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Announcements Commercial

Leading Dispute Financiers IMF Bentham and Omni Bridgeway Announce Plans to Merge

SYDNEY (October 15 2019)  Leading litigation and disputes funder IMF Bentham Limited (IMF Bentham) (ASX:IMF) announces that it is acquiring Omni Bridgeway Holdings BV (Omni Bridgeway) to create a truly global diversified funder with over A$2.2 billion in capital to fund disputes and enforcement proceedings of significant size and complexity throughout the world. On completion of the deal IMF Bentham will acquire all of Omni Bridgeway’s investment and business activities. The minimum transaction value amounts to approximately EUR 55 million, which may further increase contingent on future business development. “While the transaction involves IMF Bentham buying Omni Bridgeway’s business, it is a merger of equals,” said Andrew Saker, Managing Director and Chief Executive Officer of IMF Bentham. The combination forms a formidable ally for clients, with 18 offices in 10 countries across the US, Canada, Asia, Europe, Australia and the Middle East and 145 professionals experienced in legal and recovery systems world-wide and fluent in more than 20 languages. Together IMF Bentham and Omni Bridgeway have a 33-year track record of funded and recovered claims throughout the world to create a reliable partner for individuals, companies and professional advisers seeking strategic finance solutions. Those solutions span from inception of a case through trial, appeal, enforcement and legal recovery, and include:
  • funding and management of disputes, and international enforcement of judgments and awards (including against sovereigns in all continents)
  • enforcement of non-performing loans of banks and subrogation claims of insurance companies
  • world-first After-the-Event cost protection cover in cost-shifting jurisdictions.
The tie-up combines two pioneers of the litigation funding industry. IMF Bentham began funding disputes in Australia in the 1990s and has helped shape the globalized litigation finance industry via continual expansion and a record of achieving notable success rates and returns. Omni Bridgeway was founded in the Netherlands in 1986 and is known as a leading financier of high-value claims and a global specialist in cross-border enforcement against sovereign governments. The Omni Bridgeway group includes ROLAND ProzessFinanz, a leading German litigation funder which became part of Omni Bridgeway in 2017, as well as Omni Bridgeway’s joint venture with IFC (part of the World Bank Group) which consists of a dedicated fund and Dubai-based expertise center aimed at assisting banks with the funding and managing the enforcement of non-performing loans and related disputes in the Middle East and Africa region. “Like IMF Bentham, Omni Bridgeway has been at the forefront of the dispute finance industry in its regions and areas for decades,” said Andrew Saker. “As one of Continental Europe’s leading litigation funders, it offered unique advantages compared to other acquisition candidates that IMF Bentham considered for its European expansion. Those factors, combined with a strong cultural fit, made clear that merging was the right choice at the right time for both companies.” IMF Bentham and Omni Bridgeway achieve a shared goal of global diversification and presence in key litigation markets via the merger. Their new team includes professionals with wide-ranging expertise across all types of disputes and economists, financial experts, business intelligence and asset tracing professionals. “We view the merger as a partnership of complementary strengths,” said Raymond van Hulst, Managing Director at Omni Bridgeway. “Together, we have the global scale and local understanding needed for today’s complex multi-jurisdictional and domestic disputes.” “Since we were introduced by leading global investment bank Houlihan Lokey in March 2018, IMF Bentham and Omni Bridgeway have partnered on numerous projects and have discovered that our two companies, which have evolved on parallel paths, have a like-mindedness and commitment to excellence that distinguishes us from the competition,” said Andrew Saker. IMF Bentham will continue to be listed on the Australian Securities Exchange and the combined group will use the first-class business operations, reporting and accounting practices that have shaped IMF Bentham’s reputation as a trustworthy and reliable disputes financier. The combined group will assume one global name pending a rebrand projected for completion by 30 June 2020. About IMF Bentham IMF Bentham is a leading global litigation and dispute financier, headquartered in Australia and with offices in the US, Canada, Singapore, Hong Kong and London. The company has built its reputation as a trusted provider of innovative litigation financing solutions and has established an increasingly diverse portfolio of litigation and dispute financing assets. IMF Bentham has a highly experienced litigation financing team overseeing its investments, delivering, as at 30 June 2019, an 89% success rate across 192 completed cases (excluding withdrawals).  Visit imf.com.au to learn more. About Omni Bridgeway Omni Bridgeway was founded in the Netherlands in 1986 and is known as a leading financier of high-value claims and a global specialist in cross-border (sovereign) enforcement disputes. Visit omnibridgeway.com to learn more. About ROLAND ProzessFinanz ROLAND ProzessFinanz AG has been providing commercial litigation funding solutions since 2001. The company became part of Omni Bridgeway in mid-2017, creating one of Continental Europe’s leading litigation funders. ROLAND funds medium-sized merits and group claims in the German speaking jurisdictions of Europe.  Visit roland-prozessfinanz.de/en/ to learn more.
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Commercial

IMF Bentham Funding Class Action Against CBL

IMF Bentham is funding a shareholder class action against New Zealand-based CBL Corp., claiming the company failed to disclose that the Reserve Bank of New Zealand had been investigating its solvency for several years. CBL has since entered liquidation, leaving many shareholders out in the cold. According to ShareChat, law firm Glaister Ennor is leading the action, which has several institutional investors on board already. IMF and Glaister are now seeking retail investors for their claim, the valuation of which will likely run into the tens of millions of dollars. The case will be opt-in, because New Zealand does now allow for common fund orders the way neighboring Australia does (the country only permitted its very first opt-out claim last month). That means IMF and Glaister have to build a book of claimants, which they claim makes their case more substantiated, as numerous parties have already signed on. According to the liquidators' report, CBL owes nearly $200MM to an array of creditors. The company's assets are locked up in subsidiaries, which are currently under control of liquidators. IMF and Glaister intend to apply for the right to proceed against the liquidated company to the New Zealand Supreme Court, assuming the liquidators don't consent to move forward with the claim. They are also anticipating that insurance will cover any payout, though they aren't yet certain who the insurer is, or what the terms of any agreement are. IMF and Glaister are alleging that CBL violated The Financial Markets Conduct Act 2013. They have thus far only named the company, not individual executives or regulators, though there may be additions at a later date, should further liability be proven.
Announcements Commercial

Woodsford Litigation Funding continues its significant expansion with three key London hires and continued international recruitment drive

LONDON 14 October 2019, Woodsford Litigation Funding, the global provider of litigation financing solutions for businesses, individuals and law firms, has announced further expansion of its international executive team with the appointment of Adam Erusalimsky to the position of Senior Investment Officer, Alex Hickson as Investment Officer and Daniel Littman as Commercial Manager. All three will be based at Woodsford’s London HQ.

Adam, a seasoned litigator who joins Woodsford from Stewarts and Alex, who joins from Slater & Gordon, will be part the underwriting team led by Charlie Morris, focusing on cases in the UK and EMEA, including class and group actions, IP claims and general commercial disputes. Daniel will join the commercial team led by Woodsford’s Commercial and Finance Director, Mark Spiteri. Daniel will focus on structuring and negotiating litigation funding and law firm finance deals globally.

These appointments are a graphic illustration of the rapidly increasing deal flow at Woodsford. And the recruitment push in new (Canada) and existing (Singapore) markets illustrates how the business is not resting on its laurels.

“Our business continues to grow and succeed because we have a winning combination of high quality capital and high quality professionals. Particularly following last year’s injection of significant further capital by our shareholders, Adam, Alex and Daniel complete the ingredients for a successful litigation finance business” said Steven Friel, Woodsford’s CEO.

Woodsford’s new Senior Investment Officer, Adam Erusalimsky commented, “It’s tremendously exciting to be joining one of the world’s leading litigation funders at a time when it is growing so quickly. I am really looking forward to playing my part in taking Woodsford to the next level.”

