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Recap of IMN’s Inaugural International Litigation Finance Forum

Recap of IMN’s Inaugural International Litigation Finance Forum

IMN’s inaugural International Litigation Finance Forum brought together a crowd of international thought-leaders from across the industry, showcasing perspectives from funders, lawyers, insurers and more across a packed day of content.

Following IMN’s successful New York conference, the London event demonstrated the growing reach and maturity of litigation funding, as topics covered everything from recent industry developments to the nuances of international arbitration and dispute resolution. At the core of the day’s discussion, the central themes of regulation, ESG and insurance were present throughout each session, with unique insights being shared by panelists.

The day began with a panel focused on the current state of litigation funding in Europe, where the topic of regulation took center-stage. Whilst most speakers agreed that the proposed reforms in the recently approved Voss Report were a step in the wrong direction for the industry, Deminor’s Erik Bomans offered a contrarian take on regulation, and highlighted that the very existence of this debate around regulation is a positive sign of the industry being taken seriously.

During the second panel on jurisdictional differences in Europe, this view was echoed by Clémence Lemétais of UGGC Avocats, who stated that it was promising that the EU parliament is raising the visibility of the industry, but that the draft resolution ‘shows a lack of knowledge’ about the industry itself. This was further reinforced in terms of individual country requirements by Koen Rutten of Finch Dispute Resolution, who argued that regulation has to be based on facts, and has to address a problem, which he does not see in the Nethlerlands.

A fireside chat with Rocco Pirozzolo of Harbour Underwriting gave the audience a detailed overview of the impact and evolving nature of ATE insurance on litigation funding. During this interview, Mr Pirozzolo highlighted the difference in approaches between insurers and funders when assessing cases, but further highlighted the need for collaboration between the two to deliver wider access to justice.

Two panels completed a busy morning of discussion, with the first providing insight into the evolving nature of funders’ approach to capitalization, and the second analyzing the best practice for those seeking funding. LCM’s Patrick Moloney honed in on the evolution of the industry having come from a place of being perceived as ‘the dark arts and then loan sharks’ to now being in a position where funders like LCM garner investment from public listing. Later, Ben Moss of Orchard Group, offered a detailed overview of how requests for funding should be best structured and highlighted the ‘holy trinity’ of ‘merits, budget and quantum’.

The afternoon saw a broadening of the range of discussions, kicking off with Tom Goodhead of Pogust Goodhead providing an insightful presentation on group litigation in the UK and the need for future reforms to enable growth. Another two panels brought a wealth of insights, with the topics of co-investing, diversification and the secondary market in the first, being followed by a wide-ranging discussion of the different types and applications of litigation insurance.

After a breakout meeting explored the best practices in talent development and growth for women in litigation finance, a trio of panels capped off the day’s agenda. In a wide-ranging discussion of innovative deal terms and structures, panelists from the likes of Brown Rudnick, Litigation Funding Advisers and Stifel, provided insight into everything from the effect of insurance on pricing to the increasingly technical and data-drive process of due-diligence.

Taking a more global approach for the penultimate panel, Alaco’s Nikos Asimakopoulos, skillfully guided the audience through a global look at enforcements and international arbitration. The panel of legal experts discussed an extensive range of topics, with Tatiana Sainati of Wiley Rein, spotlighting ESG as a primary driver in the increase in transnational disputes and particularly in the EU where ESG initiatives have taken hold.

In the final panel of the day, the topic focused in on the use of litigation funding by corporates and institutional investors. In an illuminating exchange, Woodsford’s Steven Friel played down claims by other funders that CFOs and other corporate executives primarily look to litigation funding for its ability to shift legal costs off the balance book. Instead, Friel and other panelists highlighted the need for funders to bring more than just capital to the table, and that true value could be brought through a funder’s insight, as well as its ability to manage the litigation process and reduce the non-financial resource burden on corporates.

Overall, IMN’s inaugural UK event displayed the incredible depth of the litigation funding industry and gave attendees a wealth of insights that will no doubt generate further discussion and debate among leaders. In a day of packed content, IMN’s roster of speakers and panelists provided both high-level overviews and detailed looks at the nuances of certain industry sub-sectors.

Editor’s Note: An earlier version of this article erroneously attributed the detailed overview of how funding requests should be structured to Rosemary Ioannou of Fortress Investment Group. The remark was made by Ben Moss of Orchard Group.  We regret the error. 

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LITFINCON Europe Sets Amsterdam Agenda With Burford, Therium, WTW and Susman Godfrey on the Bill

Siltstone Capital has released the full programme for the first European edition of LITFINCON, which opens in Amsterdam on 7 October with eleven panels and a speaker roster drawn from funders, brokers, insurers and the plaintiff bar.

