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Commercial

Global Class Actions—Looking Ahead

A recent panel, the Global Legal Groups Class Action Symposium, looked at US and EU collective litigation, examining trends. Of particular interest are new global class action laws and how inter-jurisdictional issues will be handled in the future. ICIG details the various issues facing Litigation Finance today. Incentive payments to representatives in a class action can be a sticking point in some instances. Modest incentives may be permissible, but some firms believe they are best avoided. The United States is also experiencing the development of a new class of negotiations which may bring the US class action process closer to what’s happening in the EU and elsewhere. In the European Union, class actions are not considered to be a traditional part of the legal world. However, the new Collective Redress Directive may change that. Influenced by Australia and the US, the EU may be moving toward a more Americanized or pan-European style of collective bargaining. The Collective Redress Directive differs from US class action law in a few major respects. First, damages can be sought as well as injunctions, and only a qualified entity can bring a claim. Litigation funding is permitted under the new law, but must be completely transparent. Disclosure requirements in general will be more stringent, and cases may be thrown out of court during the early stages. Market sophistication and a willingness to litigate in other jurisdictions has fueled the globalization of class action markets. Boundaries are being tested and test cases abound. Litigation funding increases access to justice across the board, leading to more (and often larger) cases that spur a desire for increased regulation. Trends in collective action litigation include environmental and social issues, and those related to governance. The growth of class actions on the global stage is bound to continue, which is great news for third-party litigation funding.
Announcements Commercial

International Legal Finance Association Statement On Australian Parliamentary Committee Inquiry On Litigation Funding

Today, the International Legal Finance Association (ILFA) — the global voice of the commercial legal finance industry — issued a statement in response to Australia's Parliamentary Joint Committee on Corporations and Financial Services Inquiry on Litigation Funding and the Regulation of the Class Action Industry. The Committee issued its findings and recommendations to the full Parliament today. "Australia's current balanced approach between securities law, class action procedure, and legal funding provides a model for the world, and reinforces its strong position as a destination for global investment. However, today's report attempts simultaneously to water down Australia's securities law, and to apply new regulatory burdens to class action procedures and legal funding. The Committee's recommendations would place undue burdens on shareholders seeking access to justice by driving up compliance costs and increasing the cost of capital. There is no evidence, in Australia or elsewhere, that class actions or litigation funding needs the kind of intrusive regulation proposed by the Committee. It appears that the Committee has relied on dubious claims from those opposed to these free market activities in proposing these regulations. It is, of course, for each jurisdiction to determine the rigor of its own regulatory regimes.  But jurisdictions that impose onerous barriers on the enforcement of shareholders' rights risk seeing global capital flow elsewhere, impacting the level and vitality of commercial activity. The deliberations of the Committee and its recommendations have been infected by an entirely false premise that "exploding" numbers of shareholder class actions have caused "skyrocketing" D&O insurance premiums which threaten the future of ASX companies. Misconceptions about legal finance have been deliberately advanced by a small group of vocal opponents. These falsehoods threaten to upset the balance between law, procedure, and the funding of these fundamental market activities by those pursuing justice in the legal system and undermine regulatory review processes that should be grounded in facts, not hyperbole. The legal finance community operates responsibly and within well-established best practice frameworks, including those required for ILFA membership. ILFA is committed to playing an active and constructive role to promote transparency and confidence in the marketplace by striking an appropriate balance between protecting stakeholders and fostering growth and innovation." ILFA represents the industry's interests before governmental bodies, international organizations and professional associations and serves as a clearinghouse of relevant information, research and data about the uses and applications of commercial legal finance. Details of the false premise referred to above are to be found at paragraphs 17.12 to 17.24 inclusive and paragraph 17.119 of the Report by the Joint Committee. For additional information, including ILFA's industry best practices and member obligations, please visit www.ilfa.com
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Commercial

Why Litigation Funding is Catching On

Nick Rowles-Davies doesn’t mind being called an “ambulance chaser.” Maybe that’s because after chasing down an ambulance, his Sydney-based Litigation Finance firm, LCM, helps the injured parties seek justice. That’s the nature of litigation funding, and it’s working for a lot of people. LCM explains that Litigation Finance involves buying claims for ongoing cases with the hope of making money from an eventual settlement or court award. That means it’s an excellent investment for anyone looking to steer clear of traditional markets. It’s also a life-changing tool for those who have been wronged by a large company or entity and don’t have the financial means to fight back. At its core, litigation funding works to increase access to justice for everyday people. The industry itself has grown by leaps and bounds in recent years—since the last global financial crisis to be exact. Tough economic times call for creative problem solving, and Litigation Finance fits the bill. In addition to funding large cases like class actions, third-party funding can be used to fund entire portfolios of cases, diversifying risk for investors. Or it can be applied to insolvency cases, so funders can reap a portion of whatever is collected. Litigation Finance attracts more sophisticated, high-end investors like institutional investors, sovereign wealth, and hedge funds among others. Funding cases requires extensive vetting, and many funders use complex algorithms and new tech to decide which cases to back. For success in litigation investing, due diligence is essential. The industry is global, with new markets opening up to the practice regularly. Around the world, funders like Burford Capital, LCM, Omni Bridgeway, and Therium Capital are leading an industry that shows no signs of slowing. Rowles-Davies believes that the current state of Litigation Finance has only just scratched the surface of what’s possible.
Commercial

Williamtown Class Action Members Compensated

An impressive $57 million settlement was distributed among members of the Williamtown Contamination Class Action earlier this week. This comes as part of a settlement from February of last year, in a case involving PFAS contamination of homes, farms, and other businesses. Omni Bridgeway, which funded the action, explains that their involvement in the case allowed class action members to fight for what they deserved—rather than merely asking to be treated fairly. The average award per household was about $100,000, with some affected parties receiving more or less depending on the actual damage suffered. Dentons, one of the largest law firms in the world, distributed the settlement after four years of intense litigation. Reporting from the Newcastle Herald is credited with raising awareness about the case. Justice Lee called the outcome ‘excellent,’ as it seems to fairly compensate those who were harmed by the contamination and its aftermath. Omni Bridgeway points to the case as an example of Litigation Finance working exactly as it should.
Commercial

