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Key Takeaways from the LITFINCON Event

March 21, 2022

Key Takeaways from the LITFINCON Event

LITFINCON’s inaugural conference kicked off last week at the Post Oak Hotel in Houston, Texas, with attendees flying in from all over the globe. Guests had a front-row seat to several thought-provoking conversations about the growing asset class from a variety of industry experts.

The LITFINCON event featured a variety of timely and insightful panel discussions. Below are some key takeaways from the two-day conference:

Day 1 highlighted current trends, the state of the industry, best strategies when seeking litigation finance, and the relationship between corporate legal departments and litigation finance.

The day kicked off with the “Views From The Judiciary On All Things Litigation Finance” panel, which was certainly a crowd favorite. Three distinguished judges shared their insights: The Honorable Charles R. Eskridge, III, of the United States District Court for the Southern District Court of Texas, The Honorable Andrew M. Edison, of the United States District Court for the Southern District of Texas, and The Honorable Lauren Reeder of the 234th Judicial District, Harris County. They offered their unique views, as only active judges can, on a variety of issues affecting litigators, funders, and plaintiffs.

Day 2 highlighted what investors should know about this asset class, when and how to use a broker when looking for funding, technology trends in the legal field, and expert insights on fund formation. Day 2’s lunch break was something special, as it featured Chief Comedic Officer of Making Lawyers Laugh, LLC Sheng Weng, who most recently was seen touring with Ali Wong and was a featured stand-up on HBO’s “2 Dope Queens” special. Sheng also wrote for the ABC show “Fresh Off the Boat.” He kept guests entertained and roaring with laughter – a unique addition to the conference agenda.

Guests enjoyed rare in-person networking opportunities, and the opportunity to establish new business relationships. The attendee list included industry-leading firms, such as: Omni Bridgeway, Yieldstreet, Liti Capital, Law Finance Group, Polsinelli, Schulte Roth & Zabel, CAC Speciality, Parker Poe, 4 Rivers Legal, Critchfield, Critchfield & Johnston, Roche Freedman, Women of Litigation Finance (WOLF), Global Litigation Consultants, D. E. Shaw & Co., Arran Capital, Law Office of Philip A. Reale, Dunning Rievman, and Kerberos Capital Management.

Overall, attendees were delighted by how the event turned out. We received some sparkling reviews, a smattering of which is offered for you here:

“LITFINCON was a very positive experience. The range of speakers and panelists was impressive and a great deal of ground relating to the current trends in the industry was covered. The attendees were a good representation of the main industry players, namely funders, attorneys and advisors/brokers. Texas is still a relatively nascent third-party funding market and there are without doubt some exciting opportunities there, particularly in the energy and IP sectors. Siltstone did a great job in setting this up and I am already looking forward to the 2023 renewal!”

  • Peter Petyt (CEO and Co‑Founder, 4 Rivers)

“It was a pleasure to discuss how corporate legal departments can utilize litigation funding at the inaugural LITFINCON. The diversity of viewpoints and experiences of my distinguished co-panelists really contributed to a candid, free-flowing discussion of what more can be done to acclimate corporate legal departments to the exciting possibilities offered by litigation finance.”

  • Gaston Kroub (Partner, Markman Advisors)

“The litigation finance industry is growing rapidly, which makes networking at events like LITFINCON both important and exciting. We are building something together. It is particularly important that we share best practices and that we find ways to communicate those to stakeholders who may not be knowledgeable about them, such as litigation clients and members of the judiciary. LITFINCON did a great job of convening a diverse group and sharing that information.

I particularly enjoyed the “Crypto” panel, “How Will Blockchain, Cryptocurrency, And Other Technological Innovations Impact Litigation and the Legal Field.” It is nice to attend a conference that offers new information and perspectives.”

  • Lauren Harrison (Vice President/Investment Counselor, Law Finance Group)
According to Siltstone Capital, the organizer of the event, LITFINCON was such a rousing success that the second installation is already being planned.

“Our entire Siltstone Capital team was humbled to host industry leaders at our inaugural LITFINCON. LITFINCON attracted a global array of speakers and attendees to help promote best practices for the growing and still malleable field of legal private credit. Hosting the conference in Houston, Texas also helped advance the legal private credit field to one of the biggest legal markets in the country. We can’t wait to host LITFINCON II in March 2023.”

  • Mani Walia (Managing Director & General Counsel, Siltstone Capital)

“The inaugural LITFINCON was a tremendous success. It received rave reviews. I want to thank all the sponsors, panelists, and attendees, who came in from all over the world – London, Geneva, New York, Miami, San Francisco, and Austin. LITFINCON highlighted the growing field of litigation finance and the importance of Texas as a hub that unites all participants in the legal field. Siltstone Capital is excited about continuing the momentum and advancing the litigation finance field by hosting LITFINCON II in March 2023. We expect the event to be two to three times bigger!”

  • Robert Le (Founder & Managing Partner, Siltstone Capital)
We are equally excited for the 2023 version, and look forward to bringing you a recap of that event next year as well!

