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Litigation Finance Journal’s Quarterly Industry Roundup

By John Freund |
Litigation Finance News

It’s clear by now that 2020 has been a year like no other. Industry growth and the impact of COVID make this an ideal time to catch up on all of the relevant issues impacting the commercial Litigation Finance industry. With that in mind, LFJ is hosting a panel discussion that will cover a wide range of topics, including the Burford/Muddy Waters saga, the IMF/Omni merger, the rise in IP litigation, hedge fund interest in the funding sector, and much more. 

The panel will be moderated by Slingshot Capital founder Ed Truant. Truant is an investor with a unique perspective on commercial litigation finance, backed up by years of experience in the field.

The panel will feature a collection of industry experts: 

Molly Pease is the managing director of Curiam Capital, and a former litigator whose expertise includes insurance, antitrust, and securities. She has also been an Executive Director and has worked as General Counsel—providing her a varied and nuanced perspective on a vast array of legal subjects.

Mick Smith is the founder of Almatura, and co-founded Calunius Capital in 2006. He has studied Mathematics and Law at Cambridge, and is pursuing a Masters in Data Science.

Robert Hannah, co-founder of Augusta Ventures, spent 20 years managing hedge funds before becoming acting Chief Investment Officer for Mako Investment Managers—an organization he co-founded. Hannah has an LLB and an MBA from Cranfield School of Management. He is currently the Managing Director of the London office.

William Farrell Jr. is the managing director and co-founder of private investment company Longford Capital. His current duties include underwriting, sourcing, and monitoring investments. He has decades of litigation experience and as a government prosecutor. Farrell has also served as a partner in the commercial litigation departments of two different firms.

The panel is audio-only and will be held Thursday, July 30th at 1 pm EST. It will feature a 45-minute panel discussion that will be followed by a question and answer period with attendees. 

For more information and to purchase tickets, please visit this link.

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£878M Opt-Out Claim Brought Against Royal Mail, Backed by £10M in Funding 

By Harry Moran |

A new claim has been brought against International Distribution Services, the owner of Royal Mail, over allegations that it ‘prevented competition for bulk mail delivery services’ which in turn led to end-customers being overcharged for these services. The opt-out claim is being brought on behalf of any customers who purchased bulk mail services since January 2024, with an estimated 290,000 potential class members seeking up to £878 million in compensation for these overcharges.

An article in the Financial Times reveals that the application to bring collective proceedings was filed at the Competition Appeal Tribunal (CAT) on Thursday, with the action being led by the Proposed Class Representative, Robin Aaronson and supported by law firm Lewis Silkin. According to the Bulk Mail Claim website, it has secured £10 million in funding from ‘a specialist litigation funder to bring the claim’ and has ‘put in after the event (ATE) insurance to cover its liability to pay Royal Mail’s costs if the claim is unsuccessful.’

In a press release announcing the filing of the claim, Robin Aaronson said:

“Where there has been an abuse of dominant position, as has occurred in this case, it is important that those suffering loss are able to obtain redress. A collective claim is the only fair and efficient form of redress in this case, given that there are hundreds of thousands of affected customers and it would be commercially unviable for them to bring individual proceedings.”

Andrew Wanambwa, Partner in the Dispute Resolution team at Lewis Silkin, also provided the following comment:

“Royal Mail abused its dominant position, resulting in hundreds of thousands of bulk mail customers being overcharged. The purpose of this claim is to hold Royal Mail accountable for its actions and secure compensation for affected customers.”

Responding to the announcement of the filing, Royal Mail confirmed that it had received the application and said, “We consider [the claim] to be without merit and we will defend it robustly.” The draft Collective Proceedings Order can be read here.

Rockhopper Exploration Announces Receipt of Tranche 1 Funds for the Ombrina Mare Monetisation Transaction

By Harry Moran |

Rockhopper Exploration plc is pleased to provide the following update in relation to the monetisation of its Ombrina Mare Arbitration Award (the "Transaction") announced on 20 December 2023.

Having satisfied all precedent conditions to the Transaction as announced on 17 June 2024, the Company confirms that the Tranche 1 payment has been received.

Rockhopper has received €19 million of the €45 million Tranche 1 payment. As previously disclosed, Rockhopper entered into a litigation funding agreement in 2017 under which all costs relating to the Arbitration from commencement to the rendering of the Award were paid on its behalf by a separate specialist arbitration funder (the "Original Arbitration Funder"). That agreement entitles the Original Arbitration Funder to a proportion of any proceeds from the Award or any monetisation of the Award. The balance of €26 million has gone to Original Arbitration Funder in order to fully discharge the Company of all of its liabilities under the agreement with the Original Arbitration Funder. Tranches 2 and 3 of the Award remain payable to Rockhopper upon a successful annulment outcome.

As previously disclosed, success fees of approximately €4 million are owed to Rockhopper's legal representatives if Rockhopper win the claim, meaning liability is established and Italy is required to pay more than a nominal sum in damages (either by way of award or settlement in an amount equal to or more than €25 million).

Following receipt of the Tranche 1 payment, Rockhopper's cash balance is approximately $27 million.

Please refer to the Company's announcement on 20 December 2023 for further details on the Ombrina Mare Arbitration Award. Capitalised terms shall have the same meaning as in the 20 December 2023 announcement.

Samuel Moody, CEO, commented:

"We are delighted to have received the Tranche 1 payment under the Ombrina Mare monetisation agreement.  This cash gives us the strongest balance sheet we have had for a number of years, and we remain confident in the merits of our legal case as we await the decision of the Ad Hoc Panel on the annulment request from the Italian Republic."

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Industry Leaders React to House Committee Hearing on Funding Disclosure

By Harry Moran |

As LFJ covered earlier this week, a recent hearing in the US House Judiciary Committee reignited arguments around the appropriate level of disclosure required when third-party funders are involved in patent lawsuits. Whilst the hearing largely highlighted the arguments in favour of more stringent disclosure requirements, legal professionals and funders are now offering their own differing perspectives on these contentious issues.

An article in IAM looks at last week’s House Judiciary Committee hearing, focusing on the testimonies from witnesses called before the committee and examining the counter-arguments from industry professionals who are opposed to the introduction of excessively broad disclosure rules for litigation funders. As the article explains, the main point of contention around this issue relates to the level of disclosure required, with most third-party funding participants being open to the disclosure of a funder’s identity, but opposed to the disclosure of the financial details of funding agreements.

Erick Robinson, attorney at Spencer Fane, told IAM that mandating disclosure of the particulars of any funding agreement would be incredibly damaging for plaintiffs in patent infringement lawsuits. Robinson argued well-resourced defendants would “run modeling and be able to reverse engineer the budget based on their knowledge of funding agreements”, which would lead to these defendants dragging out the lawsuit to deplete the funder’s budget. Robinson also questioned the justification for providing defendants with this level of detail, claiming that “there's no legitimate reason any defendant should ever get strategic financial information.”

Anup Misra, managing director at Curiam Capital, concurred with Robinson’s arguments and acknowledged that whilst they would be open to allowing a judge to review the funding agreement, “we just wouldn’t want the economics of a funding agreement to be sent to the defence counsel.” Misra went on to question the idea that third-party funding introduces ‘unknown unknowns’ to the court, as it was described by one witness at the hearing. Misra argued that it should be left to the judge in any given case to decide if they require more information around the involvement of funders, suggesting that “if something were to happen during pending litigation, I'm sure those judges would then determine whether they wanted to see a funding agreement.”