For attorneys looking to pursue litigation financing, whether it is for the first time or as a repeat user, these professionals must consider a wider range of factors when choosing the right provider to work with. A new survey reveals some of the most pressing factors and concerns that attorneys are focused on when assessing their third-party funding options.An article from Bloomberg Law highlights findings from its recent State of Practice Survey, which found that the financial terms offered in a funding agreement are the most important factor that lawyers consider when pursuing litigation funding. 26 of the 31 attorneys who responded to the survey’s question about factors considered when assessing litigation funders, answered that the ‘financial terms offered’ were ‘very important’ or ‘somewhat important’.When looking at the top concerns raised by first time users of litigation funding, those attorneys surveyed answered that ‘high financing costs’ alongside ‘maintaining control over the litigation’ were two of the most prominent areas of concern. As the article goes on to note, these answers ‘make sense in light of the high financial stakes in litigation matters that tend to draw the interest of funders.’The State of Practice Survey included answers from 450 attorneys across a range of topics.
As LFJ reported in August, a class action backed by third-party funding and brought against one of Australia’s largest leisure companies has reached a settlement agreement. New court documents reveal the court’s approval of the settlement, as well as the details of the final payout to the litigation funder.A court order posted by the Federal Court of Australia on 30 November provides confirmation that the settlement in the case of Colin Graham Ingram & Anor V Ardent Leisure Limited & Ors has been approved and will move forward to distribution. The settlement, which will bring the class action brought in June 2020 to a close, will see Ardent Leisure pay ‘$26 million for compensation, legal fees and disbursements, without admission of any liability.’ The group members were represented in the class action by Piper Alderman, with Woodsford providing litigation funding.The order also includes ‘Deductions from the settlement for the purposes of the SDS (Settlement Distribution Scheme)’, which lists the court approved deductions from the $26 million sum. Of note, is the $7.8 million in “Funder’s Commission”, which will see Woodsford secure a significant return on its investment in the class action. The deductions also include just over $5 million for “Legal Costs Reimbursement Payments” and $737,836 for the “Funder’s Insurance Costs”, the latter of which will cover costs associated with After-the-Event (ATE) insurance cover.The class action focused on allegations that Ardent had misled its shareholders over safety measures at its Dreamworld theme park in the lead-up to the 2016 Thunder River Rapids Ride accident, which led to the deaths of four people. The final settlement accounts for roughly 10 percent of the $260 million that shareholders lost in the aftermath of the incident in 2016.The full settlement notice can be read here.
In the ever-present debate around the pros and cons of litigation funding, it is always valuable to step back from highly charged opinion pieces and look at more rigorous academic examinations of the key issues that are contested between third-party funding’s advocates and critics.A research paper from the Vanderbilt University Law School authored by Brian T. Fitzpatrick, professor of law, and William Marra, director at Certum Group, tackles the topic of ‘Agency Costs in Third-Party Litigation Finance Reconsidered’. In the paper, Fitzpatrick and Marra seek to question the oft-repeated critique that third-party funding ‘can increase agency costs for litigants’, suggesting that ‘much of the concern in the third-party litigation finance literature over exacerbated agency costs and who controls the litigation has been mistaken.’The authors argue that the assumption that the funder will ‘meddle in the lawyer litigant relationship’ is incorrect. They point out that because funders are unable to control litigation ‘due to the ethical rules’, they instead ‘try to align their interests with both the interests of the lawyers and the interests of the litigants.’ As a result, Fitzpatrick and Marra highlight that this approach avoids any need for a funder to try and control the litigation process, as it is much more preferable for a funder to ‘let the invisible hand of incentives do the work for them.’The paper takes a methodical approach to unpacking the issue of agency costs in third-party funding, firstly by examining the most common criticisms of the practice and the claim that litigation finance ‘will exacerbate lawyer-client agency costs.’ Fitzpatrick and Marra then walk through the standard funding arrangements and the use of the ‘hybrid-fee formula’, before going on to show how this formula is ‘superior to the hourly fees or contingent percentages that clients would otherwise pay without financing.’ Before concluding, the paper also tackles the issue of, ‘if the hybrid formula is so favorable,’ why the legal market does not utilise this formula even in situations with third-party funding present.The full paper can be read here.
Whilst disputes between law firms and funders who have worked together on a case are rare, we have often seen that when these fault lines do appear, the path to an amicable resolution can be quite arduous. This has once again been demonstrated through the latest development in the long-running dispute between litigation funder Woodsford and law firm Hosie Rice over unpaid fees.An article in Reuters provides an update on the fallout between Woodsford and Hosie Rice, as the funder’s subsidiary has filed a lawsuit seeking $1.8 million from the sale of a house owed by the Hosie Rice’s founders. This $1.8 million figure represents the amount that Woodsford was awarded by an arbitration panel in a dispute over unpaid remuneration to the funder.The new lawsuit is asking the court to stop Hosie and Rice from transferring $1.817 million from the sale of the property, with the sale valued at $7.99 million. Woodsford is arguing that without a court order, “it will be costly and expensive (if not nearly impossible)” to secure the amount that is still owed by Hosie Rice.Echoing previous comments on the dispute with the law firm, Woodsford’s CEO Steven Friel described the case as “a straightforward debt collection matter, complicated only by the delay tactics of recalcitrant debtors.” Whilst Hosie Rice provided a much more charged comment, denying that they owed Woodsford any money and saying that the funder is “so crooked it makes Lombard Street seem straight.”The origins of this dispute date back to Woodsford providing around $800,000 in funding for Space Data’s case against Google, with Space Data refusing to pay Hosie Rice after it reached a settlement with Google in 2020. After an arbitrator ruled that Space Data owed the law firm up to $4 million in costs but no contingency fee, Hosie argued that it was not required to award Woodsford any additional fee beyond the original loan repayments. The $1.8 million award was handed down by an arbitration panel as a result of Woodsford’s subsequent lawsuit against Hosie Rice, in which the funder argued that it was owed additional remuneration as the $4 million client payment constituted a ‘revenue event’ for the law firm. As LFJ reported in September, Judge Colm Connolly ruled that Hosie Rice’s appeal had ‘failed to establish a basis for vacating the $1.8 million award’, thereby concurring with the previous ruling by a magistrate judge.
Australia continues to be one of the top jurisdictions for class actions, with both law firms and funders eager to pursue claims which can open access to justice and secure compensation for consumers and groups who have been poorly treated by companies and institutions.Reporting by CDR and Proactive Investors suggests that Piper Alderman is launching a class action against IC Markets, over its sale of contracts for difference (CFDs) to retail investors in Australia. Last month, LFJ had reported that Piper Alderman were at the investigation stage for the class action, but both of the above publications are now reporting that the claim has been filed.The lawsuit will focus on IC Markets’ sale of these products to retail investors between December 2017 and March 2021, alleging that the trading platform failed to ‘adequately assess their [investors] objectives, financial situations and where the risks of investing were inadequately disclosed.’ The claim also alleges that IC Markets broke Target Market Determination rules, from October 2021 onwards. Piper Alderman has secured funding from Woodsford for the IC Markets class action, and interested parties can learn more on Piper Alderman’s website.Both Piper Alderman and Woodsford are already engaged in separate class actions against another trading company, IG Markets, over their sale of CFD products. Piper Alderman’s class action was filed in May of this year and received funding from Omni Bridgeway, whilst Woodsford is funding a case that was filed by William Roberts Lawyers in August.
