This past month has seen a high frequency of developments in Australian class actions, with judgements being handed down from the Federal Court, and new lawsuits being announced with the support of third-party funders. This trend is not abating as we enter the final days of October, with yet another favourable judgement handed down in a class action with its origins in the Covid-19 pandemic.An article by The Financial Times covers today’s judgement by Justice Angus Stewart in the case of Karpik v Carnival plc (The Ruby Princess) (Initial Trial) [2023] FCA 1280. Justice Stewart’s ruling found that Carnival, one of the world’s leading cruise operators, was liable to pay for Susan Karpik’s ‘out of pocket expenses in respect of her COVID-19 infection and adjustment disorder injuries’, after she contracted the respiratory disease aboard their ship, The Ruby Princess. The judge ruled that Carnival had ‘breached their duty of care in various respects’ in their handling of a Covid outbreak in March 2020, having failed to cancel the cruise, warn the passengers of the heightened infection risk, or take adequate measures to prevent the spread of infection. Whilst Justice Stewart found that Karpik’s claim for non-economic losses did not meet the legal threshold, and therefore did not award personal injury damages, Carnival was ordered to pay $4,423.48 plus interest to cover her out of pocket expenses for medical treatment. Mrs Karpik’s claim is part of a class action brought by Shine Lawyers and funded by Balance Legal Capital, representing over 1,000 individuals who were either passengers on Carnival’s ship or are relatives of passengers who died of coronavirus. Vicky Antzoulatos, joint head of class actions at Shine Lawyers, praised the judge’s decision and argued that Carnival should now “do the right thing and compensate all the passengers rather than prolong the matter through further litigation”.
LegalMation, Inc., the market leader in Generative AI-driven solutions for high-volume litigation, today announced it has raised a $15 million Series A financing round led by the venture capital team at Aquiline Capital Partners LP, Aquiline Technology Growth ("Aquiline"), with continued participation from existing investors Motley Fool Ventures, REV Venture Partners, Key Venture Partners, Quick Set LLC, and Brentwood Investments.LegalMation has experienced rapid growth in demand for its Generative AI litigation response platform that provides the insurance and legal industries with clear productivity and cost savings. LegalMation's proprietary solutions enable legal professionals to respond to lawsuits, discovery requests, and related workflows using the client's own historical response data. In 2023, LegalMation's customers have already leveraged the platform to answer over 1.1 million discovery requests in over 30 state and federal jurisdictions.Demand for LegalMation's solutions has been boosted by labor shortages and inflationary pressures. For in-house counsel in particular, automating high-volume litigation and related tasks has become the number one solution to these challenges. Accordingly, insurance carriers and large enterprises have become LegalMation's predominant client base as they seek to increase efficiency and find ways to scale at the organizational level as they find ways to apply Generative AI solutions to their operations. Valued at over $200 billion, the LegalTech and InsurTech markets are increasingly expected to rely on AI and automation solutions in the coming years. LegalMation is well positioned to benefit as the litigation and insurance industries continue to transform. LegalMation has become the trusted partner to the nation's top insurance carriers, large enterprises such as Walmart, and numerous law firms such as Sheppard Mullin, Ogletree Deakins, Fisher Phillips, Nelson Mullins, Baker Donelson, and Jackson Lewis.With this new funding, LegalMation will deepen the functionality and breadth of its platform to support the growth of its rapidly evolving customer base. Additionally, the new funds will enable LegalMation to devote significant resources to build new end-to-end litigation workflow automation and analytic tools, all focused on the goal of resolving disputes faster, while improving accuracy, cost, and outcomes for its customers."We are thrilled to partner with Aquiline given their experience and ability to identify disruptive technology platforms across the insurance and legal ecosystems combined with an extensive network across both markets. We already had strong customer relationships with a few of Aquiline's strategic carrier investors and we look forward to expanding LegalMation's reach within these markets" said James M. Lee, LegalMation's Co-Founder and Chief Executive Officer. "The need for AI automation tools to achieve financial goals has never been greater, especially with the macro-economic pressures falling on both large and small enterprises. This investment will allow LegalMation to accelerate its growth and realize our vision of becoming the most impactful technology partner to the insurance and legal industries.""The AI revolution has the potential to drive exponential productivity gains while allowing greater scalability. The legal and insurance industries are just beginning to adopt transformative technology solutions, having realized the potential to empower their highly skilled talent core" said Aquiline's Dante La Ruffa, Principal. "Aquiline has a track record in scaling SaaS companies and has made multiple investments in the LegalTech industry across our family of funds. We are thrilled to partner with LegalMation and believe they are uniquely positioned to supercharge the litigation support process as we know it today."About LegalMationLegalMation is a SaaS technology company led by a group of experienced litigators and technology specialists, dedicated to revolutionizing the practice of law through artificial intelligence aimed at legal departments of large corporates, insurance carriers, and law firms. LegalMation's ground-breaking generative AI platform dynamically produces fully formatted responsive pleadings, discovery requests and responses and other documents. The platform tailors the claims, allegations, and requests in the legal documents, incorporating jurisdictional requirements as well as the attorney's own style, and response strategy. For more information, visit https://www.legalmation.com.About Aquiline Technology GrowthAquiline Technology Growth ("ATG") seeks to invest in early and growth-stage technology companies that are bringing innovation to the insurance and financial services ecosystems. ATG is managed by Aquiline Capital Partners LP, a private investment firm based in New York and London that invests across financial services and technology. The ATG team has experience in technology and financial services and is supported by its colleagues at Aquiline, strategic partners, and an active group of industry Executive Advisors. For more information on ATG, visit http://www.aquiline.com.
Class actions often represent the best avenue for consumers looking to seek justice and some form of compensation from large companies who have harmed them. However, these claims are most effective when they are supported by third-party litigation funding, ensuring that these individuals can pursue legal redress without incurring financial risk.An article from Stuff.co.nz covers the recent filing of a class action against Toyota New Zealand over its sale of 35,000 vehicles since 2015, which allegedly contained a known fault in their diesel particulate filters (DPFs). The lawsuit brought by Shine Lawyers alleges that the defective vehicles provided customers with reduced performance, poor fuel efficiency and caused the vehicles to ‘emit white smoke’.Commenting on the class action, Shine Lawyers’ associate Hamish Davies explained that “owners of these vehicles spent thousands of dollars, in some cases, all of their savings and it’s pretty disappointing for them to now have to deal with what was a defective vehicle.” He highlighted that the defects in the diesel vehicles forced consumers to spend excessive amounts on fuel and “even in some cases loss of income when people missed work due to issues with the vehicle.”The class action is being funded by Court House Capital, with Davies highlighting that the outside financing “means that individuals don’t have to pay anything and they don’t have any risk when they sign up.”A spokesperson for Toyota New Zealand provided the following comment: “Toyota has been and remains committed to assisting any customer whose vehicle experiences a DPF issue and will continue to provide any related repairs free of charge. This has been our position to date, and we will defend the class action announced today. As this matter is now before the courts, we have no further comment.””As LFJ reported in October 2022, this is not the first time that one of Toyota’s local businesses has been hit with a lawsuit related to issues with its diesel vehicles, with Toyota Australia facing a $1 billion class action brought by Maddens Lawyers. The Australian class action lawsuit also received third-party funding, with that case being backed by Woodsford.