About Woodsford Litigation Funding

Founded in 2010 and with a presence in London, Philadelphia, San Francisco, New York, Singapore, Brisbane and Tel Aviv, Woodsford Litigation Funding provides tailored litigation financing solutions for businesses, individuals, and law firms. This includes both single case and portfolio litigation funding and arbitration funding. Woodsford’s Executive team blends extensive business experience with world-class legal expertise. Woodsford is a founder member of the Association of Litigation Funders of England and Wales (ALF). Woodsford’s Chief Operating Officer, Jonathan Barnes, was recently re-elected to the board of ALF for a further three years.

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Commercial

MDL Judge Rejects Motion to Disclose Litigation Funding

The judge in a product liability MDL in the U.S. District Court for the District of New Jersey has rejected the defense's motion to discover whether the plaintiff is using litigation funding. As reported in Bloomberg, Judge Joel Schneider followed previous court rulings in determining that defendants have no standing to inquire as to how deep the pockets of plaintiffs actually go. In Civil No. 19-2875 (RBK/JS), Valstran (NDMA) Contamination Products Liability Litigation, the court rejected the motions to discover whether the plaintiffs were utilizing litigation funding, the terms of any funding agreements, and any communications between the plaintiff and litigation funders. Defense had cited the need to discover if the plaintiffs were “real parties in interest” in the claim. However, the court flatly rejected that argument, in keeping with a host of previous judicial decisions. What's more, the court went so far as to state that opening the door to the plaintiff's finances would rightly open the door to defense's as well. The court did, however, indicate that there may be circumstances where discovery is appropriate. Such circumstances include any where a funder may be seeking to exert undue control over the outcome of a claim. In the end, the plaintiffs suggested that the court review any funding agreements in-camera, to which Judge Schneider agreed. With Judge Polster ordering an in-camera in the prominent Opioid MDL, that seems to be the trend these days as pertains to funding agreements, at least where MDLs are concerned.
Announcements Consumer

Baker Street Funding Secures $30 Million for New Attorney Focused Fund

NEW YORK, NY / ACCESSWIRE / September 23, 2019 / A leading pre-settlement funding provider, Baker Street Funding LLC, announced today the closing of a series A round of investment into their Attorney Funding Division. Founded in 2018, Baker Street Funding has quickly become a rising star in the legal funding space and their core business model is to provide plaintiffs with much needed liquidity while their case is awaiting settlement. The newly named Attorney Funding Division will provide Attorney Funding to law practitioners across the country.

Attorney Loans, also known as Attorney Funding, are credit facilities that attorneys can access, collateralized by their future receivables to help them pay for the cost of new litigation. Attorney funding is the fastest growing division at Baker Street Funding and they expect to deploy all $30 million in the next six months.

Daniel Digiaimo, President and CEO of Baker Street Funding commented, "This new capital is going to be key to growing our attorney relationships and expanding our reach in the legal funding space and will be invested solely in attorney funding transactions." DiGiaimo also said, "Since traditional banks do not recognize future fees as valid collateral, we believe we provide a much needed service to the attorneys we work with. Since we are a private institution, we eliminate much of the headache and run-around our clients would receive dealing with a more traditional financial institution. Our process is quick and effective and once we analyze an attorneys portfolio, we are able to give them immediate access to a portion of those fees, well before they are collected". About Baker Street Funding's Attorney Funding Division The firm is designed by attorneys, for attorneys to help them grow their existing practice or branch out into new areas of the legal field. This program is being piloted by providing capital to attorneys that the firm already has an existing relationship with and will provide them with case costs as well as general working capital. Baker Street Funding does not take into account credit ratings or scores, and focuses strictly on the attorney or law firms receivables. Their due diligence process normally takes 5-7 business days which includes the analyzation of the current portfolio of receivables and creation of the credit facility.

Baker Street Funding will be opening their attorney funding program to attorneys in all 50 states and has seen a large amount of initial indications of interest from attorneys in California, New York, New Jersey, Florida, Texas, Mississippi and Georgia.

Solo practitioners and law firms who are looking to utilize their receivables to pay for expert reports, operational cash flow, trial costs or other costs incurred while running a legal practice, may contact them directly online at www.bakerstreetfunding.com/attorneys or by calling (888) 711-3599. Contact information: Name: Daniel Digiaimo Company: Baker Street Funding Email: Christie@bakerstreetfunding.com Website: www.bakerstreetfunding.com Address: 303 5th Avenue, New York, NY Phone: (888) 711-3599

SOURCE: Baker Street Funding LLC

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Commercial

Prominent GCs Want FRCP Oversight of Litigation Funding

45 general counsel and chief legal officers have signed a letter which requests that the Committee on Rules of Practice and Procedure amend the Federal Rules of Civil Procedure (FRCP) as pertains to three specific areas of MDL litigation: census of claims, interlocutory appellate review, and litigation funding. As written in the letter, the GCs and legal officers lament that the growth of MDLs (now 50% of the federal civil docket) has led to their being "less and less grounded in the widely accepted principles of procedural fairness and transparency that are the FRCP’s hallmarks." The signatories express "serious concerns" about a lack of fairness in MDL procedures, and about the viability of MDLs going forward. The letter outlines the procedural uncertainties that MDL litigants now face, including questions over uniformity of process in multiple jurisdictions, and whether procedures such as discovery tools, accepted motions and pathways to appeal should be clearly explained to all stakeholders. The 1937 adoption of the first FRCP stemmed from similar procedural uncertainties. Along with changes to the initial census of claims and interlocutory appellate review process, the letter urges the FRCP to mandate disclosure of litigation funding agreements, citing the fact that litigation funding in MDLs is "growing by leaps and bounds," yet few MDL judges "report that they are aware of TPLF in the proceedings before them." The letter goes on to state: "Disclosure is the only way that courts, parties and the Committee will learn who is in the courtroom and understand the issues that are raised by their presence. The funders’ fear of revealing privileged information should be handled just like it is for everyone else: redact it and ask for a protective order. The funders’ fear of rampant discovery is misplaced; disclosure of insurance agreements (which earlier judicial rulemakers decided to require over the strong objection of defendants) has not led to any such problems." 45 GCs and legal officers signed the letter, including from prominent companies like AstraZeneca, Comcast, Exxon Mobil, Microsoft and Johnson & Johnson.  Read the full letter here.
Announcements Commercial

Westfleet Advisors Adds Federal Prosecutor and Litigation Finance Veteran To Growing Executive Team

NASHVILLE, October 10, 2019—Westfleet Advisors, the leading U.S. litigation finance advisory firm, announced today that it has expanded its executive team with the additions of Barry Kamar and Michael Perich, both as Vice President and Legal Counsel. Mr. Kamar was most recently an Assistant United States Attorney (AUSA) in New Jersey. Mr. Perich joins Westfleet from AmLaw 200 law firm, Ice Miller.

“We are thrilled to add such high-quality talent to our team, enabling us to keep pace with the growing demand for our independent litigation finance advisory services,” said Charles Agee, founder and CEO of Westfleet Advisors. “Barry and Michael have diverse backgrounds in law, financial analysis, and litigation finance that ideally complement and bring important new perspectives to our service offerings. They will deliver tremendous value to our clients as they help them navigate litigation finance opportunities.”

Mr. Kamar spent nearly a decade in public service before joining Westfleet, first as an enforcement attorney in the Securities and Exchange Commission’s New York office and later as an AUSA in New Jersey. He brings years of experience in evaluating the strengths of cases involving financial fraud, and his extensive courtroom experience includes nearly a calendar year of trial work in a large RICO prosecution. Mr. Kamar previously worked as an investment banking analyst at Morgan Stanley & Co., where he developed skills in financial analysis, due diligence and deal negotiation.

