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Casting a Worldwide Net: How Litigation Funders Can Leverage Europe’s New Unified Patent Court

March 14, 2023

Casting a Worldwide Net: How Litigation Funders Can Leverage Europe’s New Unified Patent Court

The following article was contributed by Lionel Martin (Partner, August Debouzy), Pierre-Olivier Ally (Counsel, August Debouzy), Ben Quarmby (Partner, MoloLamken LLP) and Jonathan E. Barbee (Counsel, MoloLamken LLP).  Europe’s Unified Patent Court (UPC) is on the cusp of launch, confirmed for this June 1, 2023.  It has been eagerly anticipated by the patent litigation community across the member states—starting with 17 European countries, but expected to extend rapidly to all of Europe minus Poland, Spain, Croatia, and, most notably, the UK. The UPC has been long in the making: over ten years have passed since the agreement was first signed.  What is to be expected of this new court, and what opportunities does it present for litigation funders? Uniformity and Scale.  The principal goal of the UPC is to offer a single, consistent, and coherent court system in Europe for the litigation of patents.  Historically, procedural differences in the member states’ national patent and court systems meant that the timeline of patent litigation could vary wildly from one jurisdiction to the next.  The jurisdictions also differed on substance: infringement, validity, and injunctive relief rulings were not consistently applied across the board.  And the one way in which the national jurisdictions were similar—comparatively low damages models—acted as further disincentive for patent owners looking to enforce their rights. The UPC promises to overhaul that system entirely.  It is expected to issue speedy judgments on both infringement and validity.  It should set the scene for damages verdicts that are not only more consistent across jurisdictions, but also generally much greater in size—as one would expect for verdicts covering at least 17 member states.  And it promises greater accessibility and uniformity insofar as English will be the preeminent language of infringement proceedings in any matter involving allegations of infringement extending beyond a single member state. The UPC must now live up to that promise, and there is some uncertainty as to how the system will play out in its early stages.  Will the court be able to keep up the expected pace?   What standards will the court rely on when imposing preliminary injunctions?  How will damages awards be limited or expanded?  How will the appellate process work?  How will early litigants help shape the law and jurisprudence of the UPC? Those questions and many more will have to be answered in the coming months and years.  But if the UPC delivers on even part of its promised mandate, it may represent an exciting new arena for litigation funders working with patent owners to enforce their rights.  Indeed, there is reason to believe that the court will strive to be patentee-friendly—at least at the outset—in order to attract its “customers”. Opportunities for Litigation Funding.  Many of the key features of the UPC as currently contemplated, align neatly with the incentives and priorities of litigation funders and patent owners.
  • Broader Geographic Reach. The UPC makes multi-jurisdictional patent campaigns cost-effective and efficient by allowing plaintiffs to target infringement across at least seventeen countries in one court proceeding.  Plaintiffs no longer need to pick and choose the countries in which to enforce their patents.  The reach of the UPC is likely to expand further: the UPC is expected to be integrated into European mutual recognition mechanisms that will allow the UPC’s jurisdiction to extend not only to the EU but also to Switzerland, Norway, and the UK.  While these mutual recognition mechanisms have long existed, national courts have historically been reluctant to rely on them.  The UPC, by contrast, is expected to do so much more regularly.
  • Reduced Transaction Costs. Reliance on a single proceeding across multiple countries will cut down on the costs of litigating in multiple European countries in parallel.  The UPC will therefore dramatically reduce the resources necessary to launch and maintain a multi-jurisdictional campaign in the EU.  The UPC will also cut down on the logistics and transactional costs associated with such campaigns.  A plaintiff, for example, no longer needs to hire three separate teams to enforce patents in, for instance, France, Germany, and Italy, and pay additional fees for those three teams to coordinate to ensure coherence across jurisdictions.
  • Short Time to Trial. UPC proceedings will expedite the pace of patent campaigns.  Some commentators suggest that proceedings will only take 12-15 months from complaint to final ruling—a significant boon for patent owners looking to promptly and efficiently enforce their rights.  If this holds true, and if sustainable, this pace would rival the speed of some of the fastest dockets among U.S. district courts.
  • Efficient Evidence Gathering Procedures. Unlike the U.S., there is no formal discovery in the UPC, which significantly reduces litigation costs and can expedite proceedings.  But the UPC offers several key features that will be of value to patent owners: (i) plaintiffs may move to seize evidence of infringement from a defendant’s premises, and (ii) they may obtain court orders to force defendants to produce documents.
  • Larger Damages Awards. Since UPC judgments will cover more countries and consumers, the potential damages awards should be considerably larger than they would be in a single jurisdiction.  This should help drive up the value of settlements, and put more pressure on defendants to settle earlier.  It also radically tips the scale on the economics of patent litigation funding in the EU.  Suddenly, the EU becomes an attractive venue in-and-of-itself for funders—not just an ancillary venue in support of higher-stakes U.S. litigation.
  • Broad Injunctive Relief. The UPC will allow patent holders to seek injunctive relief across multiple countries in one shot.  This too should help drive bigger and earlier settlements—a boon for funders looking for a rapid return on their investment. 
  • High-Quality Decisions. It is expected that the Court will render first-rate decisions for two principal reasons: (i) it has attracted seasoned IP judges from across Europe, and (ii) the judges consist of a mix of legally and technically qualified judges.  Furthermore, due to the high specialization of the Court, the number of judges will be quite limited (<100), which may help contribute to greater respect for precedent from fellow judges, which in turn leads to greater predictability for litigants.
Will the UPC be able to deliver on all of these fronts?  Only time will tell.  But for a savvy funder looking for an early mover advantage in a relatively underdeveloped market, and with the opportunity to potentially help shape early UPC jurisprudence in ways that will benefit patent owners for years to come, these are exciting times indeed . . . .

