Trending Now

All Articles

3225 Articles
Announcements Consumer

Upcoming Webinar on Litigation Funding

One of the more important issues today concerning litigation in America is funding. Whether it be high verdicts, claim value drivers, or fraudulent claims, we are all affected. Vince Gerbino founding partner of Bruno, Gerbino, Soriano and Aitken, will moderate the webinar's distinguished panel that will provide insight into this important concern from a broad range of perspectives. We will hear from Dennis Kass regarding his experiences with verdicts and claim values. From Eric Schuller with his industry perspective. From Matt Lehman concerning regulatory efforts and finally from Kenneth Klein, a law professor and author with his consumer-based research perspective. Do not miss this very informative webinar, and please join us to learn and understand better the growing world of litigation funding and see the good, the bad, and the ugly side of it all. We look forward to seeing everyone on July 20, 2023, at 2 pm EST.
Here is the link to register. It is free to attend.
Read More
Announcements Case Developments

Resolution of Investment for LCM

Litigation Capital Management Limited (AIM:LIT), an alternative asset manager specializing in dispute financing solutions internationally, announces a successful resolution on an investment forming part of LCM’s Fund I portfolio of investments.

Successful Award in Arbitration Investment

LCM’s investment and funding related to a dispute in London Court of International Arbitration proceedings. LCM provided funding and support to the claimant in those proceedings, which recently received an award in its favor. The subject matter, findings and funding terms remain subject to confidentiality.

Initially, the investment was expected to complete within a short time frame from the commencement of funding, however, the matter was delayed due to a number of external factors. This protraction enhanced the returns to LCM and Fund I investors, details of which are highlighted in the table below:

*AUD$mInvestment performanceLCM performance metricsFund I performance metrics
Invested capital9.22.36.9
Investment return36.79.227.5
Success fee21.75.416.3
Total revenue67.616.950.7
ROIC on investment635%635%635%
Performance fee*-15.1(15.1)
Gross profit58.429.728.7
ROIC after performance fees635%1291%416%

*The investment returns are subject to change based on the prevailing FX rate and timing of distribution

Patrick Moloney, CEO of LCM, commented: “The Resolution of this investment demonstrates two important features of LCM’s business and its investment strategy.  First, it validates the skillset of our investment managers in undertaking a rigorous due diligence exercise and accurately predicting the final outcome of a large and complex commercial dispute resolved through arbitration.  Secondly, it is an example of an investment which we had originally expected to resolve in a prior financial period.  The return metrics generated by this investment clearly demonstrate how returns are enhanced notwithstanding a delayed resolution.  Not only were we extremely happy with the outstanding investment returns, but also LCM’s funded party was grateful for the financial support beyond the originally contemplated investment period.”

Enquiries

Litigation Capital Managementc/o Tavistock PR
Patrick Moloney, Chief Executive Officer
  
Canaccord (Nomad and Joint Broker) Tel: 020 7523 8000
Bobbie Hilliam
  
Investec Bank plc (Joint Broker)Tel: 020 7597 5970
David Anderson 
  
Tavistock PRTel: 020 7920 3150
Tim Pearsonlcm@tavistock.co.uk
Katie Hopkins 

About LCM

Litigation Capital Management (LCM) is an alternative asset manager specialising in disputes financing solutions internationally, which operates two business models. The first is direct investments made from LCM's permanent balance sheet capital and the second is third party fund management. Under those two business models, LCM currently pursues three investment strategies: Single-case funding, Portfolio funding and Acquisitions of claims. LCM generates its revenue from both its direct investments and also performance fees through asset management.