“I’m excited to combine my trial and corporate finance experience for the benefit of parties seeking litigation funding,” said Mr. Kamar, who was named co-chief of the U.S. Attorney’s Office’s public protection unit while serving as an AUSA. “There was no doubt that Westfleet was the right place for me to do that, given its industry stature and commitment to operating ethically and transparently.”

Mr. Perich brings substantial experience in litigation finance to Westfleet. He previously worked at two leading litigation finance providers, where he underwrote litigation funding deals across a wide range of subject matter and assessed the strengths of new legal claims. At Ice Miller, he was the firm’s primary resource to answer questions about litigation funding and to structure unique contingency or alternative fee arrangements.

“Having seen litigation funding deals from the perspective of both funders and law firms, I appreciate the need for parties seeking financing to have a truly independent advisor at the table,” said Mr. Perich. “Westfleet recognized that need years ago. That’s one of the reasons Charles and Westfleet are so well respected as leaders in the industry.”

Mr. Perich will work from Chicago, while Mr. Kamar will be based in New York.

About Westfleet Advisors

Westfleet Advisors is the leading litigation finance advisor in the United States. It was founded in 2013 to bring greater transparency and efficiency to the litigation finance market by equipping users of litigation financing with expertise and resources. Our core mission is to ensure claimholders and lawyers have all the information they need to be successful with litigation financing. Our senior leadership has been active in the litigation finance industry since 1998.

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Announcements Commercial Consumer

NYU Center on Civil Justice Hosting Litigation Finance Conference

The Center on Civil Justice recently launched its Dispute Financing Library, a free, neutral repository of documents relating to the third-party litigation funding industry.  It is online at www.DisputeFinancingLibrary.org. To celebrate the Library's launch, the Center is hosting a luncheon and conference on the present and future of the litigation funding industry, looking at the state of the market and potential ethical concerns, with a keynote by Richard Painter. The Future of Dispute Finance: Pricing, Profits, and Policy will take place on October 18, from 12pm-4:30pm, in Greenberg Lounge in Vanderbilt Hall, 40 Washington Square South. For more information and to RSVP, visit https://tinyurl.com/y23baryf.
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Announcements Commercial

Frances Coats joins Augusta as General Counsel

London 10th October 2019, Augusta today announces the appointment of Frances Coats as General Counsel, based in London.

Frances joins from diversified insurance business The Ardonagh Group, where, as Chief Counsel, she managed the Corporate and Commercial legal needs of the group. Coats was named as Legal 500 In-House Insurance Individual of the Year 2019, Legal Business’ Rising Star In-House Counsel of the Year 2019 and was listed in The Lawyer’s Hot 100 2019.

Frances’s recruitment is a further addition to Augusta’s management group following the arrivals of Proskauer’s Director of Professional Resources Polly Bahl as Chief Operating Officer (COO) and FTI Consulting Managing Director Leor Franks as Chief Marketing Officer (CMO). These additions reflect Augusta’s continued growth and investment in professional functions to support the increasing demand for dispute and litigation funding.

Commenting on the appointment, Louis Young, Managing Director at Augusta, said: “We’re pleased to welcome Frances to Augusta. With her deep experience of financial services in-house legal management, Frances will play an important role in advising on the next phase of our growth”.

Frances Coats commented: “I’m delighted to be joining leading litigation funder Augusta. As the business continues to grow, entering new markets and forming strong strategic client relationships, I’m looking forward to supporting Augusta's management team in the UK and internationally”.

About Augusta:

- Established in 2013, Augusta’s scale enables us to make decisions in market-leading timeframes and fund cases of any size.

- Augusta is organised into a series of specialist practice groups: Arbitration, Class Action, Competition, Consumer, Intellectual Property and Litigation, and sectors including Financial Services and Construction & Energy.

- By the end of H12019, Augusta had funded 213 claims with a market-leading win ratio of over 80%.

- Augusta has offices in London, Sydney, Melbourne and Toronto.

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Uncategorized

Legal-Bay Settlement Funding Announces Extended Deadlines for Victims of Sexual Abuse

NEW YORK, Oct. 8, 2019 /PRNewswire/ -- Legal-Bay, the premier lawsuit funding company, previously reported on Governor Cuomo's new legislation to extend filing deadlines for sexual abuse survivors in the state of New York. The law went into effect last month, and since then, over 500 new cases have been filed. While most of the lawsuits targeted churches or scouting organizations, many were against Rockefeller UniversityHospital, where Reginald Archibald (now deceased) was employed as a pediatrician for decades, enabling him to sexually abuse over 1000 children. While the hospital has already settled over 200 cases, details regarding payout amounts have not yet been divulged. If you or a loved one require an immediate cash advance from your sexual abuse lawsuit, please visit the company's website: http://lawsuitssettlementfunding.com or call: 877.571.0405 Chris Janish, CEO, commented on the company's focus of assisting plaintiffs in similar situations, "We applaud the efforts in New York and New Jersey to extend the statute of limitations on all sex abuse cases, and we are hopeful that more victims will take this opportunity to obtain some justice after years without a voice." New legislation in more than a dozen states offers sexual abuse victims the ability to sue their abusers up until they turn 55. Because of similar landmark decisions, Legal-Bay predicts an influx of new filings by the end of 2019. Legal-Bay is an advocate for victims of sexual abuse across the country, and is well-versed in clergy abuse litigation, especially in situations where Catholic churches have filed for bankruptcy to limit their payouts. Even in those cases, the pre settlement cash company was able to provide a lawsuit cash advance to victims across the country, including NY and NJ. If you have already filed a sexual abuse lawsuit, you can apply for presettlement funding at: http://lawsuitssettlementfunding.com or call: 877.571.0405 Legal-Bay's programs are non-recourse lawsuit cash advances, also known as case funding, which means you only repay the settlement advance if you win your case. None of the programs should be considered to be a lawsuit loan, lawsuit loans, settlement loans, settlement loan, pre-settlement loans, or a pre-settlement loan. Contact: Chris Janish, CEO
Email: info@Legal-Bay.com 
Ph.: 877.571.0405 SOURCE Legal-Bay LLC
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Consumer

Divorce Funding Has Arrived

Couples save for weddings, not divorces. As a result, many are cash-strapped and taken aback by the high costs of divorce. This places undue burden on attorneys, who must often choose between working on contingency or turning away clients. Fortunately, divorce attorneys can leverage divorce funding options, which allow receivables to be covered as they emerge. As reported in Bloomberg, the average cost of a contested divorce ranges from $15-$30k. Of course some reach into the millions and last for many years. Many divorce attorneys end up bearing the brunt of these costs, or turning away clients who can't afford the expense. Litigation funding has permeated the Legal Services industry, and divorce law is no exception. Unlike traditional banks and finance companies which assess a prospective client's eligibility based on assets, credit or income score, divorce funders base eligibility off of the expected settlement of the claim. As a result, funding becomes available for legal fees, expert costs and living expenses. As with other consumer funding, divorce funding can enable clients to hire the best possible attorney - one whose billable hour might be outside the scope of the client's normal budget. This optimizes the outcome in the client's favor. Divorce funding is a relatively new sector of the consumer legal funding space - having truly emerged in the last decade. And with the high cost of divorce, it's likely here to stay.
Announcements Commercial

Debut Of Litigation Finance Firm BlueWhite Legal Capital Marks Latest Jules Kroll Venture, Leveraging Decades Of Legal And Business Success

