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Key Takeaways from LFJs Special Digital Event: Mass Torts and Litigation Funding 

On Thursday March 23rd, Litigation Finance Journal hosted a special digital event: Mass Torts and Litigation Funding. Panelists included Michael Rozen (MR), Founder and Managing Partner at TRGP Investment Partners, James Romeo (JR), Managing Partner at Greenpoint Capital, Brian Roth (BR), Chief Executive Officer and Chief Investment Officer of Rocade Capital, and Michael Guzman (MG), Partner at Kellogg, Hansen, Todd, Figel and Frederick. The discussion was moderated by Ed Truant (ET), Founder of Slingshot Capital.

The panel discussion spanned a range of topics, including claims origination, financing/underwriting, plaintiff and defense-side strategies and tactics, the impact of ABS regulation and much more. 

Below are some key takeaways: 

ET: How does the industry originate claims and identify and validate claimants? And how has origination industry evolved over the years from the time of mass TV advertising to the current omni-channel world of advertising? 

MG: First, all of the old traditional methods still work.  Networking, late night TV, radio, advertising – all of that still works. But what I am seeing is a number of firms have either affiliated with or own social media marketers, who are using social media in targeted ways. It’s a lot cheaper depending on how you use it, and it can be a lot faster. So people are using the old techniques, plus a number of new ones.  I’ve had some really good success with that, because you’re not just blanketing the airwaves, the people that you get back are much more focused and more interested in what it is you’re trying to recruit them for. 

JR: I think it’s helpful to go back and think about the history of legal advertising, which started in the late 70’s when two lawyers started advertising, it led to some fighting in the state bar, but ultimately it was decided that legal ads are a form of free speech and that they provide consumers valuable information. 

We’ve now seen this huge evolution around what’s possible. There is very targeted social media and paid search advertising that is driven by analytics. At Triton we’re doing a lot of this, we’ve developed our own in-house marketing team, and we’re using things like intake forms and chatbots to help pre-screen potential claimants. We’re using different identify verification tools and we’re experimenting with different medical retrieval tools to help with the intake of potential claimants. 

ET: Describe the ‘fall-out rate’ of claimants and what are typical fall-out rates evidenced in the market and reasons therefor? Has there been an improvement in fall-out rates as a result of enhanced data analytics and technological sophistication?

MR: Access to justice is always a goal for those who think that corporate America has long gotten away with unequal justice because they have a lot of money and the individual claimants don’t. So having better ways of reaching people who may have been impacted by a drug that’s been pulled from the market or a product that didn’t work as advertised is obviously a good thing. The flip side is, in tougher economic times, you see higher claim rates from people who may not be good claimants, because there is an expectation there may be some quick money to be obtained. 

So I think the fall-out rate is really a function of whether or not you’re in the right economic time with the right kind of claim. Camp Lejeune is an example of that. 3M earplugs is an example of that. We’re talking about hundreds of thousands of claimants, whereas in an ordinary mass tort you may have tens of thousands of claimants. And this is something defendants don’t like, and they push back on litigation finance in particular, and argue that somehow specious claims are being promoted. What is really at the base of that is a desire to create an unequal footing between the haves and the have nots. If you are on the have side, it is obviously to your benefit to have either lower claim rates, fewer number of plaintiffs, and/or a higher fallout rate where you can allege later on that these were not valid claimants, that they were somehow propped by third party financing. 

Nobody who has or will speak on this panel will tell you that investing in non-meritorious claims is a good thing. Yet what the other side of this argument will claim is that somehow the fall-out rate as an individual metric is indicative of whether or not there are valid claims in a particular litigation. I would say you to it is irrelevant—the more claims you have in a litigation, the higher the fall our rate is going to be. 

ET: Given the high fall-out rates and the potential for false claimants, is this sector ripe for the application of blockchain to minimize duplication of claimants and decrease fall-out rates as well as tracking the transactions and pay-outs? 

 BR: Fall out impacts the litigation strategy and settlement strategy. When a litigation starts, nobody really knows what will be a settle-able case, so there’s always going to be some level of origination that’s not going to result in a paid claim at the end of the day. I do think the technology will help with some areas like de-duplication and dual representation, whether it’s blockchain or other smart contracts. We’re seeing billions of dollars transact in the space and there’s very little transparency across the different players in the space. I see that changing over time, and that will impact the fall out rates as well. 

ET: What is the nature of the prototypical plaintiff litigation firm? Why do so called “White Shoe” law firms not get involved in mass tort plaintiff litigation work? 

MG: When I started my career, there was this perception that there were defense-side firms and plaintiff-side firms. Lines were pretty well drawn, people crossed over from time to time. But for the most part, if you did plaintiff’s work you did plaintiff’s work, and you didn’t go back and forth. My firm and lots of others defy that model, and at this point, I’m not sure there is a prototypical plaintiff’s firm. My firm is a litigation boutique, and very early on we realized some of our clients wanted us to be plaintiffs for them, and it was enormously challenging and lucrative to play that role for them.

I think why so many of the so-called ‘white shoe’ law firms have found it difficult to be a plaintiff-side firm is because they have corporate departments or longstanding institutional clients, and some of those clients just don’t like the idea that one of those partner is representing them, but at the same time someone else is off pursuing a mass action or class action, so it gets to be an institutional conflict—it’s hard to manage from a client standpoint, and we’ve dealt with that over the years. 

ET: How has the US mass tort industry evolved in terms of the size of the industry, the quantum of cases and the number of claimants over the years? 

