Day two of of the two-day event saw a trio of panels that covered topics such as investment strategy and risk management, the interplay between fund types, and litigation finance as a tool for ESG. The first panel of the day was titles “CIO Roundtable: Focus on Investment Strategy & Risk Management,” and was moderated by Steven Molo, Founding Partner of MoloLamken. Panelists included:
Patrick Dempsey, Chief Investment Officer, US, Therium Capital
Sarah Johnson, Co-Head Litigation Finance, The D. E. Shaw Group
Aaron Katz, Chief Investment Officer, Parabellum Capital
The conversation began with the rise of business interruption claims. Patrick Dempsey of Therium hasn’t seen much in the way of business interruption claims that have been successful yet. There was an initial interest in this case type, but then a lot of negative decisions came out of federal courts, and so interest waned. That said, you can build a portfolio of these claims and hedge your risk going forward. Aaron Katz of Parabellum noted how his firm hasn’t been active in the business interruption space, though the pace of all other claim types is picking up, with interesting new product areas being developed, including credit-like structures, different stages of cases being presented, lower risk investment types, and even partial recourse feature investment. Sarah Johnson of D.E. Shaw commented on the emergence of new entrants into the litigation funding space. Competition does affect pricing, and this has more of an impact in creative structuring—with new tranches of risk being created. David Kerstein of Validity jumped in to parse this out. He has seen more competition in pricing in larger size deals, however not so much in the more modestly-sized deals. There is still competition there, as claimants are approaching a lot of funders, just not as much price pressure in these types of claims. The conversation then turned to bankruptcy. This was a very quick distressed cycle—given that there was a lot of sophisticated money chasing these deals, there wasn’t as much of a need for litigation funding. However, we may soon begin to see bankruptcies driven by litigation, which could prompt claimants to approach funders for partnership or monetization. And smaller cases might be a place for funders, given that these bankruptcy claims are typically underfunded. As David Kerstein of Validity noted, “When there are bankruptcies that are based on litigation assets or issues, litigation funders are well placed to come in and provide value.” And on the issue of insurance, Aaron Katz noted that judgments are being protected with insurance, products are out there to preserve capital or even back some of the profit in a deal. That said, Parabellum hasn’t seen it as part of the bread and butter of their work. Yet Katz feels it’s only a matter of time before insurance permeates the space, but we’re not there yet. Patrick Dempsey chimed in on his experience with insurance in UK-based claims. Adverse costs insurance is inherent in the jurisdiction there, and so insurance on a portfolio basis was being considered very early on. That was ultimately deemed unnecessary, but that discussion is starting to return, and will likely come back in full force. Therium only uses insurance for judgment protection in the U.S. On the issue of regrets, Sarah Johnson noted how she wishes she had been more aggressive at the outset—doing more deals, and being less price sensitive. Having worked previously in distressed investments, she was used to price sensitivity being an issue, but she found that the industry grew a lot faster and provided much better returns than perhaps even she expected. This speaks well to the industry’s continued growth potential. Later in the day, a pair of panels tackled topics such as fund types, deal structures and costs of capital, as well as ESG and impact investing. One interesting takeaway from the former discussion came from Sarah Lieber, Managing Director and Co-Head of the Finance Group at Stifel. Lieber commented on the large commercial bank syndication model that her firm is structured with. What Stifel does is essentially a merchant banking model—they use their own balance sheet and originate their own transactions. When they approach a partner, whether that is a litigation funder, insurance company, private equity or multi-strategy firm, they choose their partner based on the return profile. And they can syndicate their partnerships within a larger deal construct. Stifel generally operates in the $50MM+ range, and can take on multiple co-investors with various tranches. So Stifel operates in cooperation with many other in the space, in a syndicated investment model. Stifel’s very presence in the market is emblematic of how prominent the funding industry has grown, and how much it has matured over the past few years. Doubtless there will be further maturation ahead, and likely more funding entities which enact a similar merchant banking model. As Tets Ishikawa Managing Director of LionFish noted (on the same panel discussion): “When the market started in the last 15-20 years, it really started as a litigation funding industry—as one single entity. But I believe this market will become like the commercial real estate market. There are many different types of real estate, just as there are many different types of litigation, so in the end there will be many different types of litigation finance investors.”
