An investigation reveals that private investors are positioning themselves to profit from the enormous pool of money flowing from Los Angeles County’s historic sex abuse litigation. The county has already agreed to spend nearly $5 billion this year resolving thousands of claims related to alleged sexual abuse in its juvenile detention and foster care systems, including a $4 billion settlement—the largest of its kind in U.S. history.

An article in the Los Angeles Times explains that proponents of this investor involvement argue such financing gives plaintiffs’ attorneys the capital they need to take on deep-pocketed defendants and helps victims who lack resources access justice. Records reviewed by the Times show that several law firms bringing these claims receive financial backing from private investors, often through opaque out-of-state entities and Delaware-based companies.

Backers contend the arrangement can level the legal playing field and expedite case filings and settlements. However, public officials and critics express alarm over the lack of transparency surrounding these investments and the possibility that significant portions of settlement money intended for survivors could instead flow to private financiers. Some county supervisors reported being contacted by investors asking about the potential profitability of the sex abuse suits, raising ethical concerns about treating human trauma as an “evergreen” revenue stream.

The backdrop to this investor interest is a surge in litigation following changes in California law that revived long-dormant abuse claims and spurred widespread advertising by plaintiff firms seeking new clients. Government scrutiny has heightened amid reports of questionable recruitment practices and potential fraud in some claims, and the county’s district attorney has launched an investigation into parts of the settlement process.

The United Kingdom's Judicial Committee of the Privy Council is set to hear a closely watched appeal that could have wide-ranging implications for third-party litigation funding in international arbitration. The case stems from a dispute between OGD Services Holdings, part of the Essar Group, and Norscot Rig Management over the enforcement of a Mauritius-based arbitral award. The Supreme Court of Mauritius had previously upheld the award in favor of Norscot, prompting OGD to seek review from the Privy Council.

An article in Bar & Bench reports that the appeal is scheduled for next year and will feature two prominent Indian senior advocates: Harish Salve KC, representing Norscot, and Nakul Dewan KC, representing OGD. At issue is whether the use of third-party funding in the underlying arbitration renders the enforcement of the award improper under Mauritius law, where third-party litigation funding remains a legally sensitive area.

The case is drawing significant attention because of its potential to shape the international enforceability of funding agreements, particularly in light of the UK Supreme Court's 2023 PACCAR decision. That ruling dramatically altered the legal landscape by classifying many litigation funding agreements as damages-based agreements, thereby subjecting them to stricter statutory controls. The PACCAR decision has already triggered calls for legislative reform in the UK to preserve the viability of litigation funding, especially in the class action and arbitration contexts.

The Privy Council appeal will test the legal boundaries of funder involvement in arbitration and may help clarify whether such arrangements compromise enforceability when judgments cross borders. The outcome could influence how funders structure deals in jurisdictions with differing attitudes toward third-party involvement in legal claims.