NEW YORK, Oct. 7, 2019 /PRNewswire/ -- BlueWhite Legal Capital ("BlueWhite" or "the Company"), a privately-held litigation finance firm led by Jules Kroll, Aaron Rubinstein, Earl Doppelt, and Jack Blackburn – all prominent business, legal and finance professionals – today announced its official company launch. BlueWhite, which will focus on financing commercial litigation, is distinguished in an increasingly important industry by its experienced team; agile, strategic, and highly-focused approach; skills in asset tracing and recovery; and committed capital. "My colleagues and I are excited to launch BlueWhite Legal Capital and help build a leading firm that can deliver real value to companies and law firms," said Jules Kroll, Principal of BlueWhite and Chairman of K2 Intelligence and Kroll Bond Ratings. "We are veteran problem solvers who think like the lawyers and corporate executives we support, giving us powerful insight and a unique competitive profile." Mr. Kroll noted that commercial litigators are under increasing pressure to find business solutions that allow them to pursue meritorious cases with the right economics, and are finding litigation finance a value added approach. "Litigation finance is a powerful tool that can give companies and law firms a competitive advantage while enhancing efficiency and profitability. BlueWhite's team and I have worked to ensure that from day one, we are delivering these advantages with top-of-the-line capabilities, capital to deploy, and a culture of excellence and integrity," Mr. Kroll concluded. Uniquely Qualified Team of Business, Law, and Finance Professionals 
BlueWhite is led by its four principals: Jules Kroll, Aaron Rubinstein, Earl Doppelt, and Jack Blackburn. Each brings unparalleled experience at the highest levels of business, law, and finance:
  • Jules Kroll pioneered the business intelligence industry. He is the founder of K2 Intelligence, Kroll Bond Ratings, cybersecurity firm BlueVoyant, and Kroll Inc. He is currently the Chairman of Kroll Bond Ratings and K2 Intelligence. K2 Intelligence, which is an intelligence, investigations, and asset recovery firm, is one of the strategic owners of BlueWhite.
  • Aaron Rubinstein, most recently a partner at Arnold & Porter Kaye Scholer LLP, chaired the Kaye Scholer litigation practice for more than a decade.
  • Earl Doppelt was formerly a senior executive and general counsel of several major multinational corporations, including The Dun & Bradstreet Corporation, The Nielsen Corporation, and Walter Energy, Inc.
  • Jack Blackburn is a former Wall Street executive with experience in litigation finance, having spent his career with Freddie Mac, Citicorp, Merrill Lynch & Co., and Burford Capital.
The BlueWhite Approach 
The Company's strategy will focus on commercial litigation, with specific targeted areas to include breach of contract, securities, M&A, antitrust, fraud, breach of duty, bankruptcy, intellectual property, and asset recovery. BlueWhite's strategic relationship with corporate investigations firm K2 Intelligence is expected to provide a distinct advantage with respect to matters that involve tracing hidden assets and enforcing legal judgments. BlueWhite will target average initial litigation finance commitments between $5 and $15 million, while maintaining the flexibility to evaluate each matter on its own merits and, where appropriate, provide financing outside of this range. The collective experience and expertise of its principals and its relationship with K2 Intelligence will enable BlueWhite to be a highly effective strategic partner to lawyers, corporate executives, and other claimants. Committed Capital 
BlueWhite is backed by Magnetar Capital, a leading alternative asset manager with over $12.9 billion of assets under management1, and a wide range of alternative credit and fixed income, systematic investing, and energy and infrastructure investment strategies. The Company will operate with committed capital, allowing it to move quickly for the benefit of its funded parties. 1 Moelis & Company LLC acted as exclusive financial advisor and placement agent for BlueWhite Legal Capital. Arnold & Porter served as BlueWhite's legal advisor. For further information about BlueWhite Legal Capital, please visit BlueWhiteLegalCapital.com. SOURCE BlueWhite Legal Capital
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Announcements Commercial

Financial Poise™ Announces “Ethical Problems Associated with Paying for Litigation,” a New Webinar Premiering October 16th at 1:00 PM CST through West LegalEdcenter™

CHICAGO (PRWEB) OCTOBER 04, 2019: Lawyers’ ethical duties don’t just inform how they do their jobs – they also dictate how they get paid. Join our panel for a discussion of ethical issues arising out of legal fee arrangements, from basic requirements of reasonableness to ongoing and developing law concerning third party litigation finance in multimillion dollar cases.

To learn more, click here.

The webinar will be available on-demand after its premiere. As with every Financial Poise Webinar, it will be an engaging and plain English conversation designed to entertain as it teaches.

About Financial Poise –  Financial Poise has one mission: to provide reliable plain English business, financial and legal education to investors, private business owners and executives, and their respective trusted advisors. Financial Poise content is created by seasoned, respected experts who are invited to join our Faculty only after being recommended by current Faculty Members. Our editorial staff then works to make sure all content is easily digestible. Financial Poise is a meritocracy; nobody can “buy” their way into the Financial Poise Faculty. Start learning today at https://www.financialpoise.com/

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Announcements Commercial

Bryant Park Capital Arranges $104.5 Million in Capital for Legis Finance

NEW YORK, NY / ACCESSWIRE / September 23, 2019 / Bryant Park Capital ("BPC"), a leading middle market investment bank, announced today that Legis Finance Ltd. ("Legis" or the "Company") recently closed on a $104.5 million capital raise transaction with a global investment management firm. This financing adds to its current insurance and merchant banking capacity, and gives the Company a long-term capital partner to finance operations and originations.
BPC served as the exclusive financial advisor to Legis in connection with this transaction. "The Bryant Park Capital team acted as a true extension of our company and had our best interests in mind every step of the way. We could not have been more pleased with their professionalism and expertise in positioning the opportunity and helping us gain senior level access to leading specialty finance investors. I would highly recommend their services to any originator seeking to raise institutional capital," said Tim Scrantom, Managing Director at Legis Finance. About Legis Finance, Ltd. Founded by seasoned commercial litigation funding executives who launched one of the industry's first institutional investment funds in 2007, Legis was formed to disrupt the traditional commercial claim investment marketplace. Legis' model is centered around providing independent advice on structuring litigation finance investments and insurance solutions to leading global law firms. Through its partnership with one of the world's largest insurance groups, and now a global investment management firm, Legis has developed a suite of novel products geared to helping law firms and their clientele invest in large-scale commercial litigation assets. For more information about Legis, please visit www.legisfinance.com About Bryant Park Capital Bryant Park Capital is an investment bank providing M&A and corporate finance advisory services to emerging growth and middle market public and private companies. BPC has deep expertise and a diversified, well-founded breadth of experience in a number of sectors, including financial services, healthcare services and, more recently, cannabis. BPC has arranged lines of credit, raised growth equity, and assisted in mergers and acquisitions for its clients. The BPC team has completed over 300 assignments representing an aggregate transaction value of over $64 billion. For more information about Bryant Park Capital, please visit www.bryantparkcapital.com. Contact: Dan Avnir, Managing Director 212-798-8202 davnir@bryantparkcapital.com SOURCE: Bryant Park Capital
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Commercial

Some Considerations for IP Lawyers Regarding Litigation Finance

The recent LF Dealmakers conference in NYC highlighted several key issues facing the funding industry. And there exists a clear overlap between litigation funding and IP, given that IP is the most-funded legal sector at the moment (additionally, the organizer of LF Dealmakers, Wendy Chou, hosts an annual IP Dealmakers event). So naturally, one of the topics discussed at LF Dealmakers is how IP lawyers should interact with the funding market. As reported in Above the Law, it's imperative that IP attorneys begin fostering relationships with funders. This includes discussing a funder's specific interests, submitting cases for diligence, and questioning funders as to how their service can benefit one's IP practice. The good news is that funders actually want to engage with attorneys - it's how they source investments, after all - so building rapport with funders shouldn't be too difficult. Funders are even looking at ways to innovate their product to enable partnerships with law firms (portfolio, defense-side, and small claims funding all come to mind). What's more, even with the devaluation of patent cases due to recent legislation, that hasn't dampened the funding community's interest in the sector. Patent claims are notoriously costly and time-consuming so there will always be a need for litigation funding, even if the risk/reward ratio isn't quite what it once was. One panelist at the LF Dealmakers conference recounted a story where one partner at an IP firm confirmed that the firm does not use funding. Meanwhile, another partner was actively soliciting funding for one of their claims. This underscores the need for IP lawyers to delineate a clear strategy with regard to funding - to what extent they will pursue it, and how they plan to approach the market. Like it or not, litigation funding and IP are highly-intertwined. Any IP lawyer who refuses to recognize this brave new world is missing out on a resource that his or her competitors are clearly leveraging.
Announcements Consumer

Modeso LLC Announces New Senior Credit Facility

KATONAH, NY / ACCESSWIRE / October 1, 2019 / Modeso LLC dba RapidFunds ("RapidFunds" or the "Company") announced today that it has closed on a $70 million term loan facility, consisting of a $40 million delayed draw term loan and $30 million accordion feature, with a multi-billion dollar institutional investment firm. This financing provides the Company a long-term capital partner to enable RapidFunds to grow its business and expand its network of law firm relationships.

