POLARIC PARTNERS GmbH is opening its doors under the management of longstanding litigation funding specialist Markus Glaser. The company provides litigation financing in return for a success-based share of the litigation proceeds. Litigation funding has established itself in the market for legal disputes as part of risk management. Companies, consumer groups, lawyers and insolvency administrators in particular make use of this opportunity to mitigate their own cost risks and those of their clients. Court costs, lawyers' fees and expensive expert opinions are a burden in any legal dispute, even at the planning stage. Litigation funders cover these costs from the outset, making it easier for their clients to plan upcoming disputes in a way that conserves liquidity. Clients only pay the funder if they are successful - from the proceeds they recover from the defendant. POLARIC PARTNERS GmbH presents itself with a network of funding and service experts and offers its clients tailor-made solutions for entrepreneurially sensible legal disputes. Its partner-focused approach sets it apart from many other offers on the market. Litigation is just as much a part of its repertoire as cases that clients prefer to keep out of court. In suitable cases, the company offers to take over claims in full so that the customer does not have to take legal action themselves. "The market for litigation funding has been dynamic for years and still has a lot of potential for development from the customer's point of view," Glaser is convinced: "Over 90% of all funding requests are unsuccessful. We want to support customers with their individual funding requirements in a more tailored way - as a strategic partner, in long-term business relationships, for our mutual benefit". About POLARIC PARTNERS:  POLARIC PARTNERS GmbH is a litigation funder for companies, consumers, lawyers and insolvency administrators. As a specialized service provider for legal disputes, it assumes the costs of court proceedings, from the advance on court costs and statutory and contractual lawyers' fees to expert witness fees - and if the customer is unsuccessful in the legal dispute, also the opponent's costs. In addition to the exemption from costs, even advances on the principal claim are possible as monetization. POLARIC PARTNERS has a network of partners in Germany and abroad that enables it to handle legal disputes worldwide, regardless of the amount of the claim. At the heart of every case is a partnershipbased understanding of cooperation and intensive individual support for the client.

The following is the second of a two-part series (Part 1 can be found here), contributed by Ed Truant, founder of Slingshot Capital, Executive Summary

• Duration risk is one of the top risks in litigation finance
• Duration is impossible to determine, even for litigation experts
• Risk management tools are available and investors should make themselves aware of the tools and their costs prior to making their first investment
• Diversification is critical in litigation finance

Slingshot Insights:

• Duration management begins prior to making an investment by determining which areas of litigation finance have attractive duration risks
• Avoidance can be more powerful than management when it comes to duration in litigation finance
• There is likely a correlation between duration risk and binary risk (i.e. the longer a case proceeds, the higher the likelihood of binary risk associated with a judicial/arbitral outcome)

