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Litigation Finance Primer

SPONSORED POST: Litigation Finance Opportunity for ‘David vs. Goliath’ Case

Loewinsohn Flegle Deary Simon is prosecuting a claim valued at $31m. We are raising $2.3m for return within 12 months, possible additional upside. $450k to close, balance on run rate 30 days net to trial. The claimant is a single individual plaintiff who is a very credible former investment banker. Claimant is very knowledgeable and is committed to conclusion of the claim. One defendant is a large international financial institution and the second defendant is a highly liquid mortgage loan originator. Case documents are structured finance and real estate. Defendant’s counsel is a national general practice firm, lead defense counsel is 4-year partner. This is a complex financial claim, fact intensive, document case. Documents we hold support an opinion letter from a legal 500 firm at 80% chance of recovery. Damages are supported by preliminary economic expert and other case documents. Why we believe we will win This case arises out of a fraudulent foreclosure on plaintiffs' home. The Financial Conduct Authority (FCA) regulated plaintiff who  has brought claims that will likely result in a verdict including actual damages of $31,880,288.014 for Breach of Contract, Fraud, Fraudulent Lien Against Real Property, Deceptive Trade Practices Act (“DTPA”) and Texas Debt Collection Act (“TDCA”).  Claimant was not in default, and allegations made against the plaintiff are proven to be false. The court records contain perjured statements, forged robo-signed affidavits, assignments, fraudulent liens, fraudulent appointment of substitute trustees and many other records. Defendants fraudulently concealed its lack of interest in the property by manufacturing evidence. These false allegations destroyed plaintiff’s credit, caused property loss, loss ofreputation and career. The jury will likely return a substantial verdict on the TDCA, which is a treble damages statute. It is important to note that the jury will not be advised that  fraud finding results in an automatic trebling of actual damages and mental anguish under both the DTPA and TDCA. The Court’s judgment could be set at over $69,131,398.50.   Three of the four claims allow for the recovery of attorneys’ fees. In sum, the fraudulent conduct by Defendants supports “uncapped” exemplary damages. Given the result obtained by the Loewinsohn Firm against JP Morgan Chase last year, defendants have a powerful incentive to settle this case for close to the full amount of damages. A Full litigation plan illustrates solid case of merits, liability, and damages for each claim. Plan includes analysis of defenses and key arguments. Data room is set up for due diligence. Case is on file in state court, no DCO or trial date. Preferential date will be requested within approximately 9 months. A Motion to dismiss was filed and denied. About Loewinsohn Flegle Deary Simon Loewinsohn Flegle Deary Simon have extensive experience representing clients ranging from Fortune 500 companies to individuals on both sides of the docket in complex business, employment and bankruptcy disputes. The firm’s recent successes include two high-profile cases. In July 2018, an LFDS team including Craig Simon, Alan Loewinsohn, Matt Ray and Jennifer Barall secured a $45 million settlement on behalf of Navajo Transitional Energy Company in a contract dispute against a number of public utilities.  Last year, partners Alan Loewinsohn, Jim Flegle and Kerry Schonwald represented their client Jo Hopper in a breach of trust case against J.P. Morgan Chase & Co., where a Dallas probate jury awarded $6.014 billion in damages, the largest jury verdict in the United States in 2017 and the ninth largest verdict in US history. The trial lawyers at Loewinsohn Flegle Deary Simon are nationally recognized, including most recently on Friday of last week, by editors and reporters of American Lawyer Media’s National Law Journal as the top law firm in the Nation for 2018, Elite Trial Lawyers Business Torts category. The facts and evidence to date suggest that we could achieve a similar outcome and damages to our record judgment in Hopper. We are new to litigation funding. Our view is this case is suited to Family Office, Special Situations Fund, Individual investor, joint venture with another law firm, or Hedge Fund. Xpress your interest by emailing Alan Loewinsohn AlanL@lfdslaw.com Loewinsohn Flegle Deary Simon LLP 12377 Merit Drive, Ste 900 Dallas, Texas 75251 214 572 1707 www.lfdslaw.com

Litigation Capital Management (AIM:LIT) announces settlement in principle of litigation project

Litigation Capital Management Limited (AIM:LIT), a leading international provider of litigation financing solutions, announces that a settlement in principle has been reached in respect of one of its litigation projects.

