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Spear’s Releases Best Litigation Funders Ranking for HNW Individuals

By Harry Moran |

Whilst most coverage of third-party legal funding focuses on high profile disputes, from large-scale class actions to complex international arbitration proceedings, the services provided by litigation funders are equally highly valued by those wealthy individuals who may find themselves embroiled in costly legal cases.

The wealth management and luxury lifestyle magazine Spear’s has released its ranking of the best litigation funding providers for high-net-worth (HNW) individuals in the UK, covering those providers who support disputes ranging from divorces to large corporate cases. Spear’s Head of Research, Ian Douglas highlighted that these litigation funders offer HNW couples “the vital financial support they need to access the legal system on an equal footing”, and “can empower clients to secure a fair settlement in an efficient and cost-effective manner.”

The complete list of Spear’s litigation funding index is as follows:

  • Katie Alexiou, Level
  • Christopher Bogart, Burford Capital
  • John Byrne, Therium
  • Alex Cooke, Schneider Financial Solutions
  • Susan Dunn, Harbour Litigation Funding
  • Steven Friel, Woodsford
  • Camilla Funari-Sherman, Rhea Family Finance
  • Alex Hulbert, Schneider Financial Solutions
  • Mark King, Harbour Litigation Funding
  • Ellora MacPherson, Harbour Litigation Funding
  • Neil Purslow, Therium
  • George Williamson, Level

Among these ranked individuals, Spear’s highlighted the following four providers as ‘names to know’: Katie Alexiou (Level), Ellora MacPherson (Harbour), Camilla Funari-Sherman (Rhea Family Finance), and Alex Cooke (Schneider).

Spear’s Research Unit selects and ranks the providers in its index through a combination of detailed market research by interviewing industry participants, soliciting information from candidates for ranking, and employing a proprietary weighted scoring system to evaluate the providers’ practices.

Backed by Funders, Provenio Litigation Reaches £1 Billion in Litigation Instructions

By Harry Moran |

An announcement from Provenio Litigation revealed that the boutique litigation firm has reached £1 billion in litigation instructions only five years after it launched in 2019. The firm, which was founded by a team of senior litigation lawyers from DLA Piper, has grown the business to expand its services across different areas of litigation and into new jurisdictions, backed by partnerships with third-party funders.

Mark Goodwin, founder and managing partner of Provenio, said that despite the difficulties faced by founding the firm shortly before the Covid pandemic, the ability “to attract business litigation instructions with a combined value of £1 billion shows how far we have come over the last five years.” Goodwin noted that this growth means the firm is now involved in cases across Europe, North America, South America, and the Middle East. 

Explaining the success of Provenio’s growth strategy, Goodwin said that this has been achieved “by attracting high value instructions, breaking into new areas of work and growing the business with a number of our high value cases being supported by the leading litigation funders.” The firm has also broadened its services with the launch earlier this year of Optimise, Provenio’s own insolvency litigation financing solution, which offers support to insolvency practitioners pursuing litigation against directors and third parties.

Opt-Out Claim Brought Against Valve for Alleged Breaches of Competition Law

By Harry Moran |

As LFJ reported in October of last year, Milberg London had previously announced that it had secured litigation funding from Bench Walk Advisors to bring a claim against Valve Corporation, one of the world’s largest gaming companies.

An article from CDR covers the news that this claim has now been formally brought against Steam, the games marketplace owned by Valve, over allegations that it breached UK competition law resulting in consumers being overcharged for purchases from the video game distributor. The opt-out claim was filed last week in the Competition Appeal Tribunal by Vicki Shotbolt, founder of the online safety advocacy group Parent Zone, and is being brought on behalf of up to 14 million UK consumers. The total value of the claim is estimated to reach £656 million, with the affected consumers potentially entitled to compensation of £22 to £44 if the claim is successful.

At the heart of the claim being brought against Steam, is the allegation that its use of a ‘price parity’ condition on game developers results in the end-consumer being charged an excessive price on games. This is because price parity prevents developers from selling the title at a lower price through other distributors, which combined with Steam’s 30% commission on all sales means that consumers are forced to pay an inflated price.

Shotbolt says that the claim aims to hold Valve “to account for breaking the law”, arguing that the company must be stopped from “abusing its dominant position to force publishers to sign up to illegal trading terms and tying consumers in and charging excessive prices.” 

Milberg London are acting for the proposed class, with representation by Robert Palmer KC, Julian Gregory and Will Perry of Monckton Chambers. As aforementioned, third-party funding has been secured from Bench Walk Advisors.

Natasha Pearman, partner at Milberg London, describes Valve’s monopolistic behaviour as part of its “stranglehold on the PC gaming market”, and that the Steam platform “has essentially taken away normal competition by introducing this price parity provision, so there’s no ability for real competition to thrive or emerge on alternative distribution channels.” For more information about the opt-out claim, visit the Steam You Owe Us website.

NORTHWALL CAPITAL RAISES MORE THAN €640M FOR EUROPEAN OPPORTUNITIES STRATEGY

By Harry Moran |

NorthWall Capital (“NorthWall”), a leading credit investment firm delivering private capital solutions to counterparties in Western Europe, today announces the final close of its flagship NorthWall European Opportunities Fund II and associated vehicles (“NWEOF II” or “the Fund”), attracting more than €640m in investor commitments.

The Fund and associated vehicles surpassed the €500m target, receiving strong support from new and existing global institutional investors and more than doubling the size of its predecessor, NorthWall European Opportunities Fund I (“NWEOF I”).

NorthWall’s European Opportunities strategy, established at the firm’s inception in 2017, invests across the broad opportunity set in European opportunistic private credit by delivering scalable private capital solutions to counterparties in Western Europe. NorthWall’s systematic sourcing approach, coupled with a focus on creating bespoke funding solutions, enables the firm to structure opportunities that deliver strong downside protection while targeting uncorrelated returns. The strategy also makes tactical allocations to areas of dislocation and has successfully participated in the dislocation in asset-backed opportunities. 

Prior to the final closing, NWEOF II was already substantially deployed, having committed c. 60% of its capital to 14 transactions across five countries in Western Europe.

The Fund attracted capital commitments from a global base of institutional investors, consisting of pension funds, insurance companies, large institutional single and multi-family offices and private banks from across Europe, North America and APAC. The Fund received strong support from a large US-based consultant and an Australian superannuation fund.

The firm’s principals have been investing in European private credit for nearly 20 years, and the NorthWall team has deployed over €1.0bn in the European Opportunistic Credit strategy to date. In addition to the flagship funds, the firm has extensive expertise in legal assets, asset-backed and senior lending opportunities. 

Fabian Chrobog, Founder & Chief Investment Officer of NorthWall Capital, said: “We are honoured by the success of the fundraise for NWEOF II and would like to thank our existing and new investors globally for their partnership. We remain committed to delivering scalable investment opportunities that generate attractive risk-adjusted returns for our investors while also serving as a reliable partner to our counterparties. We continue to observe one of the most compelling opportunity sets in European credit in recent history and will continue to thoughtfully scale NorthWall in a way that allows us to lean into areas of dislocation. I also wanted to congratulate and thank the NorthWall team that has been working tirelessly to deliver the best outcomes for our stakeholders.”

About NorthWall Capital

NorthWall Capital is a London-based credit investment firm, delivering private capital solutions to counterparties in Western Europe. The firm manages €1.5bn of AUM in long dated funds on behalf of global institutional investors, seeking to capture compelling risk-adjusted returns from Western European credit markets.

For more information, please visit www.northwallcap.com.