In the first article of this two-part series, I provided an overview of some of the issues related to duration in the litigation finance asset class.  In this article, I discuss some of the ways in which investors can manage duration risk, both before they invest and after they have invested. Managing Duration Risk The good news is that there are many ways to manage duration risk in litigation finance and you can use the various alternatives in combination to create your own portfolio to mitigate the risk. Before we look at how we can manage duration through an exit of an investment, let’s first explore how we can avoid duration risk before we even start investing.  That is to say which investments have lower levels of duration risk to begin with so we can avoid duration risk going into an investment. Case Type Selection On the commercial side, post-settlement cases have a low degree of duration risk as the litigation risk has mainly been dealt with through the settlement agreement and the resulting risks relate to procedural (generally timing) and collection risk.  Similarly, appeals finance is generally involved with cases that have less litigation risk as the issue at play is usually a specific point of law and the timeline for appeals tends to be relatively certain and short while the costs are fairly well defined. Consumer litigation cases (think personal injury cases, other than mass torts) tend to have relatively dependable timelines and so this can be a very attractive area in which to invest with less duration uncertainty, but it does come with some ‘headline’ and regulatory risk.  Mass tort cases, which technically are consumer cases, have different dynamics because of the sheer size of the claims and the complexity of the multi-jurisdictional process which require test cases to prove out the merits and values of the cases.  So, I would view these as being similar to large commercial cases in terms of their dynamics with respect to duration. Other case types such as international arbitration and intellectual property disputes tend to have much longer durations in general and so avoiding these case types is a way to mitigate duration risk within a portfolio. Case Sizes Based on some statistical analysis I had prepared from funder results (my demarcation point between small and large was based on one million in financing) and on review of a large number of case outcomes of different sizes, there appears to be some correlation between the size of the financing and the duration of the case. Smaller financings (and presumably, but not necessarily, smaller cases) tend to have shorter durations than larger financings.  The correlation could result from the fact that litigation finance is more effective in smaller cases or that there is generally less at risk in smaller cases and hence rational parties tend to resolve things more quickly when there is less to squabble over.  The exact reason will never be known, but there does appear to be some statistical correlation to support the finding.  Accordingly, one way to manage duration risk would be to focus on smaller sized cases. Case Jurisdiction Selection Not all jurisdictions are created equal in terms of speed to resolution.  Accordingly, one might want to investigate the best venue for their cases given their portfolio attributes to ensure they are in jurisdictions where duration risk is lower than others.  Of course, jurisdictions don’t offer duration risk in isolation and so you will need to know what you are trading off by investing in cases in jurisdictions with a faster resolution mechanism as there will likely be trade-offs with economic consequences.  This could involve different countries, different states within a given country, and different judicial venues (arbitration vs. court).  There are even certain judges that progress through cases at a quicker clip and are less prone to allow for unnecessary delays.  Of course, you may not be able to pick your judge and even if you can there is no guarantee you will end up with the same one you started. Case Entry Point  If you are a fund manager, another way to manage duration risk on the front end, aside from case type selection, is to focus on those cases that are already in progress and therefore should have a shorter life cycle because you are entering them later in their life cycle.  While this doesn’t deal with the situation where the case goes on longer than anticipated, it does decrease the overall length of the case by deciding to enter it at a later stage, but then you don’t always have a choice when you enter a case as it may be presented to you at a particular point in time and then you may never get the opportunity to invest in it again.  In this sense you could suffer from adverse selection if you only selected late-stage cases as you are only investing into a subset of the broader market of available cases. Liquid Investments Another way to mitigate duration risk is to focus on a liquid alternative that provides similar exposure through the publicly-listed markets, which is a topic I covered recently in a two-part article which can be found here and here under the heading of Event Driven Litigation Centric (“EDLC”) investing.  EDLC has the distinct advantage of being liquid through a hedge fund structure that provides redemption rights which allows the investor to somewhat control duration although ultimate duration is typically dictated by the timing of the event itself.  Of course, as investors move into the public markets, they start to add correlation to their portfolio which may be at odds with your duration/liquidity objectives. While it is beneficial to deal with duration risk on the front end through the case selection options outlined above, once an investor has concluded their investments, there are some options still available to deal with duration risk as outlined below. Secondary Sales  As the litigation finance industry has evolved, so to have the number of solutions in the marketplace.  While secondaries have been taking place informally for years (hedge funds, litigation funders, family offices, etc.) there has only recently been a formalizing of the secondary market and I am very keen to see how the early market entrant, Gerchen Capital, ultimately performs. Nevertheless, for managers and investors seeking liquidity and an end to duration risk entering into a secondary transaction may be a very viable solution. I believe it will be more economically viable in the context of a portfolio sale than a single case investment, but I am sure there will be some level of appetite and valuation for both.  It may be the case that the investor does not obtain 100% liquidity for their position but rather risk shares alongside another investor who doesn’t want to suffer from adverse selection and thus makes it a condition of their secondary offer that the primary investor retain an ownership position.  Other situations may allow for complete liquidity, but that will likely come at an economic cost.  And there are even other times when the case is moving along exactly as planned and the primary investor is able to sell a portion of its investment at such a high valuation that it produces a return on its entire investment, which is the case with Burford and its Petersen/Eton Park claims, despite the fact that no money has exchanged hands between the plaintiff and the defendant and there is still no clear path to liquidity. While selling a portion of an investment allows the manager to obtain some liquidity for its investors, it also serves to validate the value of the investment/portfolio to its own investors, which may in turn allow that manager to write-up its portfolio to the value inherent in the secondary sale transaction (again, this assumes that the transaction is completed with a third party investor).  As an investor, you really need to assess whether any secondary transaction is being undertaken for the intended purpose (liquidity or duration management) or whether there are alternative motivations at play (i.e. for the manager to post good return numbers to allow them to increase their chances of success at raising another fund).  And while third party validation may be comforting, too much comfort should not be derived by someone’s ability to sell an investment to another party, it could have more to do with sales acumen than the value of the underlying investment. Insurance Any discussion regarding litigation finance wouldn’t be complete without mentioning its close cousin, insurance.  In the early days of applying insurance to litigation finance, the focus was more on offsetting the risk of loss.  While that is still true today, there is an increasing focus being put on insurance as a way to deal with duration.  The thinking is that investors don’t want to get stuck in funds that take years beyond their original term to pay out and so they are prepared to accept the duration risk if there is a safety valve in place. The safety valve is the insurance which will pay out at the end of a defined term, which provides the investor with assurances that they will at the very least get their original principal repaid (and possibly a nominal return).  In essence, the insurance functions as a risk transfer mechanism between investor and insurer until the case is finally resolved. While it is more common to put insurance in place on making the investment, one could place insurance after the fact as well. Slingshot Insights   Duration management in litigation finance is almost as critical as manager selection and case selection.  I believe duration management starts prior to making any investments by pairing your investment strategy and its inherent duration expectations with the duration characteristics of your investments.  From there, you should ensure your portfolio is diversified and you should be actively assessing duration and liquidity throughout your hold period.  You should also assess the various tools available to you both on entry and along the hold period to determine your optimum exit point. As always, I welcome your comments and counterpoints to those raised in this article.  Edward Truant is the founder of Slingshot Capital Inc. and an investor in the consumer and commercial litigation finance industry.  Slingshot Capital inc. is involved in the origination and design of unique opportunities in legal finance markets, globally, advising and investing with and alongside institutional investors.