Founded in 2004 by a group of former career attorneys, RapidFunds is a leading post-settlement litigation finance company that is engaged in accelerating the working capital conversion cycle for U.S. plaintiff law firms awaiting disbursement of proceeds from a legal settlement. The Company has funded over 2,300 transactions representing over $160,000,000 in total origination volume.

"We are delighted to have completed this important financing transaction for RapidFunds," said Peter Speziale, President & CEO of the Company. "Our new senior credit facility provides us with significant capital to expand our business, as well as a long-term partner that will add tremendous value to our company. We'd also like to extend our appreciation to Bryant Park Capital, who was invaluable to RapidFunds over the course of this financing process."

Bryant Park Capital LLC served as exclusive financial advisor to RapidFunds in connection with this transaction.

About RapidFunds

For over 15 years, RapidFunds has assisted U.S. plaintiff law firms in accelerating the receipt of attorney fees in legal settlements. With a focus on superior client service and speed of execution, the Company has provided innovative financing solutions to hundreds of law firms nationally.

For more information about RapidFunds, please visit www.rapidfunds.com.

About Bryant Park Capital

Bryant Park Capital ("BPC") is an investment bank providing M&A and corporate finance advisory services to emerging growth and middle market public and private companies. BPC has arranged lines of credit, raised growth equity, and assisted in mergers and acquisitions for its clients. BPC's professionals have completed over 300 assignments representing an aggregate transaction value of over $64 billion.

For more information about Bryant Park Capital, please visit www.bryantparkcapital.com.

Contact: Bryant Park Capital Joel Magerman, Managing Partner Phone: (212) 798-8212 Email: jmagerman@bryantparkcapital.com

Matt Pennino, Managing Director Phone: (212) 798-8216 Email: mpennino@bryantparkcapital.com

RapidFunds Peter J. Speziale, President & CEO Phone: (914) 552-4261 Email: pspeziale@rapidfunds.com

SOURCE: Modeso LLC dba RapidFunds

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Announcements Commercial

The Association of Litigation Funders of England and Wales appoints Susan Dunn as Chair

London 2 October 2019: The Association of Litigation Funders of England & Wales (“the ALF”) today announced the appointment of Susan Dunn as Chair at the ALF’s Annual General Meeting. Susan Dunn currently serves as a Director of the ALF and succeeds Leslie Perrin, following his expression of a desire to stand down this year after serving as Chair for almost 8 years. Susan Dunn is one of the co-founders of Harbour Litigation Funding, one of the industry’s leading litigation funders.  Susan qualified as a solicitor in 1992 and has worked as a commercial litigator in both the United Kingdom and the United States where she was also a diplomat (Vice-Consul Investment) for the British Government.  Susan was central to the completion in 2011 of the Code of Conduct in England and Wales for Litigation Funders and the formation of the ALF in 2011. Leslie Perrin said: “Susan is one of the pioneers of the litigation funding industry and she has worked tirelessly to raise awareness of how litigation funding can promote access to justice and facilitate the resolution of disputes. Under Susan’s leadership, the ALF will continue to be regarded as embodying the best practice gold standard of the litigation funding industry.” Susan Dunn, Chair of ALF said: “It is an honour to take over the Chair of the ALF from Leslie, who took on the leadership of the ALF when it was formed in November 2011.  His work has ensured that our members adhere to the highest standards at a time of growth in litigation funding. I look forward to continuing to work with Leslie and all of my other colleagues in the industry, as well as the Government and regulators, and to ensure excellence in the provision of litigation and arbitration funding as the industry continues to grow and develop.” The Association of Litigation Funders is an independent body that has been charged by the Ministry of Justice with delivering self-regulation of litigation funding in England and Wales.  Litigation funding is the provision by a third party of finance to a party to litigation or arbitration, which is used to pay for the legal costs of the dispute, in exchange for the funder taking a share of the proceeds in the event of a successful outcome. Media enquiries Desiree Maghoo Questor Consulting T: +44 (0)7775 522740 dmaghoo@questorconsulting.com About the Association of Litigation Funders The Association of Litigation Funders (the ALF) is an independent body that has been charged by the Ministry of Justice with delivering self-regulation of litigation funding in England and Wales. Litigation funding is the provision by a third party of non-recourse finance to a party to litigation or arbitration, which is used to pay for the legal costs of the dispute, in exchange for the funder taking a share of the proceeds in the event of a successful outcome. The litigation funding industry has established and paid for its own regulation and defined best practice, helping to protect claimants who seek the rational management of financial risk in litigation and arbitration. By working with a Funder Member of the ALF, parties accessing litigation funding are assured that they will find an organisation that strives to meet the high-quality standards that should define this industry. The ALF Code of Conduct sets out the standards by which all Funder Members of the ALF must abide. It sets the standards for the capital adequacy of funders, sets out the specific, limited circumstances in which funders may be permitted to withdraw from a case, and outlines the way in which the roles of funders, litigants and their lawyers should be kept separate. The ALF also maintains robust and efficient complaints handling procedures. The ALF actively engages with government, legislators, regulators and other policy makers to shape the regulatory environment for litigation funding in England and Wales. ALF board members include Susan Dunn, Neil Purslow, Christopher Bogart, Jonathan Barnes who was re-elected at the AGM and Rob Rothkopf, Managing Partner of Balance Legal Capital LLP, who joins the board for the first time. Funder members of the ALF include Augusta Ventures Ltd, Balance Legal Capital LLP, Burford Capital, Calunius Capital LLP, Harbour Litigation Funding Ltd, IMF Bentham, Innsworth Advisors Ltd, Redress Solutions PLC, Therium Capital Management Ltd, Vannin Capital PCC and Woodsford Litigation Funding Ltd. For more information please visit: http://associationoflitigationfunders.com/
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Commercial

Burford Capital Brings Columbia Law School Study to Court in Bid to Uncover Market Manipulation

Burford Capital has commissioned a study by Joshua Mitts of Columbia Law School which found that there is indeed evidence to back the funder's claim that it was the victim of market manipulation in the wake of the Muddy Waters attack which shed 50% of the stock's valuation in a single day. Burford is presenting the study in court to compel the London Stock Exchange to release the names of the short-seller sho it says manipulated the trading. According to City A.M., Burford is accusing market manipulators of 'spoofing' and 'layering,' whereby a trader issues a heavy dose of sell order on a particular stock, then quickly cancels those orders. The idea is that the cancelled trades place downward pressure on a stock and can lead to a bear-rush - or selloff - which any short-seller will of course benefit from. Carson Block, Muddy Waters' founder, denies any allegations his firm was involved in the spoofing and layering tactics. He alleges these are tools used by high-frequency traders and computer algorithms, which he claims his firm has zero capability of facilitating. Block contends that his company's public short of Burford is what led to the stock decline, and that any spoofing or layering - if it did occur - was not his firm's doing. But Burford isn't so sure. The funder is seeking to compel the LSE to divulge the identities of the spoofers/layerers, and has petitioned the High Court for an order. The funder hasn't ruled out civil litigation and even criminal proceedings against those involved.
Commercial