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JBSL Appoints Jonathan Weitz as Managing Director and Head of Advisory Services

By Harry Moran |

In a post on LinkedIn, JBSL announced the appointment of Jonathan Weitz as Managing Director and Head of JBSL Advisory Services. 

Weitz joins the JBSL team having most recently served for the past three years as a Vice President at Evercore’s financial services advisory group. Weitz’ brings nearly a decade of experience in the financial services industry, including over six years at Keefe, Bruyette and Woods (KBW), where he held the position of Investment Banking Vice President.

In the announcement, JBSL stated that Weitz’s experience and expertise “will be invaluable to our law firm clients, corporate clients and our coinvestors, in all aspects of balance sheet and legal asset maximization.” His role as head of the company’s advisory services will see Weitz lead JBSL’s support for their clients in “identification of dormant legal assets, capital structuring, strategic acquisition/sales of dockets and law firms, and succession planning.”

$50M Partnership Between Tribeca Capital and Nera Capital

By Harry Moran |

With the global litigation finance market largely dominated by those long-established funders who have already planted significant footholds in the major jurisdictions, upstart funders must look for creative ways to grow their businesses at home and abroad. This has once again been demonstrated by the announcement of a partnership between two litigation finance companies, one based in California and the other in Dublin. 

An article in Alternative Credit Investor covers the news that Tribeca Capital is establishing a new division focused on antitrust claims, following the agreement of a new funding facility with Nera Capital. The $50 million in capital represents a significant partnership between the two litigation finance companies, with Tribeca looking to fund claims which target anti-competitive and monopolistic activities by corporations.

Aisling Byrne, director at Nera Capital, said that partnering with Tribeca “underscores the dedication of our exceptional team and reaffirms our commitment to making a positive impact globally, through the responsible use of litigation finance.” Byrne explained that this partnership supports the company’s growth plan in the United States, and said that allying with Tribeca “not only strengthens our market position but also aligns perfectly with our core values of innovation and integrity.”

Rory Donadio, founder and chief executive of Tribeca Capital, highlighted that “Commercial litigation funding plays a crucial role in ensuring the smooth progression of legal proceedings by covering essential expenses.” He went on to add that the provision of third-party funding to claimants “serves as a valuable financial tool in facilitating smoother case management and access to justice.”

Alexi Secures $11 Million USD Series A Funding to Accelerate AI-Powered Legal Technology Innovations

By Harry Moran |

Alexi (www.alexi.com), a Canadian legaltech company and leader in generative AI for legal research and litigation tasks, today announced an $11 million USD ($15 million CAD) Series A fundraise. The round is led by Drive Capital, with participation from existing investors including Draper Associates, and brings Alexi's total funding to over $20 million. In addition to the raise, Chris Olsen, Partner at Drive Capital, will join the company's Board of Directors.

This fresh instalment of capital comes less than a year after Alexi's release of their Instant Memos, Arguments and Chat capabilities. The funding will immediately support hiring across engineering, product development, brand and design, legal, and business development teams to help Alexi continue to innovate and scale its technology. It will also enable Alexi to meet increasing demand from law firms to incorporate an array of AI-powered litigation tools into their businesses and accelerate upcoming releases across North America and other jurisdictions.

"We evaluate over 6,000 companies a year, most of which position themselves as an 'AI company.' Alexi is one of the very few examples, however, of using AI to solve a business problem," said Chris Olsen, Co-Founder and Partner at Drive Capital. "Lawyers who use Alexi run more successful law practices. It is only a matter of time until attorneys all over the world are using Alexi to be better lawyers."

Alexi is a pioneer in generative AI for litigation teams. Their platform enables legal professionals to generate high-quality legal memos, identify pertinent legal issues or arguments to achieve desired outcomes and perform AI-powered routine litigation tasks-all within a single platform. The company's ultimate mission is to empower legal teams with artificial intelligence, breaking down barriers to knowledge and enabling justice for all.

"The rate of innovation happening at Alexi is truly astounding. Instead of trying to predict the future, we're building it," said Mark Doble, CEO of Alexi. "This capital further enables us to build incredible value into our products and empower our customers to better serve their clients."

Alexi is experiencing impressive growth, with recent user activity increasing by 15-20% each month. Currently, thousands of litigators across the U.S. and Canada rely on Alexi.

About Alexi

Founded by Mark Doble and Sam Bhasin, Alexi's proprietary AI-powered platform equips litigators with core legal skills. Designed to streamline the legal research process and assist with routine litigation tasks, Alexi saves time and enhances productivity for law firms. Committed to innovation and excellence, Alexi continues to lead the way in transforming access to legal knowledge. For more information, visit https://www.alexi.com or follow Alexi on LinkedIn.

About Drive Capital

Drive Capital is the most established venture capital firm at the intersection of industry and modern technology. Drive unlocks returns for limited partners by investing in market-defining companies anywhere in North America. Over the last decade, Drive grew to manage more than $2B in total assets. From insurance and manufacturing to energy, healthcare, finance and more, Drive's portfolio is full of real businesses, including DuoLingo, UDACITY and KOHO, creating real value in the real world. The result is world-class returns from the greatest emerging market in the world - America. Drive is proudly headquartered in Columbus, Ohio - the geographic center of mass of Western GDP, but Drive also has boots on the ground in a dozen North American cities, with more to come.

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Professor Andreas Stephan to File Third-Party Seller Damages Action Against Amazon In Excess of £2.5 Billion

By Harry Moran |

Professor Andreas Stephan and Geradin Partners have today announced that they have secured funding from litigation funder Innsworth for a UK opt-out competition damages claim on behalf of UK-domiciled third-party sellers against Amazon. The claim, estimated to be worth over £2.5 billion, will focus on multiple anti-competitive practices by Amazon that have harmed UK sellers and will be filed shortly in the Competition Appeal Tribunal, the UK’s specialist competition court. 

Andreas Stephan, a leading competition law scholar and the Head of the University of East Anglia Law School, will bring the damages action on behalf of UK third-party sellers who have used Amazon’s platform. He has retained a team composed of Geradin Partners, Kieron Beal KC (Blackstone Chambers), Daniel Carall-Green and Hannah Bernstein (Fountain Court), and Frontier Economics. 

Amazon’s treatment of third-party sellers has come under significant scrutiny from regulators in the United Kingdom, Italy, the European Union and the United States. These regulators have identified competition concerns in relation to Amazon’s position of dominance, and conduct in the market for the supply of e-commerce marketplace services. In some cases, those regulators have imposed sanctions or required commitments from Amazon to address these concerns. Professor Stephan’s claim would be based on showing loss arising from multiple abuses of a dominant position and therefore will provide a comprehensive opportunity for sellers to obtain full compensation for harm caused by Amazon. Estimated damages are over £2.5 billion. 

Professor Stephan said: “Amazon has engaged in a variety of strategies to grow its e-commerce platform, lock sellers into it, prevent the expansion of rivals, and use that privileged position to exploit sellers that use its platform. I am bringing this litigation to give sellers in the UK the opportunity that they might not otherwise have to be compensated for all those unfair practices.” 

Founding Partner of Geradin Partners, Damien Geradin, said: “Amazon is one of the world’s largest companies. As regulators around the world are increasingly finding, Amazon has abused that position in multiple ways to prevent third-party sellers of all sizes from enjoying the benefits that flow from free and fair online commerce. This claim intends to give sellers the opportunity to seek redress for these anti-competitive practices.”

