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Commercial Special Features

Member Spotlight: Louisa Klouda

By John Freund |

Louisa Klouda is the founder and CEO of Fenchurch Legal. She set up the business in early 2020, after identifying a gap for additional small-ticket litigation funders in the UK market.

Louisa is responsible for day-to-day operations, strategic direction and capital raising. Louisa’s expertise in sourcing, underwriting and managing borrowers, as well as attracting investor capital has been instrumental in Fenchurch Legal’s growth.

 

Prior to setting up Fenchurch Legal, Louisa worked within corporate finance, specializing in the asset backed lending industry. She managed the broking and dealing desk for secured debt securities, structured various investment products and facilitated some large M&A transactions.

About Fenchurch Legal: Fenchurch Legal is a UK-based litigation financier, specialising in providing disbursement funding to small to medium-sized law firms in the UK. The financing funds small ticket ATE (“After the Event”) cases and covers associated disbursements, all backed by ATE insurance policies.

Their focus on smaller claims, often overlooked in traditional funding, ensures that even modest claims, like housing disrepair claims receive the backing necessary to navigate the legal process, ultimately facilitating access to justice and contributing to a more balanced and inclusive legal landscape.

Understanding law firm needs, Fenchurch Legal delivers solutions to remove pain points and has developed an offering to avoid problems such as complex drawdown procedures, undisclosed fees, and non-funding of crucial costs like WIP capital.

In addition to collaborating with borrowers, we extend the opportunity to investors to invest in this unique market. Fenchurch Legal sets itself apart with a focus on smaller-ticket claims, flexible entry points, and robust security features, making it an accessible and attractive choice for those seeking alternative investment opportunities.

The company continues to innovate and has recently developed its own loan management software, providing a bespoke platform for managing loan repayments, monitoring, reporting and onboarding –  significantly enhancing the whole business operations, driving efficiency and enabling the business to scale.

Company Website: https://www.fenchurch-legal.co.uk/

Year Founded:  2020

Headquarters:  London

Area of Focus: Fenchurch Legal is solely focused on funding smaller cases with an established legal precedent at high volumes. These protocol-driven consumer claims (housing disrepair, Plevin, PCP, financial mis-selling) offer a high potential for success.

Member Quote: “The funding market is increasingly recognising the importance of smaller claims. Small ticket litigation funding plays a vital role in the UK legal landscape, offering an alternative approach to financing legal claims. Small-ticket funders like Fenchurch Legal focus on quantity, funding a high volume of smaller cases.

Our core strength lies in our deep understanding of the small-ticket claims landscape. We have developed a rigorous and data-driven vetting process tailored to this specific segment of litigation funding, allowing us to identify top-tier law firms and high-potential case types with lower individual risk profiles.

At Fenchurch Legal, we believe in the transformative power of small-ticket disbursement funding, and our commitment extends to both law firms and investors. Small-medium law firms can take on cases that might otherwise go unfunded whilst providing an avenue for investors looking for alternative investment opportunities within the litigation funding market.”

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John Freund

John Freund

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Announcements Commercial People Moves

ALFA Welcomes Mackay Chapman as Newest Associate Member

By Harry Moran |

In a post on LinkedIn, The Association of Litigation Funders of Australia (ALFA) announced that it is welcoming Mackay Chapman as its newest Associate Member. Mackay Chapman becomes the 12th Associate Member of ALFA, following the inclusion of Litica in April of this year.

Mackay Chapman is a boutique legal and advisory firm, specialising in high-stakes regulatory, financial services and insolvency disputes. The Melbourne-based law firm was founded in 2016 by Dan Maclay and Michael Chapman, who bring 25 years of experience in complex disputes to the business.More information about Mackay Chapman can be found on its website.

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Case Developments Commercial

Deminor Announces Settlement in Danish OW Bunker Case

By Harry Moran |

An announcement from Deminor Litigation Funding revealed that a settlement has been reached in the OW Bunker action in Demark, which Deminor funded litigation brought by a group of 20 institutional investors against the investment banks Carnegie and Morgan Stanley.