LCM has an unparalleled track record driven by disciplined project selection and robust risk management. Currently headquartered in Sydney, with offices in London, Singapore, Brisbane and Melbourne, LCM listed on AIM in December 2018, trading under the ticker LIT.

www.lcmfinance.com

Read More
Commercial Special Features

Key Takeaways from LFJ’s Digital Event on Litigation Funding and Legal Insurance

Wednesday, June 14th, LFJ hosted a panel of Legal Insurance experts who discussed pertinent issues regarding the intersection of litigation funding and legal insurance. The expert panel included: Stephen Kyriacou, Jr. (SK), Managing Director and Senior Lawyer, Aon, Boris Ziser (BZ), Partner, Schulte Roth & Zabel LLP, Rocco Pirozzolo (RP), Managing Director and Underwriting Director,  Harbour Underwriting, and Ross Weiner (RW), Legal Director, Certum Group. The panel was moderated by Rebecca Berrebi (RB), Founder and CEO of Avenue 33, LLC. Below are some key takeaways from the digital event: RB: How has the ATE insurance market evolved over time? And what should we expect going forward? RP: When after-the-event began, it was a product of England and Wales. It is now a product used around the world. But, its origins stem from a change in the law in England and Wales, where the purpose of the legislation was to save public money on certain types of cases.  So, its origins go back to April 2000. It was originally being used for personal injury and clinical negligence cases. It then started to stem out into insolvency disputes and commercial disputes. In the early years, its limits were quite modest. RB: Let's talk about what other types of insurance have evolved and what other types of solutions we can offer litigation finance clients, including law firms, litigants and funders. SK: Aon's litigation risk group offers a number of different solutions that are of interest to litigation funders, their funded counter-parties that are actually litigating these cases, and the lawyers that are litigating funded cases as well. At the top of the call we talked about judgment preservation insurance, which I'll refer to as JPI. Essentially, JPI is taking a judgment that has already been won, either an arbitration award, a trial verdict, maybe a summary judgment award, and insuring the risk that it gets reversed on appeal or the damages get reduced on appeal, or that there is a remand for a new trial. RW: We are seeing a lot in the duration risk space. I think one of the areas it is becoming more prevalent, is mass torts. Often the biggest question is how long will the risk take to play out? How long until individuals will get paid? And so the law firms who take on those cases for a very long duration, they've got lenders that they are responding to, and they've got certain rates they are trying to reach. Insurance with a duration trigger can be very attractive in that space as well. For the lawyers here, one of the things that we have seen a fair amount of, and have been working on recently, is contingent fee, or what we call  'work in progress' or WIP insurance for lawyers. That has to do with law firms who take cases on contingency where there is a fair amount of risk involved that could be zeroed out if the case is meritorious. RB: How are law firms using these policies? And in what types of cases and portfolios and awards are you seeing these types of policies add value to the user?  BZ: We are seeing insurance for a lot of our transactions that include single event cases. It includes mass tort cases. It includes IP antitrust cases, breach of contract, trade secret theft, and others. I think we are seeing a hit on a big cross section of case types. In terms of how it is used, it actually is a very good interplay in how law firms use it. At the end of the day, having insurance on your transaction accomplishes a number of things. Number one, it covers downside risk, therefore potentially lowering the cost of funding or monetization that you might be looking at. But the other thing it does, particularly for the user of the insurance and the holder…is that it opens the universe to other lenders or investors. It not only provides protection on the downside of the investment (i.e. insurance), but it also enables you to create an instrument that benefits from a wrap from a single carrier.  RB: Let's talk about shifting risk. What steps can insurance providers take to ensure that law firms and funders are not merely shifting risk when looking to insure a claim?  RP: It's a great question. As an underwriter, adverse selection in cases is always the most critical concern for me, as I am going through it trying to discern the motive, and is it simply getting bad risk off the books and replacing it with insurance to guarantee an outcome, or is there something more going on here?  BZ: Fundamentally and obviously by definition you get a policy that covers some risk, so in that sense, you know undeniably it's risk shifting…I focus on what it's actually doing, which to me is really enabling law firms' clients, funders to finance this asset class more effectively…I look at it as financing, not necessarily just as a pure risk shifting exercise. Then, you might think about perhaps alignment of interest in some sense between funders and lawyers. RB: What are the markers of a case or portfolio that insurers look for when determining whether or not to provide insurance?  SK: We already talked about motivation and how crucially important that is. And, how we really need to kind of suss out whether there is any sort of adverse selection going on, which is usually pretty easy for our team at Aon. With respect to other considerations, on a single case judgment preservation insurance, for example, we are really looking at three things: One, likelihood of being affirmed. Two, likelihood of damage award reduction, and then if so, where damages may be reduced to. And then third, what is likely to happen in the case, both with respect to liability and with respect to damages, if the case gets remanded by the Appellate Court for a new trial. You can view the entire panel discussion here.
Commercial Deals