Highlights

  • The project relates to an open class action LCM funded on behalf of certain former shareholders in a resources company formerly listed on the ASX
  • Expected to contribute between A$8-10 million to EBITDA for the current financial year to 30 June 2019; with all capital invested also being recovered
  • Favourable metrics for the project with the expectation of returns ahead of the last reported cumulative performance
  • The litigation project was managed to this settlement in principle in approximately 21 months
  • Fourth litigation project that LCM will complete in the current financial year
  • The settlement in principle of the class action will be documented in a Deed of Settlement that is expected to be executed shortly
The project relates to an open class action LCM funded on behalf of certain former shareholders in a resources company formerly listed on the ASX. The other party is an international professional services company and prior to a final hearing (scheduled before the Supreme Court of New South Wales), both parties participated in a mediation where the settlement in principle was reached. The settlement in principle of the class action will be documented in a Deed of Settlement that is expected to be executed shortly. The terms of the settlement are confidential, and the settlement is then subject to court approval. Class actions represent one of several types of litigation projects that LCM provides funding for across single-case and portfolio funding, as well as international arbitration, commercial claims and claims arising out of insolvency.

Patrick Moloney, CEO of LCM, said: 

"This settlement in principle demonstrates LCM’s experience in class actions in Australia, while producing favourable metrics through active project management. We have delivered a successful resolution for former shareholders in this resources company within a relatively short time period for a class action of this type.

“We remain encouraged by all the opportunities LCM is seeing as a London listed company and while class actions are part of our heritage, we have a diverse portfolio and pipeline of litigation projects including insolvency, international arbitration and corporate portfolios.”

About LCM Litigation Capital Management ("LCM") is a leading international provider of litigation financing solutions. This includes single-case and portfolio across class actions, commercial claims, claims arising out of insolvency and international arbitration. LCM has an unparalleled track record, driven by effective project selection, active project management and robust risk management. Headquartered in Sydney, with offices in London, Singapore, Brisbane and Melbourne, LCM has been listed on AIM since December 2018, trading under the ticker LIT. As at 31 December 2018, LCM's cumulative IRR calculated since 2012 (inclusive of losses) was 78%. Similarly, LCM's cumulative ROIC was 117%. Both the IRR and ROIC are exceptional figures for the industry and are testament to the consistent quality of LCM's approach to funding litigation projects and investments. The average time to completion was 27 months, as at 31 December 2018. www.lcmfinance.com
The LFJ Podcast
Hosted By Scott Mozarsky |
In this week's episode, we sit down with Scott Mozarsky of Vannin Capital to discuss the Legal Tech industry. What are the advancements being made as pertains to Legal Services? How are litigation funders leveraging the industry's innovation? How are they picking winners and losers? And what will the future of the Legal Services industry look like, once the robots finally take over? All this and more, on this week's episode of The Litigation Finance Podcast. [podcast_episode episode="3625" content="title,player,details"]

The Key Issues Facing the Litigation Funding Industry

A recent Lake Whillans survey found that over 40% of litigators had first-hand experience with litigation funding. And that number is widely expected to grow over the coming year. But with mainstream acceptance comes increased attention - not all of it positive. As the funding industry expands both domestically and internationally, some key issues are rising to the forefront; ones which funders need to be proactive about addressing if they are to properly navigate this next phase of industry expansion. As reported in Above the Law, there are some challenges facing funders at the moment which desperately need to be addressed. Firstly, there is the issue of differentiation. As nine-figure fundraises become the norm, how do funders differentiate themselves and avoid industry commoditization? One way is to appeal directly to claimants by maintaining a stellar reputation when it comes to issues of capitalization, flexibility and trust. Obviously when it comes to funding, the key issue for claimants is going to be the terms they receive (another finding in the aforementioned Lake Whillans survey), but if terms do become relatively commoditized, than differentiation can happen at a more personal level. One other possibility is the establishment of novel products, such as defense-side funding. Yet it isn't entirely clear how this will solve the 'commoditization' issue, given that the moment a successful model for defense-side funding is introduced, it will likely be replicated by most funders, as was the case with portfolio funding.