Whilst the litigation funding industry has seen significant maturation over recent years, the potential for bad actors to be involved in the industry through new startup companies cannot wholly be eliminated.Investigative reporting by John Holland and Emily R. Siegel at Bloomberg Law has revealed ties between a Kazakhstan individual accused of money laundering and a litigation funding business founded by his brother. Ilyas Khrapunov, who is alleged to have laundered hundreds of millions stolen from the Kazakh city of Almaty and from the country’s BTA Bank, is attached to Litigation Partners, SA as a litigation consultant.Daniel Khrapunov founded the Swiss litigation funding company in February of this year, with Ilyas’ role in the company being recorded in records from the Swiss Business Registry and in a statement to a New York court. Ilyas had informed the court of his involvement in Litigation Partners in response to a judgement ordering him to pay $221,000 to BTA Bank, over his use of laundered money in his real estate holding company, Swiss Development Group.Responding to Bloomberg Law’s requests for comment, Daniel Khrapunov stated that his brother was an ‘outside adviser’ to the funder and stated that he had founded the company using the proceeds from ‘a sale in 2020 of Swiss-based real estate purchased in 2004 by his mother.’ However, Bloomberg Law’s reporting includes two anonymous sources who work in the litigation finance industry, who claim that ‘they met with Ilyas Khrapunov to discuss litigation finance opportunities before and after Litigation Partners was formed.’Ilyas did not respond to Bloomberg Law’s requests for an interview or comment.The full investigative report can be read here.
As we approach the end of 2023, it is a useful time to reflect on the state of the litigation funding market in the UK and to see how prominent industry groups are thinking about the future of the industry. A preview of an upcoming survey suggests that whilst litigation funding is thriving in terms of activity and demand, there is a growing consensus that new regulations are required.An article by The Law Society Gazette provides a summary of remarks made by Nicholas Heaton, head of competition litigation at Hogan Lovells, at the London Solicitors Litigation Association’s (LSLA) annual dinner last week. Heaton was delivering a preview of the association’s Annual Litigation Trends Survey, which included some very interesting insights into the perspective of solicitors on litigation funding.According to the Gazette’s article, Heaton explained that 79% of the survey’s respondents have been involved in ‘cases in which one or more parties are using litigation funding.’ Heaton went on to note that given this frequency of funding activity, it would be natural to assume that the solicitors surveyed would regard the Supreme Court’s PACCAR decision as a ‘major concern’. However, Heaton revealed that ‘only about 10% of respondents foresee a reduction in the availability of funding or increase in its cost as a result.’Despite this largely positive view of the third-party funding market, Heaton also said that the survey had asked respondents about their views on the potential need for increased regulation of the industry. The response from these solicitors was overwhelming, as 88% of those surveyed agreed that ‘further regulation of some kind was required for litigation funding.’
When it comes to contentious relationships between the courts and funders, the ongoing situation in the US District Court for the District of Delaware is perhaps the most notorious. Judge Colm F. Connolly’s efforts to enforce greater disclosure and transparency by funders involved in patent litigation appears to have now entered a new stage, as the judge has released an opinion alleging unethical behaviour by lawyers working with a funder. An article in Bloomberg Law covers the latest developments in the case of Nimitz Techs. LLC v. CNET Media, Inc., where Judge Connolly is stepping up his investigation into litigation funding practices in intellectual property lawsuits. In an opinion released on Monday, Judge Connolly stated that he would refer lawyers associated with IP Edge for ethics inquiries, arguing that the lawyers “may have perpetrated a fraud on the court by fraudulently conveying the patents asserted in this Court to a shell LLC and filing fictitious patent assignments.”Judge Connolly’s written opinion put the spotlight on the involvement of these lawyers in around 60 patent infringement suits, where IP Edge had the controlling interest in the litigation but used shell companies to hide its presence from the court. The lawsuits were filed by Nimitz Technologies, Mellaconic, and Lamplight Licensing, but Connolly argued that IP Edge was the actual entity who owned these patents and was the driving force behind the filing of these lawsuits.Connolly went on to say that IP Edge was the “de facto owner of the asserted patents”, with the use of these shell LLCs “designed to shield the real parties in interest from the potential liability they would otherwise face.”Connolly stated that he would be referring George Pazuniakis, Jimmy Chong, Andrew Curfman, and Howard Wernow, to their state bars for ethics investigations. Whilst these four lawyers worked with the LLCs, Connolly also announced that he would additionally refer three lawyers associated with IP Edge: Papool Chaudhari, Gau Bodepudi, and Duy Tran.Of these seven lawyers, only Pazuniakis responded to Bloomberg’s request for comment, stating that “plaintiffs’ counsel followed the law, and had not done anything wrong or unethical or unprofessional.”
Maros founded LitFin in 2018 after spending several years as a business director of a successful property development company in Manchester, the United Kingdom. As LitFin’s managing partner, Maros handles its day-to-day activities, business strategy and investments. Lately, his primary focus revolves around LitFin SICAV, a recently established fully-regulated fund, perhaps the first of its kind within the EU area focused on the litigation finance industry. In 2019, Maros was honored as part of Forbes' 30 Under 30, a testament to his entrepreneurial skills and influence in the business world. Furthermore, Maros is a Chambers-ranked individual for 2023 in the EU. Maros' education includes graduating with distinction in law, which he studied in Manchester (the UK) and Lund (Sweden). His international educational background has played a crucial role in shaping his career and business strategies. In addition to his professional accomplishments, Maros enjoys a variety of personal interests. He is known for his love of swimming and traveling, however, most of all he cherishes spending weekends at his countryside mansion nestled in the hills, where he can relax and unwind from his busy work schedule. Company Name and Description: LitFin Capital Company Website:https://litfin.capital/Year Founded: 2018 Headquarters: Prague, Czech Republic Area of Focus: LitFin is a European complex litigation funder with a special focus on funding follow-on cases related to the private enforcement of damages within the realms of EU competition law. Member Quote: "Our mission is to use litigation funding in order to help injured individuals, companies, insolvency dispute stakeholders, and others to achieve justice, and provide our investors with outstanding returns. From the position of the pioneer in the region, LitFin shortly became one of the most considerable players in the EU funding space. We partner with investors who aim to diversify their investment portfolios while promoting positive social impact, as well as with law firms, which benefit from the potential to offer their clients alternative fee arrangements while minimizing associated risks."
