News and analysis dedicated to the commercial litigation funding sector including regulatory issues, case developments, funding activities, and more.

A source has revealed that controversial billionaire Jonathan Munz is funding a challenge to the Victorian government’s recent COVID lockdowns. While not the sole financier, Munz is reportedly sinking at least $1 million into the case. That shouldn’t break the bank, as Munz’s reported assets top $1.5 billion.

The use of legal finance is increasing in several important offshore jurisdictions. But how well is that going? Burford Capital’s recent roundtable discusses the effectiveness of legal finance in maximizing recovery in insolvency cases around the globe.

A recent study of in-house counsel and private attorneys affirms that the use of litigation funding is up more than 100% since 2017. Burford Capital released the study of roughly 500 legal professionals, which confirms the explosive popularity of the practice.

Law firms and businesses alike are making even greater use of Litigation Finance in the wake of COVID. That’s good news for Burford Capital, whose listing on the New York Stock Exchange went live this week. Recent reporting on the popularity of the practice, combined with this new NYSE listing and the formation of the ILFA, makes it clear that litigation funding is on the rise.

As many as 8,000 people are believed to have been directly impacted by Western Australia’s practice of kidnapping and enslaving children in the 1940s and beyond. A class action has been filed to collect wages that were never paid to the workers. So far, at least 1,000 of those affected have registered their intent to seek remuneration.

The COVID pandemic has led to the need for creativity, quick thinking, and adaptability for many legal firms. Roughly half of all firms and in-house counsel alike are expecting drops in revenues (and consequently, budgets) within the next year. But this doesn’t have to be dire news.

Even before the pandemic gained a foothold, European courts felt the impact of COVID. Litigation over insurance, safety precautions, employment, and business interruption was rampant. Such litigation is only expected to grow—even after COVID is under control.

Italian energy giant Eni has requested documents relating to a $1 billion case involving the government of Nigeria and investment firm Drumcliffe—the principles of which are still involved in a corruption trial.

As Litigation Finance permeates the mainstream and regulation catches up, the issue of disclosure remains contentious. At the time that a funding deal is created, there’s no real way to know whether or not courts will require disclosure of the agreement.

As 2020 nears its end, firms are straining to reduce the impact of Coronavirus on earnings—which for some means cutting staff even as they ensure that their best players won’t be recruited by other firms. Given that, it makes sense that firms holding strong litigation portfolios would want to consider dispute financing.

A recent announcement from Nanoco reveals a sharp tumble in revenue. The Manchester-based tech business reported that revenue fell from GBP 7.132 million to GBP 3.856 million in the period ending July of this year.

Gian Kull has been appointed head of special situations at SYZ Capital. His investment experience spans more than a decade, making him an excellent choice to manage portfolios and handle private marketing investments.

It could be argued that Burford Capital is handling the pandemic better than most. The company transitioned to a remote working platform early on, and have adapted to what’s being called “the new normal” with aplomb. In the months that followed, courts, businesses, and even schools shifted to remote operations—meaning court cases could finally continue.

One of the most attractive aspects of Litigation Finance as an investment is that it’s uncorrelated with the rest of the market. Even as the Coronavirus pandemic became increasingly impactful, funders assured investors that returns would remain high.

A claim of over $115 million in damages, filed by Russian oligarch Farkhad Akhmedov (along with owner Straight Establishment) has been dismissed by the high court of Dubai. The claim revolved around a 115-meter superyacht, the MV Luna, which had been held as part of a divorce settlement.

Australian coal giant Prairie Mining has begun international arbitration proceedings that assert a breach of bilateral treaties. The action centers around Poland’s decision to block investment in the Jan Karski and Debiensko mines.

When Litigation Finance was still making a name for itself, the American Bar Association was among the first organizations to write researched commentary on it. The white paper published by the ACA Commission on Ethics remains influential today.

On Wednesday October 7th, Litigation Finance Journal hosted a quarterly roundup on the major issues impacting the commercial litigation funding industry. The 45-minute panel discussion was moderated by Ed Truant, founder of Slingshot Capital. Panelists included Jim Batson, Senior Investment Manager of Omni Bridgeway, Nick Pontt, Managing Director of Affiniti Finance, Mick Smith, founder of Almatura, and Paul Haskel, partner at Richards, Kibbe & Orbe, LLP. 

The rise in bankruptcies and business insolvencies due to COVID cannot be denied. One side effect of this involves the exploration of how best to facilitate recovery and refinancing. Ultimately, legal funding may provide the best risk/reward ratio.

A settlement in the IAG class action is currently under review after preliminary hearings. The proposed $138 million settlement comes after the company was ordered by ASIC to refund customers for add-on products that were essentially without value.

It’s no secret that when the economy is tough, litigation increases. As the CEO of LexShares, Jay Greenberg, explains–even those who don’t normally use litigation funding are reaching out. Businesses are more anxious than ever to collateralize existing lawsuits and take steps to ensure that any impending claims can be litigated effectively.

Litigation Finance has been slowly growing since it first gained acceptance during the last financial crisis. In addition to a funding model that pairs funders with a single case, litigation funding can also come in the form of claims monetization.

Litigation funding is growing in popularity all over the world. The practice of third parties funding cases in exchange for a share of the rewards is a lucrative business model. Better still, it increases access to justice for those who couldn’t otherwise afford it. So why are insurers in Canada speaking out against the practice?

A new report from Burford Capital reveals that profits were down 15% during the first half of this year, as it reported to the London Stock Exchange. Much of this is due to fallout from Coronavirus, which led to group-wide commitments ending down a startling 74% to roughly GBP 152 million.

Questions about litigation funding led to a stay of proceedings during the liquidation of Stonewood Homes. That stay has been lifted by Associate Judge Owen Paulsen on September 25th. In August, a ruling stated that the liquidators, Rhys Cain and Rees Logan, could submit a request to lift the stay once concerns regarding the funding arrangement could be addressed.

While COVID takes a toll on businesses around the globe, Litigation Finance is experiencing boom times. As the number of insolvencies increases, funders are readying for an influx of new requests. In preparation, Litigation Capital Management has created an asset management division.