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Move Over Carnival: Litigation Funding in Brazil is Heating Up!

Move Over Carnival: Litigation Funding in Brazil is Heating Up!

Writing for Vannin’s Funding in Focus series, Carolina Ramirez, Managing Director in Vannin’s newly-formed New York office, describes the litigation funding climate in South America’s largest and most populous nation. Ramirez highlights both the perceptions and practical applications of litigation finance in Brazil, as well as the regulatory climate and challenges facing industry growth in the region.
Although third party funding arrived on the Brazilian scene only recently, the practice has been warmly embraced relative to other Latin American markets. That has to do with Brazil’s liquidity crisis following the Great Recession, in addition to fallout in the aftermath of Operation Car Wash, or Operação Lava Jato, and the subsequent reliance on arbitration as a result. According to Ramirez, Brazilians maintain a perception that litigation funding is utilized solely by impecunious claimants, or those facing liquidity constraints. Although perceptions are gradually changing, she points to one local practitioner who claims that “case law on the matter is scarce and major Brazilian arbitration chambers do not publish their precedents, so parties (be it funders, funded parties or adversaries to a funded party) still have to deal with a reasonable (and potentially damaging) degree of uncertainty.” Yet despite the uncertainty, the benefits of litigation funding are widely being recognized, with one practitioner going so far as to state that the practice “will evolve to [allow] major companies seeking reasonable financing that allows them to pursue their core business objectives while conducting high level litigation.” Such is the reality of litigation funding in other major jurisdictions, so why not Brazil? Major obstacles to the adoption of litigation funding have to do with costs and time constraints — the former containing too few, and the latter containing far too many. The cost of filing a claim (appeal included) in Brazil is extraordinarily low, which of course precludes firms from seeking external funding. Additionally, cases can go through many layers of appeal before reaching conclusion, which means that funders can’t accurately predict the timing of their expected recovery. Essentially, the barriers to justice that exist in Brazil work against litigation funders, whereas the barriers that exist in the United States, for example (those being high upfront costs and balance sheet exposure), directly play into a litigation funder’s hands. According to Ramirez, by and large, third party funding is unregulated in Brazil. “Only recently did the Brazil-Canada Chamber of Commerce (“CAM/CCBC”) – one of the most renowned institutions in Brazil – issue a resolution specifically recommending that parties disclose the use of funding at the outset of an arbitration (Administrative Resolution 18/2016).” Practitioners on the ground believe in the likelihood that other arbitral institutions will at some point promulgate further regulations on third party funding in Brazil, though at present, the industry remains unregulated. So is Brazil on the precipice of future growth in the area of litigation funding? Ramirez seems to think so. “The resounding message,” she writes, “is that Brazil is ripe for third party funding and that the time to enter the market is now. It is also clear that practitioners are enthusiastic about the prospect of having foreign third party funders with significant experience enter the market and level the playing field which has thus far been dominated by a single local Brazilian third party funder.” To read Ramirez’s article in its entirety, please visit this link

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Court of Appeal Shuts Down BHP’s Attempt to Overturn Mariana Liability Judgment

By John Freund |

The Court of Appeal of England and Wales today refused BHP’s application for permission to appeal the High Court’s landmark liability judgment in the Mariana disaster litigation.

The High Court found BHP responsible for the 2015 collapse of the Fundão tailings dam in Mariana, Minas Gerais, Brazil, concluding that BHP is liable for the disaster under both the Brazilian Civil and Environmental law.

The Court of Appeal heard BHP’s application for permission to appeal the decision on 12 March after BHP was refused permission to appeal by the High Court in January.  BHP asked the court for permission to contest the findings that it was a polluter, and that it had knowledge of the risks associated with the dam before the collapse. The mining company also challenged the finding that all claimants brought their claims in time.

The Court of Appeal’s refusal marks a further victory for the hundreds of thousands of Brazilian victims who have spent over ten years pursuing justice, and a major setback for BHP. The High Court’s liability judgment remains in force, and BHP has exhausted the ordinary routes by which it could seek to overturn it.