As we steadily approach the four-year mark since the COVID-19 outbreak began, it is clear that we have not yet seen all the long-term consequences of the pandemic play out. This is especially true when it comes to litigation that has been brought in relation to actions by governments or businesses in response to the pandemic, with a UK litigation funder indicating that it is increasing its activities in this area.An article by Legal Futures covers the recent announcement by Manolete Partners that it is looking to expand upon its pre-existing pilot scheme to bring cases related to Covid Bounce Back Loans (BBLs). In a trading update for the six months leading up to 30 September, the funder indicated that another UK bank is beginning a campaign to recover misused BBLs and will partner with Manolete.Manolete’s previous pilot programme with Barclays has provided funding for 81 BBL cases, with 33 of these receiving funds in the last six months, compared to 48 funded BBL claims in the final six months of the 2022 trading period. The funder also informed its shareholders that the cases had a noticeably shorter duration than the funder’s average timeline for funded litigation. Interestingly, Manolete also stated that the Supreme Court’s PACCAR ruling “has had no adverse impact, necessitating only very minor amendments to the standard terms of our funding agreements.”
The growth in trading platforms that cater to retail investors over recent years has significantly widened the market of individuals looking to trade investment products. However, the conduct of these platforms has come under increasing scrutiny and related legal action, with questions being raised around how they market and sell complex investment options to individuals who lack the resources and awareness of large institutional investors. According to reporting by Business News Australia, Piper Alderman is investigating a potential class action against International Capital Markets (IC Markets) over its sale of contracts for difference (CFDs) to retail investors in Australia. The claim will focus on “allegations of unconscionable conduct and misleading and deceptive conduct during the period September 2017 to March 2021” by IC Markets in its sale of CFD products to investors. Business News Australia’s reporting states that Piper Alderman is partnering with Woodsford to source funding for the IC Markets class action.This potential claim would be the latest of several class actions that targeted the sale of CFD products, following a 2021 crackdown by Australian Securities and Investments Commission (ASIC) on the marketing and distribution of CFDs to retail investors.As LFJ reported, this would not be the first time that Piper Alderman has brought a class against an online trading provider over the sale of CFD products, having filed a similar class action against IG Markets in May 2023. In the IG Markets case, Piper Alderman secured litigation funding from Omni Bridgeway. Since Piper Alderman’s case was filed, LFJ has also covered another class action brought by William Roberts Lawyers against IG Markets in August 2023, with funding also provided by Woodsford.
One of the key issues that commentators raised in the aftermath of the Supreme Court’s PACCAR ruling, was whether the judgement would lead to a series of disputes between funders and their clients over the enforceability of litigation funding agreements (LFAs). A recent decision from the High Court has demonstrated that these disputes are already underway, with funders keen to preserve their returns whilst the legal arguments continue to be tested.An article in The Law Society Gazette provides an overview of a High Court ruling in Therium Litigation Funding A IC v Bugsby Property LLC, where Mr Justice Jacobs granted Therium’s application for an asset preservation/freezing order against Bugsby. Therium’s application came about after Bugsby argued that, in the wake of the Supreme Court’s PACCAR decision, its LFA with Therium was no longer enforceable and it should therefore not have to pay the funder.In his judgement, Mr Justice Jacobs stated that “where the amounts claimed by Therium and Omni collectively exceed the proceeds received, there is every reason for all of the trust funds to be preserved.” He explained that both parties had made arguments that “require mature consideration and full argument”, which would need to be further examined in subsequent arbitration proceedings.This ruling in favour of Therium followed another application for an asset preservation order by Omni Bridgeway, who had also funded Bugsby’s original lawsuit. That application was granted by Mr Justice Cotter on October 2nd. Therium’s spokesperson explained that the company had pursued the application as a solution to the “series of failed attempts by Bugsby to avoid paying what is owed to litigation funders.” They went on to highlight that the High Court’s decision was highly relevant to “funders, law firms and their clients and discouraging to claimants such as Bugsby that wish to use PACCAR as a means to walk away from their obligations to their funders.”
Although 2023 has been a turbulent year for litigation finance, with disappointing court rulings and an increase in calls for further regulation of the industry, it is clear that there is still a strong appetite among investors to commit resources to the sector. An article from Bloomberg, shared by Investment News, revealed that Fortress Investment Group LLC is working on raising its second fund dedicated to investments in litigation finance opportunities. Bloomberg’s source indicated that Fortress was looking to build upon its legal funding portfolio, having already invested $6 billion into the sector. Whilst Fortress did not provide a comment in response to Bloomberg’s reporting, the article suggests that the private equity company has already been strengthening its litigation finance team. According to the same source, Fortress had added another 12 employees to its legal assets team in the last 18 months, bringing that department’s total strength to 32.As LFJ covered last week, Andrew Jones, director at Fortress, was present at the recent IMN International Litigation Finance Forum and led a panel discussion on ‘Developments in Class Action and Group Litigation’.
