California lawmakers have sent Governor Gavin Newsom legislation that would prohibit litigation funders, private equity firms and other outside investors from influencing case strategy, settlement decisions or client intake at law firms they finance.

As reported by the Edinburg Post, Assembly Bill 2305, authored by Assemblymember Ash Kalra (D-San José) and sponsored by the Consumer Attorneys of California, cleared the legislature with bipartisan support as part of a two-bill package alongside AB 2039. Law firms would also be barred from using investor money to market for cases. A spokesperson for the governor's office said it does not comment on pending legislation.

According to an analysis by Holland & Knight, the bill defines "corporate investors" broadly to capture private equity groups, hedge funds, investment firms and non-attorney corporations whose primary purpose involves raising or managing capital, and applies regardless of whether the practice is organised as a partnership, professional corporation or LLC.

The prohibited conduct list is detailed. It covers determining which clients to represent, the scope of representation, the financial terms of representation, legal strategy, whether to file or dismiss claims, settlement decisions, the presentation of evidence, the conduct of discovery and appellate or procedural choices. Contractual provisions granting investors that control would be void.

Enforcement runs through several channels: State Bar discipline against attorneys, statutory damages of $10,000 per violation or three times actual consumer damages, whichever is greater, plus attorneys' fees and injunctive or declaratory relief.

India has no dedicated statutory or regulatory framework for third-party litigation funding, the government has confirmed in Parliament that it has no proposal to create one, and the market is being built in the meantime by a small group of funders operating case by case.

As reported by The Financial Express, the practice is not expressly prohibited when undertaken by non-lawyer third parties, and it has drawn judicial approval. The Supreme Court noted in a 2018 judgment that there appeared to be no restriction on non-lawyer funding of litigation, and in 2023 the Delhi High Court described such funding as important for access to justice while flagging the need for transparency and disclosure rules.

The institutional base remains thin. India has only one SEBI-registered alternative investment fund dedicated to legal and litigation finance, 5 Rivers Capital Fund I. Others operate as technology platforms, corporate aggregators or private networks without regulatory oversight.

Pratyush Miglani of ELF Partners told the publication that roughly 70% to 80% of the firm's current mandates are global and unconnected to India, with about 20% India-linked and mostly commercial disputes. He said the firm now receives at least two inquiries a week, rising quarter over quarter. Delhi-based LegalFund said it has committed or deployed capital across more than 100 matters, applying a cap of Rs 5 crore per case and generally targeting claims worth Rs 50 lakh or more in realistic recovery value.

Ila Kapoor of Shardul Amarchand Mangaldas argued that statutory recognition on the Singapore or Hong Kong model would settle which proceedings qualify, what must be disclosed, and who is fit to fund.

After-the-event insurers are being told to expect higher premiums, tighter limits and harder underwriting questions on group claims following the costs ruling against Prince Harry and his six co-claimants in their privacy case against Associated Newspapers Limited.

As reported by Insurance Business, ANL claimed £34.5 million in legal costs after winning at trial. Mr Justice Nicklin ordered that costs be assessed on the indemnity basis rather than the standard basis, removing the proportionality test, and awarded an interim payment of £9,544,355. He declined to set any ceiling on the total recoverable sum, even while describing ANL's bill as exceptionally high.

Nick McDonnell, a costs lawyer at Kain Knight, said the ruling could prompt ATE insurers to factor indemnity costs orders more heavily into their underwriting. Rocco Pirozzolo, managing director at Harbour Underwriting, argued the case should push pricing higher across the board, noting that insurers have no control over how litigation is conducted once cover is bound.

Reputation consultant Mark Borkowski said insurers will start asking much harder questions about how costs can escalate if claimants lose, and about how a claimant group is likely to appear to a judge.

The wider point for the funding market is that adverse costs cover has been priced on the assumption that standard-basis assessment will discipline a winning defendant's bill. Where indemnity-basis assessment becomes a live risk in high-profile group claims, the cost of the insurance layer that makes those claims fundable rises with it.

The Federal Court of Australia has approved a A$22.5 million settlement in a class action against two former Commonwealth Bank wealth management units, under which group members will receive A$5.12 million and the lawyers and litigation funder will take the balance.

As reported by Lawyerly, Justice Jonathan Beach approved the settlement in a proceeding the publication described as having been assessed as likely to fail had it gone to trial. Group members' share works out at roughly 23% of the gross settlement sum. Law360 reported that the funder's share of the fund is A$8.3 million.

The claim was run by Shine Lawyers and funded by Woodsford, and was brought on behalf of clients of Commonwealth Financial Planning and Financial Wisdom in connection with life insurance policies issued by CommInsure and AIA Australia. The allegation was that advisers failed to act in clients' best interests, including by not telling them that substantially similar or better cover was available elsewhere.