Reflections on the State of Litigation Finance

Recently, two portfolio managers at Burford Capital shared their thoughts on 2020’s 4th quarter, the continued impact of COVID, collections, and challenges in cash management. Nicholas Cooper and Patrick Wackerly explain year-end financing and more. According to Burford Capital’s own research, roughly half of in-house counsel expect a shrinking of legal budgets, and more than half have stated that they’ll be looking for discounts from outside counsel. Even in boom times, firms tend to push client collections this time of year. But this year carries unique challenges. There’s a difference between desperation and simply salvaging what there is to salvage. Client discounts, once a go-to measure, are now being eschewed in favor of more lasting solutions. Demand for financing to carry firms through the end of the fiscal year is higher than ever. This is due to several factors: --Legal financing is not a traditional loan --Clients will not be aware when firms utilize third-party legal funding --Funders, like Burford, take on the risk so firms don’t have to --Third-party funding is reliable, time-saving, and economically sound. Savvy firms and businesses alike understand that taking a little help when you need it can spare significant hardship down the road.
Litigation Finance News
Commercial Special Features

Key Takeaways from LFJs Q4 2020 Commercial Litigation Funding Roundup

On Thursday December 17th, Litigation Finance Journal hosted a special 1-hour panel discussion on the major events impacting the commercial litigation funding industry. Panelists included Omni Bridgeway CEO Andrew Saker (AS), Therium Co-Founder and CIO Neil Purslow (NP), and LCM CEO Patrick Moloney (PM). The panel was moderated by Ed Truant (ET), founder of Slingshot Capital. Below are some highlights from the discussion. ET: Why did each of you decide to pursue a global growth strategy as opposed to solely focusing on domestic markets? PM: We looked at things from a very practical perspective at LCM, we looked at where the most economic activity was happening. Where there’s more economic activity there’s more disputes. Therefore, we looked around the globe toward the larger economies than where we started back here in Australia. We were cautious and disciplined about moving into new jurisdictions. So very much driven economically and by opportunity. NP: When we started Therium about 12 years ago, we recognized the potential then that the industry would become a global industry. And from an early stage, we were seeing funding opportunities coming from other jurisdictions as well as the UK. Our global footprint reflects a view of the market that there are benefits to being bigger in funding. From a case point of view, it’s better to have more depth of financial resources. From an investor point of view, greater diversification is better. From an underwriting point of view, being able to draw on expertise across jurisdictions and to have the benefits of a global perspective is also helpful.  ET: What were some of the business challenges you faced when you entered new markets? AS: Most of our expansion was done through organic growth. It was where we perceived first-mover advantage. That required us to address a number of key risks, market awareness of the industry was perhaps first and foremost. There were some jurisdictionally specific issues in Canada where we needed to seek some insurance regulatory approvals. But otherwise, it was all about establishing boots on the ground, finding the right people which is more than half the problem. And ensuring that you’ve got access to the local contacts and networks that you need for establishing a successful business. ET: Other than lack of sleep, what are some of the other negative aspects of going global? AS: Lack of sleep is perhaps the biggest issue, but the benefits far outweigh any of the costs. Having such a global team, a global approach, different cultures that are being fully integrated, compensate for any of those downsides. But it’s an interesting dynamic market that’s continuing to grow. PM: I think that’s right. I think...there’s a necessity to become global. In the respect of at least publicly listed and traded. NP: The thing that’s interesting is, relatively speaking, how easy it is to operate across jurisdictions in this industry, and I think it’s because--to a very large extent--the skillset that you need is so transferrable. So it’s actually been very positive. ET: What’s the implication given COVID? Are you thinking differently about your organizations going forward in terms of travel and face-to-face meetings and that type of thing? AS: I think it’s an evolving thought process. Initially, at the front end of this crisis, we all saw the benefits of staying at home and working remotely and using technology to compensate. There was a great deal of enthusiasm and everyone bought in. As this has dragged on, there’s been different views about the merits of that and the efficacy of it all. To some extent, it does vary depending on your location. We’ve been very fortunate here in Australia to have a slightly different experience from our colleagues in Europe and the US.  ET: The next major topic I want to tackle was this concept of corporate social responsibility and litigation finance in environmental social governance, or ESG. CSR is becoming a pretty powerful trend in global investing, so I wanted to explore the implications for the litigation finance asset class. What are you hearing from your shareholder base about CSR and ESG in terms of their importance, and what pressures are those shareholders putting on public companies these days? PM: From LCM’s perspective, I suppose we have had two experiences. One, the public markets through the securities exchange here in Australia, and then more recently the London stock exchange, are probably two quite different experiences. So I think investors out of the UK and Europe have been far more focused and have an expectation far more than I recollect that we’ve had here in Australia, and that’s not to say that these issues are not present in Australia. It’s probably more of a timing thing, but we’re very conscious of it. What we need to wrestle with is, as a relatively small listed entity, is what capacity we have to wade into this. So we’re very conscious of it and we do have principles associated with that. AS: Definitely, it’s an increasingly important area of relevance to all our shareholders. What we have found as we’ve shifted from the ASX300 to ASX200 is that there are more ESG-specific type funds that are interested in a stock that’s compliant with ESG obligations, and as a consequence of that, we initiated our own process to have a formal ESG policy. It’s a work in progress and something that we’re developing with internal stakeholders and well as external stakeholders. It’s a value that resonates throughout the whole company. NP: ESG and CSR considerations are becoming increasingly important for privately funded investors as well. And we get quite a lot of questions from them about how we’re thinking about this. On the CSR side, the way we’re approaching it—we tend to think of litigation finance as ultimately about investing to facilitate access to justice. And for the most part, obviously, we’re doing that as an investment in the expectation of a return. But there is a wider need in society for access to justice and legal advice where those situations can’t be funded on a commercial basis. And we have felt that it’s important as an investor in the legal world that we play our part in that area too. It’s for that reason that we set up Therium Access 18 months ago. ET: Let’s move on to the third topic, industry growth, and implications for innovation. At a macro level, the industry arguably is growing in three main ways: growth in the number of jurisdictions allowing litigation finance, increasing penetration within existing markets, and then growth through product innovation. So let’s take a closer look at product innovation as a growth factor. Perhaps each of you can comment on what your business has done to innovate in the litigation finance market within the last 2-3 years.   PM: At LCM, we’ve tried to look at business development in a very different way to how the industry might have looked at this previously, so we look at the available market in two ways. One is those who use litigation finance for necessity, and those through choice, so I think the larger part of the market which remains sort of un-penetrated and unaddressed by our industry globally is providing it to large sophisticated well-capitalized corporates. And I think that’s a very interesting part of the market for us, I think it’s an interesting part of the market for the industry as a whole. I think that’s where a lot of our focus has been in the last 2-3 years. ET: Neil, how about you in terms of innovation at Therium? NP: Certainly we’ve seen a lot of innovation in the development of product. Or perhaps to put in another way, in deployment techniques. Our core business is built around an ability to assess and to price litigation risk. But the way in which that investment has been delivered and the way it’s been structured has become a lot more varied in recent years. We put a great deal of resources into developing those techniques, whether it’s portfolio funding of different types, corporate portfolios, law firm funding, or claim monetization. These aren’t new areas, we’ve been at this for a long time. But certainly, our level of sophistication in how we do them has increased dramatically in the last few years. I think also in terms of sophistication, we’re working with an AI firm called Solomonic, to bring a more data-driven approach to our investment process as well. I think that’s another theme. The last point on this: I think the market is in an interesting point now where funders are starting to drive certain parts of the litigation landscape. So instead of being passive recipients of cases from law firms, funders are now playing an important role in shaping litigation trends and what case types do and don’t develop.  AS: From a non-product perspective, I think the evolution of the fund management model is growing, it’s something that has had roots in the last five years, but is now being more warmly embraced by the litigation funders as well as PE investors.  Looking forward, as Neil mentioned, a more active role for litigation funders in the investments is something that I think will grow. We are looking to try to shift our focus from being an agent to being a principal and actually owning claims, judgments, and awards. There are various other strategies we’re looking at, including downside risk management, cracking the holy grail we all talk about of defense-side funding. And then potentially even moving into law firm ownership, to take advantage of this shift that seems to be evolving around the world.
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Consumer