Legal-Bay LLC, The Lawsuit Pre-Settlement Funding Company, announced today that they have expanded their branch dedicated to various types of Legal Malpractice Cases. As an industry leader in legal funding and lawsuit funding with various types of lawsuits, Legal-Bay is one of the go-to funders in the legal malpractice arena. This is due to the lawsuit settlement funding company's expertise and success in helping both law firms and clients obtain the resources they need to fight and win their cases.Most legal funding companies and lawsuit loan companies do not offer law suit cash advances on legal malpractice suits, mostly out of a desire to avoid commercial litigation and the complexities that come with it. However, Legal-Bay accepts these challenges with ease, knowing they employ an experienced underwriting and investment team that understands these cases well. With this knowledge comes the ability to get their clients the lawsuit cash advances they need now, regardless of how complex the case is in nature.Many legal malpractice claims arise when an attorney's decision, action, or misstep results in a loss for their client. These items can include various elements such as missing a statute of limitation filing date, not accepting a settlement agreement, or gross negligence of some kind. The client impacted by the event may then seek to recover said loss, by filing a legal malpractice lawsuit.Chris Janish, CEO of Legal-Bay, commented, "Too often, we encounter plaintiffs who've suffered grave consequences due to judiciary missteps on their lawyer's behalf. It is for this reason we are prioritizing these cases and giving them the attention—and capital—they deserve. If you are someone who's been impacted by lawyer misconduct or legal misconduct, please don't hesitate to contact Legal-Bay today, regardless if your legal malpractice claim has been denied by other lawsuit funding companies." Legal-Bay considers themselves the best lawsuit funding company in the industry when it comes to this market. Commercial litigation cases can be tricky and very expensive to get approved, but with Legal-Bay's experienced team they are able to fund many of these cases for significant value. This not only includes plaintiff funding, but also case cost funding, and expert witness cost funding for legal malpractice cases.To learn more, or to apply for your legal malpractice pre-settlement cash advance or legal malpractice settlement cash advance now, please visit Legal-Bay's page dedicated solely to these types of cases, at: https://lawsuitssettlementfunding.com/legal-malpractice.phpLegal-Bay's pre settlement funding programs are designed to provide immediate cash in advance of a plaintiff's anticipated monetary award. Anyone who has an existing legal malpractice lawsuit or thinks they might have a legal malpractice suit and needs cash now can apply. Due to the fact that the law suit loans don't need to be repaid unless you win your case, presettlement funding is a risk-free way to get some much-needed cash in your hands—sometimes within mere hours.Legal-Bay reminds plaintiffs that these lawsuit cash advances, lawsuit loans, or legal malpractice fundings are extremely beneficial in helping to cover expenses due to the malpractice or misconduct at hand. Legal-Bay also assists law firms with case cost expenses, trial cost expenses, or expert witness cost expenses to help lawyers prosecute commercial litigation or legal malpractice claims. Legal Malpractice filings have been on the rise over the last few years. Legal-Bay believes the average settlement amount or value for legal malpractice is in the $175K area, however these amounts can be much higher or lower in the $100K range. Legal-Bay typically receives inquiries from people asking for a lawsuit loan, loan on lawsuit, loan on settlement, loans on pre settlements, presettlement funding, settlement funding, legal funding, settlement cash advances, or how to get lawsuit money early. Legal-Bay reminds people that their cash advances are not a lawsuit loan, a loan on a pending lawsuit, a settlement loan, or a presettlement loan. They are simply pre-settlement cash advances that one only has to pay back if they win their case. If a client loses their case, there is absolutely no recourse.To apply right now for the quick approval process on your legal malpractice funding request, please call Legal-Bay's 24-hour hotline at 877.571.0405 or visit: https://lawsuitssettlementfunding.com/legal-malpractice.php
A recent feature from BusinessToday examines the UK litigation funding market, putting the spotlight on those individuals whose expertise facilitate these funding deals and work to reach successful resolutions for their clients. The article lists 10 of the leading professionals in the UK industry, with the list considering these lawyers’ ‘backgrounds, achievements, and distinctive qualities.’The 2023 list includes the following individuals:
Steven Friel, CEO, Woodsford
Timothy Mayer, senior investment manager, Litigation Capital Management
Ayse Yazir ACII, global head of origination, Bench Walk Advisors
Ian Madej, founder and CEO, Asertis
Tets Ishikawa, managing director, LionFish
Adrian Chopin, managing director, Bench Walk Advisors
Louis Young, co-founder, Augusta Ventures
Roberth Rothkopf, managing partner, Balance Legal Capital
Charlie Morris, chief investment officer, Woodsford
BusinessToday concludes its list by stating that the growth of the UK litigation funding market ‘owes much to the innovative work of these highly experienced and accomplished lawyers.’
The multi-billion dollar award in the YPF case has been one of the biggest stories involving litigation funding in 2023, with Burford Capital looking to recoup impressive returns from its investment, while the Argentine government continues in its efforts to delay or avoid paying the massive sum. An article from Bloomberg and shared by Yahoo Finance provides an update on the case of Petersen Energia Inversora SAU. v. Argentine Republic, as US District Judge Loretta Preska has granted Argentina a short delay in the enforcement of the $16.1 billion award. Argentina is still appealing the award and Preska has ordered Argentina to ‘seek expedited consideration from the higher court, the Second US Circuit Court of Appeals in Manhattan.’Preska agreed to a suspension of enforcement without an appeal bond until 5 December, on the condition that Argentina pledges its 51% equity interest in YPF and receivables connected to the Yacyretá Dam, which was jointly built by Argentina and Paraguay. The equity stake in YPF is reportedly valued between $2.35 billion and $3.05 billion, whilst payments from Paraguay for the damn could provide another $2 billion, if securitized. Burford Capital, who funded the YPF lawsuit, could be set to receive up to $6.2 billion from the award.
In the months following the UK Supreme Court’s PACCAR decision, industry observers have been patiently waiting to see how the courts’ handling of group actions would be affected. Today’s decision from the Competition Appeal Tribunal (CAT) certifying a funded opt-out claim will likely be viewed as a major victory for UK funders in the post-PACCAR world.An article from CDR covers the news that the CAT has certified the opt-out claim brought against Playstation, which focuses on allegations that the video gaming company unlawfully overcharged consumers for its digital products on the Playstation store. Alex Neil, the class representative for the claim, stated that the CAT’s decision to certify the claim was “the first step in ensuring consumers get back what they’re owed as a result of Sony breaking the law.”The CAT’s decision has added significance, as this class action is being funded by Woodsford and is the first claim of its kind to receive full certification following the Supreme Court’s PACCAR ruling. Sony had objected to the claim being certified, citing both the nature of the third-party funding for the case and the merits of the claim being brought against them.Milberg London’s Natasha Pearman, who is representing the claimants, said that they hoped “the certification of our claim provides some clarity as to acceptable litigation funding agreements in the post-PACCAR environment for opt-out claims.” Pearman used the decision to highlight the fact that “litigation funding is integral to the collective action regime”, and emphasised that these funded claims “provide a route to accessing justice that simply doesn’t exist otherwise.”Charlie Morris, chief investment officer at Woodsford, celebrated the CAT’s decision to certify the claim in the wake of the PACCAR ruling, and decried Sony’s attempts to “advance numerous unmeritorious and opportunistic arguments, all of which unsurprisingly failed.” In a warning shot to other defendants looking to exploit the Supreme Court’s ruling on litigation funding, Morris suggested that they should “resolve meritorious actions in a speedy and cost-efficient way rather than spending millions on spurious and ultimately unsuccessful satellite disputes aimed solely at stymying access to justice.”