The approval places another data point in the running Australian debate over what proportion of a settlement fund should reach claimants. Where a case is settled at a discount because of litigation risk, the funder's commission and the solicitors' deferred fees and uplift are calculated against a gross sum that has already been written down, compressing the residual pool.

The outcome will be read closely by courts weighing common fund orders and funder commission in group proceedings, where the distribution split has become as contested as the merits.

Litigation Capital Management has secured another one-month extension of the covenant waiver on its debt facility with Northleaf Capital Partners, moving the expiry from 31 August to 30 September 2026.

As reported by Investegate, the AIM-listed funder told the market that the commercial terms are unchanged from the original waiver. Loan interest remains increased by 2.00% per annum for the duration of the waiver period, and there is no additional one-time waiver fee attached to this extension.

LCM said the extension reflects "Northleaf's ongoing support while LCM works towards a long-term resolution of its capital position." The company added that the Strategic Review first announced on 15 September 2025 "continues to progress," and that it will provide an update on that process in due course.

The announcement is the latest in a rolling series of short extensions that has run since December 2025, with each successive waiver granted for roughly a month at a time. The pattern has become the clearest public marker of where LCM stands with its lender: Northleaf has repeatedly declined to call the covenants, but has also declined to grant relief on anything longer than a monthly horizon.

The sequence has not been uneventful. Earlier extensions were accompanied by warnings of negative developments on case investments and expected material write-downs, and in July the company disclosed that permission to appeal in a competition claim had been rejected.

For a funder whose balance sheet depends on the timing of case resolutions, the repeated one-month cadence leaves the underlying question unresolved: whether the Strategic Review produces new capital, a sale, or a run-off.

Lawfront, the private equity-backed group that has assembled a portfolio of regional UK law firms since 2021, has named former esure Group chief executive Peter Martin-Simon as its new chief executive. He succeeds Neil Lloyd, who is retiring.

As reported by Legal Futures, the appointment comes shortly after a refinancing that nearly doubled the group's available funding, positioning it for a further round of acquisitions. Lawfront now employs roughly 1,500 staff and turns over in the region of £170 million.

The group has been one of the more visible consolidators in the UK legal market, acquiring Brachers, Farleys, Fisher Jones Greenwood, Nelsons, Slater Heelis, Trethowans and Field Seymour Parkes. Its model rests on external capital funding a buy-and-build strategy across established regional practices, with the acquired firms retaining their own brands.

Martin-Simon's background sits in insurance rather than legal services, having led esure Group, and the hire signals an emphasis on operational scale and capital deployment as the group moves into its next phase.

The appointment is relevant to the litigation finance sector less for any direct funding activity than for what it illustrates about the flow of institutional capital into legal services. The consolidation of law firms under private equity ownership sits alongside third-party litigation funding as a route by which outside investors take economic exposure to legal outcomes, and it is drawing comparable regulatory attention. In England and Wales, alternative business structures permit non-lawyer ownership, a position that contrasts sharply with most U.S. jurisdictions, where similar arrangements are typically structured through managed services organisations.

A newly published opinion piece argues that the push to compel disclosure of third-party litigation funding has moved past isolated state experiments and become a coordinated reform effort spanning Congress, statehouses and federal rulemaking.

As reported by the Las Vegas Review-Journal, the commentary by Jack Kalavritinos of InsideSources centres on the Litigation Funding Transparency Act of 2026, introduced in February by Senator Chuck Grassley (R-Iowa) and co-sponsors. The piece frames the federal bill as the anchor of a broader movement rather than a standalone measure.

At the state level, the author points to Georgia's Courts Access and Consumer Protection Act and to enacted reform legislation in Arizona, Colorado, Kansas, Montana and Oklahoma, with Ohio and North Carolina added to the list of jurisdictions taking up the issue. The commentary treats that spread as evidence of durable legislative appetite rather than a single-session trend.

The piece also draws on the Washington Health Innovation Council's 2024-25 annual report, which it says documents litigation funders targeting health-care innovators, and notes that Lawyers for Civil Justice has made a joint filing seeking an amendment to the Federal Rules of Civil Procedure. The U.S. Chamber Institute for Legal Reform is cited as tracking the momentum.

The author's central objection is that funders are "pouring billions of dollars into lawsuits" without courts, defendants or claimants necessarily knowing who is behind a case, concluding that "justice should not be a financial product." No figures on total industry size are offered.

The commentary reflects the reform side of an ongoing debate in which funders argue that disclosure mandates risk exposing privileged strategy and deterring legitimate access to capital.