Involuntary Bankruptcy Petition on the Horizon in Tom Girardi Case

Creditors of the firm Girardi Keese, and Tom Girardi himself, plan to file an involuntary bankruptcy petition by the end of the week.   Law.com reports on a recent remote hearing to discuss the appointment of a trustee. Judge Thomas Durkin (Northern District of Ill) has previously frozen the assets of Girardi and his law firm, suspecting that they may have stolen settlement money from clients. Attorneys for one litigation finance firm explained that the involuntary bankruptcy petition would negate the need to appoint a trustee. California Attorney Lending has a judgment against Girardi of more than $6 million, though they remain defendants in an earlier lawsuit brought against Girardi Keese, alleging embezzlement of settlement monies owed to families impacted by the crash of Lion Air Flight 620. Judge Durkin opted not to appoint a trustee, though he did insist that the asset freeze stay. Jay Edelson is the acting co-counsel to several of Girardi’s clients. He recently expressed his concerns about the 8,000-10,000 clients Girardi represented in another class action—possibly involving a 2015 gas leak in Aliso Canyon near Los Angeles. In court, Edelson explained to the judge that his firm is concerned about the clients in question and wants them to be fairly compensated for their losses. Girardi is a prominent attorney whose wife, Erika Jayne, appears on the “Real Housewives of Beverly Hills.” The two ostensibly filed for divorce recently, though some have speculated that this is a ruse to protect or hide the couple’s assets. One lawyer, Boris Treyzon, informed a judge of Girardi’s request that he take over several Girardi Keese cases. Durkin declined this arrangement, saying he would not allow settlement or recovery to move forward without a trustee to supervise. Meanwhile, unnamed litigation funders have offered their assistance to Girardi. A judge has not precluded Girardi from receiving funds to pay for a forensic evaluation of his finances.
Commercial

Managing the Workflow of Legal Departments

There’s an economic crisis afoot, which means managing costs and workflow is more vital than ever. Instead of telling in-house legal teams to ‘do more with less’, savvy businesses are investing in their legal departments. This allows them to better manage workflow, reduce spending, and optimize the company’s bottom line. Thomson Reuters Legal details that making a case for investment at this time may fall on deaf ears. It suggests that rather than explaining why investing is a good idea—detail instead why not investing can cause significant damage. Poor workflow, for example, is often the result of a lack of prioritization or an uneven distribution of assignments. Enhanced optimization can be a key way to address this. By streamlining, employing consistent practices, using trackable management, and filing regular reports with management, the benefits reveal themselves in short order. Automation via specialty software can connect with existing software to create a new level of efficiency. When a business is reticent to make the necessary investments, third-party legal finance is an option worth considering. Funds can be used to shore up in-house legal departments without adversely impacting balance sheets. Legal funding is a versatile, effective way to keep budgets in line while continuing to make improvements and handle pending matters effectively. Beware the cries of ‘that’s how we’ve always done this,’ when advocating for investment in and updating of in-house legal departments. Innovation is the path to a better future. Corporate legal departments have changed a lot in recent years—moving from a cost-burden to a kind of hub for communication, collaboration, and information centralized for easy access. This can be enhanced by modern tech like live updating of documents for faster contract creation and negotiation, or with software that leads to greater transparency and better communication between staff, clients, and management.
Commercial

