Fortress Investment Group, through its affiliate CF ESQ Holdco, has acquired a 20% economic interest in Esquire Law, a personal injury firm in Arizona, under the state's alternative business structure (ABS) framework. This marks the first known instance of a major U.S. asset manager entering law-firm ownership via ABS, signaling a widening scope for litigation finance beyond debt financing to direct equity participation in law firms.

An article in Bloomberg notes that Esquire Law, which handles car-accident cases and has recovered over $10 million for clients, maintains majority ownership (80%) through its named partners from Steinger, Greene & Feiner. In recent years, Fortress has committed substantial capital to legal assets—including $6.6 billion in litigation finance and an additional $2.9 billion toward intellectual property ventures—highlighting its prominence in the sector.

Consulting experts, including Lucian Pera of Adams & Reese, suggest that investor appetite for legal services is growing, especially as ABS frameworks offer legal access to outside capital in jurisdictions like Arizona. This approach is consistent with broader industry developments—Burford Capital, for example, is exploring similar paths through both ABS investments and managed services organizations (MSOs).

Fortress’s equity stake via Arizona’s ABS model represents a bold evolution in litigation finance—moving from traditional debt-based funding into direct law-firm ownership. While lauded by the industry, the move raises some important questions in a time of enhanced regulatory scrutiny: Could this model expand to other states or types of legal services? What are the implications for the ethical obligations of lawyers versus investor interests? And how might this trend shape the future relationship between capital and legal practice?

Omni Bridgeway has reported a step-change year, pairing robust investment performance with a balance sheet reset that positions the platform for its next growth phase. The ASX-listed funder highlighted headline income of $651.3 million, a $3.6 billion portfolio (up 29% year over year), and A$5.2 billion in assets under management. Returns were anchored by a 2.5x MOIC across 60 full and partial completions, while operating discipline showed through with a 6.2% reduction in cash opex. Management framed FY25 as both a consolidation of strategy and a proof point for the firm’s fair value marks.

An article in PR Newswire notes the year also brought 52 new investments totaling A$517 million in commitments and A$525.9 million added to fair value. Crucially, Omni executed its Fund 9 transaction with Ares—fully deleveraging and “significantly derisking” the balance sheet—while also validating its model with third-party institutional capital. CEO Raymond van Hulst called FY25 “a positive year with excellent investment returns and a transformative transaction,” adding that the platform is well placed for continued growth.

For a sector navigating evolving regulation and disclosure debates, the numbers matter—but so does capital formation. Omni’s ability to recycle capital, expand AUM and originate across jurisdictions reinforces the durability of legal assets as an alternative class.

Cartiga, a long-standing player in consumer and attorney funding, is heading to the public markets. The company agreed to combine with Alchemy Investments Acquisition Corp. 1 in a transaction pegged at $540 million in equity consideration, positioning the platform to scale its data-driven approach to underwriting and portfolio management. Management frames the move as about reach and efficiency: tapping a listed currency, broadening investor access to the asset class, and accelerating inorganic growth.

An article in MarketWatch reports that the proposed business combination would take Cartiga public via Alchemy’s SPAC, with the parties emphasizing how a listing could support growth initiatives and acquisitions. The piece notes the strategic rationale—public-market transparency and capital flexibility—as the platform seeks to deepen its footprint in funding for legal claims and law firms.

While final timing remains subject to customary steps (including the shareholder vote and regulatory filings), the announcement marks one of the most significant U.S. litigation-finance capital-markets events of the year.

Cartiga’s trajectory reflects a broader institutionalization of legal finance: more data, more discipline, and more diversified funding channels. The company’s model—providing non-recourse advances to plaintiffs and working capital to law firms—relies on proprietary analytics and scale to manage risk and returns across cycles. A public listing, if completed, would put Cartiga alongside other listed peers globally and provide investors with another pure-play exposure to the asset class’s uncorrelated return profile.

Private equity (PE) firms often view legal disputes involving portfolio companies as liabilities—not opportunities for value creation. However, in a recent blog post, Omni Bridgeway argues that when properly modeled and leveraged, dispute finance can unlock hidden value throughout a PE investment lifecycle.