Alphabet has agreed to pay £260 million to settle a UK collective action brought on behalf of app developers over Google Play commissions, with £160 million earmarked for the class and £100 million allocated to the funders, insurers and legal team that carried the case. That stakeholder allocation amounts to roughly 38% of the total settlement fund.

As reported by EU Today, the proposed settlement resolves a claim alleging abusive Play Store commissions without any admission of liability by Google. The £160 million class pot is to be distributed to UK-domiciled developers that sold digital content through Play Store-distributed apps between August 2018 and July 2026.

The claim was brought before the Competition Appeal Tribunal by competition law professor Barry Rodger of the University of Strathclyde, who instructed Geradin Partners. The case was certified in May 2025 and had originally been valued at more than £1 billion, with the underlying allegation that Google restricted developers' ability to distribute apps outside the Play Store while charging commissions of around 30%. Litigation funding for the proceedings has been provided by Bench Walk Advisors.

The Tribunal has listed a settlement approval hearing for 15 September, at which it will apply the statutory test of whether the agreement is just and reasonable. Represented persons had until 10 September to file written submissions. Approval would avert a trial scheduled to begin on 28 September that was expected to run for ten weeks.

Damien Geradin described the agreement as the largest settlement to date under the UK's opt-out competition regime. Google maintains it has strong defences to the claim.

California lawmakers have passed a pair of bills that would restrict the influence outside capital can exert over litigation, sending both measures to Governor Gavin Newsom for signature. Together they represent one of the most direct state-level attempts yet to regulate the relationship between private investors and the law firms they finance.

As reported by the Edinburg Post, which carried the Los Angeles Times account of the vote, AB 2305, authored by Assemblymember Ash Kalra (D-San José), would bar private equity firms and hedge funds from dictating case strategy after funding a law firm. The measure targets investor involvement in decisions such as how many clients a firm signs and when a case settles, and it prohibits firms from using investor money for case marketing. Enforcement would sit with the State Bar.

The companion measure, AB 2039 from Assemblymember Rick Chavez Zbur (D-Los Angeles), addresses client solicitation. It would strip the licence of any attorney convicted of felony capping, or of misdemeanor capping where the lawyer acted knowingly and for financial gain, and carries fines of up to $25,000 per violation alongside new whistleblower protections for law firm employees.

Both bills were sponsored by the Consumer Attorneys of California. Zbur framed the package as a response to reported patterns of attorney misconduct, while Consumer Attorneys president Douglas Saeltzer said the group was "not trying to insulate ourselves from accountability."

Not everyone is satisfied. Jaime Huff of the Civil Justice Association of California withdrew support for AB 2305, describing its enforcement mechanism as toothless: "It's like the mall cop of self-policing." The bills now await the Governor's decision.

The head of personal lines at Ignite Specialty Risk has argued that standard after-the-event indemnity limits are being outgrown by higher-value claims and group actions, and that insurers need to rethink both limits and long-standing exclusions.

As reported by Legal Futures, Kyle Stubbs writes that modest limits and standard policy structures served personal injury and consumer claims adequately for years, but that "as damages, disbursements and adverse costs exposure continue to increase, there are more cases where conventional scheme limits may no longer provide adequate protection." He identifies catastrophic injury, clinical negligence and professional negligence as the areas where the gap is widest.

Group litigation is the second pressure point. Multi-party claims have historically been excluded from many ATE products, an approach Stubbs argues is becoming untenable. "The growth of collective consumer actions and multi-party litigation means these claims are likely to become a far more established part of the legal landscape over the next decade," he writes, suggesting insurers will need to price the risk rather than carve it out.

The piece also points to rising complexity in costs management and regulatory attention on premium fairness and consumer protection, with pressure for premium structures that remain proportionate to the cover provided.

Ignite has expanded its litigation insurance footprint over the past several years, launching capital protection insurance in the US, extending its offering across the EEA and entering the Australian market with a Sydney hire.

Lawyers at Signature Litigation have argued that the UK government's latest consultation on the opt-out collective actions regime must raise the certification bar without loading additional cost and delay onto class representatives.

As reported by The Global Legal Post, partner Becca Hogan, senior associate Tom Crawford and paralegal Nikki Sutton-MacGregor write that businesses facing collective claims can incur significant cost, uncertainty and reputational exposure before the merits are tested, while a low certification threshold leaves claimants exposed to funding expensive claims that ultimately fail.

The Department for Business and Trade consultation proposes a more explicit statutory merits test and closer scrutiny of costs against overall benefits. The authors note one proposal would have the Competition Appeal Tribunal indicate the "reasonableness" of a litigation funder's return at the point of certification. They cite the consultation's reference to claims against Stagecoach South Western Trains, where less than £216,000 reached class members against "more than £10 million" paid to lawyers, funders and other advisers.