6th Annual LF Dealmakers Forum Announces Agenda

LF Dealmakers has announced the agenda for its 6th Annual LF Dealmakers Forum, which promises to cover all the latest developments and trends affecting the litigation finance industry. The event, which will return to NYC on September 26-28, will include topics such as ‘Rise of an Asset Class: Demystifying a Growing Secondaries Market’, ‘Opportunities at the Intersection of Funding, Mass Torts & ABS’, and ‘The Great Debate: Trust & Transparency in Litigation Finance’. Bringing together 275+ senior executives from across the litigation finance market, the LF Dealmakers Forum will include interactive sessions, a pre-event workshop on mass torts and funding, as well as a multitude of one-to-one meetings and networking events. Last year’s speaker roster included C-suite executives and thought leaders from the top funders, law firms and insurers at the heart of the US litigation funding industry. As the capacity is limited and following a sold-out 2022 event, Dealmakers encourages prospective attendees to register soon and is offering a $200 discount to those who register their place before July 18.  The sponsors of the 2023 LF Dealmakers Forum include Aon, CAC Speciality, Fabricant LLP, Longford Capital, and X Social Media.
Commercial Deals

Canadian Litigation Funding Market Has Strong Potential Despite Ongoing Challenges

Litigation funding continues to see wider adoption by claimants in a variety of disputes, however, there are jurisdictions that have yet to fully embrace third-party funding. One such country is Canada, where despite a supposedly favourable legal system and few major barriers to entry, we have not yet seen the meteoric growth visible in other jurisdictions such as the UK, US and Australia. An article in Commercial Dispute Resolution (CDR) examines Canada’s litigation funding industry, tracing its origin back to the funding of individual accident claims in the early 2000s, before the emergence of a wider market after the Hobsbawn v ATCO case in 2009. CDR notes that since then, we have seen the emergence of a small core of funders operating in Canada, including the likes of Bridgepoint, Omni Bridgeway and Nomos Capital. When looking at what factors are restricting the Canadian market’s growth, the ‘loser pays’ doctrine appears to be a prominent issue, along with the availability of public legal funding for group actions such as the Ontario Class Proceedings Fund.  Bridgepoint’s John Rossos highlights that ‘in the UK, litigation funders look for scenarios where ATE insurance is available” to offset the risk of adverse costs, compared to Canada, where such insurance products are relatively novel. Rossos suggests that there is still plenty of potential for the industry to grow, stating that “if we have a more developed ATE market and clearer rules governing litigation finance then that will stimulate greater funding.” Andrew Wilson KC of JSS Barristers highlights that due to the relative immaturity of the Canadian industry, “there is not as much competition as we would see in other jurisdictions, therefore pricing is not as efficient, and it is possible that funding for more complex and esoteric cases might not be available.” However, he believes that once more funders enter the market we will see “the cost come down, availability go up, and more tailored funding become more available.”
Past Event

Litigation Funding and Legal Insurance

One of the most exciting developments in the world of Litigation Finance is the widespread adoption of insurance products. In this digital event, experts in Legal Insurance discuss how the two industries intersect, the benefits that insurance products provide funders and law firms, and what future synergies are on the horizon. Our expert panel will cover what is happening at the intersection of litigation finance and legal insurance.
Event Recap Listen to Replay
Case Developments Commercial