Armadillo Litigation Funding, LLC (together with its affiliates, "Armadillo") is pleased to announce that it has secured an additional $250 million in lending capacity. This $250 million, when combined with Armadillo's existing lending capacity, brings Armadillo's total available lending capacity to over $630 million. In March 2022, Armadillo announced that it had raised $750 million of which $446 million has been deployed in 20 loans, not including an additional $150 million in Armadillo led third party syndications.Nick Johnson, Armadillo's Founder and CEO, said, "This additional $250 million demonstrates the market's continued confidence in Armadillo and its ability to successfully invest capital in the law firm lending space. We are excited to begin deploying this capital, and any other new capital commitments, with leading U.S. plaintiff law firms including new borrowers."Armadillo is targeting another $250 million in additional lending capacity in 2024. Armadillo believes that this anticipated new capital, along with the recently secured $250 million, will enable it to continue to deploy capital well into 2025 and beyond.About Armadillo Litigation FundingArmadillo Litigation Funding provides financing to US law firms participating in mass tort, consumer, and commercial litigation, law firm service providers and commercial claims through a UK funding partner. Armadillo offers general obligation loans secured by the borrowers' interests in current and future awards including, but not limited to, contingent fees. Armadillo's targeted loan size is generally $10 million to $100 million per individual client.
Siltstone Capital is thrilled to bring LITFINCON to 90210. LITFINCON, the leading litigation finance summit held annually in Houston, Texas, brings together global legal and financial experts to discuss innovations, strategies, trends, and emerging opportunities in the growing ecosystem of litigation finance. This event also stands as the premier platform for networking and sharing insights in the litigation finance space.Today, we are thrilled to announce LITFINCON's expansion to Los Angeles, marking a pivotal moment in the industry. LITFINCON has consistently brought together diverse professionals, including litigators, general counsel, law firm partners, funders, investors, insurance professionals, investors, and judges. We look forward to replicating this mix in Los Angeles—one of the busiest legal hubs in the world. Attendees can anticipate exclusive networking events, two engaging days of insightful panel discussions, the much-anticipated return of the Judicial Panel, and a delightful comedic segment during "Law, Lunch & Laughs.""We are honored to bring LITFINCON to Los Angeles, home to legendry trial lawyers and some of the busiest court systems in our country. We look forward to paying tribute to those furthering access to justice in California – while also providing the industry-leading content you have come to expect from LITFINCON," says Mani Walia, General Counsel & Managing Partner at Siltstone Capital.LITFINCON LA's venue is The Maybourne Beverly Hills, a symbol of West Coast elegance, perfectly located adjacent to Rodeo Drive. Guests can indulge in top-tier dining and services, staying at Tatler's 2023 selection for "Best City Hotel."Siltstone Capital, the organizer of LITFINCON, is a top-tier niche alternative small business that provides funding solutions for litigants, law firms, and legal teams, aiming to support plaintiffs with the financial resources to assert and protect their rights. Learn more about Siltstone Capital at www.siltstonecapital.com.For further details about LITFINCON Los Angeles, please visit our website at www.litfincon.com/losangeles.To watch the highlight video of LITFINCON II, visit https://www.youtube.com/watch?v=fiTgarzX-zs.For media and sponsorship inquiries, please contact Ally Herebic at allyson.herebic@siltstone.com.
The UK specialist competition court has today certified the legal claim brought by consumer rights expert Alex Neill, on behalf of 8.9 million Playstation customers The lawsuit was filed in August 2022 alleging Sony has abused its dominant position in the market by charging excessive prices to its customers for games and in-app purchases. It is the first claim of its kind to be fully certified by the courts following the landmark funding ruling by the Supreme Court in PACCAR that held that litigation funding agreements which provide a return to the funder based on a percentage of the damages awarded to the class are damages based agreements which are not permitted in opt-out collective actions Today, 21 November 2023, in a judgment handed down by the Competition Appeal Tribunal: (CAT), Alex Neill has been granted approval to go to trial with a £5bn claim against Sony Playstation. This marks a significant first victory for the claimants as Sony lost their battle to block the claim on both the merits of the case and the funding arrangements. The claim, first filed in the CAT in August 2022, is an opt- out group legal action and it argues that the games console giant breached competition law by unlawfully overcharging PlayStation customers. The claim sees Sony accused of abusing its market dominant position to impose unfair terms and conditions on PlayStation game developers and publishers, which results in excessive and unfair prices for consumers every time they buy digital games or ingame content from the PlayStation Store. It is alleged that this has resulted in 8.9m UK consumers being overcharged for their digital gaming purchases by potentially as much as £5 billion over the last six years. Alex Neill, the Class Representative for the claim, said: “This is the first step in ensuring consumers get back what they’re owed as a result of Sony breaking the law. Playstation gamers’ loyalty has been taken advantage of by Sony who have been charging them excessive prices for years. “It is significant that the competition court has recognised Sony must explain its actions by ordering them to trial. With this action we are seeking to put a stop to this unlawful conduct and ensure customers are compensated.” This judgment means the claim has been certified by the CAT and can now proceed to a full trial. This is the first consumer claim of its kind to achieve certification for its funding arrangements in light of the recent Supreme Court ruling in the PACCAR case. The ruling has made waves in the litigation funding industry as it means that Litigation Funding Agreements with a percentage-based fee cannot be used to fund opt-out collective proceedings that come before the CAT. Natasha Pearman, the partner leading the litigation and head of competition litigation at Milberg London LLP, said: “We are delighted to have achieved certification for our claim against Sony. Companies who break the law must be held to account and we are determined to ensure this happens and consumers get access to justice. We hope that the certification of our claim provides some clarity as to acceptable litigation funding agreements in the post-PACCAR environment for optout claims. Litigation funding is integral to the collective action regime. When a company as large as Sony breaks the rules consumers often have no idea it is even happening, let alone have the resources to take them on – litigation funding helps to level the playing field. That is why group legal claims like ours are so important, they provide a route to accessing justice that simply doesn’t exist otherwise.” Charlie Morris, Chief Investment Officer for Woodsford, commented: “Woodsford is proud to be funding Alex Neill and delighted that this is the first collective action where the funding arrangements have been approved following the seminal Supreme Court decision in PACCAR. Sony sought to advance numerous unmeritorious and opportunistic arguments, all of which unsurprisingly failed. Defendants to these actions would be better advised to resolve meritorious actions in a speedy and cost-efficient way rather than spending millions on spurious and ultimately unsuccessful satellite disputes aimed solely at stymying access to justice.” Anyone who has purchased digital games or in-game content in the UK on their console, via the PlayStation Store between 19 August 2016 to 19 August 2022, is automatically included and potentially entitled to compensation. These customers do not need to take any further action at this stage. Those impacted are encouraged to sign-up at www.playstationyouoweus.co.uk to be kept up to date on the case. About Milberg London LLP Milberg London is at the forefront of group actions law and practice. It is instructed in some of the most significant multiparty cases ever to be heard before the courts in this jurisdiction. Milberg London and its partners are ranked in London’s top legal directories; Chambers and Partners and The Legal500. Home | MilbergLondonAbout Woodsford Since 2010 Woodsford has been helping to hold big business to account for their egregious behaviour. Whether it is helping consumers achieve collective redress when businesses abuse their market dominance, ensuring that inventors and universities are properly compensated when Big Tech infringes intellectual property rights, or helping shareholders in collaborative, escalated engagement up to and including litigation with listed companies, Woodsford is committed to ensuring that companies are held to the highest environmental, social and corporate governance (ESG) standards and helping deliver access to justice. Woodsford - ESG,accesstojusticeandlitigationfinance.