Lumenci is a renowned full-service IP consulting firm dedicated to extracting maximum value from IP assets and providing technical, valuation, and strategic advice to patent owners and law firms to drive successful results.

With a global footprint spanning Austin, New York, San Francisco Bay Area, and New Delhi, India, Lumenci gathers over 100 technical and valuation/damages experts under one roof. This full-service IP consulting firm empowers companies to maximize the value of their IP assets through a blend of domain expertise and advanced automation technologies. A prolific team of Patent Monetization Strategists, Due Diligence Technologists, and Litigation Discovery Experts enables Lumenci to assist clients as a comprehensive global partner in high-stakes patent monetization and IP litigation campaigns.

Lumenci's expertise lies in understanding complex technology, analyzing patent claims and identifying underlying technological nuances. With a successful track record, Lumenci has analyzed over 60,000 patents, meticulously tested 900+ products, and investigated more than 175 litigations across ten global regions, from the US and UK to China and India. Their dedication extends to both plaintiffs and defendants, consistently securing favorable outcomes like settlements and verdicts. Lumenci's work has saved clients a staggering $3 billion in verdicts, settlements, and cost savings. The firm's team of experts possesses deep domain knowledge in various complex technology areas, including software, cloud computing, codecs, artificial intelligence, telecommunications, and hardware.

Among its technological clients, Lumenci stands out as a reliable partner looking to maximize the value of their intellectual property portfolios. The firm's commitment to delivering customized solutions, leveraging cutting-edge technology, and maintaining a deep understanding of the IP landscape has resulted in successful customer outcomes.