The High Court has rejected mining giant BHP’s application for an anti-suit injunction (ASI) that sought to prevent Pogust Goodhead from pursuing lawful evidence-gathering measures in the United States against the former president of the Brazilian redress scheme foundation set up after the Mariana dam collapse.
The Court found no basis to characterise Pogust Goodhead’s use of Section 1782 to seek a deposition of Mr André de Freitas, former CEO of the Renova Foundation[i] as vexatious, oppressive, or unconscionable, as argued by BHP.
In November 2024, Pogust Goodhead filed the §1782 application in the District Court of Arkansas seeking limited testimony from Mr de Freitas in relation to Pogust Goodhead’s claim arguing that BHP unlawfully interfered with Pogust Goodhead’s retainer rights and the compensation due to its Brazilian clients. The U.S. court granted the subpoenas in January 2025.
Since then, BHP has sought to block the deposition by filing motions to quash the subpoenas in April 2025 and seeking an ASI in the High Court. A ruling from the Arkansas court is pending.
In Wednesday’s judgment, Mr Justice Waksman rejected BHP’s request for an injunction that would have halted the U.S. evidence-gathering process, finding no basis to prevent Pogust Goodhead from continuing with its §1782 discovery efforts.
Justice Waksman wrote in his decision: “I agree with PG that the depositions serve a distinct and legitimate purpose, being to better understand Renova’s role in relation to the various settlements and their form.”
Alicia Alinia, CEO at Pogust Goodhead commented: “We welcome the Court’s clear judgment. BHP has repeatedly attempted to obstruct legitimate investigations into its conduct. Mr de Freitas’s testimony is central to understanding how our clients’ rights may have been undermined. It is essential that he gives evidence. Only by hearing directly from those involved can our clients’ rights be properly safeguarded and the full truth established.”
Key Findings
The court held that English courts do not control how parties lawfully obtain evidence abroad, and that the U.S. court is the appropriate authority to decide the scope and propriety of discovery sought under Section 1782.
The Court also highlighted BHP’s significant delay in bringing the ASI application — nearly four months after learning of the U.S. subpoenas — which weighed against granting any injunctive relief.
Any concerns about the scope of the subpoenas, alleged misstatements, or burden on the witness are squarely matters for the U.S. District Court, which has already engaged with the issues in detailed hearings.
As a result, BHP cannot use the English courts to derail the ongoing U.S. process. The parties now await the District Court of Arkansas’s decision on whether BHP’s motions to quash the subpoenas will succeed.
The following article was contributed by Dr. Avv. Gian Marco Solas[1], founder of Sustainab-Law and author of Third Party Funding, New Technologies and the Interdisciplinary Methodology as Global Competition Litigation Driving Forces (Global Competition Litigation Review, 1/25). Dr. Solas is also the author of Third Party Funding, Law Economics an Policy (Cambridge Press).
There is an inaccurate and counterproductive belief in the litigation funding market, that the asset class would be uncorrelated from the global economy. That was in fact due to a much bigger scientific legal problem, that the law itself was not considered as physical factor of correlation, as instrument to measure and determine cause and effects of economic events in legal systems.
This problem has been solved, in both theoretical and mathematical terms, and in fact – thanks to technology available to date such as AI and blockchain – it looks much better for litig … ehm … legal third-party funders.
AI allows to detect and file claims that would otherwise not have been viable / brought forward, such as unlocked competition law claims[2], which represent the largest chunk of the market for competition claims. See funding proposal.
Human law as factor of correlation allows to calculate the unexpressed value of the global economy. Everything that, in fact, can be unlocked with litigation, allowing then a public-private IPO type of process to optimize legal systems[3].
Physical modeling of the law also allows to transform debt / liabilities into new investments, thus allowing to settle litigation earlier and with less legal costs, leaving more room to creativity to optimize the investments[4].
While it may be true that the outcome of one single judgement does not depend on the fluctuations of the financial economy, legal reality certainly determines the ups and downs of the litigation funding (and any other) market. Otherwise, we could not explain the rise of litigation funding in the post-financial crisis for instance, or the shockwaves propagated by judgements like PACCAR.