On October 19th, IMN hosted its second Annual International Litigation Finance Forum in London, bringing together thought leaders from across the litigation finance industry and showcasing perspectives from funders, lawyers, insurers and more across a packed day of content.Following on from the successful inaugural edition in 2022, this year’s event once again demonstrated the growing strength of the litigation funding market, both in the UK and across the globe. The agenda also managed to capture the broad diversity of perspectives within the industry, with lively discussion and debate across the panels and breakout sessions.The day began with a panel focused on the current state of litigation funding in Europe, which immediately demonstrated the changes in the regional market over the last 12 months. Whereas last year’s panel on this topic was dominated by discussion around the Voss Report and the looming prospect of further regulation, yesterday’s conversation was firmly focused on the increasing innovation in the market and an evolving landscape that has seen competing models of third-party financing develop.Litica’s Ed Yell emphatically stated that “the growth in Europe over the last year has been spectacular”, and Iain McKenny from Profile Investment described the current state of play as a “hot bed for evolution.” A core element of the panel’s conversation revolved around the growing formation of a secondary market for litigation finance transactions, with JBSL’s co-founder Sarah Lieber summarising it aptly: “Secondary trading is the hallmark of a maturing asset class, it’s necessary to think about from the beginning of every funding deal.”The second panel of the morning ventured into the economics of the market, looking at the different types of funder capitalization and the challenges faced by funders looking to raise capital in the turbulent market. The panellists explored the differences between the UK and US market, with Ted Farrell from Litigation Funding Advisers, highlighting the lack of portfolio funding deals in the UK and pointing out that “single case is always going to be super expensive.” Neil Purslow explained that from Therium’s perspective, portfolio deals in the UK “usually don’t work well and fail”, resulting in a pivot back towards single case funding.The first of two panels focusing on the role of litigation insurance saw a wide-ranging discussion that covered everything from the type of cover available, to the increasingly varied ways that funders, law firms and insurers are collaborating on deals. On this topic, Robin Ganguly from Aon, stressed the need for funders and insurers “to work together to make the industry sustainable,” emphasising that “deals have to be attractive to everyone or deals won’t get done.” All the panelists agreed that those seeking insurers needed to be more proactive and prepared, with Tom Davey of Factor Risk Management putting it in clear terms: “Get insurance when it’s available, not three weeks before trial.”Unsurprisingly, the following panel discussion on class actions and group litigation immediately turned to the subject of the Supreme Court’s PACCAR ruling. Echoing similar sentiments from speakers earlier in the day, most of the panelists agreed that funders and law firms were taking a pragmatic approach and exploring a variety of alternative structures for funding agreements and working closely with clients to find an optimal solution. Brown Rudnick’s Elena Ray provided the clearest overview of the situation, saying that firms “are not seeing a negative impact on the litigation funding space, so the parties have adjusted well to the PACCAR judgement.”Lara Melrose from Orchard Global described the UK’s group action market as “a very buoyant one” and noted that funders are benefitting from the courts’ flexible approach as demonstrated in recent decisions including the first amalgamation of claims in the CAT and the first application for a collective settlement. Alex Garnier of NorthWall Capital also pointed out that part of funders’ interest in class actions stems from the fact that “they’re not just fought in the courtroom they’re also fought in the court of public opinion”, thereby creating added pressure on large corporates to settle rather than “having their dirty laundry aired in court for months.”After a break for lunch and networking, the agenda once again returned to the topic of insurance, but with this panel putting an added emphasis on the lawyers’ perspective. Prompted by the panel’s moderator, Rocco Pirozzolo, the lawyers on the panel discussed some of the difficulties and frustrations they’ve faced when looking to secure insurance for a case. HFW’s Nicola Gare turned the question on its head, instead pointing out some best practices, with a particular emphasis on those funders who are able to give a prompt decision and explain their reasoning. Meanwhile, Jamie Molloy from Ignite Insurance, and James Gowen-Smith from Miller, both said that it was important for all parties to remember it was a collaborative relationship and that it always worked best where there was adequate transparency, and where insurers were involved in the strategy discussions as early as possible.The agenda turned from the present to the future in the next panel, with an insightful discussion around new models of delivering legal finance and how new technology, such as emerging AI tools, can be incorporated to fuel future growth. Nick Rolwes-Davis from Lexolent led the calls for more innovation and change in the funding process, arguing that the industry was “probably overdue a change” and that increased efficiency could be achieved by “using technology as a triage tool.” Ben Knowles of Clyde & Co. offered similar support for evolution within litigation funding, pointing out that from a law firm’s perspective, “if technology could improve that due diligence process, then hopefully more cases could be funded.”In the penultimate session of the day, Louise Trayhurn from Legis Finance, and Carlos Ara Triadu from Cuatrecasas, led the room in an engaging and entertaining interactive session. Trayhurn turned the tables on the audience, seeking out the varying perspectives of lawyers and funders on the evolving relationship between funders and law firms. Whilst some attendees were more hesitant than others, the live Q&A format provided an excellent change of pace and allowed for a free-flowing discussion about the unique challenges and opportunities around the lawyer-funder dynamic.For the final panel of the event, the focus shifted to developments in continental Europe and the ongoing implementation of the EU’s Directive on Representative Actions. The discussion, moderated by Joanna Curtis from Brown Rudnick, looked at the differing approaches to implementation across Europe, focusing on the panelist’s local jurisdictions of Germany, Ireland, and Spain. Whilst all the speakers agreed that the directive was a positive development overall, they also pointed out that in terms of enhancing access to litigation funding in Europe, it may not produce significant changes. Elaine Whiteford from Wilkie Farr & Gallagher highlighted that there are still “a number of critical issues that the initiative doesn’t address for funders” in Europe, with the use of funding still primarily limited by each country’s national laws on its permissibility.Overall, IMN’s second UK event managed to provide an insightful exploration of the litigation funding industry and provided attendees with a comprehensive view of the market, bolstered by insights from stellar thought leaders. Across a busy day of content, the forum offered a platform for a variety of perspectives, generating debates and discussions that will no doubt continue long after the event.LFJ looks forward to seeing how IMN continues to build on the success of the 2023 forum in the future.
Whilst much of the discussion at today’s IMN Forum has been focused on the current state of the litigation finance market, there was equal interest in the future of the industry and what ways the industry could create new improvements and efficiencies. Moderated by Jonathon Davidson, head of Middle East & Asia at Lexolent, the panel on ‘a new landscape in the delivery of legal finance’ explored how new technologies and new models for litigation funding could transform the market.The discussion began with the panelists exploring some of the systemic challenges that still exist in litigation funding, particularly around the difficulties for those seeking funding and the inefficiencies around the origination of funding opportunities.Ben Knowles, partner & chair of the global arbitration group at Clyde & Co., explained that the vast majority of funders are all concentrated on a small subsection of cases. This results in frustration for those seeking funding for smaller or less valuable cases, with Knowles explaining that “for anything that’s not right in that sweet spot it’s difficult to get those funding discussions going.” He also pointed out the experience of seeking funding is often “a grim process”, citing many times where lawyers can spend over a year working up a case and engaging with funders, only for nothing to come of it and then “it’s too late for the case to be picked up by someone else.”Following on from Knowles’ commentary on the frustrating nature of accessing funding, Nick Rowles-Davis, CEO of Lexolent, agreed with this assessment and expressed his frustration saying that “it is an incredibly torturous process, there doesn’t seem to a huge element of urgency on the part of funders to get things done.” He went out to explain that from a funder’s perspective there is a “need to streamline origination”, as funders will often spend huge amounts of time and resources to consider a hundred cases only to actually invest in three of them.Offering new strategies to improve these processes for all parties, Ludwig Bull, CEO of CourtCorrect, put forward the utility of large language models (LLMs) and AI tools to assess cases and streamline many of the due diligence processes, arguing that “we are seeing a paradigm shift when it comes to using this technology.” He went to illustrate CourtCorrect’s experience providing these tools to clients and how quickly people get used to the technology and can improve the efficiency of their own work, emphatically stating that “We’re not talking a 2x increase in productivity, we’re talking 3x productivity.”Providing insight into the unique challenges faced by insolvency practitioners seeking funding, Kristina Kicks, managing director at Interpath Advisory, once again stressed the need for efficiency in funding proposals as, from the perspective of an insolvency professional, “having decisions on funding more quickly means I can get better returns for creditors.” She also called for increased clarity and uniformity in the funding proposal process, as insolvency practitioners “need to demonstrate that we’re entering into a funding agreement with the best possible deal for creditors.”
