The following piece was contributed by Boris Ziser and John Schneider of law firm Schulte Roth & Zabel.

As famed British-American author and journalist Christopher Hitchens astutely observed, “exceptional claims require exceptional evidence.”^[1] Alas, the U.S. Chamber of Commerce’s Institute for Legal Reform (“ILR”) overlooks Hitchens’ directive in its November 2022 paper “A New Threat: The National Security Risk of Third Party Litigation Funding” (“ILR Paper”). The ILR Paper, in short, makes an exceptional set of claims about the bad faith of American lawyers, the implied ineptness of our judges and the way our legal system functions, without providing the requisite evidence to back it up.

Last week, Brown Rudnick hosted its second European Litigation Funding Conference, which brought together a crowd of international thought-leaders from across the industry, and provided attendees with an agenda filled with insightful discussions on a wide array of issues. The conference proved to be a beneficial experience for all, with Augusta Ventures co-founder Robert Hanna describing it as ‘the pre-eminent litigation funding conference in Europe, if not the world’.

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?

The following article was contributed by Valerie Blacker, a commercial litigator focusing on funded litigation, and John Speer, a lawyer in the Dispute Resolution and Litigation Team at Piper Alderman.

While large class actions receive the lion’s share of media attention, litigation financiers also regularly fund litigation involving a single plaintiff. Given that solicitors are required to maintain professional indemnity insurance, they can be, in instances of negligence, an attractive prospect for financiers: they are well-resourced and have the capacity to satisfy any judgment awarded against them.

Hedonova is a hedge fund that was established in 2020, and it specializes in alternative investments. The company has offices located in various parts of the world, making it accessible to investors from different regions. Alternative investments are unique investment opportunities that do not conform to the standard categories of investments such as stocks and bonds. Hedonova’s portfolio of alternative investments encompasses a diverse range of assets, including startups, real estate, fine art, wine, and cryptocurrencies.

The following article is a contribution from Ben Quarmby and Jonathan E. Barbee, Partner and Counsel at MoloLamken LLP, respectively. 

Litigation funders have trade secrets on their minds.  Since the introduction of the Defend Trade Secrets Act (DTSA) in 2016, trade secrets litigation has been on the rise.  Over a thousand trade secrets cases were filed in federal court in both 2021 and 2022.  By all accounts, that trend is set to continue.  Big verdicts have followed, with some trade secrets verdicts now rivaling the biggest patent verdicts.  In the information age, a company’s most valuable intellectual property may not be its patents after all, but the wealth of non-patented, proprietary information surrounding its ideas—its trade secrets.

One of the holy grails of litigation funding has long been for funders to convince CFOs to view litigation through a commercial lens, and unlock the value of their legal assets. While straightforward and practical, the evolution of the CFO mindset on this issue has been slow to materialize. Many in the litigation funding community blame cultural norms—old habits are simply hard to break, which is especially true when things are going swimmingly. But with inflation upon us and a recession looming, the time is ripe for CFOs to reconsider their firm’s relationship to litigation funding.

On January 25, 2023, Litigation Finance Journal hosted a special digital event: Key Trends and Drivers for Litigation Funding in 2023. The hour-long panel discussion and audience Q&A was live-streamed on LinkedIn, and featured expert speakers including William Farrell, Jr. (WF), Co-Founder, Managing Director and General Counsel of Longford Capital, Laina Hammond (LH), Co-Founder, Managing Director and Senior Investment Officer of Validity Finance, and Louis Young (LY), Co-Founder and CEO of Augusta Ventures. The discussion was moderated by Rebecca Berrebi (RB), Founder and CEO of Avenue 33, LLC.

IMN’s inaugural International Litigation Finance Forum brought together a crowd of international thought-leaders from across the industry, showcasing perspectives from funders, lawyers, insurers and more across a packed day of content.

On Wednesday October 5th, LFJ hosted a panel discussion and audience Q&A covering various aspects of ESG within a litigation funding framework, including how funders consider ESG claims, how serious LPs are when it comes to ESG-related criteria, and the backlash swirling around the topic itself. Panelists included Andrew Saker (AS), CEO of Omni Bridgeway, Neil Purslow (NP), CEO of Therium Capital Management, and Alex Garnier (AG), Founding Partner and Portfolio Manager of North Wall Capital. The event was moderated by Ana Carolina Salomao, Partner at Pogust Goodhead.