Why Litigation Funding is Surging in Popularity in India

Third party funding is taking off in India, thanks in part to a robust construction and infrastructure sector that is asset and debt-heavy, yet encumbered with the prospect of litigation. As reported by CNBC, there is no statutory bar on litigation funding in India. In fact, amendments to Order XXV, Rule 1 of the Code of Civil Procedure, 1908, have established that courts have the power to secure costs from litigation funders by asking them to become a party and meeting a costs order. And The Supreme Court of India has already ruled that litigation funding does not violate the age-old tort of champerty. Recently, large conglomerates in the infrastructure and EPC sector have been engaging with third party funders. Distressed debt is a major factor for these companies, as is a recent court ruling which makes it easier for creditors to pursue defaulters in insolvency litigation once they have secured an adverse court/arbitration order. This ruling is forcing EPC companies to try to resolve litigation much sooner than they otherwise would, and that is prompting their inviting litigation funders into the mix. Hindustan Construction Company Limited and Patel Engineering Limited are two prime examples. Both are pursuing claims against government-backed entities, so there is the added security that the defendants are solvent and credit-worthy and will eventually fulfill any payment obligation. In each of these examples, the litigants have structured their funding agreements as assignments of the claims themselves to the litigation funder. It's worth noting, however, that the funders in these cases are investment firms BlackRock and Eight Capital. We have yet to see how dedicated litigation funders may structure an agreement or partake in the Indian funding market. That said, the very fact that funding is taking off in India makes the world's second most populous nation one to watch where litigation funding is concerned.
Commercial

Southern Response Wants to Avoid Paying Claims Funding Australia in Settlement

New Zealand government insurer Southern Response wants to eschew a Court of Appeals order that  a portion of its settlement go to litigation funder Claims Funding Australia. Maurice Blackburn and Claims Funding took over representation for 3,000 claimants after a New Zealand court allowed an opt-out class action for only the second time in history. Southern Response is weighing an appeal to the decision, preferring to deal with the claimant pool directly. As reported in Share Chat, in 2012, Southern Response took over claims on policies written by failed insurance company AMI. The court allowed some 3,000 claimants to engage in an opt-out action, thereby including all potential claimants in the action unless they specifically opt out. The claim is being funded by Claims Funding Australia, and Southern Response is challenging the funder's ability to collect on its portion of any settlement in the case. Currently, the government insurer is dealing with a separate action - also in the Court of Appeal - and wants to address this action once the other has concluded. Maurice Blackburn and GCA lawyers - both representing the claimant pool - have said they plan to negotiate with Southern Response, but are taking the position that the insurer has no business eschewing the opt-out order from the court.
Commercial

Security Costs Ordered in Harbour-Funded Feltex Claim

Defunct New Zealand firm Felted Carpets - which collapsed just two years after its IPO - is being sued on behalf of over 3,000 investors. Harbour Litigation Funding had funded the claim up through 2015, with 'Stage 2 Funding' coming from a group of investors including Joint Action Funding. Now, the Supreme Court has ordered a $1.65MM security for costs order, which the plaintiffs are contesting. As reported in Share Chat, former Fay Richwhite banker Tony Gavigan, who is organizing the funding, has contested the need to pay security for costs. Gavigan also claims insurance is on the way - though none has been procured as of yet. Gavigan claims that his Stage 2 Funding is coming from a quintet of Auckland businessmen. The claim, meanwhile is headed for the Court of Appeal next month in regard to witness testimony. Gavigan wants more time to secure both funding and insurance, even through the claim is more than a decade old, and Feltex collapsed nearly 14 years ago.
Commercial

With Nod to Burford, Rosenblatt Clarifies Accounting for Litigation Funding Arm

UK law firm Rosenblatt announced the formation of a litigation funding arm when the firm went public last year. Now, in the firm's half-year report, CEO Nicola Foulston announced that Rosenblatt will be treating all un-concluded claims as costs, eschewing any potential concern over its accounting methodology. As reported in the Financial Times, Rosenblatt's announcement comes on the heels of the Muddy Waters allegations against Burford Capital. The core allegation is that Burford inflates its balance sheet by accounting for profits from cases that haven't been concluded yet. Foulston said her company will only account revenue/earnings from concluded claims, and not those that reach certain benchmarks and achieve a likely probability of payout. Both Rosenblatt and Burford adhere to IFRS 9 accounting standards, but those standards allow for some wiggle room when it comes to investment valuation. Burford's accounting is audited by Big-4 accounting firm EY, but that hasn't stopped some in the investment community from questioning its use of fair value accounting for inherently risky financial products. Clearly, Rosenblatt is distancing its own accounting practices from those of Burford. In the six months ending June 30th, Rosenblatt realized £10.2MM in firm revenue and £3.2MM in pre-tax profit. The company has invested £1.5MM in four claims, none of which have concluded yet. The firm also sold off its stake in a separate claim as a secondary for £2MM.
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Commercial

Harvard Law Tackles Litigation Finance

The latest issue of Harvard Law School's Center on the Legal Profession's 'The Practice' magazine features a robust examination of the litigation finance industry, including how the industry operates, who the major players are, how deals get done, and what law students should do to secure a career in legal finance. Selvyn Seidel of litigation funding broker Fulbrook Capital Management, and Elizabeth Korchin of Therium Capital Management cogently explain the diligence process, including both case examination and financial analysis. Korchin points out that her firm typically doesn't fund for anything less than $1MM, looks for a 10:1 multiple on damages/budget (which is the industry standard). Therium looks for their investment back, plus a 3x multiple. So if they finance a $10MM claim for $1MM, they'll accept a $4MM return, leaving the claimant and their law firm with the rest. Of course, there is an alignment of interests issue. If the claimant is mandated to pay out that $4MM to the funder, he or she is not going to settle for anything close to $4MM (in order to maximize his/her own return). In order to better align their interests with those of their clients, funders often tranche their funding structures, establishing benchmarks whereby their return escalates as a claim continues. That way, funders accept a smaller return for an early settlement, which better aligns all parties' interests. Should a case drag on, both the risk and cost of capital for a funder increase, so their payout ratio should as well. The article is very informative and worth a read. One interesting tidbit comes as advice to future litigation funders - those currently in law school. Seidel urges anyone seeking a career in funding to first enter the legal practice and gain expertise in a desired field - preferably one that frequently engages with funding (IP, trade secrets, insolvency). Once you've gained the requisite legal expertise and established a strong network from which you can source case investments, then consider transitioning into litigation funding.
Announcements Consumer

Multi Funding USA Earns NMLS Certification

Woodstock, NY—September 24, 2019 — Multi Funding USA, a leading pre-settlement funding provider serving law firms and attorneys, announced that it has received NMLS  (Nationwide Mortgage Licensing System and Registry) certification, indicating that the company has the financial resources and security protocols to satisfy the needs of lawyers and plaintiffs. Applying for NMLS certification is completely voluntary. Only a select group of litigation finance providers have applied and received NMLS designation. During the NMLS evaluation process, applicants undergo comprehensive business and personal background checks, financial audits, and a review of corporate documentation, including business plans, shareholder agreements, and financial statements. Applicants must also demonstrate compliance in safeguarding personal data and financial transactions. “We’re extremely proud to have earned this certification, which is certainly unique in the litigation finance sector. This designation demonstrates that our company has the financial resources, expertise, and technology to properly serve the attorneys and their clients that rely on pre-settlement funding to manage their daily living expenses,” said Michelle Fuoco, chief financial officer of Multi Funding USA. “Pursuing NMLS certification is complex, however. We felt this designation was essential to assure our customers that Multi Funding is a reliable, secure, and stable company that can fulfill all their pre-settlement funding needs.” Multi Funding USA invests in litigations for attorneys and their clients. The company has developed a system that can place funds into the hands of plaintiffs and attorneys in less than 24 hours, providing financial security in the often-lengthy pre-settlement period. About Multi Funding USA Headquartered in Woodstock, New York, Multi Funding USA is a major provider of specialized legal funding, attorney funding, and law firm funding services. With decades of lawsuit funding, business, and legal experience, the company’s founders have made it their focus to provide simple and fast services while maintaining a high standard of excellence. Multi Funding USA has provided millions of dollars of legal funding to plaintiffs and attorneys across the United States. www.multifundingusa.com
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Announcements Commercial

Burford Capital briefing on fair value and return computations

In response to investor inquiries, Burford Capital Limited (“Burford Capital” or “Burford” or “the Company”), the leading global finance and investment management firm focused on law, has today uploaded to the investor relations section of its website a briefing of the Company’s investment fair value and return computations.
The document can be found at http://www.burfordcapital.com/investors.