Key Takeaways from the IP Dealmakers Forum

Week two of the IP Dealmaker’s Forum included a variety of panels and events revolving around three main points of discussion. These included diligence, licensing, and venue. The forum also expounded on the importance of litigation funding in an array of IP matters. Above the Law details that litigation funding is a modernization of the traditional contingency model. In many types of patent litigation, diligence is key. Litigation funders can help with this, as their experience in varied IP-related matters will provide valuable insight. Litigation funders are well-versed in IP litigation and routinely invest in their diligence capabilities. In addition, the Litigation Finance industry is well-monied and standing by to help. It’s vital that litigants be proactive in the diligence process. This includes giving funders all the relevant information, allowing them to fully vet the risks of a specific investment. Also advised is a willingness to discuss these risks fully with their funders. These aspects of diligence benefit all involved. Firms get a no-cost opinion from experienced funders while funders are able to protect their (and their investor’s) capital from risk. Patent owners can obtain an informed and experienced analysis of their case to decide how best to proceed. Venue is also a vital consideration and another aspect that may be best discussed with litigation funders early on in the process. Some might suggest that, theoretically, it shouldn’t matter where a case is filed. But that’s simply not the reality. Licensing was the third major consideration discussed at the forum. Much IP licensing is based on potential damages from infringement. Large verdicts have become increasingly common in the IP landscape, even outside the business world with university researchers and non-practicing entities gaining huge settlements or awards. Part of the frustration with licensing stems from tech companies failing to look seriously at their licensing until a lawsuit is on the horizon.
Commercial

Did the Recent Mastercard Case Open the Floodgates?

The case of Mastercard Inc et al v Merricks has captured considerable attention. Lawyers, funders, claimants in cases that have been stayed pending this decision—and at least 46 million claimants all awaited the Supreme Court’s ruling. Omni Bridgeway explains that collective proceedings in England became opt-out in 2015 as part of a bid to find more equitable solutions. This led to worry that, as some say has happened, commercial firms might fund cases strictly for profit. That was of particular concern in this case, given the high number of claimants as well as the size of the potential award. In the Mastercard v Merricks case, claimants are made up of those who made purchases with Mastercard over the 16-year-period covered by the action. Also involved are the 800,000 or so businesses that accepted the payments. All told, the class action seeks GBP 14 billion. Merricks, the representative plaintiff, has a meritorious cause of action. Specifically, the case here follows a finding of liability as the European Commission already declared that Mastercard breached its duty when they set their fees. But how can Merricks establish everyone’s individual losses on every mundane transaction over 16 years? In truth, he doesn’t have to. Seeking an aggregate award would only require data and methodology that affirms an appropriate amount of damage. At the same time, it may seem impossible to find a methodology that is fair to everyone. The Supreme Court ultimately held that defendants should not be let off the hook because proving exact damages is a herculean task. They also affirmed that collective actions are permissible even if they’re made up of claimants who could have filed their cases individually. Some have claimed that this ruling opens the floodgates to a bevy of new collective actions. It is true that class actions may have an easier path, but that only increases access to justice for ordinary people.
Commercial

New Law Brings Litigation Finance to Cayman Islands

This past Monday, Cayman Islands Parliament passed the Private Funding of Legal Services Bill 2020. The bill provides a legal framework for conditional legal fees akin to what happens in the United Kingdom, as well as US-style contingency fees and litigation funding. Cayman Compass reports that unlike UK and US litigation finance agreements, under the new law, fees will be capped. Unless there’s a Grand Court application from the client and lawyer, success fees may not be higher than 100% more than the normal fee. Further, contingency fees cannot exceed 40% of the total recovery or award. The law is a welcome one. The attorney general stated that the new provisions are expected to level the legal playing field. Without funding options, the party with the most money is generally the winner. Ultimately, the result will be greater access to justice. That’s why the Opposition Members of Parliament supported the bill. The new law does not apply to criminal cases.
Commercial

Avalanche Blockchain Offers ILO: Initial Litigation Offering

An ILO (Initial Litigation Offering) was recently launched on the Avalanche blockchain. This is, in essence, a token that provides investors with a percentage of payouts from various funded lawsuits. The December 14th announcement detailed the perks of litigation funding as an investment. Coinspeaker reports that the ILO is a first, and is estimated to generate more than $10 billion in the cryptocurrency landscape. Kevin Sekniqi of Ava Labs, explains that this ILO is a boon to investors as well as those who seek legal redress but lack the resources. Litigation finance is uncorrelated with the larger market and therefore an attractive investment in unpredictable times. While the Avalanche ILO is the first of its kind, it’s expected to be far from the last. The first noteworthy case involves a California hemp farm that was wrongfully destroyed by the Kern County Sheriff’s Office. The farm was worth roughly $1 billion. ILO investors will now be able to invest and share in any future recovery.
Commercial

Litigation Funders Move Toward Indian Market

Litigation Finance is already booming in the United States, UK, Australia, and elsewhere. India has yet to really take advantage of the practice. But that may be about to change. Reuters explains that several top funders including Omni Bridgeway, the second-largest litigation funder, are setting up operations in India. According to Omni Bridgeway CIO Tom Glasgow, the firm is already speaking to potential clients. Glasgow didn’t reveal who, but talks about de-risking and monetization are underway. The expectation is that funders will focus on international arbitration due to the short resolution time compared to other types of cases. Once funders are well-versed in local issues, it’s likely that funding for local cases in India will follow. Also on the horizon is an Indian Association for Litigation Finance, which will include input from Marsh, Omni Bridgeway, and Phoenix Advisors among others. Like the ILFA, the group plans to advocate for the industry and create a means for self-regulation of litigation funding.
Announcements Commercial

Therium’s Financial Commitments To Access To Justice Causes Surpass £1.7m

Jersey, 15th December 2020: Therium Access, the not-for-profit arm of global litigation funder Therium Capital Management, has announced the recipients of its latest grant round. The Autumn 2020 grants have been awarded to six organisations and brings the total number of organisations receiving grants to 32 with over £1.7m committed since its inception in 2019.