On funding, the authors observe that the consultation "appears to give the green light for damages-based agreements," which would go further than the stalled Litigation Funding Agreements (Enforceability) Act 2024 by permitting DBAs directly in opt-out proceedings. They argue wider funding options should increase competition, reduce the cost of litigation finance and lift claim volumes, noting that market practice currently suggests a quantum of at least £500 million is needed to attract certain funders.

The consultation closes on 25 September 2026.

Victoria's contingency fee regime is producing court-approved rates that track third-party funder commissions almost precisely, according to the Australia chapter of Chambers' Litigation Funding 2026 guide.

According to the Chambers and Partners practice guide, authored by Jason Geisker, Dirk Luff, Sam Sheridan and Georgina Overend of Claims Funding Australia, the median group costs order rate since the regime began is 24.5%, within a range of 14% to 40%. That figure "closely compared to the 24% median rate for third-party litigation funding commissions" considered by courts across the seven years from the first common fund order in October 2016 through 31 December 2023.

Under the Victorian model, the Supreme Court fixes the percentage payable to the plaintiff law firm early in the proceeding and "may revisit this percentage at a later stage," including at settlement approval. The guide cites *Bogan v The Estate of Peter John Smedley (Deceased)* [2022] VSC 201 as authority that fee-sharing with funders is permissible under a group costs order, provided the law firm is not a "mere front" for the funder.

On after-the-event insurance, the authors report that competition "has applied downward pricing pressure, with more flexible options than the historical 20–40% of policy indemnity limits." They point to *i-Prosperity Pty Ltd (in liquidation) v Crown Melbourne Ltd* [2025] NSWSC 1525, where the court accepted that an ATE policy carrying an anti-avoidance endorsement provided adequate security for costs.

The guide estimates Australian litigation funding market revenue at A$123.6 million for the 2025–2026 financial year.

The UK Financial Ombudsman Service has ordered litigation lender Novitas Loans to refund all interest and charges and halve a borrower's capital liability after finding the firm funded both parties to the same property dispute without telling either of them.

As reported by the Law Gazette, the complaint concerned former partners litigating against one another over property. Novitas had already lent to one party when it extended a facility to the other, leaving it with access to legally privileged information from both sides. The ombudsman found the arrangement "created a situation where Novitas had two or more competing interests and there was at least the potential that serving one of those interests could damage or harm the other interest."

There was no evidence the lender disclosed the dual funding to either client, no conflict management procedures, and no separate case officers assigned to each borrower. The ombudsman also found the pre-loan checks neither reasonable nor proportionate: Novitas asked only whether the applicant was a UK resident, checked for county court judgments or insolvency proceedings, and confirmed he owned a property that could be sold to repay the loan.

The borrower earned approximately £10,000 a year and already owed £240,000 when Novitas approved a £60,000 facility at 18% annual interest, later extended by a further £30,000. His former partner received approximately £50,000. The ombudsman described the arrangements as unfair, citing a "significant inequality of knowledge and understanding," and capped the borrower's total liability at roughly £36,000.

Novitas ceased accepting new clients in December 2021, and parent Close Brothers subsequently moved to write off around £90 million tied to unsuccessful funded cases.

Boston private equity firm Charlesbank Capital Partners is in advanced talks to take a stake in insurance defence firm Wood Smith Henning & Berman through a management services organisation, in a transaction that would rank as the largest private equity investment in a US law firm to date.

As reported by Above the Law, the deal values the firm at roughly $700 million, equivalent to about 18 times its adjusted EBITDA of $38.2 million. WSHB posted revenue of $244 million last year and operates more than 500 lawyers across 43 offices in 35 states and London. Charlesbank manages approximately $22 billion and traces its origins to managing Harvard's endowment. The parties have signed a letter of intent, with a definitive agreement expected in the coming weeks.

The structure is the mechanism that makes the investment possible. Rather than acquiring the law firm itself, Charlesbank would take a stake in a separate entity holding WSHB's back office, billing and technology operations, which then supplies those services to the attorney-owned practice for a fee. That split allows outside capital to participate in law firm economics without triggering the prohibition on non-lawyer ownership that applies in most US states.

LawFuel reported the talks on 20 August, framing the transaction as a test of the ownership rules that have kept institutional capital at the perimeter of the US legal market.

The deal follows a wave of MSO formation involving private equity and litigation funders in the personal injury sector, and arrives as several states move to restrict such arrangements.

Crestline Investors has closed its European Capital Solutions Fund II at $625 million in commitments, roughly 75% larger than its predecessor vehicle, with litigation finance named among the alternative asset classes the strategy is built to underwrite.