Day 2 of the LF Dealmakers conference kicked off with Roy Strom, a reporter at Bloomberg Law, interviewing Adam Gerchen, CEO of Gerchen Keller Partners and Keller Postman LLP.

The following article is part of an ongoing column titled ‘Investor Insights.’ 

Brought to you by Ed Truant, founder and content manager of Slingshot Capital, ‘Investor Insights’ will provide thoughtful and engaging perspectives on all aspects of investing in litigation finance. 

The following article is part of an ongoing column titled ‘Investor Insights.’ 

Brought to you by Ed Truant, founder and content manager of Slingshot Capital, ‘Investor Insights’ will provide thoughtful and engaging perspectives on all aspects of investing in litigation finance. 

The following piece was contributed by Anne Freeman of Australian law firm, Piper Alderman.

Virgin Australia, which has been sued by investors who purchased unsecured notes in the airline based on statements in a 2019 prospectus for a capital raising, has been ordered to advise the lead applicant in the class action whether its has made a claim against its insurer for its costs and any liability in the class action, and whether its insurer has agreed to grant indemnity.  It has also been ordered to produce copies of any insurance policies which might respond to the claims made in the class action[i].

On Thursday, July 14^th, Litigation Finance Journal hosted a digital event, “How Investors Approach Litigation Finance.” The event featured a unique cross-section of investor types, including David Gallagher, Co-Head of Litigation Investing at The D.E. Shaw Group, CJ Wei, Vice President of Private Credit at Northleaf Capital, Benjamin Blum, Managing Director at Flexpoint Ford, LLC, David Demeter, Director of Investment at Davidson College, and Kendra Corbett, Partner at Cloverlay. The event was moderated by Ed Truant, Founder of Slingshot Capital.

The Lloyd v. Google claim has given rise to some thought-provoking questions:

• Has Google breached its duties as a data controller? If so, have class members of the ensuing collective action suffered quantifiable damages?
• How exactly should “same interest” be determined in a case regarding the misuse of data?
• Do individual members of a class have to demonstrate material harm in order to receive recompense?

In the following article, we will explore the answers to these and other questions that have arisen from Case UKSC 2019/0213, otherwise known as Lloyd v. Google.

The following piece was contributed by Lillian Rizio and Max Hensen of Australian law firm, Piper Alderman. 

The Full Federal Courts’ decision in Parkin v Boral Limited (Class Closure) [2022] FCAFC 47 (Parkin) confirms the courts’ power to issue pre-mediation (and settlement) soft class closure notices to group members. The decision hints at the (positive) appetite of the Federal Court in making future orders for class closure that facilitate a just outcome,[1] simplifies the assessment of quantum prior to settlement, and reduces an element of risk in funded litigation.

Mastercard and Visa are no strangers to legal action, having endured class actions and legal challenges all over the world. Currently, a collective action funded by Bench Walk Advisors accuses the credit giant of illegally overcharging Multilateral Interchange Fees (MIFs) in the UK.

The following piece was contributed by Martin del Gallego and Matthew Harris of Australian law firm, Piper Alderman.

This article considers a recent decision of the Federal Court of Australia, awarding damages to class action claimants on an aggregate basis.  Aggregate damages is a rare global award which covers all group members described or identified in the award.  This was the first instance of aggregate damages being awarded to a funded litigant in Australia, and may spur a trend in representative claims brought on this basis.

The Litigation Finance Podcast features guests from across the global commercial and consumer litigation funding landscapes. With over 60 podcasts spanning five years of archives, we thought it would be interesting to take a look at the five top podcasts in terms of viewer traffic.

The following is a contributed piece from Rory Donadio, CEO of www.tribecalawsuitloans.com

There are many ways to look at what those of us in litigation funding do. Is it a pre-settlement cash advance or a non-recourse loan? Is it truly lending, or is it an investment? But far more important than what we call our work, is what we actually do. According to a September 2021 Bloomberg Law Litigation Finance Survey, 88% of the responding attorneys believe that litigation finance enables better access to justice.

