We are working at pace to develop a stream of bold and innovative products and services as part of our enhanced legal offering Law&, that will allow clients to seize opportunities. As part of this mission, our collaboration with Aldersgate Funding and LCM gives clients access to capital to fund claims with a speed, ease and at a quantum hitherto unheard of and represents a sea change in the traditional approach to litigation funding." Jim Holding, Managing Director of Aldersgate Funding added: "This offering provides the ability for DLA Piper clients to pursue recourse through litigation and arbitration on a risk-free basis, opening up opportunities that may have previously been unavailable to them. With the benefit of our valuable collaboration with LCM, Aldersgate Funding provides a streamlined and efficient service that provides corporates with efficient access to capital, providing increased financial freedom within their businesses, an ability that is especially relevant against the current backdrop of global economic uncertainty.” Nick Rowles-Davies, Executive Vice-Chairman, Litigation Capital Management, commented: “We are delighted to be working with DLA Piper and Aldersgate Funding on this facility which not only demonstrates that LCM collaborates with the most forward-thinking law firms globally, but also the maturing of the industry where clients now demand sophisticated disputes finance solutions that move beyond the traditional templated funding model,” Funding through Aldersgate Funding is only available to clients of DLA Piper and can only be accessed via the firm.
Commercial

Cryptocurrency Class Action Seeks Funding

Did social media giants like Twitter, Google, and Facebook conspire to kill cryptocurrency in 2018? JPB Liberty, led by Andrew Hamilton, is filing a class action against social media. In a recent statement, Hamilton claimed the assertions would be “pretty easy” to prove. CoinTelegraph explains that Hamilton is accusing several prominent social media entities of behavior more fitting a cartel than a web platform. Allegations assert that there was a coordinated attack on competing cryptocurrencies. Facebook, for example, is alleged to have banned competitors from advertising on its site while developing its own Libra currency. Similarly, Twitter CEO Jack Dorsey banned ads for cryptocurrencies while taking his own payment processing app, Square, into the crypto realm. Together, a handful of social media giants allegedly managed to squash the ICO (initial coin offering) market. $600 million in claims have already been amassed, with Hamilton stating that claims could grow as high as $300 billion. This suggests that the case is ripe for third-party funding. The case is being brought to Australia, a country where Litigation Finance is booming. If non-recourse funding is provided for this class action, funders will receive 30% of any award, with the remaining 70% going to costs and claimants. Anyone wishing to sign on as a claimant has until August 21 to do so.
Consumer

Litigation Finance Data Suggests a Need for Post-Settlement Regulation

Non-recourse funding is the backbone of the Litigation Finance model. It’s what exempts the practice from usury laws and allows funders to charge higher interest rates than other lenders. An as-yet-unpublished article suggests that funders actually made higher profits from individual car accident claims than from mass tort cases. That is to say, cases where a small number of people are injured or killed made more money for funders than large cases with multiple impacted parties. Reuters points out that if funders aren’t really taking on high risk, what justifies the high-interest rates Moreover, post-settlement cases are increasingly taken on by funders, and carry little, if any, risk. An upcoming paper suggests capping post-settlement interest rates at 15%. Lynn Baker, a law professor at the University of Texas, Ronen Avraham of the University of Tel Aviv, and Anthony Sebok of Cardozo Law examined data from thousands of funded cases. Their conclusions were striking, and suggest a need for increased oversight of the industry. Most interesting were the advances made near the end of cases. Post-settlement advances accept almost no risk—which becomes evident when case vetting is examined. Funders vet cases carefully before extending any funds. Pre-settlement cases are evaluated on their merits and potential awards. But the veracity of the claim has almost no relevance to funders in post-settlement claims. This is presumably because the key issue for funders is the net recovery. Baker points out that in the data she reviewed, post-settlement cases were limped into an ‘other’ designation, ostensibly to de-emphasize how financially valuable they are to funders. Data suggests that as much as 68% of funder profits stem from post-settlement cases. This in turn suggests that post-settlement advances are a different sector than pre-settlement funding and should be regulated differently. Ultimately she maintains that if there’s no real risk, the ‘non-recourse’ designation should not apply.
Announcements Commercial

Legal Industry Rebounds in June

The UK's Legal industry generated revenues of £2.79bn in June 2020. Whilst 3.6% down on June last year, that month was the highest billing June on record. June 2020 was the third best June in history for the UK’s legal industry, according to Office of National Statistics data released on 12th August.

Month on month, June 2020 saw revenues grow 19.5% since May 2020, but as May is traditionally the weakest month of the year for the Legal profession, the year on year comparison is more telling.

Louis Young, MD at Augusta said: “June’s revenue data shows the green shoots of recovery are now here for the UK’s legal industry. Firms will welcome this news, having been hit hard by the pandemic. Many will however take time to recover, having geared up for a record year in 2020. Leaders continue to look for options to manage costs and enhance their balance sheets, whilst planning for an improvement in trading conditions in Q3”.

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About the ONS Data

  • ONS Monthly Business Survey data shows Legal Activities revenue as £2.79bn in June 2020 compared to £2.33bn in May 2020 and £2.89bn in June 2019.
  • The overall Services sector (including Legal) grew by 24.5% since May 2020.
Commercial

How a Rise in ‘Nuclear Verdicts’ Impacts an Industry

Trucking-related lawsuits are on the rise, as are the potential awards. When a driver is negligent, the company pays the price. This has led to a comparable increase in insurance premiums and shipping costs, much of which is passed down to the consumer. What’s causing this? Some point the finger at Litigation Finance. Logistics Management details tips from the American Transportation Research Institute, which has some suggestions on how to mitigate litigation. Most of the suggestions are obvious—settlement is often better than a trial, make safety a paramount concern, avoid accidents. Trucking companies describe the current conditions as a free-for-all, where well-funded lawyers choose welcoming jurisdictions or use shady medical testimony to reap a big payout. In one recent case, a driver ignored a stop sign and caused two deaths. Is this simple driver error, or is the real culprit here a set of policies that leave drivers too exhausted to follow the rules of the road? In the last decade, the average dollar amount of awards was just over $3 million. Now they average around $7 million. The rate of increase in the awards outstrips inflation and is even more pronounced than the rise in healthcare costs. This has inspired some states to legislate ‘damage ceilings’ that limit total awards per incident. Is it fair to blame Litigation Finance for the current predicament of truckers? It’s true that third-party litigation funding has grown in popularity in recent years. It’s also true that ordinary citizens have better access to justice than ever before. It makes sense that trucking companies would long for the days when awards were small and most people couldn’t afford to take them to court. After all, the growth of an industry is a signal that their services are in demand.