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

In 2018, the NYC Bar surprised a lot of folks by issuing a formal opinion declaring litigation funding in conflict with the Bar’s rules on fee-sharing with non-lawyers, as outlined in Rule 5.4 of the professional conduct code. The reaction within the funding community was swift, however no formal response has been delivered… until now. 

The Arkin Cap is officially sunk. A UK Court of Appeal has sided with the trial court in the case of Davey v. Money, which found that the Arkin Cap is merely a suggestions, and courts are not bound by its limitations. 

No one will ever accuse Aussie law firm Maurice Blackburn of not being proactive. The class action king (Maurice has filed the most in Australia) is pursuing a class action claim against banking giant NAB, and plans to use a contingency-fee model. There’s just one wrinkle here: contingency-fee arrangements aren’t legal in Australia. The state of Victoria is mulling legislation that would legalize such arrangements, but hasn’t passed the final bill yet. 

“Lawyer-Directed” litigation finance, whereby a funder forms a partnership with contingency counsel, provides an opportunity to work around some of the issues that exist in client-directed funding – most notably issues that arise when creditors or lienholders are awaiting recoupment from the client, pending successful litigation. Many funders are averse to partnering with a client that is encumbered by senior lienholders, hence many such claims go unfunded, despite the merits of the underlying case. Lawyer-directed funding provides an attractive solution. 

New Zealand has been far slower to adopt litigation funding than neighboring Australia, where the practice originated. However, the funding market is surging in kiwi-land, thanks in part to local funder LPF Group, which has bankrolled some sizable claims. 

The bankruptcy trustee for the now-defunct aircraft parts manufacturer Super98, is looking to clawback payments made to law firm Quinn Emanuel and litigation funder IMF Bentham, for a claim the company pursued against Delta Airlines. 

Litigation funder JustKapital is considering bailing on the Westpac claim, after the Australian Supreme Court overturned common fund orders. 

Deputy Associate Attorney General Stephen Cox of the Justice Department gave a speech on Monday to False Claims Act (FCA) attorneys, and Cox expressed concern that DOJ doesn’t know the extent to which FCA attorneys are using litigation funding. Cox mentioned that Justice is considering mandating disclosure of litigation funding agreements for FCA whistleblowers. 

UK-based Manolete Partners has published its latest investor presentation – a 15-minute showcase of the UK insolvency litigation market, and explanation of how litigation funding will benefit lawyers and practitioners in the space.