Plaintiff Voluntarily Reveals Third-Party Funding in Patent Lawsuit

Discussions around disclosure of litigation finance are now becoming a weekly occurrence, spurred on by developments in cases and rulings from courts across the US. However, whilst most of these discussions revolve around disclosure that is requested by defendants or ordered by the court, one patent infringement lawsuit has demonstrated that disclosure can also happen voluntarily. An article in Bloomberg Law highlights the case of SilcoTek Corporation v. Waters Corporation in Delaware, which saw the plaintiff voluntarily share the involvement of a third-party funder in its lawsuit. SilcoTek revealed that its lawsuit had received financial backing from Omni Bridgeway, but declined to specify the amount of capital provided due to its non-disclosure agreement with the funder.  Geoff White, SilcoTek’s general counsel, explained that this move is in line with SilcoTek’s business philosophy: “We are extremely open internally, and we’re frankly extremely open externally.” Despite the oft-quoted criticism that funders exert undue control on the litigation process, White rebuffed the idea that Omni Bridgeway was controlling the litigation, stating: “They are definitely not in control. They allow us to make all decisions.” Whilst Omni Bridgeway reportedly discussed the potential risks of disclosure with SilcoTek, such as the defendant exploiting it for unnecessary and costly discovery, the funder supported SilcoTek’s decision to disclose the information. Matt Harrison, co-chief investment officer at Omni Bridgeway, emphasized that the funder was not concerned about dealing with further discovery requests, as he believes that “the courts are pretty uniform in their rejection of this as discoverable information.”
Case Developments Commercial

Malaysian Prime Minister Threatens Legal Action Against Sulu Case Claimants, Arbitrator and Funder

As LFJ reported recently, one of the unique and high-profile cases of litigation funding being used in a case against a national government has taken another turn, as a Paris court ruled in favour of the Malaysian government and against the heirs to the Sultanate of Sulu. The ruling’s announcement was swiftly followed by rhetoric from the government that it would pursue punitive action against the plaintiffs and associated parties, which has once again increased in intensity. Reporting by The Malaysian Reserve reveals that Anwar Ibrahim, the Prime Minister of Malaysia, informed parliament that the government would take legal action against those who supported or collaborated with the Sulu claimants. Of particular note was his reference to third-party funding, stating that the government “will also continue to oppose any form of financing by third party litigation funders who support the abuse of the process initiated by those making the claims.” In his remarks, the Prime Minister explained that the Royal Malaysia Police (PDRM) were already investigating the individuals who brought the claim, the arbitrator and other parties connected to the claim ‘under Section 124K of the Penal Code for the offense of sabotage.’ Referencing the initial arbitral award that is now likely to be overturned by the Paris court, Prime Minister Ibrahim argued that all the awards had violated the core principles of ‘diplomatic immunity, jurisdictional immunity and sovereignty.’
Announcements Commercial