As reported by Pulse 2.0, the fund provides capital across the structure — from senior secured debt through to structured equity — for asset-backed and lower-middle-market businesses in Northern and Western Europe. Alongside conventional collateral, Crestline points to what it describes as less traditional assets including music royalties and litigation finance.

Roughly 35% of the fund had already been committed as of the second quarter of 2026. Limited partners include public and private pension plans, insurance companies and sovereign wealth funds.

Crestline has been deploying the strategy since 2015, completing approximately $2 billion across 45 European transactions. The firm manages around $18 billion in credit assets and operates as part of Rithm Capital.

Michael Guy, executive managing director and head of European credit, said the "European lower-middle-market continues to face a significant funding gap requiring creativity, speed and asset-level expertise." Keith Williams, executive managing director and chief investment officer, added that Crestline has "built relationships and proprietary sourcing networks, accessing bilateral opportunities difficult to replicate."

Crestline is a familiar name in the funding market, having provided a £20 million facility to UK funder Apex Litigation Finance in 2023. The latest close signals continued appetite among private credit managers to treat legal claims as one collateral type within a broader specialty lending mandate rather than as a standalone strategy.

Amazon has revised its Conditions of Use to require consumers pursuing mass arbitration claims to disclose whether third-party litigation funders are backing them. The updated terms, effective 15 August 2026, oblige claimants to identify any relationship with a funder, produce copies of funding agreements, and reveal any financial interest in the claim that has been assigned or transferred to a third party.

As reported by Bloomberg Law, the move places Amazon alongside Uber, which has adopted comparable disclosure requirements as it faces thousands of passenger sexual assault claims. The provisions arrive as mass arbitration has become a significant pressure point for large consumer-facing companies.

An Amazon spokesperson said the company "continually update[s] our Conditions of Use to better serve our customers," adding that "reinstating the arbitration clause will offer customers a fast, cost-effective way to resolve disputes while still giving them the option of going to small claims court."

The industry response was sceptical. Dai Wai Chin Feman, U.S. chapter chair of the International Legal Finance Association, described the requirement as "one of many new tactics in Amazon's arbitration terms that would face serious enforceability challenges if ever tested." He also questioned its practical significance, noting that individual consumer claims are generally too small to attract third-party funding in the first place.

Amazon removed a similar arbitration clause in 2021 following a wave of Alexa privacy challenges. Since then it has faced class actions over allegedly unsafe products sold on its platform and over its Prime cancellation practices.

Omni Bridgeway has reported a sharply lower bottom line for FY26, with net profit after tax falling 89% to A$45.9 million even as statutory revenue rose 57% to A$106.5 million. Total income declined 72% to A$182.2 million, and profit attributable to members fell 85% to A$53.7 million. The funder declared no final dividend for the year.

As reported by The Motley Fool Australia, the steep percentage declines largely reflect a high comparison base rather than a deterioration in the underlying business. FY25 income was inflated by a substantial one-off benefit tied to the Fund 9 transaction, which does not recur in FY26.

Beneath the headline figures, several operating metrics moved in the funder's favour. Omni Bridgeway recorded cash investment proceeds of A$350.5 million excluding secondary market activity, up 49% year on year, alongside A$564.4 million in newly added fair value. Employee expenses fell 16% as the group operated with a smaller headcount and reduced corporate overheads.

The company also pointed to record new commitments of A$712.2 million and a portfolio of more than 300 active litigation investments. Its late-July fourth-quarter update flagged an A$407.8 million pipeline spanning 43 exclusive term sheets.

Balance sheet measures were mixed. Net assets per share slipped to A$2.96 from A$2.99 a year earlier, while net tangible assets per share improved to A$2.08 from A$1.94.

The result caps a difficult stretch for the ASX-listed funder, whose shares have declined roughly 10% over the past 12 months against a rising benchmark index.

A commentary piece argues that the momentum behind third-party litigation funding disclosure laws has come from broad business coalitions rather than any single industry, pointing to Ohio as the template other states are now following.

As reported by AMAC, the article traces a run of state legislation beginning with Georgia's Courts Access and Consumer Protection Act, which requires outside financiers to register with state regulators, bars them from influencing litigation strategy and prohibits foreign funding. Arizona, Colorado, Kansas, Montana and Oklahoma each enacted their own versions, with Ohio and North Carolina subsequently added to the list.

Ohio State Representative Meredith Craig, a co-sponsor of House Bill 105, told the author that the coalition behind the measure mattered more than anything else. "We ultimately had every major business group supporting the legislation, from the Ohio Farm Bureau to the Ohio State Medical Association," she said. "That broad coalition showed this wasn't about helping one particular industry; it was about protecting Ohioans and the integrity of our courts." On the bill's bipartisan path, she added that members on both sides "agreed that it was time to defend our constituents and our businesses."