This is part of a wider group of actions originating from OW Bunker’s 2014 bankruptcy, which led to significant financial losses for both company creditors and shareholders who had invested in the company. These other cases were brought against several defendants, including OW Bunker and its former management and Board of Directors, Altor Fund II, and the aforementioned investment banks.

The settlement provides compensation for plaintiffs across the four legal actions, with a total value of approximately 645 million DKK, including legal costs. The settlement agreement requires the parties to ‘waive any further claims against each other relating to OW Bunker’. Deminor’s announcement makes clear that ‘none of the defendants have acknowledged any legal responsibility in the group of linked cases in connection with the settlement.’

Charles Demoulin, Chief Investment Officer of Deminor, said that “the settlement makes it possible for our clients to benefit from a reasonable compensation for their losses”, and that they were advising the client “to accept this solution which represents a better alternative to continuing the litigation with the resulting uncertainties.” Joeri Klein, General Counsel Netherlands and Co-head Investment Recovery of Deminor, said that the settlement had demonstrated that “in Denmark it has now proven to be possible to find a balanced solution to redress investor related claims.”

Case Developments Commercial

Burford German Funding Sued Over Hausfeld Ownership Stake

By Harry Moran |

The ownership or funding of law firms by litigation funders continues to be a hot topic in the world of legal funding, with models such as alternative business structures (ABS) gaining momentum in places like Arizona. However, a complaint filed by a client in Delaware reveals a falling out due to the reverse funding model, where a law firm maintained an ownership stake in the funder.

Reporting by Bloomberg Law covers a new lawsuit brought against Burford German Funding (BGF), an affiliate of Burford Capital, by a client who claims that the funder failed to disclose the fact that BGF was partly owned by the same law firm it nominated to lead the client’s antitrust cases. Financialright Claims GMBH (FRC) alleges that when it negotiated the funding agreement with BGF for its antitrust litigation against the trucks cartel, it had no knowledge “that Hausfeld  was  also  a  part  owner  of  BGF  through  an  entity  called German Litigation Solutions LLC (“GLS”) or that one of the lead German partners at Hausfeld responsible for the firm’s representation of FRC had a personal stake.”

The complaint, filed by FRC in the Delaware Superior Court, explains that as Hausfeld is part-owner of BGF, and the funding agreement “provides for a share of FRC’s recoveries in the Trucks Litigations to flow to FRC’s lawyers”, this constitutes a contingency fee arrangement which are illegal under German law.  FRC had filed a lawsuit against Hausfeld in a German court and then applied for discovery from BGF, Burford and GLS in the Delaware District Court, which was followed by an assertion by these parties that the application for discovery “is subject to mandatory arbitration” under the terms of the funding agreement.

FRC argues that “as  a  direct  result  of  BGF’s  fraud  on  FRC,  FRC  did  agree  to  the Arbitration Agreement that—according to BGF—subsumes disputes between FRC and GLS.” However, FRC claims that it “would  never  have  agreed  to  an  arbitration  clause  requiring  it  to arbitrate claims against Hausfeld”, were it not for the concealment of Hausfeld’s ownership stake in BGF. FRC is therefore asking the Superior Court to declare that “BGF fraudulently induced  FRC  into  agreeing  to  the  Arbitration  Agreement”, and that the agreement should be declared both invalid and unenforceable.

Lisa Sharrow, spokesperson at Hausfeld LLP, provided the following statement:  “The US-based Hausfeld LLP and the UK-based Hausfeld & Co LLP hold indirect economic minority interests in Burford German Funding. These are separate legal entities from Hausfeld Rechtsanwälte LLP that do not practice law in Germany. Burford German Funding was of course developed and set up in a way that was fully compliant with all relevant regulations.”

David Helfenbein, spokesperson at Burford, also provided a response to Bloomberg via email: “There is a dispute in Germany between a client Burford has funded and its lawyers. Burford is not a party to that dispute and its outcome has no impact on us. This Delaware proceeding is a third-party discovery request to Burford for material for the German litigation, which Burford believes should be adjudicated in arbitration and not in the Delaware courts.”

The full complaint filed by FRC can be read here.

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