An article on Omni Bridgeway’s website explains that dispute finance enables PE firms to convert uncertain legal claims into a probability‑weighted, risk‑adjusted net present value (NPV), which can be used as a powerful negotiating lever in acquisitions. The firm illustrates this with an example: a $10 million litigation claim, after probabilistic weighting, legal cost deductions, and discounting, yields a risk‑adjusted NPV of roughly $3.5 million—highlighting how firms can avoid overpaying for speculative legal value

Once the investment is underway, dispute finance can preserve EBITDA by funding legal costs outside the P&L, since such non‑recourse financing isn’t treated as an SG&A expense or recorded as debt. Omni Bridgeway demonstrates that a $2 million litigation expense can be eliminated from SG&A, boosting EBITDA from, say, $11 million to $13 million.

As dispute finance becomes more accepted in M&A workflows, funders that offer robust valuation frameworks and flexible, non‑recourse instruments may gain a competitive edge. Overall, Omni Bridgeway’s post highlights that monetising legal claims—through non‑recourse capital advances or outright sale to a funder—can free up liquidity for operational initiatives without increasing downside risk.

Express Legal Funding announced it has reached its fifth year as a member of the Alliance for Responsible Consumer Legal Funding (ARC), underscoring a commitment to best practices in an often-polarized pre-settlement space. For a company that brands itself around transparent pricing and consumer education, the ARC imprimatur doubles as a marketing and compliance asset—especially as statehouses revisit disclosure, APR caps and contract clarity.

An announcement in PR Newswire positions the milestone within a “rapidly growing” lawsuit-cash-advance market. While the release is light on metrics, the message tracks with the broader U.S. consumer-funding narrative: pressure from insurers and tort-reform groups on one side; advocates and funders emphasizing access to liquidity and non-recourse safety on the other.

For plaintiff firms, vendor due diligence remains a reputational imperative; for consumers, independent accreditation—however voluntary—can serve as a quick proxy for baseline standards when shopping funding offers. The strategic subtext is clear: as more states contemplate rules around discoverability, disclosures and rate structures, firms that can point to consistent adherence to codes like ARC’s may enjoy smoother law-firm relationships and fewer regulatory headwinds.

With regulatory skirmishes likely to continue at the state level, recurring membership signals (ARC or otherwise) will matter more.

Editor's Note: An earlier version of this article stated that Express Legal Funding reached its fifth consecutive year as a member of the Alliance for Responsible Consumer Legal Funding. Express Legal Funding reached its fifth year, but not consecutively. We regret the error.

A new salvo in the UK’s collective actions saga puts third-party funding in the spotlight. The Solicitors Regulation Authority (SRA) has criticized aspects of mass-consumer practices—specifically around funding and referral fees—raising uncomfortable questions for claimant firms and their financial backers. The latest flashpoint again involves Innsworth, the funder behind the long-running Mastercard litigation brought by class representative Walter Merricks CBE, where wrangling over settlement distribution and funder economics has spilled into public view.

An article in The Times reports that the watchdog sees “poor practices” in parts of the market and notes escalating tensions tied to the £200 million Mastercard settlement—well below the claim’s original £14 billion headline—prompting Innsworth’s threatened action over the deal’s terms. The piece underscores the funding dynamics now woven into virtually every major UK mass claim, from opt-out competition cases to data-privacy suits; the SRA’s framing suggests a harder regulatory edge on fee flows and governance in arrangements that align firms, funders and marketing affiliates.

Beyond the immediate case drama, two structural trends are converging. First, post-PACCAR contract examination has left funders and class reps renegotiating economics and disclosure with tribunals watching closely. Second, political and judicial appetite for “light-touch” oversight (rather than price caps) remains in flux, even as market size and claimant outreach expand.

If the SRA proceeds from cautionary statements to targeted enforcement, firms may re-paper referral arrangements and introduce additional ring-fencing around funder influence to avoid conflicts.

Pogust Goodhead has emphatically denied that it is controlled by litigation funders, insisting it retains full “forensic independence” in the high‑profile claim over the 2015 Mariana dam collapse.

As LFJ recently reported, the class action firm, representing hundreds of thousands of victims in a potential £36 billion lawsuit against mining giant BHP, is under scrutiny following the recent ousting of its co‑founder and chief executive, Tom Goodhead, at the behest of its primary financier, Gramercy Funds Management.