Lake Whillans Releases 2019 Litigation Finance Survey

Lake Whillans has released the findings from its annual litigation finance survey. The funder questioned 357 respondents ranging from solo practitioners to members of large law firms to in-house counsel, and aggregated their thoughts on the growing industry of third party funding. According to the survey, the largest proportion of respondents (36%) were law firm partners or counsel, while the remaining 64% was split mostly evenly across solo practitioners, law firm associates and in-house counsel. 41% of respondents answered in the affirmative when asked if they had first-hand experience working with a litigation finance firm. When grouped by firm size, solo practitioners had the lowest level of experience (27%), yet 2-25 person law firms had the highest rate of experience (56%). 500+ person firms came in second at 50%. In-house counsel, as can be expected, reported the lowest level of engagement at only 25%. When looking across industries, most industries sampled hovered around the 50/50 mark in terms of level of engagement. Yet the Energy industry was the only one to break the 50% mark, coming in at 53%. Finance/Banking came in at the bottom of the list, at 38%, yet that represents a 7% uptick since 2016. Interestingly, when queried on who drives the decision to utilize funding, both outside law firms and in-house counsel tend to think they are the drivers. Outside law firms named themselves as drivers 1/3 of the time, and in-house counsel only 7% of the time. Yet in-house counsel felt the opposite; that they drove the decision-making 40% of the time, and outside lawyers drove it 10%. I guess everyone likes to take credit for a good decision? The #1 motivation for seeking financing for in-house counsel is hedging the risk of litigation (43% of respondents), while the #1 motivation for law firms is lack of funds for legal fees (a full 48% gave this answer). Another top answer given was 'to help fund operating expenses.' Very few respondents cited 'lower cost of capital' as their reason for seeking funding. The majority (35%) of funders were identified through referrals, while 25% were found via the media (you're welcome!) And to no one's surprise, by far the most important consideration when choosing a litigation funder was 'Economic terms.' That was followed 'Flexibility on deal structure' and 'Funder reputation.' It is perhaps noteworthy that in-house counsel overweighted a funder's 'right to influence case strategy' as a major consideration, relative to law firm respondents. That illustrates that there is more work to be done in convincing in-house counsel that funders are not seeking to control case strategy, and remain passive investors. That said, we can all take solace in the fact that a whopping 81% of respondents said they would use litigation funding again, with only 19% saying they would not. And a full 75% said they would either strongly recommend or somewhat recommend litigation funding to others. Additionally, a full 80% of respondents predicted either rapid growth (46%) or gradual growth (34%) for the industry as a whole (count us in the 'rapid growth' category!) All told, some very positive signs for the industry, with a handful of alarm bells (that in-house counsel is overly concerned about funder control over cases is worrying). It will be interesting to see how these numbers shape up during next year's annual survey.

IMF Bentham Funds Australian Retirees’ Claim Against Australian Executor Trustees

4,500 Australian investors in Australian Executor Trustees (AET) are suing the trustee for $55MM plus interest. Their suit, backed by litigation funder IMF Bentham, alleges that AET acted negligently on the sale of Southern Australian Perpetual Forests (Sapfor), which led to secured investors suddenly losing their entire investment. As reported in Investor Daily, A company called Gunns purchased Sapfor, only to experience financial difficulties which ultimately resulted in bankruptcy. Gunns took on debt from lender ANZ, which assumed control of Sapfor subsequent to Gunn's bankruptcy. In 2012, AET allegedly sold off their interest in Sapfor for $39MM, which went directly into Gunn's overdraft account. So investors saw nothing. Now investors are claiming a breach of trust, and demanding the full $55MM plus interest. Their claim was initiated in 2016 with the NSW Supreme Court. Court papers show AET is laying blame at the feet of its lawyers, Sparke Helmore, for allegedly providing negligent advice. Piper Alderman is representing claimants in the ongoing case.