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Commercial

Litigation Finance Faces Regulatory, MSO, and Insurance Crossroads in 2026

By John Freund |

The litigation finance industry, now estimated at roughly $16.1 billion, is heading into 2026 amid growing uncertainty over regulation, capital structures, and its relationship with adjacent industries. After several years of rapid growth and heightened scrutiny, market participants are increasingly focused on how these pressures may reshape the sector.

Bloomberg Law identifies four central questions likely to define the industry’s near-term future. One of the most closely watched issues is whether federal regulation will finally materialize in a meaningful way. Legislative proposals have ranged from restricting foreign sovereign capital in U.S. litigation to taxing litigation finance returns. While several initiatives surfaced in 2025, political gridlock and election year dynamics raise doubts about whether comprehensive federal action will advance in the near term, leaving the industry operating within a patchwork of existing rules.

Another major development is the expansion of alternative investment structures, particularly the growing use of management services organizations. MSOs allow third party investors to own or finance non legal aspects of law firm operations, offering a potential pathway for deeper capital integration without directly violating attorney ownership rules. Interest in these models has increased among both litigation funders and large law firms, signaling a broader shift in how legal services may be financed and managed.

The industry is also watching the outcome of several high profile disputes that could have outsized implications for funders. Long running, multibillion dollar cases involving sovereign defendants continue to test assumptions about risk, duration, and appellate exposure in funded matters.

Finally, tensions with the insurance industry remain unresolved. Insurers have intensified efforts to link litigation funding to rising claim costs and are exploring policy mechanisms that would require disclosure of third party funding arrangements.

Taken together, these dynamics suggest that 2026 could be a defining year for litigation finance, as evolving regulation, new capital models, and external pushback shape the industry’s next phase of development.

Commercial Regulatory Issues

Liability Insurers Push Disclosure Requirements Targeting Litigation Funding

By John Freund |

Commercial liability insurers are escalating their long-running dispute with the litigation funding industry by introducing policy language that could require insured companies to disclose third-party funding arrangements. The move reflects mounting concern among insurers that litigation finance is contributing to rising claim costs and reshaping litigation dynamics in ways carriers struggle to underwrite or control.

An article in Bloomberg Law reports that the Insurance Services Office, a Verisk Analytics unit that develops standard insurance policy language, has drafted an optional provision that would compel policyholders to reveal whether litigation funders or law firms with a financial stake are backing claims against insured defendants. While adoption of the provision would be voluntary, insurers could begin incorporating it into commercial liability policies as early as 2026.

The proposed disclosure requirement is part of a broader push by insurers to gain greater visibility into litigation funding arrangements, which they argue can encourage more aggressive claims strategies and higher settlement demands, particularly in mass tort and complex commercial litigation. Insurers have increasingly linked these trends to what they describe as social inflation, a term used to capture rising jury awards and litigation costs that outpace economic inflation.

For policyholders, the new language could introduce additional compliance obligations and strategic considerations. Companies that rely on litigation funding, whether directly or through counterparties, may be forced to weigh the benefits of financing against potential coverage implications.

Litigation funders and law firms are watching developments closely. Funding agreements are typically treated as confidential, and mandatory disclosure to insurers could raise concerns about privilege, work product protections, and competitive sensitivity. At the same time, insurers have been criticized for opposing litigation finance while also exploring their own litigation-related investment products, highlighting tensions within the market.

If widely adopted, insurer-driven disclosure requirements could represent a meaningful shift in how litigation funding intersects with insurance. The development underscores the growing influence of insurers in shaping transparency expectations and suggests that litigation funders may increasingly find themselves drawn into coverage debates that extend well beyond the courtroom.

Case Developments Commercial

Diamond McCarthy Backs Lansdowne Oil Treaty Claim Against Ireland

By John Freund |

US-based litigation funder Diamond McCarthy has agreed to back a high-stakes investment treaty claim brought by Lansdowne Oil and Gas against the Irish state, with the claim reportedly valued at up to $100 million. The dispute arises from Ireland’s policy shift away from offshore oil and gas development, which Lansdowne argues has effectively wiped out the value of its investment in the Barryroe offshore oil field.

According to NewsFile, Lansdowne Oil and Gas, a small exploration company listed in London and Dublin, is pursuing arbitration against Ireland under the Energy Charter Treaty. The company alleges that Ireland’s 2021 decision to halt new licences for offshore oil and gas exploration, followed by regulatory actions affecting existing projects, breached treaty protections afforded to foreign investors. Lansdowne contends that these measures frustrated legitimate expectations and amounted to unfair and inequitable treatment under international law.

Diamond McCarthy’s involvement brings significant financial firepower to a claim that would otherwise be difficult for a junior energy company to pursue. The funder will cover legal and arbitration costs in exchange for a share of any recovery, allowing Lansdowne to advance the case without bearing the full financial risk. The arbitration is expected to be conducted under international investment dispute mechanisms, with proceedings likely to take several years.

Ireland has previously defended its policy changes as part of a broader climate strategy aimed at reducing fossil fuel dependence and meeting emissions targets. Government representatives have indicated that the state will robustly contest the claim, arguing that the measures were lawful, proportionate, and applied in the public interest. Ireland is also in the process of withdrawing from the Energy Charter Treaty, although existing investments may remain protected for a period under sunset provisions.