The flip side is that understanding and measuring legal reality, as well as leveraging on modern technologies and innovative legal instruments, the market for legal claims and legal assets is much bigger and sizeable than with the standard litigation financial model.
In order to test Litigation Funding 3.0, I am presenting the following proposal:
10 MILLION EUR in the form of a series A venture capital type of investment to cover one test case's litigation costs, tech, book-building and expert costs aimed at targeting three already identified global or multi-jurisdictional mass anticompetitive claims in the scale of multi-billion dollars, whose details will be provided upon request.
Funder(s) get:
Percentage of claims' return as per agreement with parties involved;
Property of the AI / blockchain algorithm;
License of TPF 3.0.
The funding does not cover: additional legal / litigation / expert / etc. costs.
AI: Artificial Intelligence ML: Machine Learning TPF: Third Party Funding
GENERAL SCENARIO FOR COMPETITION LAW DAMAGE CLAIMS – IN SHORT
Competition authorities around the globe are rapidly developing AI / ML tools to scan markets / economy and prosecute anti-competitive practices. This suggests a steep increase in competition claims in the coming years, in both volume and scope. AI also reduces the costs and time of litigation and ML allows to better assess its risks and merit, prompting for a re-modelling of the TPF economic model in competition claims considering empirical evidence of the first wave(s) of funded litigation.
Below is the abstract and table of contents from my research:
Abstract
This article aims at fostering competition litigation and market analysis by integrating concepts borrowed from physics science from an historical legal and evolutionary perspective, taking the third party funding (TPF) market as benchmark. To do so, it first combines historical legal data and trends related to the legal and litigation markets, discussing three macro historical trends or “states”: Industrial revolution(s) and globalisation; enlargement of the legal world; digital revolution and liberalisation of the legal profession. It then proposes the multidisciplinary methodology to assess the market for TPF: mainstream economic models, historical “cyclical” data and concepts borrowed from physics, particularly from mechanics of fluids and thermodynamics. On this basis, it discusses the potential implication of such methodology on the global competition litigation practice, for instance in market analysis and damage theory, also by considering the impact of modern technologies. The article concludes that physics models and the interdisciplinary methodology seem to add value to market assessment and considers whether there should be a case for a wider adoption in (competition) litigation and asset management practices.
-- 1. Italian / EU qualified lawyer and legal scientist. Leading Expert at BRICS Competition Law & Policy Centre (Higher School of Economics, Moscow). Ph.D.2 (Maastricht Law School, Economic Analysis of Law; University of Cagliari, Comparative Law) – LL.M. (College of Europe, EU competition Law). Visiting Fellow at Fordham Law School (US Antitrust), NYU (US Legal finance and civil procedure).
2. G. M. Solas, ‘Third Party Funding, new technologies and the interdisciplinary methodology as global competition litigation driving forces’ (2025) Global Competition Litigation Review, 1.
3. G. M. Solas, ‘Interrelation of Human Laws and Laws of Nature? Codification of Sustainable Legal Systems’ (2025) Journal of Law, Market & Innovation, 2.
US personal injury law firms are leading a push to open the doors to private equity investment in the legal sector, even in the face of long-standing regulatory opposition to outside ownership of law practices.
According to the Financial Times, a growing number of US firms that built their practices around high-volume, billboard-driven mass tort and injury representation are quietly exploring capital injections from private equity firms. The motivation is fast growth, increased leverage, and the ability to scale operations rapidly, something traditional partner-owned firms have found difficult in a consolidating market.
The move represents a departure from the conventional owner-operator model historically favored by the legal profession, where practicing attorneys hold equity in their firms. Private capital could provide aggressive funding for marketing, case acquisition, litigation infrastructure, and operational expansion, enabling firms to ramp up nationwide acquisition of cases. Critics, however, warn that outside investors prioritizing returns could create pressure to maximize volume over client outcomes.
Private equity’s entrance into legal services is not entirely new, but the aggressive push by personal injury firms may mark a tipping point. If regulators and bar associations ease restrictions on non-lawyer ownership or passive investment, this could fundamentally reshape how US law firms are structured and financed.
For the legal funding industry, this trend signals a potential increase in demand for third-party litigation financing and capital partners. As firms leverage outside investments for growth and case volume, funding providers may find new opportunities or face increased competition.
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