The piece frames the federal picture as moving in parallel, citing the Litigation Funding Transparency Act of 2026 introduced in February by Senator Chuck Grassley and co-sponsors, which would require disclosure of funding in federal class actions and multidistrict litigation, alongside a joint filing by the Institute for Legal Reform and Lawyers for Civil Justice seeking amendment of the Federal Rules of Civil Procedure to create a uniform national disclosure standard.

Writing from the perspective of the Washington Health Innovation Council, the author focuses on medical device and biopharmaceutical companies, arguing that plaintiff recruitment advertising invoking the FDA name and logo can imply regulatory action that has not occurred, and that resources diverted to funded litigation lengthen development timelines.

A U.S. Patent and Trademark Office proposal to require third-party requesters for ex parte reexamination to name all real parties in interest has drawn a sharply divided response, with the dispute turning on the same transparency questions that animate the broader litigation funding disclosure debate.

As reported by IPWatchdog, 26 comments were filed before the period closed on 21 August, submitted by 17 organisations and eight individuals. The July rulemaking notice proposed that requests identify the requester and any other real parties in interest, with statements kept confidential on request, so the Office can assess whether statutory estoppel provisions bar a filing. The USPTO said it has received a significant number of reexamination requests aimed at patents already challenged in inter partes or post-grant review.

Eight of the 17 organisational comments opposed the rule outright. Supporters included Adeia, Nokia, Dolby Laboratories and the Council for Innovation Promotion. Adeia said it received ten anonymous requests between October 2025 and April 2026 after more than a decade without any, and had to defend its patents without knowing whether the requester was a licensee, competitor, affiliate of an estopped party or a foreign-backed organisation.

Dolby went further, arguing that a requester's own identification may be insufficient and proposing that requesters answer factual questions about their business model, member or subscriber funding, and the source of funds used for the challenge. Nokia recommended additional guidance covering indemnification obligations, industry consortia and third-party funding.

Opponents including the Business Software Alliance, Unified Patents and the PTAB Bar Association argued the Office has produced little evidence that estopped parties are exploiting anonymous reexamination, and warned that importing a fact-intensive real party in interest inquiry into an examiner-driven proceeding without discovery would generate satellite disputes and deter legitimate filings.

Ireland's centuries-old prohibition on third-party funding has become the practical barrier to collective redress claims against the technology companies that base their European operations there, with only one class action filed in the country in the five years since the EU opened the door to them.

As reported by POLITICO, Ireland is the only EU member state that bars a funder from financing litigation unless it has a direct or legitimate interest in the case. The restriction stems from the medieval doctrines of maintenance and champerty, written into Irish law in 1634 and still in force. England abolished both offences in 1967; Ireland's courts have continued to uphold the ban, with narrow exceptions such as charitable donations made without expectation of a share of any award.

The prohibition collides directly with the EU's 2020 Representative Actions Directive, which permits only non-profit qualified entities to bring class actions. Those organisations typically depend on outside capital to fund proceedings against well-resourced defendants. Five non-profits are registered in Ireland to bring such claims, but only one case has been lodged — the Irish Council for Civil Liberties' challenge to Microsoft's online advertising system, financed from the organisation's general budget.

Johnny Ryan, who directs the ICCL's enforcement unit, said complex litigation in Ireland costs at least €1 million at first instance and that the organisation "cannot take multiple cases unless the State allows us to raise the necessary funds." He described the combination of the EU's non-profit requirement and Ireland's funding ban as a "fatal contradiction" for consumers seeking compensation.

Ireland's Law Reform Commission is due to publish a report later this year on whether the rules should change, though Justice Minister Jim O'Callaghan has said he is "very hesitant" about permitting third-party funding. The European Commission said it is assessing implementation of the directive and that member states banning funding must ensure costs do not obstruct qualified entities.

Administrators to collapsed litigation funder Woodville Consultants Limited are investigating allegations that the company used money raised from new investors to pay promised returns to earlier ones, and have told investors that no reliable estimate can yet be placed on the value of the company's litigation funding portfolio.

As reported by The Law Society Gazette, the disclosure comes in Kroll's third update to investors since the Pontypridd-based business entered administration on 16 July by order of the High Court. Woodville focused on funding car finance redress claims and is understood to have raised more than £390 million from investors through unregulated loan notes.

Kroll reported that the funding arrangements have proved "more complex than initially understood," with some involving multiple parties, intermediary structures, overlapping contractual documents and inconsistent records of how money moved and on what basis it might be recovered. The administrators have met two law firms and remain in dialogue with others as they assess next steps, while also weighing how the Financial Conduct Authority's own motor finance redress scheme — designed to bypass claims brought by lawyers — could affect the timing and value of any recoveries.