As expected, the thriving class action landscape has been a prominent topic at IMN’s International Litigation Finance Forum, with the final panel of the morning focusing on developments in class action and group litigation. The discussion was led by Andrew Jones, director at Fortress Investment Group, who guided the conversation across everything from recent changes in the class action process, to the ethical considerations for funders and lawyers, and managing origination risks.John Astill, managing director at Exton Advisors, kicked off the discussion with a detailed overview of the differing approaches taken by funders as they have been responding to the Supreme Court’s PACCAR decision. He noted that whilst there has been some divergence in pricing, most increases in multiples have been very reasonable and that when reviewing new structures, “we have to be very careful on the impact that has on the stakeholders.” Astill went on to explain that whilst there are already several different approaches being taken in restructuring LFAs, such as introducing IRRs as a floor for duration risk, he suggested that “we will see more divergence as the market matures.” Furthermore, Astill stated that PACCAR hadn’t resulted in a downturn in demand for finding, instead they have been “seeing more appetite for law firm arrangements.” Elena Rey, partner at Brown Rudnick, offered an optimistic perspective on concerns that had been raised that the PACCAR ruling would lead to a series of client-funder disputes. Rey explained: “We are not seeing a lot of disputes, we are working one or two coming out of PACCAR, but mostly our clients (law firms or funders) were able to mutually agree on new arrangements. We are not seeing a negative impact onto the litigation funding space, so the parties have adjusted well to the PACCAR judgement.”Moving to a more general discussion of the opportunities and challenges involved in funding class actions, Alexander Garnier, founding partner at NorthWall Capital, highlighted that it remains “a high risk space compared to some of the assets we invest in.” He described it from the investor’s perspective by saying “it’s often sailing uncharted waters, so the returns need to reflect that”, but he also noted that “it’s not just about financials, this is about levelling the playing field for people who have been wronged.”Looking at the changing environment for the funding of class actions, Lara Melrose, co-head litigation finance at Orchard Global, said that “the fundraising environment is challenging, the cost of capital is going up, there are other asset classes which are more attractive to investors than these long duration, high risk claims.” However, she also countered this by asserting that it was not a wholly treacherous climate for class action funding and said, “on the positive side, the courts are demonstrating a flexible and pragmatic approach to facilitating these claims.”Bringing the perspective of law firms back into the discussion, Becca Hogan, partner at Signature Litigation, suggested that one of the most noticeable trends was a recent but noticeable cultural change within the UK that has seen people become more comfortable with participating in claims compared to previous years. Hogan added that this has been supported by the “courts’ willingness to take a more pragmatic approach to group claims, which has driven the increase in class actions.”
As the Co-Founder and CEO of DealBridge.ai, Jon Burlinson has over 25 years of experience in information management, software engineering, and technical management. He is passionate about delivering advanced SaaS solutions that leverage AI and data analytics to automate tasks, optimize decision-making, and provide valuable insights, ultimately enhancing efficiency and driving better deal outcomes. Company Name & Description: DealBridge.ai is the first Deal Relationship Management (DRM) platform, revolutionizing the way private market deals are handled. Harnessing the power of Generative AI and other advanced algorithms, DealBridge.ai automates the complexities and non-linearity of deal-making. The platform streamlines origination, due diligence, and distribution of private assets, eliminating traditional, labor-intensive processes. DealBridge.ai empowers sellers and buyers of alternative products to connect effortlessly at the deal level, enhancing the overall human experience and allowing users to focus on building and nurturing valuable relationships. With automation at its core, DealBridge.ai maximizes revenue potential and elevates deal-making capabilities in private markets. Company Website: https://DealBridge.aiYear Founded: 2021 Headquarters: New York Area of Focus: Building solutions for the litigation finance community. He aims to solve core issues that have plagued the space for years, facilitating more efficient and effective deal management for all stakeholders. Member Quote: "Litigation finance evens the odds, granting access to legal recourse for parties who might otherwise be outmatched. Advanced technologies such as AI and blockchain are becoming game-changers in the litigation finance sector. They are instrumental in transforming the way we handle legal transactions, making them more transparent, streamlined, and accessible to all stakeholders involved."
IMN’s agenda continued with a panel focused on the role of litigation insurance in the funding market, with the panelists attempting to answer the question: ‘how can litigants and funders use insurance to de-risk and monetize litigation and arbitration?’ Moderated by Simon Warr, lead underwriter for legal expenses at AmTrust International, the panel discussion explored the range of products being used in the industry, which types of insurance policies are seeing growth, and how funders, insurers and lawyers can continue to enhance their collaborations.Beginning with a discussion of the different types of litigation insurance that is available, the panelists focused on the prevalence of after-the-event (ATE) insurance in the UK market, whilst also putting a spotlight on the explosive growth of judgement preservation insurance (JPI) in the US. Robin Ganguly, executive director, UK & EMEA for Aon, highlighted the “huge explosion in the JPI market” and explained that as that market has matured, they are seeing a shift from “pure JPI” and towards “working with funders on a diversified portfolio basis.”The panelists also discussed the warning signs that insurers look for when receiving enquiries, with Tom Davey, co-founder of Factor Risk Management, providing the audience with some straightforward advice: “Do your homework, prepare well and take your broker’s advice.” Nathan Hull, director at VALE Insurance Partners, emphasised the importance of timing and citing situations where they receive “enquiries where the hearing has taken place and then they want to take out insurance before the judgement has come out.” The other panelists focused on the issue of due diligence during these enquiries, as Rocco Pirozzolo, underwriting director at Harbour Underwriting, highlighted that there are real issues where clients fail to give adequate responses to supplementary questions. He encouraged prospective insurance buyers to not “be shy about the fact that there might be issues with the case.” Boris Ziser, partner at Schulte Roth & Zabel, also emphasised that there can be related risks for the insurer depending on the client, as he said that “depending on who you’re insuring, there can be a moral hazard.”Moving on to the future of the industry, Ziser highlighted that they are seeing “a lot of insurance for mass tort or collective actions cases.” Davey built upon this point and suggested that one possible reason for this increase in activity is due to the fact that “collective actions in the UK are effectively stepping into the shoes where regulators should be, the law is filling the gap.” In the US, Hull returned to the topic of JPI and stated that its popularity in the US was “because you can not only insure the judgement award but you can monetise it.” Ending with a note of caution for the industry, Pirozzolo expressed concern that there was still not enough education and communication between lawyers and their clients about the use of insurance to manage risk. He stated that he was “not convinced those conversations are happening at a high level,” and suggested that “this is where the value of a broker comes in, when solicitors don’t feel comfortable having to explore the risk appetite of their clients.”