For further information, please contact:

Burford Capital Limited
Jim Kilman, CFA, Chief Financial Officer+1 917 985 9840
Robert Bailhache, Head of Investor Relations – email+44 (0)20 3530 2023
Macquarie Capital (Europe) Limited – NOMAD and Joint Broker+44 (0)20 3037 2000
Jonny Allison
Alex Reynolds
Jefferies International Limited – Joint Broker+44 (0)20 7029 8000
Graham Davidson
Tony White
Numis Securities Limited – Joint Broker+44 (0)20 7260 1000
Charlie Farquhar
Jonathan Abbott
About Burford Capital Burford Capital is the leading global finance and investment management firm focused on law. Its businesses include litigation finance and risk management, asset recovery and a wide range of legal finance and advisory activities. Burford is publicly traded on the London Stock Exchange, and it works with law firms and clients around the world from its principal offices in New York, London, Chicago, Washington, Singapore and Sydney. For more information about Burford: www.burfordcapital.com This release does not constitute an offer of any Burford fund. Burford Capital Investment Management LLC (“BCIM”), which acts as the fund manager of all Burford funds, is registered as an investment adviser with the U.S. Securities and Exchange Commission. The information provided herein is for informational purposes only. Past performance is not indicative of future results. The information contained herein is not, and should not be construed as, an offer to sell or the solicitation of an offer to buy any securities (including, without limitation, interests or shares in the funds). Any such offer or solicitation may be made only by means of a final confidential Private Placement Memorandum and other offering documents.
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Commercial

CFPB Determines Own Structure Unconstitutional; RD Legal Claim Likely to be Stayed

Well, how often does this happen? A government agency officially declares itself unconstitutional. That's what the Consumer Financial Protection Bureau (CFPB) just did, as director Kraninger sent letters to House Speaker Nancy Pelosi and Senate Majority Leader Mitch McConnell, stating in no uncertain terms that the agency is unconstitutional given the single-director-removable-only-by-POTUS structure. According to JD Supra, the CFPB has formally agreed with its numerous critics, which have moved that its actions against them be dropped because the agency is unconstitutional. Several courts have agreed, and currently there are two appeals courts - the 5th and 2nd circuits - hearing those cases. One of those involves RD Legal, the consumer legal funder being sued by the CFPB for alleged 'predatory lending' tactics. In the letters, Kraninger suggest simply removing the for-cause-removal provision, and letting the CFPB get on with business as usual. However, it is possible the end result here is a termination of the CFPBs enforcement activities entirely. For now at least, it seems the CFPBs claim against RD Legal is going nowhere. We'll have to wait and see if the CFPB will continue to be an enforcement entity at all.
Commercial

Supreme Court of Queensland Finds LCM’s Funding Agreements to be Enforceable

LCM has been funding a class action against the Gladstone Ports Corporation (GPC) on behalf of local fisheries and fishermen, who claim that GPCs port expansion project led to the collapse of the fishing market there. GPC had been arguing that LCMs funding agreement is unenforceable on the basis of champerty and maintenance, but the court just upheld the agreement as not champertous. As reported in Mondaq, the plaintiffs applied for a declaration by the court that their funding agreement is enforceable. LCMs counsel went so far as to argue that maintenance and champerty are essentially obsolete, and requested 'a decent common law burial' for the pair of torts. Plaintiff's counsel was a bit less aggressive, arguing that even if maintenance and champerty are enforceable, they do not apply to the enforceability of a funding agreement in a class action regime, which essentially carries with it the understanding that litigation funding will be part and parcel of the action. Courts have upheld funding agreements on such grounds in the past, so GPC had an uphill battle to climb here. They argued that LCM's funding agreements ceded too much control to the funder, and was therefore contrary to public policy. The court ultimately found in LCMs favor, ruling that too much control was not ceded, and that ultimately the court maintains the authority to determine what percentage of a settlement a funder is to receive. This essentially negates any argument of control on LCMs part, despite that certain mandates in the funding agreement appear to give the funder some sway over decisions which are made during the case. In the end, the Gladstone claim will go down as yet another brick in the now formidable wall which supports litigation funding agreements as enforceable in regard to maintenance and champerty.
Commercial

LF Dealmakers Forum Brings Together Legal Funders, Lawyers, Academics and In-House Counsel