Burford Capital Reports First Quarter 2023 Financial Results

Burford Capital Limited ("Burford"), the leading global finance and asset management firm focused on law, today announces its unaudited financial results at and for the three months ended March 31, 2023 ("1Q23").1 Burford's report on Form 6-K for 1Q23, including unaudited condensed consolidated financial statements (the "1Q23 Quarterly Report"), is available on the Burford Capital website at http://investors.burfordcapital.com. Christopher Bogart, Chief Executive Officer of Burford Capital, commented: "We saw continued positive momentum in the first quarter of 2023 in the progression of our portfolio as court activity and legal processes further normalized in the aftermath of the Covid-19 pandemic. The breadth of the case activity pick-up was reflected in capital provision income, excluding our YPF-related assets, more than doubling to $185 million compared to 1Q22, comprising almost a sixfold increase in realized gains and 41% growth in unrealized gains. Fair value gains arising from the favorable summary judgment ruling in our YPF-related assets contributed to an extraordinary first quarter for total revenues, driving growth in capital provision income of 238% to reach nearly $500 million. As an indicator of ongoing portfolio activity, an additional 12 case milestones have occurred since our May 16 update when we had observed 28 milestones and expected 61 more through the remainder of the year." 1 All 1Q23 figures in this announcement are unaudited and presented on a consolidated basis in accordance with the generally accepted accounting principles in the United States ("US GAAP"), unless otherwise stated. Definitions, reconciliations and information additional to those set forth in this announcement are available on the Burford Capital website and in the 1Q23 Quarterly Report (as defined above). In addition, Burford applied its revised valuation methodology for capital provision assets to its unaudited condensed consolidated financial statements at March 31, 2023 and for the three months ended March 31, 2023 and 2022 included in this announcement. As Burford has not previously issued quarterly financial statements, its unaudited condensed consolidated financial statements for the three months ended March 31, 2022 are not technically restated. 1Q23 highlights New business Group-wide new business
  • New commitments of $165 million, up 102% compared to 1Q22 (1Q22: $82 million)
  • Deployments of $129 million, up 1% compared to 1Q22 (1Q22: $128 million)
Burford-only capital provision-direct assets, representing assets capable of generating highest profits for our equity shareholders
  • New commitments of $101 million, up 130% compared to 1Q22 (1Q22: $44 million)
  • Deployments of $67 million, up 29% compared to 1Q22 (1Q22: $52 million)
Portfolio and liquidity
  • Group-wide portfolio grew to $6.6 billion at March 31, 2023 (December 31, 2022: $6.1 billion), due to significant fair value gains but also new deployments and undrawn commitments
  • Broad pick-up in portfolio activity, with capital provision income, excluding the YPF-related assets, more than doubling to $185 million compared to 1Q22
    • 464% increase in realized gains and 41% increase in unrealized gains compared to 1Q22
  • Fair value gains arising from the favorable summary judgment ruling in the YPF-related assets contributed to an extraordinary first quarter for total revenues
    • Burford-only carrying value of the YPF-related assets (both Petersen and Eton Park) increased to $1.0 billion at March 31, 2023 (December 31, 2022: $823 million)
  • Cumulative ROIC since inception from Burford-only capital provision-direct assets of 89% (December 31, 2022: 88%) and IRR of 29% (December 31, 2022: 29%)
  • Burford-only cash receipts of $97 million, up 66% compared to 1Q22 (1Q22: $59 million)
  • Burford-only cash and cash equivalents and marketable securities of $183 million at March 31, 2023 (December 31, 2022: $210 million)
    • Due from settlement of capital provision assets decreased 14% to $99 million at March 31, 2023 (December 31, 2022: $115 million, of which 17% was collected in cash in 1Q23)
Income
  • Total revenues increased 209% to $381 million (1Q22: $123 million), represented by a higher level of case activity and portfolio progression, including $192 million of fair value gains, net of third-party interests, in the YPF-related assets and $185 million of capital provision income excluding the YPF-related assets
  • Burford-only capital provision-direct realizations of $64 million (1Q22: $21 million) and realized gains of $36 million (1Q22: $10 million), with a single matter generating a realized gain of $27 million
  • Burford-only annualized capital provision-direct realized loss rate of 0.9% of average portfolio at cost in 1Q23 (2022: 1.0%)
  • Operating income increased 252% to $327 million (1Q22: $93 million), with significant growth in capital provision income compared to 1Q22, partially offset by third-party interests in the YPF-related assets fair value adjustments and higher total operating expenses due to increases in non-cash accruals in light of the positive performance of Burford's share price, the increase in the carrying value of the YPF-related assets and the increase in the carrying value of a legacy asset recovery matter
  • Net income attributable to Burford Capital Limited shareholders increased 361% to $259 million (1Q22: $56 million)
Net income per ordinary and diluted share of $1.17 (1Q22: $0.25)
Read More