The opening panel of IMN’s Litigation Finance Forum in London provided a lively discussion around the topic of ‘The Current State of the European Litigation Finance Market’. The panel, which was moderated by Rosie Ioannou, director – legal assets at Fortress Investment Group, covered everything from the ongoing drivers of change in the market, to the innovation and competition between competing models of third-party financing.Tackling the question of what is fueling the pace of change in the market, Sarah Lieber, co-founder of JBSL, explained that “the primary driver of change is the institutionalisation of the asset class”, with the growing diversity of types of investor and capital involved leading to changes in deal structuring. Iain McKenny, director and co-founder of Profile Investment, highlighted that funders are facing pressure from both “internal and external sources”, which has led to a “hot bed of evolution […] and as a consequence you get these competing models” for litigation funding.Turning to the role of insurance in the European market, Edward Yell, managing director at Litica, stated that “the growth in Europe over the last year has been spectacular”, but emphasised that “there isn’t a single European approach” due to the differing requirements across individual jurisdictions. Yell also pointed to the entrance of new participants to the market resulting in growing sophistication in deal types, explaining that as “it’s harder to deploy capital into Europe, funders have had to be more creative to make the deals worthwhile.”Speaking from the perspective of law firms who work on the defence side of litigation, Alice Darling, senior associate at Clifford Chance, explained that there are numerous barriers to entry for defendants including a lack of awareness and a lack of desire to engage with funders. In particular, Darling said that there is a “hesitancy about bringing a third party into the case if they don’t need to”, especially where a corporate doesn’t necessarily need the capita,l and where reputational risks are high. When it comes to that issue, Darling noted that the “Burford-Sysco case did not help the narrative” around litigation funding.Looking at potential future developments for the European market, Lieber stated that “secondary trading is the hallmark of a maturing asset class,” and that moving forward it will be “necessary to think about from the beginning of every funding deal.” Yell returned to the relationship between insurers and funders, asserting that whilst the two businesses are not direct competitors at the moment, “there are products coming onto the market where you could achieve the same effect with an insurer as you would with a funder.”Darling closed the panel with an overview of developments in regulation and case law, highlighting that we would not see the real impact of PACCAR for a while, whilst the Voss Report has “gone into the long grass of the European Commission.” McKenny also suggested that a lot of the calls for regulation of third-party funding in Europe “are actually really about concerns with the litigation system rather than about funding itself.”
Wendie Childress is an experienced commercial trial lawyer and litigation funder with an extensive and deep network across the U.S. legal and funding market. She joined Westfleet Advisors in 2023 after years of working with funding pioneers at Validity Finance and well over a decade of practicing commercial litigation at powerhouse boutique Yetter Coleman, one of the nation's premier boutique trial law firms.
In her private practice, Wendie had a winning track record representing both plaintiffs and defendants in commercial disputes across a variety of industries, including energy, financial services, healthcare, and IT. She graduated with Honors from the University of Texas at Austin, where she earned her JD in 2000. She then served for two years as General Counsel to the Texas Senate Committee on Business and Commerce. Wendie has been named to the Lawdragon "Global 100 Leaders in Litigation Finance" list and a "Houston Top Lawyer" in Business & Commercial Litigation by H Texas Magazine. She is a member of the State Bar of Texas, Texas Bar Foundation, Houston Bar Association, and Women of Litigation Finance Steering Committee. Company Name and Description: Westfleet Advisors is the most experienced litigation finance advisory firm in the world. Our core mission is to make litigation finance work better for lawyers and their clients by equipping them with the transparency, expertise, and resources they need to secure the best terms with the right capital partner. Company Website: https://www.westfleetadvisors.com/Year Founded: 2013 Headquarters: Nashville Area of Focus: As Managing Director and Counsel in the Westfleet Advisors Houston office, Wendie works directly with clients and their counsel in evaluating opportunities for litigation finance transactions and advising and shepherding them through all stages of the process to ensure that they get the best possible experience and terms. Member Quote: "As a former trial lawyer and member of the litigation funding community, I have seen firsthand the need for balanced access to justice for all litigants and how funding presents an innovative and valuable way to mitigate risk and bring good cases to trial. I am so impressed with the quality of counsel and professionals within the litigation funding industry who are a pleasure to work with and eager to partner with firms and help clients succeed. I also see sweeping changes across the industry as it matures and evolves with intra-market movement, new entrants appearing daily, and new and creative solutions being derived to meet the market's changing needs. As a member of the Westfleet team, my goal is to help clients and their counsel navigate this dynamic industry to have successful outcomes with their funding experience and ultimately, their cases."
Law Finance Group (LFG) has announced that Brendan Dyer has joined its team, taking on the position of Funding Director and based on the East Coast. Dyer arrives at LFG with a depth of experience in both litigation funding and the wider legal sector, having most recently held the position of Vice President, Business Development at Woodsford. Prior to that, Dyer had served as the Manager of Pricing and Project Management at Goodwin, and as Senior Pricing and Business Analyst at Wilmer Hale. Dyer also founded a legal finance brokerage, LongRock Advisors, providing deal origination for commercial litigation finance.In the announcement, Dyer stated that he was “excited to work with a diverse group of colleagues and to be part of a funder with LFG’s singular longevity.” Explaining his reasoning for joining the funder, Dyer went on to emphasise “LFG’s client focus and commitment to building long-term strategic partnerships.”LFG’s president & CEO, Kevin McCaffrey expressed that they were “thrilled to be adding Brendan to the LFG team”, highlighting that Dyer’s experience “in strategy and pricing for three AmLaw firms gives him a keen understanding of law firm economics and the attendant operational constraints.” McCaffrey added that Dyer’s “ability to put himself in the shoes of all parties in the funding agreement” would further enhance LFG’s services and its “ability to provide bespoke and creative financial solutions.”
There are few issues concerning litigation finance that have received more scrutiny and commentary than the ongoing debates around transparency in third-party funding, and conversely, the level of confidentiality that is afforded to lawyers and clients who engage with funders. To provide detailed guidance for industry participants, a leading litigation finance broker and adviser has published a new study that offers detailed insights into recent developments regarding confidentiality in litigation funding.Westfleet Advisors has published a new edition of its white paper, ‘Litigation Funding and Confidentiality: A Comprehensive Analysis of Current Case Law’, which aims to provide a thorough analysis of court decisions on the ‘confidentiality of information and documents about litigation funding.’ The report notes in its introduction that the number of decisions on this subject have risen dramatically over recent years, with Westfleet’s study analysing a total of 106 court decisions.The white paper explains that there has been a common misconception that ‘lawyers were unable to predict whether a court would compel discovery of information shared with a commercial litigation funder because few decisions existed on the issue.’ It goes on to explain that despite the lack of concrete appellate court rulings on the subject, ‘enough case law exists to see the shape and trend of the law on these questions.’Through its analysis of these 106 trial court decisions, Westfleet found that in most cases (68%), the court denied or limited discovery of any communications with litigation funders or the actual litigation funding agreements. The report also looks at the volume of decisions on this subject over time, and found that ‘since 2011, each year has seen more courts denying discovery requests related to litigation funding than granting them.’ This has been consistently true, despite the fact that the number of rulings concerning confidentiality of litigation funding has risen over the last decade.The full report, which delves into the specifics of these decisions, the reasoning that the courts applied, and the conclusions that can be drawn from these trends, can be read here.
As legal departments in companies across every sector face increasing pressures on their budgets and litigation strategies, funders are keen to demonstrate the different ways in which they can provide support, both through direct provisions of capital and by lending their expertise in litigation matters.In an insights post from Omni Bridgeway, Carrie Freed and Matt Leland offer an overview of the challenges facing legal departments using preferred legal panel (PLP) programs, and how in-house counsel can use litigation funding to enhance these PLPs. The use of third-party funding by in-house attorneys allows these teams to ease budget pressures, whilst still maintaining sustainable relationships with high quality outside counsel. Looking at the benefits available to legal departments, Freed and Leland begin by stating the most immediately apparent benefit that by using litigation funding, ‘the company reduces its financial risks by capping or possibly eliminating its legal fees for the life of the litigation.’ Furthermore, the rigorous analysis that funders undertake before financing a case is a useful tool for ensuring the strength of the claim, which can provide ‘reassurance to in-house counsel, business partners, and directors who might be wary about filing a claim.’ In addition to verifying the merits of a claim, funders can also bring a wealth of experience both from their teams and the vast number of past engagements with similar cases, providing in-house counsel with ‘fresh perspectives about strategy or to pressure-test arguments.’Freed and Leland therefore recommend that companies incorporate litigation funding into their PLPs, firstly by educating their law firms about funding opportunities and then by including ‘litigation funding provisions in PLP documents’. They suggest that this could include a variety of provisions, such as setting the expectation that a law firm would ‘solicit at least one proposal for litigation funding when pitching for a plaintiff-side case.’