JR: If you look at the federal docket, it took something like 59 years to reach the first 250,000 cases in MDLs, and over the subsequent seven years, from 2007-2014, we hit a total of half a million cases, and then by 2021, we topped 1 million cases. So that’s an additional 500,000 case jump from 2014 to 2021. And there’s currently something like 360,000 cases that are still pending in the federal docket. So there’s definitely been an acceleration of cases, and that’s continued. And I don’t see that sopping any time soon. 

ET: Can you describe the various ways in which finance intersects with the mass tort industry?

BR: Financing is an ever changing landscape, but at the front end, you’re seeing it for case origination, a lot of times it’s done on a non-recourse basis. We see a lot of law firm loans, where you’re financing the whole process from origination to settlement. We’re also seeing capital enter for service providers in the space – lead origination or working up cases, ordering records on a contingent basis. We’re also starting to see some post-settlement finance develop, where firms are basically able to factor their claims. 

As we think about the space, we expect this to continue to evolve and develop, and this matures as an asset class, and we develop more data and track records, you’ll see more segmentation I think. But that should translate into more flexible options for the firm. The space currently is shaped by the rules around fee sharing and the ethical rules for law firms which prevent non-lawyers from having ownership in the firm. Obviously, Arizona and other jurisdictions are changing that, so the landscape of how finance intersects with firms is changing as well. 

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Court Approves Settlement Between MMA Law Firm and Litigation Funders to Sell 6,000 Mass Tort Cases

By Harry Moran |

The risk taken by litigation funders reflects the inherent uncertainty of any given case. However, there are rare examples where that risk is compounded by the potential for improper conduct by the law firm entrusted with a funder's financial resources.

An article in Reuters covers the approval of a settlement between MMA Law Firm (formerly McClenny Moseley & Associates) and two litigation funders, which will see the bankrupt law firm sell more than 6,000 cases to repay debts owed to the funders. Equal Access Justice Fund and EAJF ESQ Fund had sued MMA in Texas state court, and under the new settlement will receive a minimum of $18 million from the sale of the cases. The settlement brings the dispute between the funders and law firm to a close, following years of court battles over MMA’s filing of lawsuits on behalf of people it did not represent.

The settlement, which was approved by Chief U.S. Bankruptcy Judge Eduardo Rodriguez, requires that 75% of the proceeds from the sales go to the two funders, with the remaining percentage of proceeds distributed to MMA’s other creditors. The $18 million figure set as a minimum return for the funders under the settlement is still significant below the nearly $38 million that they claim to be owed by MMA. The mass tort cases include claims related to pharmaceutical drug, a weed killer, and a baby formula.

The troubles facing MMA go back several years, with LFJ reporting back in 2023 on a petition lodged by the same two funders in a Louisiana court over MMA’s improper filing of claims on behalf of property owners who suffered damage to their properties from hurricanes. The law firm and its founder, Zach Moseley, were reported to be under investigation by the FBI over these filings of claims but there is currently no update as to the status of that investigation. 

The settlement also allows MMA and Moseley to continue working on other cases on its books, on the condition that the latter does not receive any form of salary increase or bonus before the funders have been repaid.

Panthera Resources Files $1.58 Billion Claim for Damages in Dispute with India

By Harry Moran |

The prolonged duration of investor-state treaty disputes often means that updates on these claims are few and far between. However, the presence of litigation funding allows these claims to proceed at their own pace without the claimant being concerned over the significant financial resources needed to support these disputes. 

In an announcement released today, Panthera Resources Plc provided an update on the arbitration claim being brought by its subsidiary company, Indo Gold Pty Ltd (IGPL), against the Republic of India over the Bhukia project. The announcement revealed that IGPL has issued its Memorial to the arbitration tribunal, which includes a claim for damages totalling $1.58 billion. 

The filing of the memorial and statement of claim to the tribunal follows IGPL’s formal issuance of a Notice of Arbitration to India in July 2024, and the tribunal’s later order to file the memorial by 16 May 2025.

As LFJ previously reported in August 2023, Panthera Resources has secured litigation funding through LCM Funding, a subsidiary of Litigation Capital Management. The funding agreement provides for up to $13.6 million in financing to support the dispute through to a conclusion.

The claim being brought by IGPL centres on alleged breaches of the 199 Australia-India Bilateral Investment Treaty, claiming that the Government of Rajasthan ‘denied and frustrated’ IGPL’s right to be granted a prospecting license over the Bhukia mining project. Furthermore, IGPL’s claim alleges that it suffered a total loss of investment following the passing of new legislation in 2021 which amended the Mines and Minerals (Development and Regulation) Act of 2015 and thereby revoked the preferential right to a prospecting license and mining lease.

LFJ Podcast: Richard Culberson, CEO, Moneypenny

By John Freund |

In this episode, Richard Culberson, the CEO of Moneypenny, discuses how technology is redefining communications and the client experience within the litigation funding and broader legal services industries.

In this podcast, Richard highlights:

  1. Balancing innovation with professionalism when it comes to the human connection that clients demand
  2. How to implement secure digital communication tools to ensure that AI-enabled client insights maintain robust security
  3. One technology that most firms still overlook but has the potential to become a major differentiator in client experience
  4. Practical first steps for firms that wants to future-proof their communication strategies without overwhelming their internal teams.

Plus much more! Check out the full video below:

https://www.youtube.com/watch?v=5JMz-6XwtHg