In an announcement on 17 November, Uinta Investment Partners revealed that it would be merging with Alternative Income Solutions (AIS), with the merger set to take place on 1 January 2024. The new company will operate under the Uinta Investment Partners, LLC brand, and will ‘provide enhanced resources, focus, and growth at a time when opportunities for deploying capital are both quite attractive and more plentiful.’Uinta is a multi-family office based out of California, founded in 2017 by Gavin James and Don Plotsky, offering financial products and solutions to institutional, wholesale and retail clients. Uinta’s flagship fund, Uinta Income Fund, LP, was launched in Q2 of 2017 and focuses on consumer litigation finance investments. AIS was founded in 2019 by Andrew Saunders and Don Plotsky, and launched its Alternative Income Solutions – Foundation Fund, LP, to provide ‘a diversified portfolio of specialty finance opportunities’. This fund will continue to be managed by Saunders and Plotsky after the merger, but will be renamed as the Alternative Income Solutions Fund, LP.Saunders is also the co-founder and president of Castle Hill Capital Partners, a strategic marketing and capital raising firm, which will continue to support the new Uinta Investment Partners company with compliance and marketing services. Inquiries about the merger can be directed to: info@uintapartners.com
In December of last year, LFJ reported on the launch of Inweasta, a boutique investment company with a focus on litigation finance and cross-border litigation management. Following last month’s news that Inweasta’s founder, Andrey Elinson, had departed A1 to dedicate his time to the firm, we are already seeing signs of its strategy for global expansion. Reporting by Gulf News covers the announcement that Inweasta has opened its first office in the Middle East. The new branch has been set up in the Dubai International Financial Centre (DIFC), and will allow Inweasta to provide distressed asset management (DAM) services to companies operating in Dubai. This latest expansion adds to Inweasta’s global footprint, having already established presences in Paris, Hong Kong, Vienna, and Istanbul.Explaining the decision to open an office in the DIFC, Elinson highlighted its “strategic location and business-friendly policies”, describing it as “an ideal platform for Inweasta to expand its operations and cater to a diverse clientele.” Elinson went on to say that the Dubai branch is already live and operational, with the regional division aiming to “ensure convenience for clients seeking a wide spectrum of services, including consulting, legal, and investment solutions."According to Inweasta’s website, the Middle East office will be led by Timur Unarokov, who also serves as the company’s CEO.
Despite the much-hyped growth in demand for litigation funding across the globe, the last year has seen an industry increasingly defined by fierce competition among funders for market share. As LFJ covered in September, Augusta Ventures has experienced staff layoffs and exits in recent months, and according to new reporting, the funder is faced with increasing losses and a rise in expenses. An article in The Law Society Gazette provides an overview of recent account filings by Augusta Ventures, which show that the litigation funder is facing tougher financial circumstances than in previous years. The article details that Augusta’s losses for the 2022 calendar year totalled £1.4 million. This figure represents a dramatic increase compared to its 2021 filings, when Augusta only reported £262,000 in losses.The Gazette’s reporting also revealed that while Augusta’s turnover had risen by 4.5% to £9.2 million in 2022, this good news was dampened by the fact that it had faced a 17% rise in administrative expenses, which reached £10.6 million. Furthermore, Augusta faced a £2 million increase in the amount owed to creditors, with the total amount owed reaching £6.8 million. As a result, the funder’s net liabilities had almost doubled compared from 2021, hitting £2.2 million in 2022.According to the Gazette, Augusta Ventures did not respond to any requests for comment.
Whilst the debate rages on about the level of disclosure that funders and their clients should provide to the courts, it is important to note that financial transparency and disclosure between a funder and client is one of the best ways to ensure a successful partnership in any funding arrangement.In an insights post from Sentry Funding, Jack Burgess highlights the importance of greater financial transparency between funders and clients, as well as the ways in which funders can enhance both their own and their client’s position through this approach. Firstly, he points out that it is one of the best ways to increase trust in litigation funding, as clients can often be under large amounts of stress during legal proceedings, and by providing open financial disclosure, funders are able to ‘ease their concerns and establish trust in the partnership.’ He also points out that this goes a long way to maintaining ethical funding practices, so that ‘clients can have confidence that they are partnering with a reputable and trustworthy organisation.’Beyond this trust building, Burgess argues that this approach also empowers the client, because when a funder makes sure that the client is aware of all the information around ‘the terms, fees, and repayment structures’, these clients can then ‘make informed decisions about their legal financing.’ Similarly, financial transparency can be a helpful part of a funder’s risk mitigation strategy, as an informed client is one that is able ‘to make risk-aware decisions and plan accordingly.’Burgess explains that Sentry Funding maintains its commitment to financial transparency through these four principles: open financial disclosure, client empowerment, ethical funding practices, and financial accountability.
As LFJ reported last week, it is clear that litigation funders see the potential for partnerships with companies in the mining sector, who are often embroiled in disputes with nation states over projects, and must pursue costly legal proceedings to safeguard their investments.An announcement from AVZ Minerals reveals that the Australian mineral exploration company has signed a binding term sheet with Locke Capital for a litigation funding facility of up to $20 million. The funds will support AVZ’s corporate and legal costs as it pursues six arbitration proceedings connected to the Manono Lithium and Tin Project in the Democratic Republic of the Congo (DRC).The funding from Locke Capital is expected to cover all costs related to the arbitration matters as well as ‘provide significant working capital to ensure AVZ can continue defending its legal rights to its interests in the Manono Project and ultimately see its development.’ AVZ explained that it has now entered into ‘a phase of exclusive due diligence with Locke until, at latest, 31 March 2024, with the aim of executing a formal agreement for the Funding Facility as soon as practicably possibly.’Nigel Ferguson, CEO of AVZ, said that the company was ‘extremely pleased to have signed this Term Sheet with Locke, a global litigation funder with deep experience in funding complex litigation proceedings.’ He also said that the fact Locke had moved forward with the proposed funding, after completing its own rigorous due diligence on the proceedings, ‘validates AVZ’s strong position across all its legal disputes with a clear pathway to conclusion in AVZ’s favour.’AVZ is currently pursuing the following legal proceedings related to the Manono Project:
Three ICC arbitration proceedings involving La Congolaise d’Exploitation Minière and/or Jin Cheng Mining Company.
Two ICC arbitration proceedings involving Dathomir Mining Resources SARLU.
On March 6, 2024, Houston,Texas will host the third annual LITFINCON conference, convening some of litigation finance's top industry leaders, in an event sponsored by Siltstone Capital. Above The Law recently published Gaston Kroub's preview of LITFINCON’s planned agenda at the Post Oak Hotel in Houston. Kroub says he has attended the past two LITFINCON conferences and finds the conference's networking experience to be a premier highlight. LITFINCON is slated to hold several panel discussions on topics ranging from patent and intellectual property litigation investment law to regulatory compliance and ethical considerations for the international litigation finance community. Additionally, LITFINCON will host a roundtable composed of academic scholars who specialize in third party funding research. Kroub says LITFINCON will also include several events for litigation investment professionals who specialize in mass tort and international arbitration law.