Doorway Capital, a specialist in legal funding solutions,has launched a new funding product designed to support law firms looking for M&A opportunities to achieve their growth ambitions.
The Shelf Facility provides a firm with pre-agreed access to funding - the facility is fully underwritten and documented in advance of being required, with funds being made available as they are needed. This structure allows firms to actively pursue acquisition opportunities in the knowledge that they can act swiftly and decisively when they find the right target.
The product is an extension of the flexible solutions Doorway Capital has been offering law firms since 2015, including funding for the merger of Moore Blatch and Barlow Robins, and various acquisitions made by AWH Solicitors, Simpson Millar and other firms.
“Doorway Capital’s new shelf facility is a gamechanger” saysAbdul Hussain, Chief Executive of AWH Solicitors. “It means that we can secure access to additional funds when we find a suitable investment opportunity in the M&A market without having to wait on credit approval.”
The launch comes in response to increased demand from across the sector, with leading M&A broker, Acquira Professional Services, reporting more than 60 M&A deals in 2023 to date, with a spike expected shortly to coincide with the PII renewal season.
“Over the last 18 months, law firms have increasingly asked Doorway for a funding commitment that can be established in advance of needing to draw upon it” says Steve Din, founder of Doorway Capital. “The catalyst for this is, undoubtedly, the desire for law firms to make acquisitions and ensuring acquisition funding is available to be drawn, often, at very short notice.”
Doorway Capital has been providing specialist funding solutions for UK law firms since 2015. Facilities are typically written up to values of £20m and tailored to clients’ individual needs.
“The team at Doorway Capital are extremely knowledgeable – they spent time and effort designing a facility that gave us the depth and flexibility we needed at a crucial time in our growth. I couldn’t recommend a better funding partner for a law firm.” – Shane Hensman, CEO of Cordus Law.
As Doorway’s founder, Steve Din, was a former managing director of the global investment bank Morgan Stanley and European Head of Restructurings at Citigroup, it is no surprise that Doorway has chosen to pay close attention to the needs of law firms looking to grow by acquisition.
As we continue to see a growing number of high profile class actions in Australia, industry leaders are keen to look at how the class action landscape in Australia will evolve and how it can be improved.In a post on LinkedIn, The Association of Litigation Funders of Australia (ALFA) announced the agenda for its upcoming Future of Class Actions in Australia conference, which will be held at Herbert Smith Freehills’ Sydney office on 27 October 2023. The half-day event will cover a wider range of topics including the current trends in Australian class actions, the future of court approval and settlement administration, and potential strategies for reducing the costs of class actions.The event will be bookended by two keynote addresses, opening with an address from the Hon Justice Michael Lee, Federal Court of Australia, and closing with a keynote from the Hon Justice Sarah Derrington AM, Federal Court of Australia.The three panel sessions during the afternoon will feature a range of speakers including senior leaders from Australia’s top law firms, funders, and insurers. Among the representatives from litigation funders set to speak are Stuart Price, CEO of CASL, and Kristen Smith, portfolio manager and senior investment manager at Omni Bridgeway.Limited in-person tickets for the vent are still available here, whilst unlimited virtual passes can be purchased here.
Whilst industry commentators are still debating the potential impact of the Supreme Court’s PACCAR ruling on the enforceability of litigation funding agreements (LFAs), new court rulings in related practice areas are being analysed to see whether they offer lessons for funders post-PACCAR. The most notable in recent weeks has been a Court of Appeal ruling which dealt with the issue of severance of terms for a conditional fee agreement (CFA). A new insights piece from LCM’s senior investment manager, James Foster, examines the recent decision from the English Court of Appeal in Diag Human v Volterra Fietta [2023] EWCA Civ 1107, looking at how the ruling may prove instructive on the issue of severance in LFAs, in a post-PACCAR world. This issue of the ‘severance of offending contract provisions’, is particularly important for LFAs which not only have a clause for a funder’s return to be calculated from a percentage of damages, but also have additional clauses for the return to be calculated on a different basis.Foster begins by highlighting the existing case law from the Supreme Court’s ruling in Egon Zehnder Ltd v Tillman [2019] UKSC 32, which lays out the conditions that must be met for contracts to remain effective after the removal or severance of an unenforceable provision. He goes on to examine the Court of Appeal’s judgement and reasoning, highlighting the court’s position that in this case, ‘public policy considerations alone precluded severance, irrespective of compliance or non-compliance with the three stage test.’Turning to the decision’s relevance to LFAs, Foster explores whether an LFA, with additional clauses laying out differing methods for calculating a funder’s return, would violate the third condition of the Tilman ruling that specifies that the removal of an unenforceable provision must not ‘change the character of the contract that it becomes “not the sort of contract that the parties entered into at all”.’ Foster argues that severance of one provision for a funder’s return does not change the nature of the contract that the parties willingly entered into, as the use of any other provision for a funder’s return means that, ‘in all other respects the bargain struck between the parties in the LFA would be exactly the same.’Furthermore, Foster argues that the public policy considerations are unlikely to be applicable in relation to LFAs, stating that, ‘it would not be possible to argue (as it might be in the case of lawyers who act under non-compliant CFAs or DBAs) that the reward arrangements pre-severance were both illegal and unenforceable and so should not be saved by severance.’In recent days, other industry experts have also offered their own views on the impact of the Diag Human ruling. Martyn Griffiths, of Gatehouse Chambers, acknowledged that funders and their opponents will make differing arguments as to the applicability of the Diag Human decision to LFAs. However, he concluded his analysis by emphasising that the courts ‘will have to consider whether the funder should face the full consequences of the un-enforceability of their agreement or whether to allow those consequences to be ameliorated or avoided by permitting severance or the payment of a quantum meruit.’In a piece for Sentry Funding on LinkedIn, Rachel Rothwell suggested that the Court of Appeal’s judgement ‘may not be seen as particularly helpful to the plight of litigation funders’, and that the main lesson is that for those ‘drawing up fee agreements with clients, make sure you get it right.’