This past Wednesday and Thursday saw New York City play host to the 2nd annual LF Dealmakers Forum. Hosted by Wendy Chou, whose popular IP Dealmakers Forum served as a launchpad for a similar conference aimed at the litigation funding market, the sold out two-day event brought together industry experts and novices alike. Keynote Address The event kicked off with a keynote address from Stephen Susman, founding partner of Susman Godfrey, and one of most successful plaintiffs lawyers in US. Susman recounted his early days as essentially one of the first litigation funders, having formed his contingency-only plaintiff-side law firm in the late 70s, back when the notion of contingency-only raised more than a few eyebrows. Susman saw himself filling a need in the marketplace, and indeed by the end of the decade had grown so popular that in 1981 he landed the cover of American Lawyer, which itself founded the legal journalism market. In the process of running his contingency-fee practice, Susman learned how to construct fee agreements that provide the right incentives, how to handle cases efficiently, how to compensate associates and partners properly, and how to teach younger lawyers to be effective at their trade. These are all ideals that Susman continues to preach. The theme of Susman's speech was how contingency leads to efficiency. The more skin in the game that attorneys have, the more likely they are to question the efficacy of their discovery motions, and reconsider or reevaluate their overall case strategy with an eye towards efficiency over simply a 'more is better' approach. "Lawyers who are paid by the hour have no incentive to be efficient," Susman said. "Even if they give you a discount. It’s like buying a suit at Barney’s half price. It’s already been marked up four-times." To that end, Susman advocates funders adopt a 50/50 fee model with the law firms they partner with. He recommends funders insist that law firms also maintain skin in the game. Susman further encouraged the industry to play an active role in reducing the cost of litigation. He advocates for public jury trials, as opposed to private dispute resolution. Susman ended his address by suggesting that funders have a role to play in terms of advising their clients on how best to negotiate with their law firms. While acknowledging that this advice goes against his own best interests, Susman stated unequivocally that litigation funders - with their legal expertise, and the fact that they are no longer lawyers and are therefore operating as advisors - can guide clients on how best to negotiate with law firms on fee arrangements. This is an area where funders can provide value to the client, outside of pure financing. Panel Discussions Panels ranged from a broad overview of the funding industry, to coverage of specific sector topics. In the first panel of the day, which provided a bird's eye view on the state of the industry, panelists highlighted the industry's monumental growth, both in single-case and portfolio funding, and within boutique and AmLaw 200 law firms alike. Of course, as firms become more knowledgeable, they are becoming more sophisticated. Five years ago many law firms hadn't even heard of litigation funding, whereas now they are experts; some even holding auction processes for funding, and others entertaining offers from funders as a source of leverage for settlement negotiations. In the latter example, a law firm will receive an offer from a funder with no intention of accepting. They simply approach the counterparty in the claim and ask for a higher settlement figure than what the funder is willing to invest. Clearly, the marketplace is growing more sophisticated. What's more, law firms are negotiating better fee splits on their behalf. Years ago, a funder would receive 100-150% of their investment recouped on first-money back. Today, law firms are negotiating a chunk of that first money, and even integrating success fees (usually in the 20% range) to secure their spot at the front of the line. On a CIO-specific panel, the panelists discussed their preferences for types of cases to fund. Obviously, IP topped the list, given the lengthy time-to-settlements and high upfront costs. International arbitration was also mentioned, yet most funders broaden their scope to include any commercial litigation opportunities. To keynote speaker Susman's point, panelists did point out that they prefer to get law firms on board with fee sharing, via 50/50 splits, yet they noted how some law firms simply aren't comfortable with risk. Therefore, if a case is right, the funder will cover 100% of fees if necessary. When asked about the biggest threats to funding, panelists agreed that all of the overly optimistic or naïve capital coming into the space could lead to some negative outcomes, like funder misbehavior which may incur negative headlines. These could then be seized upon by regulators in a bid to exert broad industry oversight. Allison Chock of Bentham IMF noted that the Chamber of Commerce is now approaching state legislatures, and none of them know what litigation finance is or how it works.  So they are ramming through legislation with people who don’t understand the industry. This is a cause for concern. And to the point of 'dumb money' in the space, Chock illustrated an example of how an influx of capital into a growing sector can lead to extremely bad decision-making. She told of receiving an email from a claimant in a case they had looked at that another funder had heard that Bentham was interested, so they simply threw money at the claimant. Chock's firm signed an NDA, but that didn't mean they were interested. They simply wanted to diligence the claim. Chock noted how this was the third such instance she heard about, where another funder jumped into a claim simply because her firm had been looking at it. “A fool and his money are soon parted," warned Chock. A Case Study Perhaps the most interesting panel of the day centered around a case study of how litigation finance literally saved a business' life. Business Logic (BL) had a trade secrets misappropriation and breach of contract claim against a subsidiary of Morningstar. At the time, BL was a 20-person firm with annual revenue of $4MM. All of its margin and savings were tied up in the litigation. The case had been in the works for a few years, and BL was so confident in their claim they committed much time and money to fighting it. Yet they reached a breaking point. The company was going to have to reduce its workforce to continue the claim, unless it found outside financing. They reached out to a trio of funders, and Lake Whillans responded. The funder provided fee coverage and even working capital to BL. Now, as the trial approached, law firm Yetter Coleman could find top experts and formulate a robust case. Suddenly, Morningstar got nervous. No longer could they threaten the small Business Logic by bleeding them dry pre-trial. The trial was approaching, and BL had a strong case, and was well-capitalized. The damages claim was for $65MM, and Morningstar was so concerned about a multiple of that number being rewarded, they settled for nearly the full value of the claim - $61MM. It was the 9th largest trade secrets settlement at the time, and to this day remains the largest in the state of Illinois. BL has since grown its business to 150 employees, and changed its name to NextCapital. The story illustrates the quintessential David v. Goliath dynamic that litigation funding facilitates, and highlights how funding can not only save a company from going under, but help it thrive well into the future. Final Thoughts Given the packed house, it's safe to say there will likely be a third annual conference next year. The growing popularity of conferences like LF Dealmakers underscores the mainstream acceptance of litigation finance. I personally noticed the diversity of attendees at this conference compared to the initial installment. There were more lawyers, in-house counsel and academics this time around, and I expect that will continue into next year and beyond.
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Commercial

Legalist Lands $100MM Fundraise

Legalist, the San Francisco-based AI-driven litigation funding platform, has landed a $100MM funding round. The firm will deploy the capital into 100-200 cases of at most $1MM each. As reported in TechCrunch, Legalist was founded in 2016 by a pair of 20-something Harvard dropouts, Eva Shang and Christian Haigh. The firm graduated from the prestigious Y Combinator school, and received financing from Peter Thiel, as part of its $10.2MM initial funding round. Legalist is an AI-driven funding platform that uses machine learning to source and diligence claims. The firm claims to have funded 38 cases thus far, of which half have resolved. 80% of those were successful. Because of the firm's leverage of AI, they are able to keep costs low and therefore fund smaller cases that much larger funders tend to eschew (Despite its reliance on AI, Legalst is an 11-person firm). The latest fundraise was sourced from non-profit endowments, family offices, and institutional investors, including an insurance company. Legalist is organized like a traditional private equity fund, with management fees and a carry structure. The total life of the fund is five years, but Shang expects to deploy all capital within two years, over 100-200 claims.
Announcements Commercial

Validity Finance Adds Experienced Dispute Funder Ronit Cohen to Investment Team, Secures Additional $50 Million in Capital Commitments

NEW YORK (September 18, 2019) – Litigation funder Validity Finance continues to build its U.S. investment team while expanding its capital base. The firm announced the arrival of Ronit Cohen, who joins Validity as portfolio counsel. A former trial lawyer who practiced at Simpson Thacher & Bartlett and O’Melveny, Ms. Cohen transitioned to litigation finance in 2012 and spent the past seven years as an investment professional at Bentham IMF. As dispute funding has gained acceptance in the U.S., Ms. Cohen has overseen investments in a wide span of commercial litigation matters, reviewing many hundreds of cases in the process. She’s helped clients secure funding in disputes involving breach of contract, fraud, insurance coverage disputes, patent infringement and large arbitrations. She’s also helped vet and manage investments in portfolios of cases for law firms. In coming to Validity, Ms. Cohen reunites with firm founder and CEO Ralph Sutton, who formerly was chief investment officer at Bentham and originally recruited Ms. Cohen. She is the third former Bentham manager to join Validity this year, following the arrivals of David Kerstein and Julia Gewolb. Mr. Kerstein now serves as Validity’s Chief Risk Officer; Ms. Gewolb is Director of Underwriting. Added to the firm’s other senior staff, Validity has built a team with the most tenured investment professionals focused on disputes in the U.S. “We could not be happier having Ronit join us and round out the team,” Mr. Sutton said. “She was one of our first hires out of Big Law at Bentham and her industry experience is almost unrivaled. Ronit conducted due diligence on hundreds of prospective cases and assisted in bringing dozens to strong conclusions. Her experience will be a great benefit to our current and growing roster of funding clients.” Validity launched in June 2018 with $250 million in committed capital and the backing of leading private equity investor TowerBrook Capital. The firm recently raised another $50 million in commitments from additional investors and has committed more than $50 million in its first year of operations to clients across a range of litigation matters and jurisdictions. The firm recently partnered with American Lawyer Media to survey 330 lawyers at law firms and businesses about their experience with litigation finance. Just under 100% of those surveyed who have used third-party funding said they planned to do so again. And 98% of respondents said that trusted relationships are the most important factor in choosing a funder. “It’s a great pleasure to be working again with Ralph, Dave Kerstein and Julia Gewolb, and to connect with the superb professionals that Validity has assembled in the past year,” Ms. Cohen said. “The firm has created a unique market position with its focus on client-centric service. Fortunately, there is zero learning curve for me in getting started and I’m excited to be part of a team dedicated to innovative dispute funding on a national scale.”

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About Validity: Validity is a commercial litigation finance company that provides businesses, law firms and individuals with non-recourse financing for a wide variety of commercial disputes. Founded in 2018 with $250 million in financing, Validity believes that capital and legal expertise combine to help solve legal problems on behalf of clients. Validity’s’ mission is to make a meaningful difference for clients by focusing on fairness, ethics, innovation, and clarity.  For more, visit www.validity-finance.com.

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