Capital Pro-Égaux Inc. (NEX: CPE.H) Announces Litigation Funding Agreement

MORIN-HEIGHTS, QC, March 12, 2019 /CNW Telbec/ - Capital Pro-Égaux Inc. (the "Company") (NEX: CPE.H) announces that its wholly owned subsidiary, Technique d'usinage Sinlab Inc. ("Sinlab"), has entered into a Litigation Funding Agreement for the funding of expenses related to the professional negligence action for damages commenced in 2013 in Florida against Sinlab's counsel who represented Sinlab in litigation in Virginia against certain entities who violated Sinlab's pioneering digital dentistry patent portfolio (the "Litigation"). Update on Litigation The Litigation continues and is expected to be on the trial docket for the fourth quarter, 2019, with limited additional discovery during the next few months. To date, no defendant has offered any settlement payment to Sinlab. Litigation Funding Agreement The Company and Sinlab explored solutions to finance expenses relating to the Litigation, including a temporary revocation of the cease trade order to complete a private placement of common shares and funding from commercial litigation financing entities. Ultimately, Sinlab entered into a litigation funding agreement with certain of its directors and officers upon terms and conditions consistent with those available from commercial litigation financing entities. The agreement provides for funding of litigation expenses in exchange for the payment of a portion of the proceeds from the resolution of the Litigation, including a settlement or a judgement, ranging between 20% and 40% depending on the amount of funding expended and timing of the resolution of the Litigation. In order not to hurt Sinlab's position in the Litigation, the amount of the funding is not disclosed. However, this amount is in the range of half a million dollars. Although the transaction constitutes a related party transaction of the Company within the meaning of applicable securities legislation, the Company is relying on certain exemptions from the formal valuation and minority approval requirements contained in such legislation. "The principals of the Company are committed to seeing this Litigation through and are open to considering further financing if necessary" said Mr. Pierre Désormeau, president of the Company. Caution regarding forward-looking statements This news release contains certain forward-looking statements regarding the Company's expectation of future events, including potential claims and developments regarding legal proceedings. Such expectations are based on certain assumptions based on currently available information. If these assumptions prove incorrect, actual results may differ materially from those contemplated by the forward-looking statements contained in this press release. Factors that could lead actual results to differ include, amongst others, factors that may impact claims and legal proceedings, such as interpretation of factual matters, time and money involved in undertaking legal proceedings, uncertainty as to the final result and other risks. The Company disclaims any intention or obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, other than as required by securities laws. About Pro-Égaux Inc. Pro-Égaux through its wholly owned subsidiary, Technique d'usinage Sinlab Inc., is a company based in Lachenaie, Quebec, specializing mainly in the conception and design of titanium products to be used in the dental prosthesis restoration industry. Neither NEX, the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of NEX and the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. SOURCE Capital Pro-Égaux Inc.

Legal-Bay Pre Settlement Lawsuit Funding Expects Numerous Multi-million Dollar Settlements In Defective Takata Airbag Cases

MIAMIMarch 12, 2019 /PRNewswire/ -- Legal-Bay, The Pre Settlement Funding Company, reports today that the ongoing legal saga concerning Takata airbags isn't over yet. Plaintiffs are still filing suit against major car manufacturers including Ford, Mazda, and Toyota, citing injuries that have resulted from faulty airbags in their vehicles.
The automotive giants have come under fire in recent years for manufacturing, distributing, and/or selling certain vehicles which contained allegedly defective air bags manufactured by the Takata Corporation. The faulty devices have ruptured upon inflation, causing damage to the vehicle and/or not deployed at all, causing injury—and in some cases death—to car occupants. Four major car manufacturers concluded a class action lawsuit against Takata with over $550 million in payouts in 2017, but additional lawsuits are currently being filed.
If you are a prospective plaintiff for that has sustained injuries due to faulty airbags or other car or truck accidents, Legal-Bay can help you. Chris Janish, CEO of Legal-Bay, says, "The Takata Airbag cases have been lingering for some time. It is tragic that some of the car and truck accidents resulted in wrongful death cases, and it seems Takata is starting to take some responsibility. However, many personal injury cases requiring surgery are still moving through the court system throughout the country." Legal-Bay, one of the leading lawsuit funding companies, along with their funding partners, remains consistent in their dedication to helping clients receive cash funding for their legal needs. Their ample, knowledgeable staff is available to quickly evaluate cases for the fastest pre-settlement funding in the industry. If you are involved in a pending lawsuit and need cash advanced to you now, you may apply at: http://lawsuitssettlementfunding.com. Legal-Bay's programs are non-recourse lawsuit cash advances, also known as case funding, which means you only repay the settlement advance if you win your case. None of the programs should be considered to be a lawsuit loan, lawsuit loans, settlement loans, settlement loan, pre-settlement loans, or a pre-settlement loan. To apply now for lawsuit settlement funding go to the company's website at: http://lawsuitssettlementfunding.com or call the company's toll free intake line at: 877.571.0405 where agents are standing by. SOURCE Legal-Bay LLC