Susanna Taylor is Head of Investments – APAC, for Litigation Capital Management (LCM). Susanna leads LCM’s team of Investment Managers in Australia and Singapore and is responsible for overseeing the sourcing, due diligence and management of LCM’s investment activities across the APAC region. Susanna is a highly experienced and skilled operator being active in the litigation funding industry since 2014 when she joined LCM. Since that time Susanna has been responsible for sourcing, underwriting and managing a large and diverse portfolio of dispute projects consisting of commercial disputes, class actions, insolvency claims and international arbitration. Susanna sits on LCM’s investment committees for both APAC and EMEA and is intimately involved in the operational aspects of LCM’s business, taking part in regulatory and compliance and capital raising activities, investor relations and the expansion of LCM to new jurisdictions. Prior to joining LCM in 2014, Susanna was a litigation specialist with Norton Rose Fulbright in Sydney where her practice canvassed class actions, financial institutions disputes, contentious regulatory work (including work for the Australian Competition and Consumer Commission) and corporate disputes. Before joining Norton Rose Fulbright, Susanna practised in London for UK firm Hammonds Suddards Edge where her focus was on construction litigation. Susanna’s Chambers and Partners profile describes her as “one of the top operators in the industry,” and as “an extremely impressive litigation funder with a strong ability to cut to the commercial reality of claims.”Company Name & Description: LCM specialises in providing bespoke dispute finance solutions to facilitate the pursuit and successful recovery of funds from legal claims, while protecting our clients from the downside risk associated with disputes. Founded in 1998, LCM is one of Australia’s most experienced and successful disputes finance companies. LCM has completed over 260 cases and has assisted hundreds of companies and individuals in achieving significant recoveries from claims that, without LCM, may not have been pursued due to the associated costs and risks. All of LCM’s Investment Managers are former litigators with the level of experience required to facilitate successful outcomes in disputes. LCM’s team is highly skilled in the assessment of claims and in providing strategic assistance throughout the process of determining the dispute. LCM has an unparalleled track record, driven by effective project selection, active project management and robust risk management. LCM’s capability stems from being a pioneer of the industry with more than 25 years of disputes finance experience. LCM is listed on AIM (at the London Stock Exchange), trading under the ticker LIT. Company Website https://lcmfinance.com/ Year Founded: 1998 Headquarters: Headquartered in Sydney, with offices in London, Singapore, Brisbane and Melbourne Area of Focus: Arbitration, Insolvency Claims, Commercial Claims, Class Actions Member Quote: “Disputes finance is a risk management tool which allows a variety of claimants from small to large to leverage their dispute assets in order to transfer the costs and risk of a dispute to a third party funder. Being involved in structuring these finance solutions and sitting alongside claimants to assist them to reach a successful outcome makes this a very rewarding industry to be a part of“.
Ireland's litigation funding laws differ from those of the United Kingdom and other common law jurisdictions. Dispute resolution investment in Ireland is broadly illegal under champerty and maintenance crime statutes, however, Ireland's Courts and Civil Law Act 2023 offers a new legal framework that permits the use of third party funding products and services for international arbitration proceedings in commercial disputes. Mondaq reports lawmakers in Ireland are embracing litigation finance as a tool for citizens' access to justice. The Representative Actions for the Protection of the Collective Interests of Consumers Act 2023 is a positive step to decriminalize third party funding in international arbitration in Ireland. Furthermore, recommendations to expand legalization of litigation funding vehicles in Ireland have included insolvency, liquidation, receivership and bankruptcy actions. The Law Reform Commission continues to explore and examine policy considerations that decriminalize litigation investment in Ireland. According to Mondaq, Ireland's Department of Justice is working to publish additional policy findings on litigation finance by the second quarter of 2024.
The video game industry has seen tremendous growth over recent decades, with research from PwC projecting that it could generate more than $300 billion in revenue by 2026. However, this rising tide has also brought with it allegations that some of the largest gaming companies have engaged in anti-competitive and anti-consumer practices, resulting in claims being brought with increasing regularity.A LinkedIn post and announcement from Milberg London LLP reveal that the law firm has secured ‘a substantial funding package’ from Bench Walk Advisors to bring a claim against Valve Corporation, one of the world’s largest gaming companies. The opt-out competition claim focuses on allegations that Valve’s digital distribution service and storefront, Steam, used ‘excessive pricing and anti-competitive price parity clauses, with the aim of ensuring fair competition in the digital gaming marketplace.’The intended claim will be filed with the UK’s Competition Appeal Tribunal (CAT), with Vicki Shotbolt, founder and CEO of Parent Zone, acting as the proposed class representative. Shotbolt is working with Milberg London, as well as barristers from Monckton Chambers including Robert Palmer KC, Julian Gregory, and Will Perry. This is notably the second opt-out claim that Milberg London has brought against a gaming corporation, having already brought a claim, worth up to £5 billion, against Sony Playstation for alleged abuses of its monopolistic position.
Silver Bull Resources, Inc. (TSX: SVB, OTCQB: SVBL) (“Silver Bull” or the “Company”) is pleased to announce that following the entering into the litigation funding agreement with Bench Walk Advisors LLC (the “LFA”), the Company has established a Management Retention Agreement (“MRA”), which is a long-term incentive program to retain key personnel of the Company who have important historical information and knowledge to contribute towards the Claim.The MRA provides that if the international arbitration claims against Mexico for breaches of its obligations under NAFTA (the “Claim”) is successful and the Company receives damages proceeds, 12% of the net proceeds will be directed to the MRA for distribution to its participants, which include Timothy Barry, President, CEO and Director, Brian Edgar, Chairman of the Board, Christopher Richards, CFO, Juan Manuel Lopez Ramirez, and David Xuan.Each participant must satisfy specific Claim related duties and if they do so, each participant may be entitled to a pre-defined percentage of the proceeds received by the MRA.Certain participants under the MRA constitute related parties of the Company and accordingly the MRA constitutes a “related party transaction” of the Company under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The Company is relying on the exemption from the requirement to obtain a formal valuation pursuant to section 5.5(g) of MI 61-101, which provides an exemption where the criteria set out therein are met.The Toronto Stock Exchange (the “TSX”) has provided their conditional approval of the MRA, including that the MRA be approved by the Company’s disinterested shareholders at the next Annual Meeting of Shareholders, which will also be sought in compliance with the requirements for minority shareholder approval under MI 61-101.
In a LinkedIn post, Balance Legal Capital announced that it had bolstered the strength of its Australian team, with the hiring of Patrick Crisp as an Investment Manager. Crisp joins the funder’s Sydney office having previously provided consulting services to the litigation funding industry and having spent 10 years at Freshfields Bruckhaus Deringer, as a senior associate in the firm’s commercial disputes team. Crisp is a qualified solicitor with experience in litigation matters across Australia, the UK, and in offshore disputes.Balance Legal Capital’s Australian operations are led by Simon Burnett and Kylie Ansbro, with Burnett also a director of the Association of Litigation Funders of Australia (ALFA). Olivia Pinto serves as managing director for Australia, from the firm’s Sydney office, whilst Fraser Shepherd acts as senior advisor to the investment committee for the funder’s activities in Australia and New Zealand. Crisp is now the second investment manager in Balance Legal Capital’s Sydney office, joining Maya Shallita, who was also appointed as ALFA’s company secretary in September.