LegalPay is a Litigation Finance startup founded in India, an emerging market for third-party legal funding. Until recently, investing in legal cases was reserved for high-end investors. The advent of LegalPay allows retail investors—those of average means–to take advantage of the potentially large uncorrelated returns that have attracted savvy investors for years.

According to founder Kundan Shahi, LegalPay is the only formal player that offers third-party litigation funding for late-stage cases in India. One can’t help but wonder how this will influence the development of global Litigation Finance? Does LegalPay’s success foretell the rise of litigation funding in emerging markets? 

The High Court has ruled in favour of shareholders in Walton & Anor v ACN 004 410 833 Ltd (formerly Arrium Limited) (in liq) & Ors. In a 3:2 decision, the majority permitted former shareholders of Arrium Ltd to examine the insolvent company’s officers under s 596A of the Corporations Act 2001 (‘CA’) for the purpose of potentially bringing a class action against the company’s managers.

LFJ’s latest digital event featured Litigation Finance advisors Rebecca Berrebi (Founder and CEO, Avenue 33, LLC), Peter Petyt (Co-Founder, 4 Rivers Legal), Andrew Langhoff (Founder and Managing Director, Red Bridges Advisors), and moderator Ed Truant (Founder, Slingshot Capital). The panel discussed how they navigate between funders, law firms and claimants, as well as the challenges they face in this market, and the numerous benefits they provide each counter-party.

The following is a contributed piece by Ed Truant, founder of Slingshot Capital, and Andrew Langhoff, founder of Red Bridges Advisors.

When we write about litigation finance, we often assume it is easily accessible and that plaintiffs undertake most of the ‘leg work’ to secure financing.  In practice, litigation finance is often difficult to obtain, and plaintiffs typically rely quite heavily on their law firms to obtain it.  This is a very different dynamic than one sees in other areas of financial services. And because law firms may not have the expertise and bandwidth to properly broker a litigation funding transaction, their involvement in the process may be unintentionally short-changing their clients. With some law firms now entering contractual “tie-up” or “best friends” arrangements with favored funders, we thought this an opportune time to consider the law firm’s proper role in the litigation funding process.

This article will explore common but unexamined efforts by law firms to deal with funders, the practical challenges posed and suggest a preferred approach for law firms and their clients.

More Americans than ever are living paycheck to paycheck. With inflation rising and a recession right around the corner—financial pressures on the average family are increasing. And lawsuits aren’t going anywhere, which is why Consumer Legal Funding is a vital and necessary option for average families seeking justice in a legal setting. Yet regulation threatens the availability and effectiveness of Consumer Legal Funding—with the potential to curtail justice for those of modest financial means.

The following piece was contributed by Eric Schuller, President of the Alliance for Responsible Consumer Legal Funding (ARC). 

The opponents of consumer legal funding often say that consumers do not need this product. That they have several other options which they can tap into, and as such, are trying to put up barriers through the legislative process in limiting consumers’ ability to have access to this vital piece of financial stability.

The following article was contributed by Nikki Stever and Madison Smith of Australia-based commercial law firm, Piper Alderman.

In the third decision delivered in a shareholder class action in Australia,[1] Iluka Resources Limited (ASX: ILU), (Iluka) succeeded in its defence of a lawsuit[2] which failed to prove that the shareholders’ direct reliance on Iluka’s conduct caused their losses. However, the decision in favour of Iluka notably lacked any significant consideration of the second causation argument typically pleaded in shareholder class actions – market-based causation.

The following piece is a contribution by Charles W. Price, CEO of Capital Now Funding, LLC. 

The pre-settlement legal funding industry is often viewed in a negative manner by those outside of the industry, because settlement advances charge higher interest rates than traditional lending methods. The truth is, that without pre-settlement legal funding, those personally injured in accidents that were no fault of their own often do not have the financial means to properly care for themselves following a personal injury accident.  Therefore, pre-settlement legal funding plays a vital role by providing much-needed financial assistance for personal injury victims when they have no other options available to them.

According to a recent Burford Capital survey, more than half of in-house lawyers say their company has awards and judgements that have remained uncollected—often to the tune of $20 million or more. That’s a staggering number of successful cases that go unfulfilled, from a collectability standpoint.