Therium launches “Therium Access” to provide not-for-profit litigation funding to improve access to justice in the UK

Therium Group Holdings Limited, one of the world’s leading providers of litigation, arbitration and specialty legal finance, today announced the launch of Therium Access, which will provide not-for-profit litigation funding in order to facilitate access to justice. Therium Access is the first-of-its-kind initiative in the litigation funding industry. Grants awarded by Therium Access are intended to provide access to justice to those who lack the funds necessary to pursue or defend claims, as well as to projects that seek to improve access to justice. Therium Access is the primary expression of Therium’s corporate and social responsibility programme. Therium Access dispenses with the criteria of funding for profit and has the sole purpose of facilitating access to justice by funding cases and projects which could not usually be funded on a commercial basis.  Therium Access is a mark of Therium’s wider commitment to the pursuit of justice and the rule of law, and its launch coincides with the firm’s 10th anniversary. John Byrne, Co-Founder and CEO of Therium Capital Management Limited, said: “We are delighted to announce the launch of Therium Access, which is dedicated to improving access to justice by providing not-for -profit litigation funding for cases and projects of public interest. Therium is ten years old this year and the making of the first Therium Access grants in April will be a fantastic way to mark the firm’s 10th anniversary.” Lord Falconer, Chairman of Therium Access Advisory Committee said: “I am delighted to chair this important initiative, which is a first for the litigation funding industry and will hopefully lead the way for further initiatives.  The choking of legal support that we have witnessed in this country as a result of unprecedented cuts to legal aid has had drastic consequences on the vulnerable who are being denied access to justice, and on those individuals and organisations who work tirelessly to support them.  The not-for-profit funding that Therium Access will provide through grants for cases and projects is urgently required to make some contribution towards restoring the right to legal support, which is the bedrock of our justice system.” The first grants will be announced in April. The deadline for the submission of the next round of grant applications is 30 August 2019. Applications need to be made by legal representatives or the entity seeking a grant.  The board of Therium Access will be assisted by an Advisory Committee which will be chaired by Lord Falconer, former Lord Chancellor, Secretary of State for Constitutional Affairs and Secretary of State for Justice. Further appointments to the advisory committee will be announced in due course. Therium Access aims to support access to justice in the broadest terms and considers applications that further the following causes (in no particular order):
  • The right to legal representation or due process;
  • The proper and efficient administration of justice;
  • The advancement of human rights;
  • The promotion of equalityof rights and diversity;
  • The protection of children, the elderly, the disabled, minorities, asylum seekers and other vulnerable or disadvantagedgroups;
  • The advancement of environmental protection or improvement;
  • The promotion of legal educationthat furthers the causes listed above; and
  • Any othercase or project in which a person, group, or entity will not have access to justice without financial assistance.
Therium Access is intended to be a global initiative, its initial focus will be on the UK and it will be rolled out in other jurisdictions in a number of planned phases. About Therium Therium is a leading global provider of litigation and arbitration and specialty legal finance, active in England and Wales since 2009. Over that period, Therium has funded claims with a total value exceeding £34 billion, including many of the largest and most high profile funded cases in the UK.  With investment teams in the UK, USA, Australia, Spain and Norway, Therium has established a track record of success in litigation finance in all forms, including single case litigation and arbitration funding, funding law firms and portfolios of litigation and arbitration claims.  Therium is also a founding member of the Association of Litigation Funders of England and Wales. Therium has consistently been at the forefront of innovation in litigation finance, pioneering the combined use of insurance tools alongside funding vehicles, and introducing portfolio funding products into the UK.  Therium’s ability to develop innovative funding arrangements and bespoke financial solutions for litigants and law firms complements its unmatched experience and rigorous approach to funding a wide range of commercial disputes throughout the world. In Chambers and Partners’ inaugural litigation support directory 2018, Therium was ranked as a Tier 1 litigation funder, and Neil Purslow, the firm’s Chief Investment Officer, was named a leading individual in the litigation funding industry. In February this year, Therium Capital Management was top ranked as one of the two “Leading” litigation and arbitration funding firms in the UK by legal and business directory Leaders League, in their 2019 ranking of litigation funding. Therium was also ranked as “Excellent” in the 2019 US ranking. www.therium.com