The report also removes a source of comfort for investors. Performance bonds issued by Ohio-based insurer Talisman, which the administrators reviewed, do not cover amounts Woodville owes to investors. Kroll noted that some investors "were led to believe these bonds were a full insurance protection for their capital."

Separately, the administrators are reviewing Kairos Litigation, a venture established earlier this year by Woodville directors Ann Marie Bell and Peter Legge that sought to raise money through a tokenised loan note programme, as well as allegations concerning the possible mis-selling of insurance guarantees and a crypto-investment opportunity offered shortly before the collapse. No conclusions have been reached, and the administrators say it remains too early to draw reliable conclusions about recoveries.

The Unified Patent Court has ordered a newly formed patent claimant to post €200,000 in security for costs after concluding that the entity was economically assetless because its patents, licences and future income had all been pledged to its litigation funder.

As reported by Mishcon de Reya, the Hamburg Local Division reached that finding in *Nixu v Infoblox* (UPC_CFI_360/2026). Nixu, a US-domiciled claimant, was incorporated in March 2025 and acquired the patent in suit weeks later. The court declined to treat US domicile as a ground for security in itself, holding that "a claimant's domicile in the US did not, in itself, justify security for costs" and noting that US courts recognise European judgments.

What did justify security was the claimant's financial structure. Under a Patent Security Agreement, all patents, licences and future income were pledged to the funder, and part of the purchase price remained unpaid. The court found Nixu was "basically assetless in an economical sense" and dependent on discretionary support from its funder.

The same update reports a second security decision. In *La Siddhi v Athena Pharmaceutiques* (UPC_CoA_48/2026), the Court of Appeal upheld a €75,000 order against an SME claimant, confirming that "a party's SME status does not, by itself, exempt that party from the obligation to provide security for costs." The court distinguished fee reductions and cost ceilings available to SMEs from the security regime under Article 69(4) UPCA and Rule 158, which contains no SME carve-out. Security was set at roughly 60% of the applicable €112,000 recoverable costs ceiling.

Together the decisions suggest the UPC will look through corporate form to the funding arrangement itself when assessing whether a claimant can meet an adverse costs award.

Insurance rating agency Demotech has called for a structural change to the way property and casualty insurers report loss costs, arguing that the current composite format masks the effect of technology-driven claim generation that is sometimes financed by third-party litigation funders.

As reported by PR Newswire, Joseph L. Petrelli, president and co-founder of Demotech, said the firm's 2022 review of failed carriers pointed to litigation as the decisive factor. "In 2022, our postmortem of failed carriers identified new, annual litigation as the proximate cause of what destroyed them," Petrelli said.

The argument turns on an assumption built into loss cost reporting decades ago. Petrelli noted that until the mid-1980s advisory organisations published rates and premiums for insurers to adopt or deviate from, and that "an implicit assumption underlying the original loss cost format was that an equilibrium existed in the relative claim frequency between claims reported and settled with policyholders, and claims litigated and negotiated with plaintiff firms."

Demotech's position is that the equilibrium no longer holds. Its research concluded that industrial-scale increases in litigated claims were achieved through technology, online marketing and advertising, "sometimes financed through third-party litigation funding." Petrelli also pointed to alternative business structures, managed services organisations and what he described as other mutations in the legal profession that "may circumvent the disclosure of third-party litigation funding."

The proposed remedy is to trifurcate loss cost data, disaggregating a single composite figure into claims closed without payment, litigated claims and non-litigated claims, each weighted by its own frequency. Demotech contends that the added granularity would allow insurers and regulators to price the litigated portion of a book directly rather than absorbing it into a blended average.

A new annual study of large jury awards has recorded the steepest year of nuclear verdict activity since 2009, and it places the erosion of tort reform — including rules governing third-party litigation funding — among the forces driving the increase.

As reported by Insurance Journal, the latest edition of Marathon Strategies' *Corporate Verdicts Go Thermonuclear* report counted nearly 200 verdicts of $10 million or more against corporate defendants in 2025, a 40.7% rise over 2024 and the highest total in sixteen years. Those awards totalled $25.6 billion. Forty of them cleared $100 million, the threshold Marathon uses for a "thermonuclear" verdict, and four exceeded $1 billion.

The spread across the economy widened as well. The report identified nuclear verdicts in 68 industries, up from 55 the previous year and 48 the year before that. Product liability accounted for 29 verdicts worth roughly $12 billion, while the insurance sector recorded five verdicts totalling $390 million. Texas, California, Florida and Maryland saw the heaviest activity.

Marathon attributes the trend to a combination of factors, stating that its research "identified corporate mistrust, social pessimism, erosion of tort reform, and public desensitization to large numbers as among the most important."