As the UK funding industry continues to adapt to this post-PACCAR world, it is becoming increasingly important for industry leaders to take the temperature of the public on the role of funders in class actions.The fourth annual Class Action Report published by Portland Communications shows that whilst there is some stagnation in the UK public’s understanding of class actions in general, there is a growing public understanding and acceptance of litigation funding. The report’s dedicated section on funding explains that ‘those expressing a ‘low’ level of awareness of litigation funders has dropped from 57% in 2022 to 49% in 2023.’Part of this growth in awareness among the general public can be attributed to greater media coverage of the sector, with Portland finding that the volume of references to litigation funding by UK national news outlets grew by 65% from 2022 to 2023.One of the most intriguing areas explored by Portland was: ‘what return on a funder’s investment do the general public think is unfair?’ There was a wide variety of responses to this question, with ‘nothing is unfair so long as they still got their damages’ accounting for 28% of respondents, with another 28% saying that even ‘double investment is unfair’. Between these two polar opposite responses, the next highest answers were either ‘quadruple is unfair’ at 23% and ‘six times is unfair’ at 12%.Adrian Chopin, co-founder and managing director of Bench Walk Advisors, provides featured commentary within the report. He begins by noting that as “nearly half of respondents thought that a funder shouldn’t make more than double its money on an investment”, in order to comply with this standard whilst still breaking even, “a funder would have to win 50% of its cases on average.”Whilst Chopin acknowledges that on its own this “doesn’t sound so bad”, the economics of litigation funding make it a more challenging proposal. He points out that “the fact that funders’ investors must make a profit on their money, and the fact that the funder also has its own operating costs to cover out of those profits”, means that the win rate would need to be far higher. If this became reality, Chopin says that “the end result would certainly be far fewer funded claims.”The full Class Action Report from Portland can be downloaded here.
As LFJ reported last week, in the wake of the Supreme Court’s PACCAR decision, many advocates for the litigation funding industry have suggested that only the government can rectify the situation through new legislation that would more clearly define the place of litigation funding agreements (LFA). However, it appears that an initial attempt to manufacture a legislative shortcut through an amendment to the proposed bill will not be successful.An article by The Law Society Gazette canvasses the opinions of legal experts regarding the amendment to the Digital Markets, Competition and Consumers Bill, which is due to enter the ‘report stage’ next week. The amendment, listed as NC8, is described as a response to the PACCAR decision and ‘provides that a damages-based agreement is only unenforceable in opt-out collective proceedings before the Competition Appeal Tribunal if the agreement is with a provider of advocacy or litigation services.’According to the industry leaders and experts that are quoted in the Gazette article, the current version of the amendment is not a complete solution to the issue of LFAs being classed as DBAs. Richard Pike, partner at Fieldfisher, explained that the amendment would only solve the problem for funding agreements in opt-out collective proceedings but not ‘any other type of proceedings.'Jonathan Barnes, director of the Association of Litigation Funders, also described the amendment as ‘a partial fix to the problem’. He expressed appreciation that the government had made an effort to address these issues that would limit access to justice, but emphasised that the amendment ‘does not address cases heard outside of the Competition Appeal Tribunal.’
With the numbers of insolvencies on the rise in the aftermath of the pandemic, insolvency litigation funders are seeing the market begin to shift in their favour, as reflected in new financial reporting from one of the UK’s leading funders of insolvency litigation.Manolete Partners released its unaudited half-year results for the six months up to 30 September 2023, reporting that the business has seen significant increases in case completions, new case investments and total revenues.According to the H1 FY24 results, Manolete recorded 116 case completions during this period, which marked a 21% increase from the 95 cases completed during H1 FY23. Across these cases, the average duration dropped from 14.9 months in FY23 to only 11.5 months in FY24. Manolete suggested that ‘this signifies a return to the Company's long established case duration of around 12.7 months, which had expanded temporarily due to the challenges presented by Covid.’The funder also confirmed that it ended H1 FY24 with 417 cases that are still ongoing, which once again represented a significant increase of 58% over the same period in FY23.Moving on to Manolete’s investments, the funder reported a total of 179 new case investments in H1 FY24, representing a 116% rise from last year’s H1 total of 83 new investments. Manolete explained this increase, stating that ‘the higher level of insolvencies in the economy translated to higher new cases signed as well as the impact of the Barclay Bounce Back Loan Pilot (BBLs).’Regarding the BBL pilot scheme, Manolete reported that since the start of the calendar year it has signed 80 of these cases and has already achieved completion on 27 cases. As LFJ reported in October, Manolete confirmed that it ‘is hopeful to shortly commence a separate BBL pilot with another well-known bank.’Overall, Manolete recorded a 104% increase in total revenues, achieving £11.2m in H1 FY24 compared to £5.5m in H1 FY23In his statement on the results, Steven Cooklin, Chief Executive Officer, highlighted the importance of the return of large company insolvencies “back to pre-pandemic levels”, which is now filtering down to create increased opportunities for funders focusing on insolvency litigation. He explained that “as the insolvency market develops through the current business cycle, the Directors anticipate a return to higher average case sizes, reflecting a greater mix of larger company insolvencies.”
Whilst intellectual property and patent lawsuits remain one of the top target areas for litigation funders, questions around these funders’ level of control and interference in the litigation process have come to the fore over the last year.In a piece for TheRecorder, Keith Zullow and Yoko Bian from Goodwin Procter interviewed Brendan Dyer, funding director at Law Finance Group (LFG). The interview covers a wide range of topics including LFG’s evolution from its beginnings in 1994, the nuances of case selection and LFG’s involvement in the litigation process beyond the provision of capital.Dyer begins the interview by highlighting LFG’s pedigree as “the oldest litigation funder in the U.S.”, and with nearly three decades of experience in legal funding, LFG is able to provide “unique and creative capital solutions that go above and beyond merely funding costs and a percentage of legal fees.”Addressing the contentious issue of funder control over lawsuits, Dyer pointedly states that “reputable commercial funders like LFG remain passive in disputes in which they have invested.” Whilst Dyer acknowledges that funders can often provide valuable expertise when it is requested by the client, he reinforces his initial point that “the claimant retains complete control over all decision-making.”Dyer also discusses the parameters which LFG uses when considering potential litigants or cases to engage with, stating that it primarily looks to identify “high-value commercial and IP claims that can benefit from our investment.” Speaking to the particular factors that are important in evaluating patent lawsuits, Dyer says that LFG “like to see at least two patents involved in the case along with a compelling invention story”, and also prefer cases that involve “open patent families.”
As LFJ reported last month, the news that a Chinese company was funding multiple intellectual property lawsuits has reignited debates around expanding regulations of litigation finance. However, representatives for the funding industry continue to argue that the campaign driving these calls for a crackdown is not resting on a solid foundation of evidence.In an interview with Bloomberg Law, Gary Barnett, executive director of the International Legal Finance Association (ILFA), argues that increased disclosure requirements for litigation funding are neither necessary nor are they a reform that has widespread popular support. Barnett suggests that much of the narrative around the need for heightened disclosure stems from lobbying by the Chamber of Commerce, arguing that we shouldn’t “confuse [Chamber’s] interest in it with the overall direction that more disclosure is the way things are headed.” Building on this argument, Barnett claims that the ‘Protecting Our Courts from Foreign Manipulation Act of 2023’ which was introduced in Congress “is based on a false premise.” He goes on to say: “The genesis of it is a commissioned paper that was paid for by the Chamber of Commerce that posits, based on no evidence and it’s pure speculation, that the legal finance industry poses a national security risk.”Barnett does not discount the idea that there is room for reform in funding regulations, explaining that “we’re not opposed to disclosure, we just think that requiring disclosure in every case causes more problems than it’s worth.”Addressing the Chamber of Commerce report’s specific claim that litigation funding provides an avenue for malign actors to interfere with US businesses, Barnett says that “foreign adversaries aren’t able to manipulate the legal system through legal finance providers.”However, Nathan Morris, senior vice president, legal reform advocacy at the U.S. Chamber Institute for Legal Reform, argues that their research shows “that there’s an incentive for geopolitical actors to use funding to engage in America.” Morris acknowledges that this foreign engagement may sometimes be about gathering information rather than damaging US businesses but emphasises that “if there’s no check on the ability for it to occur, it is exceedingly likely it will happen.”