An article in The Law Society Gazette reports that Pogust Goodhead maintains it enjoys “forensic independence” from its principal backer. Opponents—including BHP and its counsel, Slaughter and May—have raised serious concerns about governance, questioning whether Gramercy now exerts undue influence over strategic decisions—an arrangement that could run foul of English and Welsh rules reserving case control for qualified lawyers.

In response, Pogust Goodhead reiterated that it remains “fully independent, with complete control over the strategy and direction of every case” and that its renewed governance structures strengthen its capacity to act in its clients’ best interests. Gramercy, for its part, denied any ownership or management control of the firm.

Looking ahead, this unfolding governance dispute raises critical questions for the future of litigation funding: How will courts view funder-linked control over claimant law firms? Could the outcome limit or reshape access-to-justice models reliant on third-party financing? As this case nears a key ruling, the legal funding industry may be on the cusp of a regulatory watershed.

A new joint study by the Insolvency Law Academy and Burford Capital sheds light on how legal finance is gaining traction as a strategic tool in the India's insolvency processes. By enabling distressed entities and professionals to monetize contingent assets without exhausting limited estate resources, legal finance has the power to enhance liquidity and improve recovery outcomes for creditors.

An article by Burford Capital unveils how legal finance-backed structures can convert contingent claims into tangible value, supporting corporate continuity and delivering stronger creditor returns. The study highlights India’s unique factors: abundant untapped recoveries from avoidance claims and disputed receivables, widespread capital shortages faced by insolvency professionals, and the need for prompt liquidity solutions. It also references real-world case studies showcasing how legal finance facilitated strategic wins for firms like Hindustan Construction Company and Patel Engineering.

On the regulatory front, judicial rulings—such as in Tomorrow Sales v. SBS Holdings (2023)—have explicitly recognized the legitimacy of legal finance in India’s litigation ecosystem. Meanwhile, updates to the IBC now permit the assignment of “not readily reali[z]able assets” during liquidation, laying groundwork for integrating legal finance into the insolvency framework. Nonetheless, the regulatory landscape—including aspects of FEMA compliance and fund repatriation—remains cautiously permissive.

Emerging operational structures include direct estate financing, SPV‑based claim ring‑fencing, and creditor assignments for immediate value. The report urges a “light‑touch” regulatory approach, alongside the development of codes of conduct and educational efforts to arm insolvency professionals and creditors with the know‑how to deploy legal finance effectively.

Looking ahead, as India’s insolvency infrastructure matures, legal finance is poised to play a central role—unlocking value in distressed assets, bridging funding gaps, and aligning with global best practices.

Burford Capital’s new push to take minority stakes in U.S. law firms is already meeting resistance from tort-reform advocates and insurer-aligned groups, who argue the structure could blur loyalties inside the attorney-client relationship. The plan, described by Burford’s chief development officer Travis Lenkner as “strategic minority investments” to help firms scale, would rely on managed service organizations (MSOs) that house back-office assets while leaving legal work to a lawyer-owned entity. Supporters cast it as a lawyer-friendly alternative to private equity; skeptics see a back-door end-run around state bars’ bans on non-lawyer ownership.

An article in Insurance Journal reports that critics, including the Florida Justice Reform Institute’s William Large, warn MSO-style deals could tilt decision-making toward investors focused on “big verdicts,” threatening firm independence and client interests. Only Arizona permits direct non-lawyer ownership today, and while Utah and Washington, D.C., have loosened rules at the margins, most states still enforce bright-line prohibitions.

The debate has sharpened as disclosure and licensing regimes proliferate: at least 16 states now require some level of third-party funding transparency. The Insurance Journal piece also notes a recent Texas Bar ethics opinion that green-lights MSOs for law-firm services under narrow conditions, though it doesn’t answer the broader question of outside investors’ influence. For its part, Burford says it understands the ethical guardrails and intends to be a passive investor focused on firm growth and operational support.

For the legal finance industry, the MSO path signals a pivotal test. If bars and courts accept these structures, capital could flow directly into firm operations—potentially accelerating portfolio origination, technology spend, and fee-earner leverage. If regulators balk, expect renewed calls for explicit rulemaking on ownership, disclosure, and control—alongside creative alternatives (credit facilities, revenue shares, and hybrid portfolios) to replicate MSO-like benefits without the governance controversy.