The reference to tort reform is notable given the pace of state-level legislative activity. Eight states — Arkansas, Georgia, Kansas, Louisiana, Missouri, Montana, Oklahoma and South Carolina — enacted tort reform measures in 2025, and those packages included both damages caps and expanded disclosure obligations for third-party litigation funders.

The findings are likely to be cited on both sides of the funding debate, with defence-side advocates pointing to verdict growth as evidence that disclosure rules are needed, and funders noting that the report identifies broader social and economic drivers rather than isolating litigation finance as the cause.

The seven celebrity claimants in the failed privacy action against the Daily Mail have been ordered to pay costs on the indemnity basis and to make a payment on account of £9.54m by 28 August, crystallising a gap between their after-the-event insurance cover and the publisher's claimed costs.

As reported by the Law Society Gazette, Mr Justice Nicklin found that the case went "well outside the norm" and that its "conduct was unreasonable to a high degree." The judge described the action as "litigation conceived and pleaded on an unjustifiably wide canvas," which was "speculative at origin and depended substantially on inference," with serious allegations maintained over a prolonged period on an inadequate evidential foundation.

The claims of unlawful information-gathering, brought by claimants including the Duke of Sussex, Baroness Lawrence and Sir Elton John, were dismissed last month following an 11-week trial. Associated Newspapers had exceeded its approved budget by more than £18.6m, with total costs amounting to what claimant lawyers called an "eye-watering" £34,481,622.54. The claimants hold legal expenses insurance covering £16.2m.

Nicklin J declined to impose a cap on recoverable costs, though he described the publisher's costs as "striking." The payment on account was set at £9,544,355, close to the £9,950,624.37 sought by Associated, which represented 65% of incurred pre-budgeted costs and 90% of budgeted costs.

The order converts a previously theoretical insurance shortfall into an immediate obligation, and stands as a reminder of how far ATE limits can fall short of defendants' actual costs in heavily contested, long-running litigation.

Hundreds of struck-out rugby head injury claims have been granted relief from sanctions in principle after the players switched solicitors, in a ruling that also records the appointment of independent counsel to advise the claimants on their position relative to their new law firm and their litigation funder, which sit in the same corporate group.

As reported by Legal Futures, Senior Master Cook allowed the claims to proceed despite non-compliance with unless orders on disclosure of medical records, taking "comfort" from the change of solicitor. The litigation involves around 1,000 claimants across rugby union and rugby league who allege serious head injuries from collision forces in matchplay and training, and that the governing bodies did not do enough to protect them. Between the two groups, 530 claimants stood struck out.

The players moved from Rylands Garth, described by the judge as "a relatively new firm with one qualified solicitor," to class action specialists KP Law, with Leigh Day assisting. Master Cook said that had the original solicitor continued to conduct the litigation, "I could not have had any confidence that future court orders would be complied with timeously or at all."

A witness statement from former Wales international Alix Popham, on behalf of the union players committee, said the players have appointed James Oldnall, managing partner of Milberg London, as independent counsel to advise them on their position "vis-à-vis KP Law and [litigation funder] Asertis (as Asertis and KP are part of the same corporate group)."

Relief will be subject to conditions to be decided at a further hearing, with minimum terms including payment of the defendants' costs of securing compliance and production of the missing documents.

Leslie Perrin, chairman of Calunius Capital, has argued that the Competition Appeal Tribunal's developing approach to litigation funding agreements poses a more immediate threat to the UK's opt-out collective actions regime than either the unimplemented Civil Justice Council recommendations or the still-awaited PACCAR reversal.

As reported by City AM, Perrin welcomed the government's recent light-touch proposals on the opt-out regime, which followed a Department for Business consultation and cover faster distributions in successful class actions, better management of legal costs and procedural reforms. But he wrote that funders still await implementation of key CJC recommendations on returns made a year ago, as well as the legislation promised to reverse the 2023 Supreme Court judgment in PACCAR.

His central concern is retrospective reassessment. Perrin wrote that the Tribunal "appears increasingly willing to revisit funding arrangements and priority agreements when determining distributions, effectively reassessing returns after a case has concluded," and that the concept of success being applied "remains uncertain and may depend on factors that were impossible to predict when funding was first committed."

Perrin framed the consequence in market terms: "Capital is mobile. Investors will only deploy funds into litigation if the potential return reflects the risks undertaken." He argued that no investment market can function if agreements are liable to be substantially redrawn after the event, and that if returns can be recalculated years later, funding becomes more expensive and some claims may never be brought at all.

Ten years after the first UK opt-out collective action was filed at the CAT, Perrin said scrutiny of funder returns is appropriate but must involve a level playing field, describing the issue as a test of whether Britain remains committed to a predictable and investment-friendly legal framework.