The Autumn 2020 grant round remained focused on the issues exacerbated by the Covid-19 pandemic, with a focus on supporting work which is difficult to find funding for elsewhere, scalable delivery models, preservation of legal specialisation and work of strategic importance. Areas of law such as employment and housing were focussed on as these services face a huge surge in demand. Issues facing vulnerable young people were also prioritised.

As the Covid-19 pandemic continues into 2021, these organisations will continue to serve as a lifeline to the most vulnerable and marginalised in society. Additional grants have been awarded to two current grantees.

The recipients of the Therium Access Autumn 2020 grant round are:

  • Bristol Law Centre: The grant will increase capacity in employment and housing, enabling Bristol Law Centre to deliver a full service including complex advice and casework, in a wider geographical area without the limitations of Legal Aid work.
  • Child Poverty Action Group: The grant is for the continuation of funding for a solicitor in the charity’s strategic litigation team and other various costs as it continues to promote and protect the rights of children and families and maximise family incomes.
  • Legal Action Group: The grant is for a new Housing Possession Duty Desk: a practical guide. The Guide will provide a practical, accessible and affordable source of information for advisers at Housing Possession Court Duty Schemes.
  • Project for the Registration of Children as British Citizens: The grant is towards PRCBC’s core costs to support delivery of their pro bono strategic casework that ensures young people are aware of and able to exercise their rights to British citizenship.
  • South West London Law Centre: This grant will fund a Housing Court Crisis Navigator who will give practical help and support to deal with the underlying issues of people seen by their housing and debt teams in Croydon.
  • Youth Legal: The grant is for the salary and associated costs of a part-time Development worker to support Youth Legal’s vital work and to reach out to their communities, develop strong networks, and coordinate projects.

Jeunesse Mensier, Grant Programme Director at Therium Access, said: “Our Autumn 2020 grant round has again shown us the excellent and necessary work that organisations and individuals provide across the country in facilitating access to justice. We are so pleased to be supporting these six impressive and inspiring organisations which help some of the most vulnerable in our society in the areas of citizenship, employment and housing.”

Lord Falconer, Chairman of Therium Access Advisory Committee said: “During such a difficult time, legal advice has never been more important. It’s so brilliant to see Therium Access lead the way and provide much-needed financial support to such worthy organisations that provide free legal advice to strive and reduce the ever-increasing justice gap. We look forward to seeing other funders follow suit.”

Solange Valdez-Symonds, Solicitor and Director of Project for the Registration of Children as British Citizens said: “PRCBC’s core activity is assisting, including by litigation, children and young people to secure their rights to British citizenship. This grant from Therium Access is vital for our continued ability to deliver on this - and not only to directly assist more children and young people. It enables us to bring our expertise and experience to bear in challenging the several injustices in policy and practice that deprive so many more children and young people of the security and recognition that is theirs by right through registration of citizenship. Thank you Therium Access.”

Louisa McGeehan, Director of Policy at Child Poverty Action Group said: “Funding from Therium Access Fund for a further year will enable us to continue our award-winning work in ensuring low-income families have access to justice.  The need is greater than ever given the unprecedented number of families claiming universal credit as a result of the Covid-19 pandemic. renewed funding will help us in our ongoing work of ensuring that laws relating to social security entitlement are made and applied in compliance with fundamental rule of law requirements and that ordinary individuals will be able to hold the government to account when this is not the case.”

Applications for the Spring 2021 grant round will close on 15th April 2021 with priorities being confirmed in early 2021.

About Therium Access:

Therium Access is the primary expression of Therium’s corporate and social responsibility programme. Therium Access dispenses with the criteria of funding for profit and has the sole purpose of facilitating access to justice.  Therium Access is a mark of Therium’s wider commitment to the pursuit of justice and the rule of law.

Therium Access accepts applications from charities and other entities whose services and projects facilitate access to justice or from those seeking assistance to obtain legal representation on cases (including defence) which have strategic importance. The applicant’s need and the impact of the grant will be important factors in our review process. The deadline for the submission of the next round of grant applications is 15 April 2021. In addition, urgent applications may be considered on an ad hoc basis. Applications need to be made by legal representatives or the entity seeking a grant.  The board of Therium Access is assisted by an Advisory Committee which is chaired by Lord Falconer, former Lord Chancellor, Secretary of State for Constitutional Affairs and Secretary of State for Justice.

Therium Access aims to support access to justice in the broadest terms and considers applications that further the following causes (in no particular order):

  • The right to legal representation or due process;
  • The proper and efficient administration of justice;
  • The advancement of human rights;
  • The promotion of equality of rights and diversity;
  • The protection of children, the elderly, the disabled, minorities, asylum seekers and other vulnerable or disadvantaged groups;
  • The advancement of environmental protection or improvement;
  • The promotion of legal education that furthers the causes listed above; and
  • Any other case or project in which a person, group, or entity will not have access to justice without financial assistance.

Therium Access is intended to be a global initiative. Its initial focus is on the UK and it will be rolled out in other jurisdictions in a number of planned phases.

About Therium Capital Management:

Therium is a leading provider of investment capital to the legal industry and one of the largest, having raised over $1 bn since 2009.  With investment teams in the UK, USA, Australia, Germany and Norway, Therium has funded litigation and arbitration claims exceeding $40 billion including many of the largest and most high profile funded cases in the UK and internationally, including arbitrations under rules of the LCIA, ICC, UNCITRAL, LMAA, AAA, CIETAC, ICSID, Stockholm Chamber of Commerce and the Energy Charter Treaty.  Therium has been Top Ranked by Chambers and Partners and Leaders League with investment officers across the UK, Europe, USA and Asia Pac recognised as leading individuals in litigation finance.

Last year to mark the firm’s tenth anniversary, Therium Access was launched as a not-for-profit venture to fund a wide range of access to justice projects and cases – supporting the most vulnerable in our society and helping to bridge the widening justice gap. With its own board composed of eminent figures from the legal community and a dedicated grants officer, Therium Access has made over £1.7 m in financial commitments over the last 22 months to over 32 different organisations. As the first initiative of its kind, Therium has been shortlisted for several awards for launching this ground-breaking initiative, including the FT Innovative Lawyer Awards 2019, the Lexis Nexis Awards 2020 and The Lawyer Awards 2020.