Member Spotlight: Jeff Zaino

By John Freund |

Jeffrey T. Zaino, Esq. is the Vice President of the Commercial Division of the American Arbitration Association in New York. He oversees administration of the large, complex commercial caseload, user outreach, and panel of commercial neutrals in New York. He joined the Association in 1990. Mr. Zaino is dedicated to promoting ADR methods and services.

His professional affiliations include the American Bar Association (Dispute Resolution, Litigation, and Business Law Sections), Connecticut Bar Association, District of Columbia Bar Association, New York State Bar Association (Dispute Resolution Section - Executive Committee Member and Chair of the Blog Committee; Commercial & Federal Litigation Section, Chair of the Arbitration and ADR Committee), New York City Bar Association (Member of the Arbitration Committee and Affiliate Member of the ADR Committee), Board of Advisors of the Scheinman Institute on Conflict Resolution, New York Law School ADR Advisory Committee, American Bankruptcy Institute, and Westchester County Bar Association.

He has also written and published extensively on the topics of election reform and ADR, including several podcasts with the ABA, TalksOnLaw, and Corporate Counsel Business, and has appeared on CNN, MSNBC, and Bloomberg to discuss national election reform efforts and the Help America Vote Act.  He was deemed a 2018 Alternative Dispute Resolution Champion by the National Law Journal and received awards for his ADR work from the National Academy of Arbitrators, Region 2 and Long Island Labor and Employment Relations Association, New York State Bar Association (Commercial and Federal Litigation and Dispute Resolution Sections).

Company Name and Description: The not-for-profit American Arbitration Association® (AAA®)-International Centre for Dispute Resolution® (ICDR®) is the largest private global provider of alternative dispute resolution (ADR) services in the world.

With that comes enormous responsibility, which the AAA-ICDR® embraces. Its work lessens the load of a tremendously overburdened court system. Its efforts ease the financial hardships of those shattered by natural disasters. The foundation it established supports access to justice for all. 

The AAA-ICDR has a core dedication to service and particularly to education. It would be gratifying to focus on teaching people to stay out of disputes; however, since that is not a realistic objective in today’s world, the AAA-ICDR provides fair, rational, faster, and less adversarial means to handle the disputes that inevitably arise. 

Contrary to a common misperception, arbitration is confidential—not secretive. Parties are free to talk about their cases; it is the AAA-ICDR and the arbitrators who are bound to keeping parties’ confidences, similar to a judge and jury. 

Company Website: www.adr.org

Year Founded:  1926

Headquarters:  NYC

Area of Focus:  Commercial, Construction, Consumer, Employment, Government, International, and Labor

Member Quote: I look forward to working with the members of the Legal Funding Journal to collaborate on various efforts, including the promotion of arbitration and mediation.

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Nevada’s Proposed Contingency Fee Cap May Create Opportunities for Funders

By Harry Moran |

When looking at legislative and regulatory developments impacting litigation funders, we must commonly look at those measures specifically targeting third-party funding around issues such as disclosure and transparency. However, a proposition being brought forward in Nevada to limit contingency fees is being highlighted as a rule change that may benefit funders who will be able to take advantage of smaller law firms’ need for capital.

Reporting by Legal Newsline looks at a proposed law change in Nevada which would cap lawyer contingency fees at 20%, with legal analysts expressing concerns about the effect this might have on the state’s litigation regime. Proposition 22 has garnered huge support from Uber, with the rideshare company having spent $4 million in lobbying to back the rule change through the Nevadans for Fair Recovery group. However, the measure is seeing equal opposition by the state’s trial lawyers who have formed the campaign group, Uber Sexual Assault Survivors for Legal Accountability.

The article explains that it is Nevada’s business community who are stuck in the middle of this debate, with concerns that this 20% cap could increase the power and influence of third-party litigation funders in the state. Samir Parikh, professor at Lewis & Clark Law School, explained that Proposition 22 could benefit funders who support upstart “hungry law firms” and would need the third-party funding in place of higher returns from contingency fees.

Funding Becomes Mainstream Despite Concerns over Public Perception

By Harry Moran |

The role of third-party funding in the Post Office case triggered a variety of responses from legal industry professionals and outside observers in the UK, with its utility as a tool for access to justice being weighed against the idea that claimants are not receiving sufficient proportions of compensation compared to funders. A recent panel discussion at a leading industry event has highlighted these competing ideas, and how funding has entered the legal ‘mainstream’ after a sustained period of increasing adoption.

An article by CDR provides a recap of discussions held at the London International Disputes Week (LIDW) conference, offering particular insight into a panel on ‘Emerging Trends and Public Perceptions in Class Actions, Funding and Corporate Accountability’. The panel discussion saw contributions from Tim West, partner at Ashurst, Simon Pugh, partner at Portland Communications, Lorraine Lanceley, partner at Stewarts, and Andrew Mizner, editor at CDR.

The panel explored the growing influence of litigation funding in UK class actions, noting that the increased public profile of third-party funders had attracted mixed reactions from industry participants and the wider public. Pugh suggested that, at the moment, “the public perceives lawyers and funders as the principal beneficiaries of the regime,” and that “the onus has to be on the funders to explain the difference between cost versus profit, and accounting for their risk.”

West concurred with this idea that there was scepticism and concern directed towards funders from those observing the way compensation from class actions has been distributed. On the other hand, Lanceley noted that despite these questions of perception, it is clear that litigation funding has become part of the ‘mainstream’ in UK class actions, and that this is reflected in the number of clients who are proactively looking for funding to support their claims.

PLA Litigation Funding Appoints Alipio Conde Herrero as Director

By Harry Moran |

An article in Iberian Lawyer covers the announcement of PLA Litigation Funding’s appointment of Alipio Conde Herrero as a director at the company. Before PLA, Conde most recently served as Head of Legal Advisory at Bankinter, where he served for over 17 years and ‘showcased his ability to navigate complex legal matters and provide strategic counsel at the highest level.’

Commenting on the appointment, Jesús Rodrigo Lavilla, CEO of PLA Litigation Funding said: “We are thrilled to welcome Alipio to our team. His extensive experience and industry knowledge will undoubtedly strengthen our organization and further our commitment to providing top-tier legal services to our clients.”

LCM Funding UK Class Action Brought Against Amazon 

By Harry Moran |

Whilst funders operating in the UK may be waiting until after July 4 to see how the next government will approach the litigation finance industry, this does not seem to have dissuaded the appetite for funding high value class actions being brought in this jurisdiction.

An article in City A.M. covers the announcement of the UK’s ‘biggest ever’ class action case, as Willkie Farr & Gallagher has filed a claim on behalf of the British Independent Retailers Association (BIRA) against Amazon. The claim, which has been filed in the Competition Appeal Tribunal (CAT), focuses on allegations Amazon misused the data of its marketplace’s retailers and manipulated the ‘Amazon Buy Box’ feature for its own financial benefit over the interests of these retailers.

The claim is being funded by Litigation Capital Management, with the total value of the class action estimated to be worth up to £1 billion. Willkie Farr will reportedly be submitting over 1,150 pages of documents to support the allegations being made in the claim.

BIRA’s Chief Executive Andrew Goodacre provided the following statement:

“The filing of the claim today is the first step towards retailers obtaining compensation for what Amazon has done. I am confident that the CAT will authorise the claim to go forward, and I look forward to the opportunity to present the case on behalf of UK retailers. This is a watershed moment for UK retailers, but especially for small independent retailers in this country.”

How Quick Should Corporate General Counsel Be to Use Litigation Finance?