In today’s ruling, the court concluded that BHP’s proposed grounds of appeal have no real prospect of success and there is no other compelling reason for the appeal to be heard.  The decision means that the parties will proceed to the trial of Stage 2 of the proceedings, which will determine issues of causation, loss and damages. The trial evidence is to be heard from April 2027 to December 2027, with closing submissions listed for March 2028.

Lord Justice Fraser wrote in the decision: “I do not accept that any of the grounds relating to BHP’s liability for the dam collapse are reasonably arguable. I do not consider that there is any foundation for the different complaints that the trial judge failed to engage with BHP’s case."

Jonathan Wheeler, lead partner for the Mariana litigation at Pogust Goodhead, said: “The Court of Appeal has now joined the High Court in finding that BHP’s grounds of appeal have no real prospect of success - an emphatic and unambiguous outcome. BHP remains liable for the worst environmental disaster in Brazil’s history, and it will not be given another bite at the cherry.”

“Our clients have waited more than a decade for justice while BHP pursued every procedural avenue to avoid accountability; those avenues are now closed. We are focused on securing the compensation that hundreds of thousands of Brazilians have been owed for far too long.”

Corbin Capital Closes $342 Million Litigation Finance Fund I

By John Freund |

Corbin Capital Partners has held the final close of Corbin Litigation Finance Fund I at $342 million in fund and co-investment commitments, marking the alternative asset manager's first vehicle dedicated exclusively to litigation finance. The close caps a roughly two-year fundraise and consolidates a strategy that the $10 billion firm has run inside broader credit mandates since 2018.

As reported by Bloomberg Law, the fund has already deployed across 26 investments, with approximately 30% of capital allocated to mass tort matters and the balance spread across antitrust, commercial disputes, and intellectual property cases. Corbin runs a credit-style strategy that finances both case portfolios and law firms directly, including prior exposure to Boy Scouts of America abuse claims and ongoing financing of sexual abuse cases against government, religious, and educational institutions.

The fund drew commitments from institutional investors, family offices, and high-net-worth individuals seeking returns uncorrelated with public equities. Cesar Bello, Corbin's director of litigation finance, told Bloomberg that the strategy depends on diversification across legal risks rather than concentrated case bets. Litigation finance assets under management have climbed to roughly $16.1 billion as of mid-2024, up from under $10 billion five years earlier, according to industry data cited in the report.

Corbin's leadership has signaled that litigation finance will remain a complementary allocation rather than a flagship strategy, but the dedicated vehicle gives the firm a more visible platform in an asset class increasingly courted by allocators searching for non-correlated yield.

ITC Proposes Disclosure Rule Reaching Litigation Funders in Section 337 Cases

By John Freund |

The U.S. International Trade Commission has proposed a new disclosure rule that would require parties and intervenors in Section 337 investigations to identify ownership interests, legal-rights holders, and non-party funders or decision-makers with financial or control stakes in the matter. The rule reflects a broader patent-forum trend toward unmasking the parties operating behind named litigants.

As reported by JD Supra, the proposal would mandate disclosure across three categories: parent corporations and stock owners; non-party persons or entities with legal rights to bring the investigation based on the asserted unfair acts; and any non-counsel person or entity providing investigation-specific funding or holding approval rights over litigation or settlement decisions. Counsel contingency arrangements, personal loans, bank loans, and insurance are expressly excluded.

The Commission framed the rule as a transparency measure aimed at evaluating conflicts, clarifying whose rights are at stake, and facilitating settlement. The proposal aligns with the Patent Trial and Appeal Board's real-party-in-interest scrutiny and Chief Judge Colm Connolly's standing order in the District of Delaware, which already requires disclosure of non-recourse funding and funder approval rights. Public comments are open until June 29, 2026.

For litigation funders, the rule does not bar third-party financing of Section 337 cases but does demand visibility into capital structures and decisional control. Funders backing patent-heavy ITC dockets will need to assess whether portfolio mechanics, exclusive-licensee arrangements, or settlement consent rights cross the disclosure threshold — and prepare for a regulatory environment in which the named complainant is no longer presumed to tell the whole story.