Therium also invests in AI and software projects to accelerate the advancement of the industry. As a founding member of both the ALF, ILFA and the Litigation Funding Working Group, Therium is also committed to shaping the future of legal finance and setting high standards for the industry.

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Commercial

IPO Wealth Class Action Targets Trustee

A class action involving IPO Wealth is proceeding in a Victoria Federal Court. The case was filed against Vasco Trustees and names associated company DH Flinders. Law firm Slater and Gordon is running the class action. Australian Financial Review details that the IPO Wealth Fund was the debut product of Mayfair 101, an upstart investment firm. Earlier this year, two other Mayfair 101 entities have also had their assets frozen. The class action currently involves more than 50 investors, including several retirees or those who invested workers comp monies. While the fund was reserved for investors with high net assets—the investors in question were largely inexperienced. The lead plaintiff, Helen Batey-Smith, put $1 million into the fund as of November 2018. She rolled it over multiple times until the investment was frozen. In the claim, some aspects of the promotional material are at issue—including eye-catching declarations of “attractive returns” and the phrase “term deposit.” This seemed, to some, deliberately intended to obfuscate or mislead investors. A memorandum on the fund released between 2017-2019 omitted the significant risk of the fund’s underlying investment. Vasco should have known (or did know) that the investments were speculative at best. Mayfair 101 insists that they have not broken any laws but nor would they comment on the accusations regarding advertising. Similar cases have been adjudicated recently in the investor’s favor. However, litigation funding firms and legal fees absorbed much of the settlements. This new class action is not utilizing litigation funding.
Consumer

‘Real Housewives’ Husband Held in Contempt Over Missing Settlement Payouts

The husband of reality TV star Erika Jayne is being held in civil contempt along with his law firm. A federal judge in a Chicago court made the decision after Thomas Girardi and the Girardi Keese law firm failed to identify the whereabouts of more than $2 million in payments for survivors and family of the Lion Air Flight 610 plane crash. Chicago Sun-Times explains that Judge Thomas Durkin froze the assets of the lawyer and his firm. He then affirmed that payment to at least four families owed half a million dollars would cure the situation. Girardi is also being sued by multiple litigation finance firms over non-payment and leaving funding contracts unfulfilled. He and his wife are accused of embezzling settlement money in order to maintain the appearance of being wealthy celebrities. The couple, ostensibly in the midst of a divorce, claims to be staring at ever-growing debt. It’s been alleged that the couple misdirected large amounts of money from both funders and clients for their own personal use. Jayne herself describes the case as “high drama.”
Commercial

Canterbury Class Action Against Southern Response Launches

Policyholders with Southern Response got a rare bit of good news as their class action against the insurer was launched. New Zealand’s top litigation funder, LPF, will provide financial support for the action. Those homeowners who were insured by Southern Response and made a claim after their home was damaged in the earthquake are eligible for inclusion—if their settlement was lower than it should have been. Scoop reports that roughly 3,000 homeowners were allegedly shorted by the insurer in settlements related to the Canterbury earthquakes. This new class action is an alternative to an earlier claim—run by GCA lawyers and funded by Claims Funding Australia. A recent opt-out ruling could lead to claimants becoming part of the GCA lawyers class action, which carries high fees. This new class action carries no success fees and is free to sign onto. Funders will receive a max payout of 15% of the award if the case is successful. If the case is resolved successfully within two years, and costs are under $2 million, LPF Group will get 10% of the settlement. If it takes longer though or costs more, the 15% return will come into play.
Commercial

Mastercard Case Moves Forward as UK Inches Toward US-Style Class Actions

Litigation Finance received a holiday gift in the form of a new UK Supreme Court decision allowing a GBP 14 billion case to proceed against credit giant Mastercard. The claim, which could involve over 46 million claimants, alleges that the credit card group charged excessively high fees and overcharged customers regularly. Proactive Investors explains that the ruling opens the door to a bevy of new collective claims. A similar claim was filed last year against five big banks alleging price manipulation. Many have presumed that litigation funders are salivating at this news. Neil Purslow, CIO of Therium Capital, has stated that Therium will be making investments in these types of cases as a result of this ruling.
Commercial

Arbitration Against Tanzanian Government Begins

Indiana Resources, an ASX-listed gold mining company in Australia, is proceeding with its case against the Government of Tanzania. The case involves the alleged illegal expropriation of a nickel mining project. The action is led by two incorporated UK companies: Ntaka Nickel Holdings, and Nachingwea UK. Mining Review explains that the case, which is funded by Litigation Capital Management, is expected to convene in the first quarter of next year. An arbitral tribunal will be appointed, followed by filing the claimant’s evidence and supporting documents. Original estimates of losses are close to $1 billion. The government of Tanzania has allegedly been reticent to participate in every step of the process. Plaintiffs claim they refused to come to the negotiation table when claimants invited them to negotiate in good faith, and that they refused to engage concerning the formation of the tribunal. Bronwyn Barnes, executive chair at Indiana Resources has stated that she is pleased to see such progress in recent months. She goes on to affirm that there is adequate litigation funding in place and that the memorial is well underway. According to Barnes, $95 million is the minimum claim for expected compensation.
Commercial