By John Freund |

IMN hosted its 6th annual Financing, Structuring and Investing in Litigation Finance conference in New York City yesterday. The event was well-attended and featured a diverse array of stakeholders, including funders, law firms, investors and corporate counsel. One of the panels covered the topic of General Counsel and their mindsets, attitudes and approach to adopting litigation funding.

The panel was moderated by Martin Gusy (MG), Partner at Bracewell. Panelists included Edward Reilly (ER), Managing Member at McDonald Hopkins, Vincent Montalto (VM), Partner at DLA Piper, and William Derrough (WD), Managing Director at Moelis & Company.

The discussion covered the following topics:

  • When and how should corporate general counsel utilize litigation finance?
  • Can litigation finance replace corporate legal budgets? Should it?
  • How attractive is the monetization of solid cases and arbitration? Is the factoring of legal fees a bad habit to start?
  • What are issues large corporations face when using litigation finance? Are there reputational issues? Others?
  • Will more disclosure in the market make the use of litigation finance more attractive and viable for public companies?
  • How active are corporates in monetizing large claims?

Below are some key takeaways from the discussion:

MG:  Is the GC office looked at as being a profit center, or cost center? Can you make that shift (from cost to profit)?  The benefits can take years to realize, so it’s a challenge to get the GC to think about making an investment for a payout 5 or 6 years down the road. 

VM: GCs do not have the mindset of affirmative recovery. It takes a shift in mindset for in-house counsel to start thinking about pursuing affirmative recovery.  There are too many other important things to do, and limited resources. Funders need to get some wins, and show them it works.  When a portion of the settlement or award goes back to the GC office, then they will begin to shift their mindset towards being more of a profit center.

ER: There is a corporate mindset in the GC office—they are risk averse.  A GC’s job is to avoid all kinds of risk.  It takes a lot to get a GC to think outside the box.  If you look at the Buford surveys, finance guys always have an interest in litigation funding, until they look at cost of capital and think ‘I can do better than that.’  They don’t want to take the risk on the case, and even if they win, pay off a huge percentage. So it will take a lot to change their mindsets.

WD: We've been working on a case for 7-8 years.  The CFO or CEO can easily decide to stop spending money on this at any time.  So duration risk is a real risk. That said, we think it almost always makes sense, even with higher cost of capital. Take any WACC, and it is almost always recourse. Litigation funding is non-recourse. So that is a great selling point tot he CFO.

Also, the number of players out there has probably doubled in last 5 or 6 years, so when we run a process, we can get interesting participation, not cookie cutter proposals. Some want to be in New York state court, some don’t.  Different jurisdictions are favored. So you can find the funder that works best for you.  

And remember, the perception of an asset class can change over time. There was a time when asset-based financing was a dirty word.  Nobody at the bank did any loan-to-value work. If you needed extra money, you went to asset-based lenders. All of those funders have been bought out by banks.  Now ABS is a massive market.  We have to get past people’s natural responses… showing people IRR, examples of successful litigation.  This will help change minds.

MG: Disclosure is a topic we should consider. By show of hands:  How many of you have dealt with cases where you had to disclose the identity of a funder?

(very few hands are raised).

How many of you had to disclose the entirety of a funding agreement?

(a few more hands, but not many).

VM: There are some GCs who would take offense if a funder takes an adverse position to them in a case.  If they find out funder X is funding a case against them, they might write off that funder forever.  I’ve had that happen to clients. This brings up part of the risk of disclosure, for funders. There is still an emotional response from GCs around this. 

If the industry spoke in one voice, that would be a lot easier for corporates.  Some funders are in favor of disclosure of a funding agreement.  Others say absolutely no disclosure, period.   We can all agree, disclosure of a funding agreement In its entirety has work product and other issues—everyone in the industry should agree on that.  So that can be a starting point. The industry needs to speak in one voice on this, so GCs can better wrap their heads around the issue. 

An LFJ Conversation with Genevievette Walker-Lightfoot

By John Freund |

Genevievette Walker-Lightfoot brings extensive expertise in compliance, risk management, and regulatory affairs. As the Managing Member of The Law Offices of Genevievette Walker-Lightfoot, P.C., she ensures SEC-regulated entities adhere to compliance standards. With ties to FINRA and previous positions at the Federal Reserve Board and the U.S. Securities and Exchange Commission, she has been listed among The Hedge Fund Journal's Top 50 Women in Hedge Funds.

Hedonova, established in 2020, specializes in alternative investments, encompassing a diverse range of assets such as startups, real estate, fine art, carbon credits, and more. Hedonova offers a single fund structure that allows shareholders to invest without the burden of managing the day-to-day distribution of their investments. Hedonova's mission is to make alternative investments accessible to all.

Below is our LFJ Conversation with Genevievette Walker-Lightfoot:

1. Hedonova has a unique business model. Can you explain how the fund works?

Certainly, the Hedonova fund operates on a single fund structure, which means that instead of offering multiple funds with different risk profiles, we consolidate various alternative investments into one accessible option for investors. This simplifies decision-making for our clients, as they don't have to navigate multiple investment choices. Within this single fund, we strategically diversify across different asset classes, such as startups, real estate, art, litigation finance, and more. By spreading investments across diverse assets, we aim to manage risk effectively and potentially enhance returns for our investors.

2. How do you make it possible for investors worldwide to access alternative investments?

We prioritize global access to alternative investments through several means. Firstly, we leverage user-friendly online platforms, making it easy for investors worldwide to explore and invest in our fund. Hedonova has established and operates four feeder funds within its international framework across various jurisdictions, each meticulously structured under the relevant local laws. Additionally, we establish strategic partnerships with financial institutions across different regions, enabling us to reach a wider audience. Through these partnerships, we ensure that investors from various parts of the world can seamlessly participate in our fund, tapping into the opportunities offered by alternative investments. 

3. How are you adapting your business to the new regulatory requirements of the SEC’s Private Adviser Rule?

Adapting to the new regulatory requirements of the SEC’s Private Adviser Rule is a key focus for us. We're enhancing our compliance measures and transparency practices to align with the regulatory framework. This involves thorough reviews of our operations and investment processes to ensure compliance. Additionally, we're strengthening our communication channels with investors, providing them with clear and transparent information about our fund and its compliance with regulatory requirements. We aim to maintain trust and confidence in our operations by prioritizing investor protection and regulatory compliance.

4. Are there unique challenges in the Litigation Funding space for Hedonova?

Yes, the Litigation Funding space presents its own set of unique challenges. One significant challenge is assessing the financial viability of litigation cases. We carefully evaluate factors such as potential costs associated with litigation, the likelihood of successful resolution, and the estimated timeline for outcomes. Maintaining transparent communication with all parties involved, including law firms and plaintiffs, is crucial. We navigate these challenges by implementing rigorous evaluation processes and fostering open dialogue with our partners, ensuring alignment of interests and effective management of risks.

5. What are the advantages for investors in litigation finance?

Investors stand to gain several advantages from investing in litigation finance. Firstly, it offers the potential for high returns, as successful litigation cases can result in significant settlements or awards. Additionally, litigation finance typically involves shorter investment horizons than traditional investments, allowing investors to realize returns within a shorter timeframe. Moreover, litigation finance often exhibits a low correlation with traditional markets, providing diversification benefits to investors. By incorporating litigation finance into their portfolios, investors can access alternative sources of income and enhance overall portfolio resilience.

6. What are the types of litigation finance cases that Hedonova has invested in?

Hedonova has invested in various types of litigation cases across different sectors. These include commercial lawsuits, intellectual property disputes, class action lawsuits, and more. Each case undergoes a thorough evaluation process, where we assess its financial viability, the strength of legal arguments, and the expertise of the legal team involved. By diversifying across different litigation cases, we aim to spread risk and maximize potential returns for our investors.