Jade Road Investments Limited (AIM: JADE), the London quoted company focused on seeking the best risk-adjusted returns globally, announces a new investment of $250,000 into Heirloom Litigation Funding 2022 SPV XI ("Heirloom Litigation Finance"). The investment was made in support of JADE's updated Investment Policy to invest in attractive, uncorrelated, risk adjusted return opportunities.This is the second investment made by JADE under its new Investment Policy approved in February 2023. Its first investment, in April 2023, was into an Alternatives fund which invests primarily in asset-backed and/or income-producing opportunities such as equipment leasing, agriculture and infrastructure, and that are highly uncorrelated to the general market. Heirloom Litigation Finance has issued JADE a 1-year, 14% cash interest debt note, that is backed by a diversified portfolio of disbursement fundings for small consumer litigation claims in the UK, all backed by insurance. Interest is paid quarterly. Unlike many litigation finance opportunities, these claims fall under established precedents or quasi-governmental compensation programs, which are expected to increase the chance of success and reduce the length of time to settlement. The investment is a related party transaction under the Aim rules for Companies as Heirloom Investment Management LLC is a substantial shareholder in the Company and Heirloom Litigation Finance is a self-managed Cayman Islands company wholly owned by Heirloom Holdings. The Directors of the Company consider, having consulted with WH Ireland Limited, the Company's nominated adviser, that the terms of the transactions are fair and reasonable insofar as its shareholders are concerned.JADE recognizes the importance of genuine diversification in this volatile market, and how alternative investing can reduce volatility and improve returns in an investment portfolio. JADE is pleased to add another investment that would be difficult for most investors to either access or diligence, and which aims to provide genuine diversification and risk-adjusted return enhancement to an investor's portfolio. John Croft, the Company's Executive Chairman, commented:"JADE's investment in Heirloom Litigation Funding 2022 SPV XI continues to build on our updated Investment Policy and our commitment to providing our shareholders with a portfolio of investments with solid risk-adjusted global returns. With its strong return profile, insurance -backing, short duration and high coupon, which is paid quarterly, the Heirloom Litigation Finance investment is another step forward in JADE's on-going transformation."
Aon is a global insurance brokerage and professional services firm with approximately 50,000 employees across 120 countries that offers a wide array of risk mitigation products and structured solutions. Aon’s Litigation Risk Group focuses on de-risking adverse outcomes in active and potential future litigation for corporate, private equity, hedge fund, law firm, and litigation finance clients through the use of insurance. Aon has spearheaded the rapid development of this insurance market over the past five years with pioneering solutions like judgment preservation insurance, insurance-backed judgment monetization, and portfolio-based “principal protection” coverage for funders and plaintiff-side law firms. Aon’s Litigation Risk Group is the dominant market leader in the litigation and contingent risk space, having placed nearly $5 billion in total limits over just the last several years, including over $1 billion in limits in 2023 alone. Website: https://www.aon.com/m-and-a-transaction/transactionsolutions/litigationsolutions.jsp Founded: 1982 HQ: London (Global) and Chicago (US), with Aon’s Litigation Risk Group being based in New York About Aon’s Litigation Risk Group: Aon’s Litigation Risk Group works with a wide variety of clients across all industries and sectors of the economy, but the fastest-growing appetite for insurance solutions by far comes from litigation funders and other similar investors in litigation-related assets. Aon helps these clients protect their downside in litigation-related investments in many different circumstances, whether protecting a judgment they have obtained in a case in which they invested at inception, wrapping a loan they are making to a plaintiff-side law firm with principal protection insurance, or insuring an entire portfolio of uncorrelated investments in cases at different stages of the litigation lifecycle. Aon has fostered strong partnerships with dozens of insurance markets to bring our clients the most creative bespoke insurance solutions for the most complex litigation-related risks on the best possible coverage terms. As the Director of Underwriting for a well-established litigation funder on whose behalf Aon has placed over $70 million in limits across a number of different investments put it: “We have worked with the Aon’s Litigation Risk Group on a number of insurance policies over the years, and I can say unequivocally that they are second to none. Besides being fantastic to work with, the team was also able to leverage their litigation know-how and strong relationships with insurers to obtain favorable terms for each of our policies. Even when we had to file a claim on a policy, they jumped on it right away, handling it quickly and professionally without any need to involve a separate claims team. We have been very happy with our partnership.”Points of Differentiation:Innovation – Aon is a leader in terms of pushing the limits of what litigation and contingent risk insurance policies can do. While this area of the insurance industry got its start on the defense side in the context of M&A transactions, where what is now refered to as “adverse judgment insurance” or “AJI” was used to ring-fence litigation risks that were getting in the way of an acquisition, they were the first to place insurance on plaintiff-side judgments, which led to Aon coining the term “judgment preservation insurance” or “JPI,” which is now used industry-wide and beyond. Aon was also the first to have the insight that once a judgment is insured, so long as the defendant is sufficiently creditworthy, the combination of “judgment plus JPI policy” can serve as collateral for a loan that can be made on more attractive terms than would be available without insurance. Aon was among the first broker in the insurance industry to facilitate loans against this combination of “judgment plus insurance,” a solution they named “insurance-backed judgment monetization,” and which has now also become widespread and provided a significant boost to the broader litigation and contingent risk insurance industry. Their team prides itself on finding new and unique uses for insurance to help our clients achieve their goals, and excels at using insurance capital to solve complex litigation-related issues. Pre-Underwriting – Aon’s team of former litigators has earned a reputation for submitting to insurers only the highest quality risks, after thoroughly analyzing their merits before submission to insurers. As one of the leading insurers in the litigation and contingent risk insurance space, Ambridge Partners, put it: “We’re always happy to receive contingent risk submissions from the Aon team. The deals are always pre-vetted and well-presented, and it’s clear that they’ve asked themselves ‘What would I want to see as an underwriter?’ – and then provide exactly that. It makes Aon’s deals very attractive easy for us to consider.” And per Alston & Bird litigation partner Steve Penaro, “As outside counsel working with underwriters in the contingent risk space, when we see a contingent risk submission from Aon, we immediately know that is has been thoroughly vetted and the issues meticulously scrutinized. And, once the underwriting process begins, Aon actively partners with us to ensure all relevant information is readily available and all questions have been answered allowing for a smooth close. From the initial submission to the binding of the policy, Aon is there every step of the way.” Given the explosive growth in this space, Aon values their underwriters’ scarce time, and enjoys a competitive advantage knowing that underwriters move Aon submissions to the top of their piles. Relationships with Insurers – Aon is not only a market leader in terms of litigation and contingent risk insurance, but also other lines of insurance written by the same carriers such as representations and warranties and tax insurance. As one lawyer we have worked with on policies for two different clients put it: “The Aon team did a magnificent job in placing adverse judgment insurance for one of my clients and judgment protection insurance for another. They have deep contacts with the insurance market, and it was apparent to me that insurers trust their expertise and judgment. I have not hesitated to recommend them to other attorneys.” Given the volume of business that Aon does in the broader transaction solutions insurance market, they maintain deep relationships with insurers, and that benefits their clients by helping them