Litigation Funding Ethics in the US

The Third Annual Ethics Summit from Frankfurt Kurnit was held last month. The litigation funding panel covered a host of ethical and legal points of interest. These include coverage of the back-and-forth between the industry and the NYC Bar Association, and the ever-evolving rules of professional ethics. MONDAQ begins with an overview of the practice of Litigation Finance, including the non-recourse nature of funding and how it differs from traditional loans. This detailed the many advantages of litigation funding, including helping average citizens see their day in court without financial barriers. It also affirmed the risks—such as pushing the boundaries of attorney-client privilege, or funders attempting to make decisions about the cases they fund. The NYC Bar Association turned heads in 2018 when they asserted that Rule 5.4a disallows fee-sharing with non-lawyers—and therefore renders litigation finance prohibited. This stance has been debated, sometimes vehemently, by legal professionals. However, the opinion is not law, and litigation funding agreements have not changed because of it. The question of disclosure remains in flux. How much should a lawyer tell a potential funder? What should they be obligated to reveal? This is especially relevant in single-case funding. It only makes sense that funders want details to properly vet cases they fund, but the question of what they’re legally entitled to know remains up in the air.   When states refine professional ethics and rules regarding litigation funding, they help ordinary citizens gain access to the justice system. While questions about disclosure and privilege remain, it cannot be denied that anyone who has been wronged deserves their day in court. Further, it should not be denied that litigation funding is the most effective way to secure the rights of citizens to pursue a case even when they lack the financial resources to do so.
Commercial

Insights into Funding International Collective Proceedings

The first day of the Global Class Actions Symposium brought with it new considerations for claims filed in the US and EU. In the United States, champerty is still an issue, as nearly half of all states do not allow the practice of Litigation Finance. Some have even said that regulatory trends are moving in two directions at once—with some seeking to restrict or heavily regulate the use of litigation funding, and others laying the groundwork for its mainstream acceptance. ISLG explains that regulatory developments are often focused on changes within the industry, and mitigating their impact. In the last few years, litigation funding has shifted from funding single large cases, often class actions, to portfolio funding. This reduces risk for funders while helping legal firms manage budgets. Some have suggested that this funder-friendly approach is incongruous with the foundational concept of Litigation Finance—increasing access to justice. Disclosure is an ongoing sticking point in litigation funding, as is the fear that funders will hold sway over decision-making in the cases they fund. This, despite existing law typically requiring that funders not control any aspect of the case. In the EU, class action cases are called ‘collective redress’. The EU is expected to strengthen the laws that impact such actions. Typically, the use of litigation funding must be disclosed to the courts, regardless of which side is utilizing it. Meanwhile in Germany, Litigation Finance has been legal since 1999, but it has never gained the popularity it has elsewhere. Day one of the symposium concluded with Melissa Ferrari, president of Verein Global Justice Network, who affirmed the importance of funders not controlling any aspect of a funded case.
Commercial

Eni Will Issue Subpoenas on Nigerian Litigation Funding Arrangements

Eni, the Italian energy company, was recently given court approval to subpoena companies accused of taking part in the Nigeria OPL 245 scandal. This is expected to include asset recovery companies as well as litigation funders. Previously, Eni suggested that the government had taken action under pressure from third parties who are hoping to profit illegally. Premium Times reports that there are seven companies involved, including Poplar Falls LLC, and six Drumcliffe Partners entities, based in Delaware USA. The subpoenas are not expected to require the release of privileged documents. The evidence sought by Eni was largely unattainable by any other method, which is why court assistance was necessary. Eni insists that their request was not intended to circumvent existing restrictions or policies on gathering evidence. In fact, the discovery sought by Eni is narrow and non-intrusive. The scandal itself involves the former oil minister of Nigeria, Dan Etete. Etete is accused of controlling accounts that received more than a billion dollars from Eni and Shell—both multinational oil giants. From those accounts, over $500 million was transferred to accounts controlled by Etete, and Abubakar Aliyu—the owner of AA oil. This 2011 transaction was authorized through several ministers of the Nigerian cabinet, ostensibly as payment for OPL 245—one of the richest oil blocks in Nigeria. Initially, both Eni and Shell stated that they were unaware that the money would go to Etete and his associates. Evidence showing that claim to be false was eventually revealed—as Shell eventually affirmed. Currently, Etete, Shell, Eni, and several oil company officials are being prosecuted in Italy for their alleged roles in this scandal. The deadline to comply with subpoenas will be 30 days from the date it is served.
Commercial

New Scholarship for ASU Law Students Announced by Pravati Capital

Scottsdale, Arizona’s leading litigation finance and consulting firm has established a scholarship in support of gifted students. The scholarship will go to exceptional students attending Sandra Day O’Connor College of Law at Arizona State University. ASU reveals that the Pravati Capital Endowed Scholarship is part of the Dean’s Circle for donors, in support of law students looking for mentorship and networking opportunities. It also provides financial support to gifted students, including those attending ASU on campuses in LA, Washington DC, and downtown Phoenix. Dean of Law at ASU, Douglas Sylvester, stated that they are grateful for such a generous donation and that the money will be used to continue to provide a first-rate law school experience for students. Pravati Capital provides litigation funding to firms on a non-recourse basis.
Commercial

Therium Capital: Identifying Claims

 In an insolvency situation, a company and its legal department will have to structure an affirmative recovery program. After that comes building a framework to identify claims they’ll pursue. In this process, understanding potential claims and being aware that an affirmative recovery program is underway are both critical. That’s why keeping everyone in the loop is essential. Therium Capital explains that how effective an affirmative recovery program is will depend largely on how well the company understands available claims. In-house legal teams can be instrumental in bringing in new claims proactively. Potential recoveries can arise from a variety of opportunities including insurance claims, IP usage, and commercial contracts. It’s vital that business units and legal teams all understand which claims are worth pursuing. Ultimately though, general counsel will make the final determinations. Any employee can serve as the eyes and ears of the legal department if they’re properly trained and motivated to do so. Relationship building, education, corporate culture, and employee incentive programs can all play a part in a successful affirmative recovery program.
Commercial

Temur Akhmedov Reportedly Lost $50 Million in High-Risk Trades

Infighting among members of the Akhmedov family continues, as divorcee Tatiana Akhmedova continues to accuse her son of hiding assets. Temur Akhmedov, London oil trader and son of Farkhad Akhmedov, denies that he hid money from his mother. City AM reports that the younger Akhmedov recently stated that while he was studying at the London School of Economics, he engaged in several risky trades. He claims to have ultimately lost more than $50 million. This was revealed during a London court case over the disbursement of a 2016 divorce settlement. Burford Capital is funding Akhmedova’s case.
Litigation Finance News
Announcements Commercial Special Features

LFJ to Host Special Digital Conference on Commercial Litigation Funding

2020 was a pivotal year for commercial litigation funding, and the industry approaches 2021 on the cusp of massive growth. Litigation Finance Journal is hosting a special digital conference which will cover the most impactful stories of the past year, and offer insights into what next year will bring. This special one-hour panel discussion and Q&A will explore the major events of the past 12 months, including the Omni/IMF merger, the founding of the ILFA, industry innovation (corporate portfolio funding and financing M&A transactions) and more. Our panel of industry experts will also offer their views on what's in store for 2021 and beyond.