7. How can investors use litigation finance to diversify their portfolios?

Investors can utilize litigation finance to diversify their portfolios by capitalizing on its non-correlation with traditional assets, as returns from legal cases are often unaffected by economic fluctuations. Diversification within the litigation finance asset class itself spreads risk across various cases with different risk profiles, mitigating the impact of any single case's outcome. With the potential for high returns and exposure to alternative assets beyond stocks and bonds, litigation finance offers a unique avenue for portfolio diversification. Additionally, investors gain access to specialized legal expertise and thorough due diligence processes conducted by litigation finance firms, enhancing their investment decisions. As the litigation finance industry matures, it presents opportunities for long-term growth, making it an attractive option for investors seeking to broaden their investment horizons.

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Louisiana State Senate Unanimously Passes Litigation Funding Bill

By Harry Moran |

Whilst the UK government has demonstrated support for the litigation finance industry through its legislation, state governments within the US continue to indicate a growing preference for tighter rules and increased oversight around the use of third-party funding.

An article in Bloomberg Law covers the progression of SB355 through the Louisiana legislature, as it received unanimous approval from the state Senate last week and will now be sent to Governor Jeff Landry to be signed into law. SB355 requires any foreign litigation funder involved in a civil action in Louisiana to disclose its details to the state’s attorney general (AG), and to provide the AG with a copy of the funding agreement. The bill would also prohibit funders from controlling the legal action in any way and also prohibits them from being ‘assigned rights in a civil action for which the litigation funder has provided funding’.

State Senator Jeremy Stine, the legislator who introduced SB355, said that the bill will ensure that “Hostile foreign nations and sovereign wealth funds associated with hostile governments will no longer interfere in our justice system.” 

Bloomberg’s reporting notes that whilst Gov. Landry has not publicly stated whether he will sign SB355, a similar bill was vetoed by his predecessor John Bel Edwards when it was sent to the governor’s desk last year.As LFJ reported last month, SB355 is one of two pieces of draft legislation concerning third-party funding in Louisiana, with HB336 introducing additional disclosure requirements for funders involved in civil actions.

Minnesota Judge Rules Against Burford’s Substitution of Plaintiff Request in Sysco Lawsuits

By Harry Moran |

As LFJ reported in March, attempts made by Burford Capital, and its subsidiary Carina Ventures, to replace Sysco as the plaintiff in its antitrust lawsuits had achieved some success, with an Illinois court ruling in favour of their Joint Motions for Substitution of Plaintiff. However, the parties have now faced another setback as a Minnesota court has affirmed a prior ruling from a magistrate judge that denied their request.

Reporting from Reuters provides an update on the Burford-Sysco story, as a judge in the US District Court for the District of Minnesota ruled that Sysco should remain as the plaintiff in the antitrust lawsuits that Burford Capital funded. District Judge John R. Tunheim concurred with the February ruling by U.S. Magistrate Judge John Docherty, saying that there was no evidence to show that the “decision to deny the Joint Motions for Substitution of Plaintiff was clearly erroneous, especially considering the unique facts of this case.” 

Judge Tunheim’s ruling follows on from Judge Docherty’s February ruling, which found that Burford could not be named as the plaintiff in the antitrust lawsuits, as it did not have an interest in the case beyond its financial investment in the litigation. In the ruling, Judge Tunheim rejected arguments brought by Burford and Sysco that the Magistrate Judge had erred in his judgement, both on the grounds that it contravened Federal Rule of Civil Procedure 25(c) and that public policies cited by Judge Docherty actually favoured the motion for substitution.

Judge Tunheim went on to say that “Sysco and Burford’s conduct is precisely the kind of conduct of which courts are wary”, and that their motion for substitution of plaintiff “directly resulted from their attempt to resolve the dispute over whether Sysco or Burford should control this litigation.” According to Reuters, Burford is now reviewing Judge Tunheim’s decision, whilst Sysco declined to provide a comment.Judge Tunheim’s full ruling can be read here.

CaseMark Secures $1.7 Million Seed Funding Led by Gradient Ventures to Revolutionize Legal Workflows with Generative AI

By Harry Moran |

CaseMark AI, a pioneer in legal generative AI workflows, today announced the closing of a $1.7 million seed funding round led by Gradient Ventures, Google's AI-focused seed fund. Additional participation came from Rex Salisbury's Cambrian, Ride Home AI Fund and Alumni Ventures. The funding will drive the company's mission to help legal professionals benefit from the efficiency and productivity of generative AI.

CaseMark's AI-powered legal workflows address automating time-consuming tasks like document summarization, research, and legal analysis. This frees up valuable time for legal professionals to focus on high-value activities such as client strategy and casework.

CaseMark's platform is modular, web-based, and easy-to-deploy. Unlike legacy legal tech, it seamlessly integrates into existing legal workflows such as deposition summaries or discovery responses, minimizing disruption and maximizing user adoption. The built-in chat tool allows legal professionals to query their case content in a secure, privacy first environment. 

"We're the AI easy button that won't get attorneys in trouble," said Scott Kveton, CEO of CaseMark. "Hours spent summarizing take minutes now. That time saved can be reclaimed to work on legal strategy," said Kveton, highlighting the platform's efficiency gains.

"The rise of generative AI is transforming the legal landscape. Attorneys are now leveraging AI tools to sift through vast amounts of documents and automate time-consuming tasks like summarizing lengthy court transcripts. Casemark is at the forefront of this movement, offering an innovative solution for quickly and accurately generating summaries of depositions, cases, and trials," said Denise Teng, Investor at Gradient Ventures. "Casemark's platform has the potential to streamline legal work, making it more efficient and cost-effective for everyone from solo practitioners, large law firms to legal tech companies. We're proud to support Scott and his team as they redefine legal tech."

"For generative AI to succeed in legal workflows, it needs to perform reliably and cost efficiently. With CaseMark's LLM-agnostic architecture and mixture-of-experts approach, they can deliver best-in-class results at a fraction of the cost of their well-funded competitors. It's game on." stated Chris Messina, inventor of the hashtag and GP at the Ride Home AI Fund.

The seed funding will accelerate CaseMark's product development, expand its team of AI and legal experts, and drive adoption of its AI-powered legal workflows among law firms, legaltech companies, court reporting and litigation services firms.

"CaseMark has demonstrated incredible speed in bringing a high quality product to market, delivering real value for their clients. I look forward to seeing how continued enhancements in underlying models allows the team to do even more." said Rex Salisbury. 

The CaseMark Workflow API enables access to all of CaseMark's AI-powered workflows via a white-label integration for legal tech companies and litigation support firms. Companies can leverage the AI-as-infrastructure service provided by CaseMark to increase time-to-market and maximize revenue for the most common attorney use cases.

ABOUT GRADIENT VENTURES

Gradient Ventures has been investing at the forefront of artificial intelligence since 2017. We are led by former founders, technical experts, and domain specialists, who know how to take an idea to product-market-fit and beyond. Gradient Ventures is headquartered in the San Francisco Bay Area. For more information, visit www.gradient.com.

ABOUT CASEMARKCaseMark is a pioneer in the legaltech industry, dedicated to transforming the way legal professionals work. Our AI-driven workflow platform streamlines document creation, research, and workflow management for law firms, litigators, and support services. With a focus on privacy, security, and innovation, CaseMark empowers legal professionals to maximize efficiency and deliver exceptional outcomes for their clients. Learn more at www.casemark.ai.