For litigation funders, reaching a successful resolution to a case is rarely as simple or straightforward as achieving a favourable judgement or award, with the inevitable difficulty of enforcement and recovery proving to be its own separate battle. This is once again being demonstrated in the high-profile YPF case funded by Burford Capital, as Argentina continues its fight to avoid paying the multi-billion-dollar award.Reporting in the Buenos Aires Times and Bloomberg Law provides an update on the latest development in the case of Petersen Energia Inversora, S.A.U. v. Argentine Republic, as the Argentine government has formally appealed against Judge Loretta Preska’s order to pay $16 billion to the shareholders of YPF. The appeal was filed this Tuesday in the US Court of Appeals for the Second Circuit. As LFJ reported last month, Burford Capital had already moved to begin collecting the award and asked the court to begin attaching Argentine assets from October 16th.In filing the appeal, Argentina argued that forcing the government to pay the award would inflict “irreparable damage to the [Argentine] population, which suffers from high inflation caused by an unprecedented drought.” The appeal also emphasised that the Argentine government “does not have access to the capital market to issue a bond and deposit a guarantee.” The appeal was filed this Tuesday in the US Court of Appeals for the Second Circuit.
The financing of patent litigation remains one of the most popular areas of investment for litigation funders, whilst also being the site of frequent contentious showdowns in recent years, as US courts have pressed for increasing levels of disclosure and transparency. However, new market research also highlights that the volume of patent infringement filings by non-practicing entities (NPEs), who often have ties to litigation funders, has fallen over the last quarter.Earlier this week, RPX released its Q3 in Review report and highlighted several key trends from the world of patent litigation, including a particularly interesting trend around NPE filings in the third quarter of 2023. RPX found that across those three months, “NPEs added 382 defendants, down 32% from the same quarter this past year (when NPEs added 558 defendants).” The report also noted that these figures represented a 12% reduction compared to the second quarter, as well as a 31% drop from the trailing Q3 average measured between 2020 and 2022.RPX attributes this reduction in NPE filings, both in this quarter and across 2023, to the significant absence of filings from IP Edge since December 2022, and a decrease in filings in the Western District of Texas since last year’s court order which attempted to redistribute patent litigation across districts. However, RPX did highlight that IP Edge’s extended hiatus finally came to an end on September 13, with a new lawsuit targeting Roku. The plaintiff in this case is Communication Advances, which is another entity created by IP Edge’s principals: Lillian Woung, Gautham Bodepudi, and Sanjay Pant.In an additional point relevant to litigation finance, RPX noted that two Burford special purpose vehicles (SPVs) avoided sanctions from Judge Todd W. Robinson in the Southern District of California, over its funding of Taction Technology’s case brought against Apple. Whilst Burford’s SPVs did not receive sanctions for a potential violation of their ‘duty of candor’ to the court, Judge Robinson did rule in favour of Apple and granted a summary judgement of noninfringement.
Whilst class actions in the UK, US and Europe often receive more coverage, Australia continues to demonstrate its place as one of the top jurisdictions for class actions, particularly those cases that benefit from third-party funding. This is once again demonstrated by news today that a major class action brought against McDonalds has scored two significant victories.In a post on LinkedIn, Michelle Silvers, CEO of Court House Capital, provided an overview of two major developments in the class action being brought against McDonald’s in Australia by Shine Lawyers. Court House Capital is providing funding for the claim.Firstly, the Federal court of Australia rejected an application to stay the class action, allowing the case to proceed to a case management hearing in 21 days. Secondly, the Full Court of the Federal Court ruled that it had the power “to order that a portion of settlement monies be paid to the litigation funder, Court House Capital, supporting the action, upon approval of any settlement – a so called Settlement Common Fund Order.”The class action focuses on allegations that McDonald’s failed to give its workers a paid 10-minute break when they were working shifts of four hours or more. This refusal to provide paid breaks was in contravention to McDonald’s Australia Enterprise Agreement 2013 (EBA) and the Fast Food Industry Award 2010 (Award). The class action is also being supported by the Retail and Fast Food Workers Union (RAFFWU).Commenting on the ruling, Silvers said, “We now look forward to progressing the class action for the thousands of group members represented by Shine Lawyers and funded by Court House Capital.”
The European Litigation Funding Association (ELFA) is delighted to announce that Litigium Capital has become the latest member to join the organisation. “Joining ELFA is a natural step for Litigium Capital. From a European perspective, the legal financing market is still evolving and, as such, subject to continuous development and innovation. It is essential that key players within the market set standards for, and monitor, responsible operations. By joining ELFA, we continue our commitment to industry best practice in our mission to further develop litigation funding in our home markets”, says Litigium Capital’s CEO, Thony Lindström Härdin. Omni Bridgeway Managing Director and ELFA Chairman, Wieger Wielinga commented: “I am delighted to welcome Litigium Capital as the latest ELFA member and first Nordic based litigation funder. Litigium’s core mission to establish litigation funding as a well-recognised and widely used form of financing in the Nordics, aligns perfectly with ELFA’s aims. We look forward to collaborating with Litigium founders, Thony Lindström Härdin and Oscar Holm.” About ELFA:ELFA was founded by three leading litigation funders with a European footprint, Deminor, Nivalion AG, and Omni Bridgeway Limited. ELFA's current directors are Charles Demoulin (Chief Investment Officer, Deminor); Marcel Wegmüller (Co-Founder and Co-CEO, Nivalion AG); and Wieger Wielinga (Managing Director EMEA, Omni Bridgeway), who is ELFA's Chairman. The intention of the association is to be inclusive for all professional litigation funders of larger or smaller size. About Litigium:Litigium Capital is a Swedish investment company dedicated to legal financing. Litigium Capital focuses on funding litigation and arbitration disputes in the Nordics, as well as funding Nordic clients globally. Combining legal and financial expertise for superior risk www.elfassociation.eu 2 assessments and customer service, Litigium Capital’s vision is to make legal financing a natural tool for companies of all sizes in the Nordics.
Despite the ongoing discussions around the fate of litigation funding for class action claims in the UK, we are still seeing positive outcomes in ongoing claims before the Competition Appeal Tribunal (CAT). Reporting by Commercial Dispute Resolution (CDR) provides an update on the Car Delivery Charges claim, which has seen the impressive milestone of a settlement being reached today. Although the claim has been brought against five separate shipping companies, this settlement is between only one company, CSAV, and the class representative Mark McLaren. In the opt-out claim that is funded by Woodsford, McLaren is representing both UK consumers and businesses who had bought or leased vehicles from one of five international shipping companies: MOL, “K” Line, NYK, WWL/EUKOR and CSAV, between 2006 and 2015. The claim alleges that these companies engaged in a price-fixing scheme, following a European Commission ruling in 2018 which found that these corporations had violated the European Union’s competition laws and issued a fine of €395m.Now that the settlement with CSAV has been reached, both the law firms representing the claimants and CSAV have submitted an application for the CAT to approve the settlement. The CAT will consider the application at a hearing on 6 December 2023. However, it is important to note that CSAV’s market share is the smallest of all five defendants, at only 1.7%, with the other four defendants set to continue to fight the claim at trial in 2025.McLaren highlighted that the settlement was important not only for this case, but was “also a significant development for the wider UK collective action regime.” Steven Friel, CEO of Woodsford described the outcome as a “pioneering settlement, which demonstrates the power of litigation funding to help hold large companies to account for their wrongdoing, in this case cartel behaviour.”
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