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Member Spotlight: Jonathan Stroud 

September 20, 2023

Member Spotlight: Jonathan Stroud 

Jonathan Stroud is General Counsel at Unified Patents, LLC, where he manages a growing team of talented, diverse attorneys and oversees a docket of administrative challenges, appeals, licensing, pooling, and district court work in addition to trademark, copyright, administrative, amicus, policy, marketing, and corporate matters. Prior to Unified, Jonathan was a litigator with Finnegan, Henderson, Farabow, Garrett & Dunner LLP, and prior to that, he was a patent examiner at the USPTO. He earned his J.D. with honors from the American University Washington College of Law; his B.S. in Biomedical Engineering from Tulane University; and his M.A. in Print Journalism from the University of Southern California. He enjoys teaching, writing, and speaking on Federal Courts, administrative law, competition, and IP policy. Company Name and Description: Unified Patents, LLC is a 350+ international membership organization and trade group that seeks to improve IP protection and patent quality and deter unsubstantiated or invalid assertions in defined technology sectors through its activities. Its actions include analytics, prior art, invalidity contests, patentability analysis, administrative patent review (PTAB), amicus briefs, economic surveys, and essentiality studies. Unified works independently of its members to achieve its deterrence goals.
Company Website: www.unifiedpatents.com Year Founded: 2012 Headquarters: 4445 Willard Ave., Suite 600, Chevy Chase, MD Areas of Focus: Competition and IP Policy, NPEs, Patent and Trademark Law, Economics, Commentary, Quote on Litigation Funding:
 
From Jonathan Stroud: “Discourage litigation. Persuade your neighbors to compromise whenever you can. Point out to them how the nominal winner is often a real loser—in fees, expenses, and waste of time. As a peacemaker, the lawyer has a superior opportunity of being a good man. There will still be business enough.”

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Commercial

Shine Justice Marks 50 Years as Mass Tort Expansion Leans on Litigation Funding

ASX-listed Shine Justice has marked its 50th year with a return to profitability and an international mass torts strategy that depends heavily on third-party litigation funding.

As reported by TipRanks, the firm now operates across Australia, New Zealand, Thailand and the United States, with practice concentrations in personal injury, class actions and international mass torts.

Results presented on August 28 showed adjusted revenue up 7.8% to A$220.4 million and adjusted EBITDA up 13.9% to A$44.7 million. Net profit after tax attributable to members reached A$9.3 million, up from A$0.6 million, while operating cash flow held steady at A$19 million. Net work in progress rose 0.9% to A$366.6 million, and the company declared a fully franked dividend of A$0.04 per share. Offsetting that, Shine booked an A$11.2 million provision following an adverse U.S. court decision in a legacy class action now under appeal, and reported six in-principle settlement agreements worth more than A$219 million.

The company describes a hub-and-spoke model in which a U.S. hub sources large mass tort cases and exports them to spokes in Australia, New Zealand and Asia, with balance sheet risk minimised through litigation funding. Shine has secured up to A$40 million for talcum powder litigation and expects further backing for comparable claims in New Zealand and Thailand.

Simon Morrison has moved from managing director to a senior role focused on international mass torts, with Carolyn Barker taking over as group chief executive. Chief financial officer Marc Devine guided to high single-digit personal injury revenue growth of about 8% in FY27.

Commercial

Fair-Value Accounting Is Amplifying Case Losses at Listed Litigation Funders

Listed litigation funders are facing renewed scrutiny as fair-value accounting pushes losses from adverse court and arbitration outcomes into earnings well before any cash changes hands.

As reported by Traders Union, reversals at Burford Capital, Litigation Capital Management and others have intensified questions about valuation models that treat lawsuits as financial assets.

One recent flashpoint was a Paris-based ICC tribunal's dismissal of a $680 million claim against Nigeria that Burford had funded. The claim, brought by Sunrise Power, concerned a 2020 settlement the tribunal found had been signed by ministers who lacked authority to bind the state without presidential approval. Recoverability concerns were compounded by Sunrise Power's minimal assets and by cost penalties. Burford has separately absorbed the reversal of a $16.1 billion YPF judgment and a $2.4 billion write-down, while LCM has recorded a High Court loss alongside a 99% decline in its share price.

Under IFRS 9 and ASC 820, model-based unrealised gains and losses flow directly into reported earnings, tying marks to share prices, compensation and debt capacity. Net asset value therefore rests on probability-weighted assessments over which management retains significant discretion.

The scrutiny is not new. Muddy Waters alleged in 2019 that Burford "manipulates its performance metrics and abuses the latitude afforded it under fair value accounting," and the company later restated results for FY2019 through FY2022 following an SEC initiative. Burford has also reported a material weakness in internal controls affecting fair value measurement of capital provision assets, though it has pointed to $518.3 million in cash realizations year to date as evidence that timing, not deterioration, drives the volatility.

Commercial

Apple Moves to Overturn Record $5.7 Billion Patent Verdict Tied to Litigation Funding

Apple has asked a federal court in San Diego to overturn or retry the largest patent verdict on record in the United States, a $5,721,961,750 award that carries a substantial litigation funding stake.

As reported by PYMNTS, a jury found on September 25 that the Taptic Engine used in iPhones and Apple Watches infringes two haptics patents held by Taction Technology. Apple is asking U.S. District Judge Todd W. Robinson to set aside the findings or order a new trial, and could then take the dispute to the Federal Circuit.

Taction sued in 2021 over patents describing tactile transducers that produce bass frequency vibrations. Apple had the case dismissed in 2023, but the Federal Circuit revived it last year after finding the dismissal rested on an unwritten requirement that improperly prevented Taction from relying on certain expert testimony. Apple maintains that the Taptic Engine is "fundamentally different from Taction's technology." Jurors found the infringement was not willful, removing the basis for treble damages.

Burford Capital is entitled to roughly a quarter of the award, or about $1.4 billion, split roughly evenly between its balance sheet and its investment funds. Burford has cautioned that the figure is likely to be altered in post-trial proceedings and that the parties could settle for considerably less. Gronostaj Investments LLC and Kenosha Investments LP were identified as funders in the proceedings. Apple sought unsuccessfully during the case to compel disclosure of the funding arrangements — an issue a federal rules committee is scheduled to take up on October 21.