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Petronas Azerbaijan Believes Sulu Case Backers “Intentionally Supported” Spanish Arbitrator’s “Unlawful Actions”

By Harry Moran |

There have been few funded disputes that have reached the worldwide footprint of the Malaysia Sulu case, with arbitration and enforcement proceedings, criminal charges, and a significant geo-political fallout all taking place across Spain, Malaysia, France, Luxembourg, and the Netherlands. In a dispute that has now been ongoing since 2017, we do not appear to be approaching the finish line in the back-and-forth conflict between the core parties.

Reporting by Bloomberg Law covers the latest development in the ongoing saga of the Sulu dispute as Petronas Azerbaijan, an energy company owned by the Malaysian state, is now accusing Therium Capital Management of impropriety in its funding of the Sulu heirs’ case. The company has applied to the United States District Court, Southern District of New York, for an order to “conduct discovery for use in foreign proceedings” and to serve Therium with subpoenas for documents and communications that relate to the funder’s attempts to seize Petronas’ assets in Luxembourg.

Petronas’ Application for Order has its basis in the $14.9 arbitration award issued by Spanish arbitrator Gonzalo Stampa, who was later found guilty of contempt of court for improperly filing enforcement actions and ignoring orders from the Madrid High Court of Justice. Petronas said that they intended to “seek disclosure from various entities acting as custodians of records that could be relevant to its proposed civil and criminal actions against Mr. Stampa, the Funder, the Sulu Claimants, and the Sulu Claimants’ attorneys.”

Explaining the need for the disclosure of these materials, Petronas’ application stated that they “reasonably believe that the Therium Group used one or more of them to facilitate payments to Mr. Stampa”. The application goes on to say that the funder, arbitrator, the claimants and their attorneys, “collectively and/or individually knowingly and intentionally supported Mr. Stampa’s unlawful actions.” Petronas’ explained that this discovery “is for use in contemplated proceedings before a foreign tribunal”, with Spain and Luxembourg mentioned as two jurisdictions where Petronas is considering bringing claims against the aforementioned parties.The full Application for Order can be read here.

Industry Leaders React to the Election’s Impact on Litigation Funding Agreements Bill 

By Harry Moran |

As LFJ recently reported, the surprise announcement of the UK general election being held on 4 July has had unforeseen consequences for the litigation finance industry, with the government’s efforts to reverse the effects of the Supreme Court’s PACCAR decision appearing to have stalled.

An article in City A.M. covers the reaction of law firms and litigation funders to the news that the Prime Minister’s election announcement would mean that the Litigation Funding Agreements (Enforceability) Bill will not move forward at present. 

The collective feeling among industry professionals appears to show widespread dissatisfaction following the encouraging progress that the bill had already made, with Martyn Day, co-president of the Collective Redress Lawyers Association describing the development as “disappointing news”. In particular, Day highlighted that the election had undermined the work that had gone into the bill and the momentum it had gained, saying that the certainty the bill provided to funders “is now lost for at least some months while the political future of the country is decided”.

Mohsin Patel, co-founder and director at Factor Risk Management, offered substantive commentary on the issue and called this roadblock in the bill’s progress “frustrating for many, particularly given the relatively swift manner in which the government had sought to rectify its position on litigation funding.” However, Patel remained optimistic that legislation to solve this issue would still be passed even if there is a change in government following the election, highlighting the “non-partisan nature of the bill, and the groundswell in public opinion in support of the funding industry following the Post Office scandal”.

Litigation Capital Management’s CEO, Patrick Moloney appeared to share this viewpoint and suggested that “if there is a change of government one might have thought a Labour led government would be equally focused on access to justice thus allowing the passing of the Bill.”

Julian Chamberlayne, partner at Stewarts, explained that on a procedural level this is the end of the road for the current version of the draft legislation, due to the fact that “A Bill cannot be carried over from one Parliament to the next.” Chamberlayne went on to say that “whether it can be introduced in the same form, and whether it will be in the Lords or House of Commons, will depend on who forms the next Government.”

Samsung Patent Infringement Suit Dismissed After Claimant Shares Confidential Materials with Funder and Lawyers

By Harry Moran |

The use of third-party funding in patent infringement lawsuits has not dominated the headlines in 2024 when compared to previous years, with debates over the disclosure of funding agreements waning amid various instances of state legislatures introducing new rules. However, a high profile patent infringement claim brought against Samsung has come to an end, after the court found that the claimant had improperly obtained and shared confidential information with their lawyers and funder.

An article in ICLG covers a significant development in Staton Techiya and Synergy IP v Samsung Electronics where District Judge Rodney Gilstrap has dismissed the case against Samsung and described the claimant’s behaviour as “dishonest, unfair, and repugnant to the rule of law”. Judge Gilstrap’s ruling found that the claimant, Ahn Seung-ho, had obtained confidential information from Samsung and then shared it with other parties for their own gain in the lawsuit.

The court’s judgement explained that Ahn and Cho Sungil, a patent attorney formerly employed by Samsung, had shared internal status reports with Techiya’s patent lawyers and with the claimant’s funder, PurpleVine IP. In his ruling, Judge Gilstrap stated that the misappropriation and dissemination of these materials was particularly egregious, as they “were critical documents that could determine the outcome of the litigation because they contained Samsung’s strategy regarding the Techiya litigation”. 

Furthermore, the court highlighted that there had been evidence of more wrongdoing by Ahn and his associates, including evidence of perjury, attempts to destroy evidence, and violations of discovery rules. Judge Gilstrap concluded that the “evidence presented by the parties at the bench trial demonstrates subversion of our adversarial system of litigation and an invasion of the attorney-client privilege”. As a result, the court ordered that the conduct exhibited by Ahn, and other individuals working with him, be reported to ethics committees in both California and New York.

Nakiki SE: New litigation financing agreements: EUR 3 million, option volume EUR 1.5 million

By Harry Moran |

Nakiki SE, in future Legal Finance Holding SE, announces 3 new litigation financing agreements:

Real estate purchase agreement:

The seller of non-EU real estate with a value of EUR 10 million suffered damages of approximately EUR 2.3 million as a result of a cancelled property purchase agreement. Legal Finance entered into a litigation funding agreement with the seller to pursue the claim.

Sports car accident:

A policyholder suffered damage in a serious car accident and the insurance company refused to pay the claim for approximately EUR 700,000. Legal Finance entered into a litigation funding agreement with the policyholder to pursue the claim.

Loan agreements:

A borrower refused to repay business loans totalling approximately EUR 550,000. Legal Finance entered into a litigation funding agreement with the lender to enforce the outstanding payments.

The total amount in dispute of the new litigation financing agreements is approximately EUR 3.5 million (excluding costs and interest). The option volume is approximately EUR 1.5 million.

Additional cases are under review.

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Progress on PACCAR Bill Stalls as UK Election Approaches

By Harry Moran |

An article in CDR looks at the potential impact of the upcoming UK general election, which may result in progress stalling for the government’s Litigation Funding Agreements (Enforceability) Bill. With Prime Minister Rishi Sunak’s announcement on 22 May that the election will be held on 4 July, it is now very unlikely that the bill will reach any further significant milestones towards being signed into law.

The last major development in the bill’s progress was the 15 April second reading in the House of Lords, which saw members continue to debate the proposed legislation and the amendments that had been put forward to alter the language of the bill. As LFJ explained in our recap of the debate, the bill currently sits in the report stage, which provides an opportunity for members of the Lords to further examine the bill and propose any additional amendments to the text. 