Moderator

Ed Truant Founder Slingshot Capital

Panelists

Andrew Saker CEO Omni Bridgeway

  Neil Purslow Co-Founder Therium Capital Management

   Nick Rowles-Davies Executive Vice Chairman LCM

The event will be held on Thursday, December 17th at 5pm ET. It will be audio-only, and comprise a 45-min panel discussion, followed by a 15-min Q&A with attendees. Tickets can be found here. Anyone who purchases a ticket will receive a recording of the event; it is not necessary to attend to receive the recording.  Questions? Write to: jfreund@litigationfinancejournal.com Hope you enjoy the event! - The LFJ Team
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Commercial

Mara Abols Joins Omni Bridgeway as Corporate Counsel in Toronto

The Omni Bridgeway Toronto team grows larger with the addition of Mara Abols. She’ll be serving as a member of the Legal, Risk, and Compliance team, which handles global legal issues. Omni Bridgeway details that Abols will negotiate, advise, and draft litigation funding agreements as well as focus on corporate legal issues. Abols is an excellent fit for a company that has grown in size and number of deals in recent years. Abols is a bar member in Ontario and New York, and graduated with distinction from McGill University. She was also part of an International Exchange with the University of Copenhagen.
Commercial

Blackmore Bonds Pursues Suit Against Insurers Accused of Failing to Pay Out

Two insurers have been accused of wrongdoing by Blackmore Bonds after refusing to pay out to bondholders. Bondholders are guaranteed by law to receive shortfalls if the company becomes insolvent. They have stated the likelihood of legal proceedings in order to force payment. International Adviser explains that a formal demand for payment was made in April of this year, but no payments have thus far been made. While litigation is proceeding, it’s expected to be expensive and lengthy. As such, the trustee is said to be seeking out litigation funding to finance the case. In the meantime, bondholders have been told to expect substantial shortfalls.
Commercial

Ukrainian Airlines Class Action Granted Carriage

A class action brought by plaintiff Omid Arsalani has been granted carriage by the Ontario Superior Court of Justice. The case is in relation to the downing of Ukraine International Airlines Flight PS752 on January 8th. Law Times News details that two plaintiffs who filed similar but separate actions, had each tried to stay the other action—and that another action was also filed by an additional two potential plaintiffs. In determining which case would receive carriage, the judge considered the quality of counsel, the chances of success in the case, litigation funding, and proposed case theory. In addition to carriage, Arsalani’s action is being funded by Galactic Litigation Partners LLC. The funding agreement has been approved by the courts as of September of this year. Those who led the other cases were informed that they could not file for a new class action—but could pursue individual cases relating to the downed plane.
Announcements Commercial

Winshear Gold Secures Funding for Legal Proceedings Against the Government of Tanzania

Winshear Gold Corp. (TSX-V: WINS) ("Winshear" or the "Company") provides the following update on arbitration activities related to the expropriation of the SMP Gold Project (the “Project”) by the Government of Tanzania.

Winshear is pleased to advise that it has completed a Litigation Funding Agreement (the “Agreement”) with an affiliate of the Litigation Funder. The Agreement provides for funds to be drawn from a financing facility to meet all fees and expenses relating to the pursuit of certain claims against the Government of Tanzania for the illegal expropriation and loss of the SMP Gold Project, including all costs associated with legal proceedings, media/public relations, geopolitical efforts, and, if necessary, enforcement, of any awards.

Mark Sander, President of Winshear Gold, commented, “Winshear’s legal representatives, Lalive, backed by the financial support of the Litigation Funder, have been engaged to aggressively pursue compensation for the illegal activities of the Government of Tanzania in expropriating the SMP Gold Project. Lalive is highly experienced in arbitration cases in Tanzania with a track record of success for its clients.”

Background information on the arbitration case is contained in Winshear’s press releases of:

  • January 10, 2020, which announced delivery of the required 180-day notice of intent to file arbitration proceedings to the Attorney General of Tanzania; and
  • July 14, 2020, which announced the commencement of international arbitration proceedings after the 180-day notice period had expired without response from the Government of Tanzania.

Compensation being sought for expropriation of the SMP Gold Project may include, but will not be limited to, the value of the historic investment made by Winshear in Tanzania, the value of the project at the time that tenure was expropriated and damages the Company has suffered as a result of Tanzania’s acts and omissions.

The Company is not able to make any comment in relation to the potential quantum of any claim for compensation at this point.

ON BEHALF OF THE BOARD OF DIRECTORS “Mark Sander” Dr. Mark V. Sander President

For more information, please contact Irene Dorsman at (604) 210-8751 or visit www.winshear.com.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Cautions Regarding Forward-Looking Statements

This news release includes certain statements and information that may contain forward-looking information within the meaning of applicable Canadian securities laws.

Generally, forward-looking information can be identified by the use of forward-looking terminology such as “intends” or “anticipates”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “should”, “would” or “occur”. Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made and they are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements or forward-looking information, including the risks normally involved in the exploration, development and mining business or as may be otherwise set out in the Company’s filings with Canadian securities regulatory agencies. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information. The Company does not undertake to update any forward-looking statements or forward-looking information that are incorporated by reference herein, except in accordance with applicable securities laws.

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