As reported by PR Newswire, the two-day conference runs 7 and 8 October at the Rosewood Amsterdam, the former Palace of Justice on the Herengracht, with VIP programming including a dinner and canal cruise the evening before. This is the seventh LITFINCON edition and the first held in Europe, following events in Houston, Beverly Hills and Singapore that have drawn more than a thousand attendees between them.

The theme is "The Claim Is the Asset: IP, Arbitration, Class Actions & the Investors Who Know It." Confirmed speakers include Philipp Leibfried, Managing Director and Head of Europe at Burford Capital; Neil Purslow, Co-Founder and Managing Partner of Therium Capital Advisors; Max Tribble of Susman Godfrey; Dan Kesack of WTW; Nick Moore of CAC Specialty; Jamie Molloy of Ignite Specialty Risk; Tets Ishikawa of LionFish Capital; and Till Schreiber of Cartel Damage Claims.

Panels cover pricing in European collective actions, enforcement of arbitration awards, Unified Patent Court strategy, artificial intelligence in litigation finance, insurance structures for legal assets, and the divergent regulatory positions taking shape in the UK, EU and United States. The programme closes with a 75-minute unscripted session billed as "Candid Conversations."

Jim Batson, Chief Investment Officer of Legal Finance at Siltstone Capital, said: "Every deal in this industry starts with a conversation between people who trust each other."

Padronus Funds Three German Collective Actions Over Streaming Price Rises, Capping Its Fee at 9.9%

Austrian funder Padronus is financing three new German collective redress actions against Netflix, Apple TV and WOW, structuring its return just below the statutory ceiling that governs funder participation in the country's collective redress regime.

As reported by Digital Fernsehen, the Verbraucherschutzverein filed the three Abhilfeklagen on 15 September, two before the Kammergericht Berlin and one before the Bayerisches Oberstes Landesgericht. The claims allege that the providers raised subscription prices unilaterally on the basis of clauses that do not meet German standards for consumer contracts. Cited increases include WOW from €35.99 to €44.99, Apple TV+ from €4.99 to €9.99, and Netflix from €11.99 to €19.99.

The funding terms are the notable feature for the market. Padronus, operating through Vienna-based Prozessfinanzallianz GmbH, carries the entire cost risk and takes 9.9% of any proceeds, deliberately set beneath the 10% cap imposed on funder remuneration by the German legislation implementing the EU Representative Actions Directive. Where a participant holds legal expenses insurance that responds, Padronus waives its share altogether. Consumers pay nothing regardless of outcome.

Expected individual refunds run from roughly €200 to €700 per provider, and Padronus chief executive Richard Eibl has said a subscriber to all four services could recover close to €800. At the participation levels the funder is targeting, aggregate exposure would reach nine figures.

The German courts have not settled the question. The Kammergericht Berlin held comparable Netflix and Spotify clauses invalid in 2023, and the Bundesgerichtshof declined to disturb that outcome. But the Bayerisches Oberstes Landesgericht dismissed a parallel claim over Prime Video in July, and an appeal is pending.

CAT Approves £260M Google Settlement, the Largest Class Payout in the Regime’s History

The Competition Appeal Tribunal has approved the £260 million settlement of the opt-out collective action brought against Google on behalf of thousands of UK app developers, clearing the way for the largest distribution to class members the Tribunal has sanctioned since the UK's collective proceedings regime began in 2015.

Of the total, £160 million is earmarked for eligible developers, including sole traders and small businesses that sold apps or digital content through the Play Store from August 2018 onwards. The remaining £100 million covers the funding, insurance and legal costs of running the case. Individual payouts will be calculated on each developer's qualifying Play Store sales during the relevant period, and eligible businesses are being directed to the claim website to register ahead of the claims process opening.

As reported by City AM, the claim alleged that Google abused a dominant position by imposing unfair and excessive commissions on developers distributing through the Play Store. Google settled without any admission of liability or wrongdoing, saying it was pleased to reach agreement subject to court approval.

For the funding market, the approval resolves the question hanging over the case since August. Bench Walk Advisors financed the proceedings, and the professional parties agreed to forgo £34 million of their contractual entitlement, bringing their combined return down to the £100 million the Tribunal has now approved. The Tribunal's willingness to sanction a settlement of this size, with costs and funder returns disclosed and reduced in advance, gives funders a concrete benchmark for what the CAT will treat as just and reasonable.

Neil Purslow, Chairman of the Executive Committee of ILFA, said: “This landmark settlement vindicates the opt-out collective actions regime at an important moment for its future. Thanks to the regime and the litigation funders who underpin it, thousands of small businesses with no realistic alternative to take on a corporate wrongdoer will now be awarded compensation they could never have won on their own.”

“As the Government considers the future of the regime, this case is proof the system can deliver. This is a young regime that should be nurtured and expanded, not constrained, so more consumers and small businesses can hold powerful defendants to account.”