However, with an election just over a month away and the current crop of elected representatives already busy campaigning, it would be surprising to see any further progress made under the current government. As CDR notes, it is also unknown whether this bill will be seen as a priority for parliament following the next election, especially if there is a change in the governing political party.

CDR’s article includes a statement from a spokesperson for the International Legal Finance Association (ILFA), which said: “It’s disappointing for us, but more importantly for small businesses and individuals like the sub-postmasters who rely on litigation funding to secure justice. It is critical the next government recognises the urgency of this issue and prioritises a quick fix to ensure access to justice can continue and the UK’s reputation as a world-leading legal centre is protected.”

Burford Capital Expected to Join Russell 3000® and 2000® Indexes

By Harry Moran |

Burford Capital, the leading global finance firm focused on law, is expected to join the broad-market Russell 3000® and small-cap Russell 2000® Indexes at the conclusion of the 2024 Russell US Indexes annual reconstitution, effective after the US market opens on July 1, 2024, according to a preliminary list of additions posted on May 24, 2024. Burford is the first legal finance firm to be listed on the New York Stock Exchange and the first legal finance firm expected to join the Russell 3000® and 2000® Indexes. Legal finance is an emerging asset class generally uncorrelated to market conditions or the performance of the overall economy.

Burford’s inclusion in the Russell 3000® and 2000® Indexes reinforces its continued growth both with its investors and with its clients, which include Fortune 500 companies and many of the world’s largest law firms. Burford, which celebrates its 15th anniversary in October 2024, helps clients shift the cost of their commercial disputes as well as manage the risk and optimize the timing of the often-significant cash flows associated with pending claims, judgments and awards. The company has a multi-billion dollar portfolio, and in 2023, a Burford-funded case against Argentina involving the renationalization of Argentina’s oil company, YPF, resulted in the largest judgment in the history of the US District Court for the Southern District of New York, with the court awarding plaintiffs approximately $16 billion in damages.

Christopher Bogart, CEO of Burford Capital, said: “Since its founding in 2009, Burford has deployed billions of dollars to the business of law, and we’re continuing to see growing demand from CFOs, GCs and other business leaders who recognize that they can use legal finance to turn the legal department from a cost center to a capital source, including a recent $325 million Group-wide commitment with a Fortune 50 company. Joining the Russell 3000® and 2000® Indexes is an exciting moment for Burford, and we are proud to continue on a trajectory of growth and increasing visibility to clients and investors alike.”

Russell indexes are widely used by investment managers and institutional investors for index funds and as benchmarks for active investment strategies. According to the data as of the end of December 2023, about $10.5 trillion in assets are benchmarked against the Russell US indexes.

About Burford Capital

Burford Capital is the leading global finance and asset management firm focused on law. Its businesses include litigation finance and risk management, asset recovery and a wide range of legal finance and advisory activities. Burford is publicly traded on the New York Stock Exchange (NYSE: BUR) and the London Stock Exchange (LSE: BUR), and it works with companies and law firms around the world from its offices in New York, London, Chicago, Washington, DC, Singapore, Dubai, Sydney and Hong Kong.
 
For more information, please visit www.burfordcapital.com.
 
This announcement does not constitute an offer to sell or the solicitation of an offer to buy any ordinary shares or other securities of Burford.

Forward-looking statements

This announcement contains “forward-looking statements” within the meaning of Section 21E of the US Securities Exchange Act of 1934, as amended, regarding assumptions, expectations, projections, intentions and beliefs about future events. These statements are intended as “forward-looking statements”. In some cases, predictive, future-tense or forward-looking words such as “aim”, “anticipate”, “believe”, “continue”, “could”, “estimate”, “expect”, “forecast”, “guidance”, “intend”, “may”, “plan”, “potential”, “predict”, “projected”, “should” or “will” or the negative of such terms or other comparable terminology are intended to identify forward-looking statements, but are not the exclusive means of identifying such statements. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors because they relate to events and depend on circumstances that may or may not occur in the future. Burford cautions that forward-looking statements are not guarantees of future performance and are based on numerous assumptions, expectations, projections, intentions and beliefs and that Burford’s actual results of operations, including its financial position and liquidity, and the development of the industry in which it operates, may differ materially from (and be more negative than) those made in, or suggested by, the forward-looking statements contained in this announcement. Except as required by law, Burford undertakes no obligation to update or revise the forward-looking statements contained in this announcement, whether as a result of new information, future events or otherwise.

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Leading Finance Firm Secures Coveted Spot in European Litigation Funders Association (ELFA)

By John Freund |

A top-tier litigation finance firm has achieved a significant milestone by becoming a member of the prestigious European Litigation Funders Association (ELFA).

This development marks a strategic move for Nera Capital as it continues to solidify its position as a key player in the global litigation funding market.

With its headquarters in Dublin, along with offices in Manchester and The Netherlands, the company has earned a reputation for delivering innovative financial solutions and cutting-edge technology across a diverse range of claim types.

The company’s portfolio includes high-volume consumer disbursement funding in the UK and substantial commercial claims in both Europe and the USA.

This strategic membership in ELFA underscores Nera Capital’s commitment to fostering ethical and effective litigation funding practices.

The ELFA is a collective of like-minded professionals from the litigation funding industry whose management committee is formed by representatives from the original founding companies, Deminor, Nivalion and Omni Bridgeway.

To become a member, firms need to have demonstrated excellence in the sector and a proven track record of deploying a significant amount of capital into the market.

Aisling Byrne, Director at Nera Capital, expressed her delight at this milestone, stating: “We are very pleased to join the European Litigation Funders Association.

“As a member, we look forward to collaborating with industry peers, sharing our wealth of experience, and contributing to the advancement of ethical and effective litigation funding practices across Europe.

“It positions us to advocate for transparency and promote higher industry standards that benefit all stakeholders involved. We believe our involvement will drive positive change and reinforce the essential role of litigation funding in delivering access to justice.”

Nera Capital’s membership in ELFA comes at a pivotal time when the litigation funding market is experiencing rapid growth.

By aligning with ELFA, Nera Capital is poised to play a crucial role in shaping the future of the industry, and the importance of litigation funding.

Wieger Wielinga, Managing Director of Omni Bridgeway and Chairman of ELFA, welcomed the company’s membership, noting the significance of their inclusion:

“With its roots in Ireland, the only Common Law EU country, Nera Capital operates in several EU jurisdictions as well as the UK.

“ELFA is thrilled to have another experienced funder on board, further enabling us to develop best practices for assisting claimants, insolvency trustees and consumer organisations and law firms across Europe.

“The addition of Nera to ELFA will also enhance our ability to advocate for the funding industry and its invaluable role in delivering access to justice across Europe.”

About Nera Capital:

·        Established in 2011, Nera Capital is a specialist funding provider to law firms.

·        Provides Law Firm Lend funding across diverse claim portfolios in both the Consumer and Commercial sector.

  • Headquartered in Dublin, the firm also has offices in Manchester and The Netherlands.

·        Nera Capital is dedicated to facilitating the setup of class actions and group actions to promote equitable access to justice for individuals and interest groups. With a proven track record, Nera Capital has spearheaded numerous impactful claims, empowering clients to achieve legal redress in cases such as Housing Disrepair Claims, where vulnerable claimants lack the means to address their grievances effectively. Additionally, Nera Capital has played a pivotal role in supporting claims like the Trucking Cartel case in Europe, assisting in exposing evidence of anti-competitive behaviour by manufacturers. Through its strategic interventions and advanced AI capabilities, Nera Capital continues to champion fairness and accountability in the legal landscape. 