deliver the best possible coverage terms, pricing, and claims service. Key Metrics: Aon's Litigation Risk Group has placed billions of dollars in limits on litigation and contingent risks in the last several years, including ten separate insurance programs that each provided more than $100 million in coverage limits and four that provided at least $500 million in coverage limits. The policies placed by Aon have arisen in a variety of procedural contexts and run the gamut in terms of subject matter and types of claims – commercial litigation, breach of contract, patent infringement, trade secret misappropriation, and antitrust, just to name a few. Aon has placed adverse judgment insurance on the defense side and judgment preservation insurance on the plaintiff side, including pre-trial, pre-judgment insurance for litigation funders to protect the value created by important evidentiary rulings that were the subject of interlocutory appeals. Aon has also placed principal protection insurance on several hundred million dollars that have been invested into early stage, pre-complaint patent litigations across multiple unique patent families. They have procured insurance for defendants who have lost significant damages verdicts at trial against the risk that an appellate court will not reverse, and have insured against adverse outcomes related to regulatory processes. Put simply, as long as their team has access to sufficient underwritable information about the litigation risk to be insured, there are few limits on the kinds of cases or procedural postures that Aon can insure. Jurisdictions and Sectors Served: Aon’s Litigation Risk Group has insurance broking teams not only in the United States, but also in the United Kingdom (which can insure risks across much of EMEA), Bermuda, and Southeast Asia, which enables them to deliver to our clients truly global solutions across myriad jurisdictions. While the core of Aon's business remains insuring the outcome of judicial proceedings in the United States, they understand where to go to find appetite to insure litigation in other domestic courts, as well as insuring the outcome of international arbitration proceedings.Key Stakeholders:Stephen Davidson is a Managing Director and both the Head of Aon’s Litigation Risk Group and Head of Claims for Aon’s broader Transaction Solutions team. As Head of the LRG, Stephen works with clients and insurance markets on the development of litigation and contingent risk insurance. As Head of Claims, Stephen manages transaction liability claims – which includes not only litigation and contingent risk insurance claims but also representation and warranty and tax insurance claims – and has overseen and helped negotiate the favorable resolution of hundreds of such claims in North America and around the world. Prior to joining Aon in 2016, Stephen was a commercial litigation partner in DLA Piper’s New York office, and he began his career at Schulte Roth & Zabel LLP, where he worked as a litigation associate for several years. Stephen Kyriacou is a Managing Director and Senior Lawyer in Aon’s Litigation Risk Group, and was the first insurance industry hire dedicated solely to the litigation and contingent risk insurance market, which he has been working to develop and grow since 2019. Stephen has twice received the designation of “Power Broker” from Risk & Insurance Magazine (in 2022 and 2023), which called him “a pioneer in judgment preservation insurance,” and is the only litigation and contingent risk insurance broker to have been so recognized. While Stephen places insurance across all of Aon’s solution lines, he specializes in single-case judgment preservation insurance and adverse judgment insurance placements. Prior to joining Aon, Stephen spent close to a decade as a complex commercial litigator at Boies, Schiller & Flexner, where he amassed significant trial, appellate, and arbitration experience representing both plaintiffs and defendants in the U.S. and abroad across a wide array of practice areas, and clerked in the U.S. District Court for the District of Columbia. Ed Conlon is a Managing Director in Aon’s Litigation Risk Group, and is the team’s resident insurance industry veteran, having been in the industry for over 15 years and having placed litigation and contingent risk insurance since 2015, when the market for such insurance was still in its embryonic stages. While Ed brokes across all of Aon’s litigation and contingent insurance lines, he focuses primarily on developing cutting edge bespoke portfolio-based coverage structures for law firms, litigation funders, and other investors in litigation. Ed also leverages his deep, battle-tested relationships across the broader insurance industry to bring new carriers into the growing litigation and contingent risk insurance market and to maximize limits and optimize coverage terms on Aon policies. Prior to his current role, Ed led Aon’s Financial Institutions Group and, before that, was a complex commercial litigator and ran a complex commercial claims desk at AIG. David Hodges is a Vice President and joined Aon’s Litigation Risk Group in 2021. David brokes across all of Aon’s litigation and contingent insurance lines, and focuses primarily on single-case judgment preservation and adverse judgment insurance placements. Prior to joining Aon, David was a complex commercial litigator at Boies, Schiller & Flexner and Lankler Siffert & Wohl, and was also a law clerk for federal judges on the Second Circuit and D.C. District Court. Bill Baker is a Managing Director in Aon’s Litigation Risk Group and joined the team in early 2020. Bill leads the team’s work on structured solutions, including loans that are collateralized by judgment preservation insurance policies and other financing solutions that are customized to meet the unique capital needs of our clients. Prior to joining Aon, Bill was an investment banker at various firms throughout a 15-year career, after which time he worked in private equity and corporate roles, including strategy, corporate development, and investor relations. Mike Kenny is a Director in Aon’s Litigation Risk Group and joined the team in 2021. Mike is responsible for the team’s structured finance solutions, including premium finance and judgment monetization. Mike works with clients to structure bespoke credit transactions, allowing them to leverage the combination of their judgments and insurance to access the capital markets and obtain liquidity. Mike uses his industry relationships and a broad network of investors to help clients find the best deal terms and structure for their specific needs. Mike is also a licensed investment banker with Aon Securities. Prior to joining Aon, Mike was an investment banker at BTIG, where he focused on M&A, public and private financing, and strategic advisory for software industry clients.
Funders are seeing their role in the legal services market as a provider of expertise and guidance, in addition to being a source of capital. As was highlighted in a recent interview with a senior executive from one of the largest international funders, this is creating opportunities for funders to develop deeper relationships with law firms and claimants.In an interview with Lawdragon, Hannah van Roessel, managing director and chief investment officer for EMEA at Omni Bridgeway, discusses everything from her own career in law, to differences in funding across geographical markets, and recent trends in legal funding.Looking at the difference between the litigation finance markets in the U.S. and Europe, van Roessel highlights that the American market is larger and “most dispute lawyers are very familiar with funding and have experience negotiating a funding agreement.” However, she reinforces that “the basics are the same” regardless of the location, with core propositions from funders remaining the same as they appeal to clients’ desire to access justice without incurring any unnecessary financial risks or burden.Addressing the relationship dynamics between funders and law firms, Van Roessel speaks to the desire from funders to be seen as not just a source of capital but also as “a resource and partner”, which she suggests lawyers are increasingly warming to the idea of utilising funders’ experience and expertise in this way. In terms of areas for improvement in the relationship, she encourages lawyers to “pick up the phone” and just have quick discussions with funders over potential cases, rather than feeling that “they need to draft a 10-page memo and get all the citations correct” before approaching a funder.Asked about current trends she’s seeing in the market, Van Roessel highlights “merits plus enforcement matters.” These are cases where clients and lawyers are recognising that “they can pursue a claim and might win, but that doesn’t necessarily mean they’ll get paid”, which is an area that funders can provide real value in terms of ensuring that these cases not only reach successful conclusions but also end with the client being able to collect on those wins.
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