Company Website:  www.lumenci.com

HQ - Austin: 901 South Mopac Expressway, Building 1, Suite 300, Austin, TX 78746, USA

Member Bios

Harish Daiya is the Co-Founder and Chief Executive Officer of Lumenci. He is based out of Austin, Texas and oversees the company’s operation across all global offices. With over 15 years of industry experience in technical consulting in IP litigation and licensing, Harish has been a part of $2B+ in IP value creation. He is also a member of the Forbes Business Council, where he regularly writes Thought Leadership pieces and shares ideas on global impact. Harish has also been a serial entrepreneur and angel investor for several successful startups. As the CEO, Harish is elemental in driving Lumenci’s vision, goals, sales, and revenue. He oversees organizational growth, business strategy, people culture, client relationships, business development, strategic partnerships, and launching new businesses. Kalyan Banerjee is the Co-Founder and Chief Growth Officer of Lumenci and operates out of Lumenci’s head office in Austin, Texas. Kalyan is a thought leader to reckon with for patent, source code analysis, and blockchain issues, where he is regularly invited as a speaker in several US universities and industry panels. He is also a testifying expert in source code matters at ITC, District Courts, and Arbitration and has been a part of IP litigation and licensing outcomes amounting to $2B+. He is instrumental in shaping the fundamental mission and principles at Lumenci. As the Chief Growth Officer, he is involved in growth strategy, technical delivery and consulting, business development, key partnerships, and organizational culture. He has been a mentor to several startups and has successfully built and scaled many consulting teams.

Deepak Patnala is the Senior Vice President and Head of Corporate Practice at Lumenci, operating out of San Francisco Bay Area Office. Deepak oversees Patent Monetization and M&A practice at Lumenci and is a trusted advisor to clients, helping them navigate complex intellectual property matters. He is a world-class technical expert in IP licensing and litigation matters and an upcoming testifying expert. He has 12+ years of experience providing technical support in high-stakes IP litigation and monetization matters. He has assisted various organizations, from corporations and law firms to high-growth emerging companies, in solving issues, creating value, maximizing growth, and improving business performance for their intangible assets. He has experience working across multiple technology domains such as cloud, OTT, cryptography, enterprise software, computer security, artificial intelligence, virtual and augmented reality, internet technologies, telecom, networking, etc.

Vamsi Krishna is Senior Vice President & Head of Litigation Practice at Lumenci and operates out of Lumenci's head office in Austin, Texas. He oversees Lumenci's IP Litigation practice and is responsible for customer relationship management, account growth, and elite delivery in high-stakes patent monetization and litigation matters. He has 12+ years of experience in IP consulting, technical discovery, and leading technology consulting teams in major patent litigations in the US. He is a world-class technical expert in IP litigation matters and an upcoming testifying expert in Telecom, Networking, Hardware, and Software. He has extensive source code review and expert report drafting experience in major litigations. He is proficient in navigation, mapping, mobile, user interfaces, streaming, security, DRM, databases, and other technologies. Vamsi has also provided a declaration in the EDTX patent litigation matter.

Areas of Focus:  Monetizing IP assets

Over the years, Lumenci has showcased its proficiency and added value in crafting multiyear, multi-geography, and high-opportunity patent monetization campaigns through adept capabilities in technology analysis, valuation, and business strategy domains for its clients.

Lumenci is proud to have a multi-faceted team skilled in diverse areas such as - reverse engineering, product testing, and EoU creation. Lumenci empowers clients to navigate the complex patent landscape confidently, prioritizing empowerment over mere numbers.

Lumenci tailors monetization strategies for inventors and companies with portfolios of any size, from solo innovators with five patents to industry giants with 30k+ Patents. Their expertise has driven impactful results of multi-million-dollar licensing deals for their clients. Whether through licensing, sale, or litigation, Lumenci illuminates the path to maximizing patent value for each client. The team utilizes proven techniques to uncover high-value patents, build comprehensive evidence for campaigns, and provide strategic insights. With a track record of 20,000+ patents mined, 25,000+ EoUs created, and $3 billion+ in client outcomes, Lumenci delivers tangible results.

Underlining Lumenci's impact and value, one of the leaders of a software technology patent portfolio holding firm mentioned - "I recently had the pleasure of working with Lumenci, and their technical patent support was outstanding. We are monetizing a networking-based patent portfolio, and Lumenci's expertise and guidance were crucial to our success. They helped us to identify the most promising infringement reads, provided valuable insight into the patent landscape, and were always available to answer our questions and offer advice."