·       www.nerecapital.com

About The European Litigation Funders Association (ELFA):

·        ELFA was founded by three leading litigation funders with a European footprint and today includes the vast majority of EU based litigation funders. ELFA was established to serve as the voice of the commercial litigation funding industry operating from within the EU member states. With the objective of representing the industry’s interests before governmental bodies, international organisations and professional associations, ELFA aims to act as a clearinghouse and reference for relevant information, research and data regarding the uses and applications of commercial legal finance within the European continent. ELFA aims to be inclusive for all professional litigation funders of larger or smaller size and to allow specific contributing market participants and academics as associate members.

·        www.elfassociation.eu

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Member Spotlight: Tamar Katamadze

By John Freund |

Tamar is an underwriter in the Political Risk division at Mosaic Insurance and, among other things, responsible for developing Mosaic’s Arbitration Award Default Insurance (AADI) worldwide after previously supporting transactional liability division. In prior positions, she worked as a senior lawyer at JSC Georgian State Electrosystem in Georgia, representing the company in the European Union, and later, as an associate at Fridman Law Firm PLLC in New York. She started her career at Georgia’s Ministry of Economy & Sustainable Development, where she represented the government in courts, with a particular focus on complex commercial litigation.

Mosaic Insurance is a global specialty insurer with exceptional expertise, a focus on complex products, and an award-winning, digitized operating model. Mosaic Insurance underwrites for trade clients alongside we own Lloyd’s Syndicate 1609—offering capacity and custom service across seven lines of business in seven countries.

Company Website: https://www.mosaicinsurance.com/

Year Founded:  2021

Headquarters:  Bermuda

Area of Focus:  Arbitration Award Default Insurance Product

Member Quote: We believe that our new product revolutionizes the landscape for litigation funders investing in international arbitration, providing funds with certainty and effectively managing the value of their investments.

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LSB Report on Litigation Funding Welcomed by ILFA and ALF Leadership

By Harry Moran |

A report by Queen Mary University of London and commissioned by the Legal Services Board, has provided new research into litigation funding in England and Wales. The research report was led by Prof. Rachael Mulheron KC (Hon), professor of tort law and civil justice at Queen May University includes an empirical and legal literature study of the topic, and included input from funders, insurers, law firms, brokers and advisors.

The report found that litigation funding ‘serves the public interest by funding litigation that would (and could) not otherwise be funded’, and ‘offers consumers a hitherto unobtainable route to access to justice where there are more widespread but lower levels of detriment.’ Following the publication of the report, the chairs of both the International Legal Finance Association (ILFA) and the Association of Litigation Funders (ALF) provided comments on the research. 

Neil Purslow, Chair of ILFA said: “We welcome the LSB’s findings that the litigation funding industry serves a public interest, and that although the industry is still nascent, it has become a key feature of legal services provision that supports the development and enforcement of the rule of law.  The report also clearly sets out how claimants would benefit if funding costs were recoverable from an unsuccessful defendant and we look forward to this becoming a key consideration in the upcoming CJC review.”

Susan Dunn, Chair of ALF said: “The Association of Litigation Funders has a strong and growing membership and our board will reflect on the findings contained in this important and thoughtful research, which recognises the utility of the ALF as a self-regulating body and the benefits of the code of conduct to claimants, law firms and funders.”The full report can be read here.

AFR: Gramercy Expects $135M Profit Per Year from Pogust Goodhead Funding Deal

By Harry Moran |

Although the wider public rarely if ever are aware of the details of legal funding deals, new reporting sheds some light on the largest litigation funding deal in the industry’s history, and demonstrates the impressive scale of financial returns’ that may be on offer to outside investors in law firms.

An article in the Australian Financial Review provides new insight into the financial success of Gramercy following its landmark $550 million funding deal with Pogust Goodhead, stating that the hedge fund expects to see around $135 million in profit a year from the deal. AFR’s reporting highlights that the loan has allowed the UK-based law firm to expand its global footprint to include operations in Australia, with the firm announcing its intention to pursue litigation against Australian corporations for violations of environmental law.

AFR’s reporting is based on a Gramercy investor presentation from May 2023, which covered the “Special Situations Opportunity” for funding the deal with Pogust Goodhead and offered insight into the financial returns that Gramercy was expecting. The presentation separated the deal into two loans, each accounting for $250 million in capital, with the first loan projected to return approximately $95 million over 2-3 years and the second to return around $220 million over a 3-.3.5 year period. 

Whilst both firms declined to comment on the details of the funding arrangement, Pogust Goodhead’s managing partner Tom Goodhead spoke about the firm’s broader financial strategy, explaining that debt capital markets have allowed it “to level the playing field with the corporations that have access to sophisticated corporate finance.” Mr Goodhead went on to say that this approach enables the firm “to take up the fight for justice on victims’ behalf despite the often elaborate attempts by large mega-wealthy corporations to deflect and obstruct.”

Burford CEO says Capping Funders’ Fees is “a Preposterously Dumb Idea”

By Harry Moran |

As the UK government moves forward with its legislation to reverse the effects of PACCAR, the parallel progress of its review into the litigation funding industry is attracting even more attention than the bill itself, with funders weighing in on the direction this review should take.

An article in The Law Society Gazette covers a media briefing from Christopher Bogart, chief executive of Burford Capital, who spoke about the upcoming Civil Justice Council (CJC) review into third-party litigation funding in the UK. Commenting on the choice to have the CJC lead the review, Bogart said that “the CJC has a long history of being sensible [in its] thinking about this industry” and that he saw no reason “why that would change.”

However, when it came to discussing the potential reforms to the litigation finance industry that this review might recommend, Bogart was particularly scathing when it came to the idea of a cap on funder’s returns, saying it “would be a preposterously dumb idea.” He argued that there was little logic behind the argument for imposing such a restriction on this kind of financial transaction, acknowledging that whilst there was “some superficial appeal” to outside observers of the industry, “it doesn’t stand up to any sort of rational financial scrutiny.”

Similarly, Bogart cautioned against the introduction of capital adequacy requirements for litigation funders that are used for the banking industry, arguing that the suggestion that funders may run out of capital during a case also lacks evidence as the funding industry “has been operating for over 20 years, and you don’t have a history of that happening.” In reality, Bogart explained, the litigation finance industry has repeatedly demonstrated “a history of larger players being willing to step in and buy out claims if somebody doesn’t have the capital.”

Class Action Filed Against Rio Tinto over Closure of Panguna Copper Mine

By Harry Moran |

Reporting by Bloomberg and shared on Yahoo Finance provides details on a new class action that has been launched on behalf of the people of Bougainville, an autonomous region of Papa New Guinea, against Rio Tinto Plc over its alleged mismanagement of the Panguna copper mine. The Panguna Mine Action (PMA) lawsuit alleges that it was the closure of the mine in 1989 by Rio Tinto’s former unit Bougainville Copper Ltd. that led to protests over the ‘disbursement of revenue’ from the shuttered mine, which then escalated into a civil war that resulted in the deaths of up to 20,000 people.

The Bouganvillean plaintiffs are being represented by lawyers from Sydney-based firm Morris Mennilli and Port Moresby-based Goodwin Bidar Nutley, with Matthew Mennilli stating that the plaintiffs are seeking compensation that could amount to billions of dollars. According to PMA’s website, the class action is being supported through third-party funding, although the name of the litigation funder has not been released.

In an emailed response, Rio Tinto stated: “We are reviewing the details of the claim. As this is an ongoing legal matter, we are unable to comment further at this time.”

The class action has been filed in the National Court of Justice of Papua New Guinea.