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CIO Roundtable: Art of the Deal from Terms to Returns

CIO Roundtable: Art of the Deal from Terms to Returns

A panel consisting of Sarah Johnson, Senior VP and Co-Head of Litigation Finance at D.E. Shaw, Aaron Katz, Co-Founder and CIO of Parabellum Capital, David Kerstein, Managing Director and Senior Investment Officer at Validity Finance, and Joe Siprut, CEO and CIO of Kerberos Capital Management, discussed the various investment aspects of litigation funding as an asset class. The panel was moderated by Steven Molo, Founding Partner of MoloLamken. The conversation began with new trends in the industry. Price compression came up early. Joe Siprut of Kerberos Capital Management noted he has witnessed price comparison over the past couple of years, including having seen multiple term sheets that were mis-priced. Litigation finance has always been about attractive risk-adjusted opportunities, yet if the risk remains the same and price compression remains, that reduces the attraction of the asset class. Moderator Steven Molo was surprised there hasn’t been more fallout in this regard. Aaron Katz of Parabellum pointed out how things are opening up after COVID, and that helps a lot, given that a pipeline of cases awaiting trial quickly burns through ROI. Katz countered the price compression argument, stating that he hasn’t witnessed real price compression and hasn’t found his firm to be competing on raw price. Of course this depends on which segment of the market you are looking at. The conversation then steered toward ESG, and David Kerstein of Validity noted how there are green shoots of funders getting involved in impact litigation. Yet for most commercial funders, ESG would maintain the same type of analysis as any other case–that said, funders like to have a ‘good story’ for the case, and ESG can bring that to the table. Aaron Katz mentioned Parabellum is very cautious about ESG in particular. “We think people need to be careful about labelling things incorrectly,” said Katz. There are real impact players out there, and litigation funders should be careful about loosely claiming the mantle. The next question was pretty blunt: Is there a secondary market right now? Aaron Katz thinks not “I pray for it daily.” There is a network of well-resourced institutional players who like to look at claims, but the transactions are laborious (DD challenges, information asymmetry). The secondary participant is not going to be in a direct conversation with the counter-party, and that could cause complications. One final point: Joe Siprut noted that the evolution of a secondary market is one of the main things that can really unlock a lot of investment for the industry. One of the main barriers to investment is the long lockup period investors are staring at, and if a secondary market were to materialize, that would make fundraising a much easier sell.

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Owner-Operators Join the Push for Funding Disclosure as Ohio’s Law Takes Effect

The Owner-Operator Independent Drivers Association has added its voice to the trucking industry's campaign for mandatory disclosure of third-party litigation funding, arguing that defendants in nuclear verdict cases should be told who is financing the claims against them.

As reported by Land Line, OOIDA wants outside funding of lawsuits disclosed as a matter of course rather than contested case by case. The association's position puts owner-operators and small fleets alongside the larger carriers that have driven the disclosure debate to date, and reframes it as a concern for the smallest operators rather than only for well-capitalised defendants.

The piece, written by Keith Goble, is pegged to Ohio's new funding law, which takes effect on 6 October. The statute requires disclosure of third-party litigation funding agreements and bars funding from foreign governments, foreign corporations and foreign investors outright. State Representative Meredith Craig, a Smithville Republican, said that "for too long, foreign actors have profited off Ohio citizens."

Michigan is moving on a broader measure. House Bill 5281 would require disclosure of funding agreements, establish a registration regime for funders operating in the state, prohibit commissions, referral fees and other payments between funders and attorneys or healthcare providers, and bar foreign entities from financing Michigan litigation. State Representative Mike Harris, a Waterford Republican, described the current arrangements as "shadow cash" moving through the civil justice system.

The article does not put a figure on how much outside capital is financing trucking claims, which remains the central gap in the industry's argument for disclosure.

Rugby Brain Injury Claimants Face £2.8m Costs Bill as Court Blames Former Firm’s Approach

Claimants in the long-running rugby brain injury litigation have been left with a £2.8 million costs bill payable to the defendants by the end of October, with no clarity yet on who will actually pay it.

As reported by NR Times, Senior Master Cook attributed the delays that generated the costs to what he described as the "contradictory and misguided approach" taken by Rylands Garth, the firm that originally ran the group action. KP Law has since taken over the claimants' case and must meet outstanding disclosure obligations by 31 October.

The litigation is funded in full by Asertis, which has financed the entire action over six years, including the neurological testing required to establish each claimant's condition. The report notes that it remains unclear whether the £2.8 million falls to the funder, the former firm, or the claimants themselves, a question with direct consequences for a claimant group that includes seven rugby union players who have died since the action began.

Hundreds of claimants have already been struck off the group register as the case has progressed, and Paul Downes KC has warned of the consequences of further procedural failures. The costs order is the latest in a sequence of adverse developments for the action, which was presented as a landmark test of governing bodies' duty of care in contact sport.

For funders, the case illustrates how a cost liability generated by the conduct of a law firm rather than the merits of the underlying claims can land on a funded book, and how little clarity English procedure offers about where that liability ultimately sits.

Krasha to Launch India-Focused Litigation Finance Platform With US$10 Million Minimum Claim Size

Krasha Financial Services has announced plans to launch a dedicated litigation finance platform aimed at the Indian market, with first deployments targeted for the fourth quarter of the 2026-27 financial year.

As reported by India CSR, the platform will fund commercial litigation, arbitration, insolvency claims and award enforcement. Krasha has set a minimum claim size of US$10 million and will cap funded matters at a five-year expected duration, a structure designed to filter out the long-tail cases that have historically made Indian litigation difficult to underwrite. The company said it is in advanced discussions with a UK-based legal finance firm about a strategic partnership, which would give it access to established underwriting practice in a more mature market.

Krasha's chief financial officer, Avdhesh Singh, framed the opportunity around the scale of unresolved Indian litigation, citing more than 50 million pending cases across the court system. The company pointed to global litigation finance market estimates of roughly US$29 billion in 2026, rising to about US$43 billion by 2031, and referenced Burford Capital's reported 26% internal rate of return as a benchmark for the asset class.

The litigation finance platform will sit separately from Krasha's existing neo-financing business, which has a deployment target of ₹1,200 crore for FY2026-27. The group also runs Prism Strategy, a Category II alternative investment fund of roughly US$60 million to US$70 million. Krasha was founded in November 2023.

India has no dedicated statutory framework for third-party funding, and the launch will test how far a domestic funder can build an underwriting model without one.