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Triple-I Launches Consumer Campaign Against Litigation Funding in Texas and Kentucky

The Insurance Information Institute has opened a new front in the fight over third-party litigation funding, launching a consumer-awareness campaign in Texas and Kentucky ahead of both states' 2027 legislative sessions. The push adds two more targets to a state-level reform wave in which more than 20 states have already enacted funding disclosure laws.

As reported by Insurance Business, Triple-I is framing the campaign around the transmission of litigation costs into insurance premiums. Michel Léonard, the organisation's chief economist, put the argument bluntly: "Litigation is outgrowing the economy. That gap doesn't stay in the courtroom. It lands in claims, reserves and premiums." Critics of such measures counter that disclosure mandates and funding restrictions limit access to justice for claimants who cannot otherwise afford to litigate.

Casualty pricing is the evidence Triple-I points to. While commercial property rates declined over the past year, casualty lines have stayed elevated, with umbrella and excess liability recording the sharpest increases and commercial auto under sustained pressure.

The underlying cost data comes from several Triple-I studies, including work with the U.S. Chamber Institute for Legal Reform and the Casualty Actuarial Society. U.S. tort costs reached $579.7bn in 2023, nearly double the $299.7bn recorded in 2014. Other liability accounted for $249.3bn and personal auto liability for $188.1bn. Triple-I estimates that legal system abuse added between $231.6bn and $281.2bn to liability losses across the decade to 2023.

Commercial

Proposed DIFC Arbitration Law Reforms Would Impose Express Third-Party Funding Disclosure

Dubai's financial free zone is moving toward a statutory disclosure obligation for litigation funders. The proposed 2026 reforms to the DIFC Arbitration Law—the most substantial overhaul since the statute was enacted in 2008—would introduce express disclosure requirements for third-party funding arrangements in arbitrations seated in the Dubai International Financial Centre.

As reported by SCC Online, the reforms were examined during Dubai Arbitration Week 2026, in a session on the proposed changes to the DIFC Arbitration Law and the new DIFC Mediation Law. Justice Michael Black of the DIFC Courts framed the funding provision as a measure to strengthen transparency and accountability in arbitral proceedings. The panel, moderated by Graham Lovett of the DIAC Arbitration Court, also included DIFC Courts Chief Justice Wayne Martin, DIAC Registrar Robert Stephen, and counsel from Akin.

The funding disclosure requirement sits within a broader package. Other proposed changes would cut the window for set-aside challenges from three months to 30 days on a non-extendable basis, permit summary determination of unmeritorious claims, allow peremptory orders backed by sanctions, give statutory recognition to emergency arbitrator decisions, and extend confidentiality to the existence of proceedings. A standalone Mediation Law would make mediated settlements binding and court-enforceable.

The reforms follow a DIFC consultation that ran from 11 June to 10 July 2026. Arbitration volume at the DIFC Courts underscores the stakes: the courts handled 54 arbitration matters in 2025 and 45 by early November 2026, roughly one-third of the Court of First Instance workload.

Commercial

Federal Court Removes Hellyer Metals Liquidator, Citing Failure to Pursue Litigation Funding

The Federal Court of Australia has removed the liquidator of Hellyer Metals Pty Ltd, finding a lack of independence and criticising his handling of litigation funding offers that could have financed an investigation into a disputed asset transfer.

As reported by ABC News, Justice Shaun McElwaine delivered orders and reasons on 10 November 2026 in Goshawk Mining Pty Ltd v Hellyer Metals Pty Ltd, in the matter of Hellyer Metals Pty Ltd (in liq) [2026] FCA 1676, removing Liam Bailey of O'Brien Palmer and appointing Adam Johnston in his place, with all books and records to be handed over. The judgment records that the parties behind the share transfer under scrutiny had appointed Bailey, who then retained as his solicitor the lawyer who had introduced them. He also provided a draft statutory liquidation report to directors the court described as intimately involved in the transaction, conduct the judge called "a serious error of judgement and demonstrative of a lack of independence."

The funding findings were central. Time records showed 30.35 hours of investigative work between January and May 2026, of which just 12 minutes were spent on litigation funding. From March 2026, two companies offered to discuss funding an investigation, but the court found he failed to engage meaningfully. A funding agreement was signed only after the removal proceeding had commenced, following an approach from lawyers acting for two bankrupt former directors.

Hellyer Metals entered voluntary administration in January 2026, with Bailey appointed liquidator on 22 January. Assets had been transferred to associated company Celestial Group around the time the Tasmanian government ordered the Hellyer Gold Mine temporarily shut over unpaid debts. Goshawk Mining and Saxby Capital, which obtained a Supreme Court order freezing $36.4 million, are pursuing damages exceeding $36 million. The court described the transaction as prima facie highly questionable and said removal was indeed required.