End to End Support for IP Litigation

Lumenci stands out as an end-to-end partner for patent litigators, offering a potent blend of expertise and strategic support throughout the litigation. Lumenci's dedicated team of specialists delves deep into the technical complexities, particularly excelling in the high-stakes arena of code review matters, covering a spectrum from UI code to hardware code. Lumenci's expertise in different aspects of litigation-related activities enables legal teams with strategic insights and technical acumen critical for navigating the dynamic realm of IP litigation.

The company's proficiency extends to product testing, reverse engineering (in domains such as semiconductors), and meticulous research in creating high-quality Evidence of Use (EoUs) that maximize patent value. Lumenci assists in the pre-filing stage by valuing patent assets, conducting venue analysis, and offering a turnkey solution to satisfy Rule 11 requirements, and also works towards providing technical support to damages valuation such as testing, non-in figment alternatives, apportionment, etc. Lumenci is a strong technology partner during the discovery process, handling end-to-end source code discovery, product testing, and updating contentions with the most recent technical evidence. But the journey doesn't end there. Lumenci provides real-time technical assistance during Markman hearings, depositions, and trials to maximize your chances of securing favorable judgments.

As a testimony to Lumenci's high-quality support in IP litigation, one of the counsel members of a US law firm mentioned - "We recently wrapped up the deposition, and I am thrilled with the valuable testimony we from your team. As we gear up for numerous depositions over the next three weeks, I am eager to designate you as our preferred drafter for several of similar requests. Kudos to the Lumenci team for a job well done!"

Connect with Litigation Funders

Lumenci transcends litigation support, offering additional avenues for maximizing the value of patents. The company's patent purchase network connects patent stakeholders with potential buyers, pools, and licensees, opening up alternative monetization pathways. For those seeking financial leverage, Lumenci's financing solutions tap into their established network of financing entities, crafting innovative strategies to unlock the full potential of the patent portfolio.

Through a cooperative exchange, Lumenci offers valuable advice on opportunities around seeking trusted funders while taking a proactive stance in pinpointing avenues for value generation. Lumenci's consultative methodology extends beyond traditional client-firm interactions, nurturing a flexible and responsive association that adjusts to the ever-evolving demands of its clients within the dynamic domains of patent law and intellectual property.

Burford Capital Limited ("Burford" or "Burford Capital"), the leading global finance and asset management firm focused on law, today announces the pricing of its private offering of $275.0 million aggregate principal amount of additional 9.250% senior notes due 2031 (the "Additional Notes") by its indirect, wholly owned subsidiary, Burford Capital Global Finance LLC (the "Issuer"), which represents an increase from the previously announced offering size. The Additional Notes will be guaranteed on a senior unsecured basis by Burford Capital as well as Burford Capital Finance LLC and Burford Capital PLC, both indirect, wholly owned subsidiaries of Burford Capital (such guarantees, together with the Additional Notes, the "Securities"). There is $400.0 million aggregate principal amount of the Issuer's 9.250% senior notes due 2031 (the "Initial Notes") outstanding as of the date hereof. The Additional Notes will initially be offered to investors at an offering price equal to 103.625% of the principal amount thereof, plus accrued interest from January 1, 2024, representing a yield to worst of 8.251%. The offering is expected to close on January 30, 2024. If issued, the Additional Notes will be issued as "Additional Notes" under the indenture pursuant to which the Issuer previously issued the Initial Notes, will have identical terms to the Initial Notes (other than with respect to the date of issuance, the issue price and the first interest payment date) and will be treated as a single class for all purposes under such indenture. Burford Capital intends to use the net proceeds from the offering of the Securities for general corporate purposes. The Securities have not been, and will not be, registered under the US Securities Act of 1933, as amended (the "Securities Act"), or the laws of any other jurisdiction and may not be offered or sold within the United States or to, or for the account or benefit of, US persons absent registration or an applicable exemption from registration under the Securities Act or any applicable state securities laws. The Securities will be offered only to persons reasonably believed to be "Qualified Institutional Buyers" within the meaning of Rule 144A under the Securities Act or non-US persons outside the United States pursuant to Regulation S under the Securities Act, in each case, who are "Qualified Purchasers" as defined in Section (2)(a)(51)(A) under the US Investment Company Act of 1940, as amended.