In what constitutes the latest major bailed-out bank facing a shareholder dispute, third party financier Therium Capital Management is understood to be bankrolling the high profile claim by shareholders against Lloyds with the cost of funding the case thought to be as high as £12m so far.
The latest instalment in the Excalibur case is interesting for many reasons. One is Lord Justice Clarke’s claim that making litigation funders pay costs on an indemnity basis when costs are awarded against the party they are funding on an indemnity basis is not likely to chill access to justice.
‘A warning to third-party funders’: Litigation funders found liable for indemnity costs in $1.6bn Excalibur dispute
In what was a keenly awaited judgment for the third party funding profession, the Commercial Court has yesterday (23 October) handed down judgment on the costs liability of litigation funders in the high profile Excalibur Ventures v Texas Keystone & Ors battle, a $1.6bn energy dispute over oil rights in Iraqi Kurdistan and one of the biggest cases of 2013, and has ordered the funders to pay the defendants’ costs of the action.
MARKET VIEW – LITIGATION
Simon Dluzniak of Bentham IMF discusses Europe’s litigation funding market and compares it with the more mature Australian market the funder has come from
The third-party litigation funding market in this jurisdiction is, relative to Australia, still in its infancy. Hence it is incumbent upon the various stakeholders within the industry to continue to create awareness of the benefits of litigation funding in assisting and shaping its growth. After what appears to have been a fairly positive start, third-party funding (TPF) appears to have suffered a backlash of sorts as a result of a spate of so-called ‘setbacks’, most notably the loss of high-profile funded cases (for example, the Excalibur case) and the collapse of a well-known funder (Argentum).
MARKET VIEW – LITIGATION
Therium’s Neil Purslow examines the different funding options available
Since the introduction of damages-based agreements (DBAs) on 1 April 2013, use of contingency fee arrangements (CFAs) in England and Wales has been very limited, due largely no doubt to the fact that partial DBAs are not permitted and also the flaws in the enabling regulations have created uncertainty as to the efficacy of this new form of agreement. Nevertheless, commercial litigators have shown significant interest in taking litigation risk on their cases in return for a contingency fee upside. While this has, however, been difficult to achieve to date, Therium has now launched a portfolio funding offering which, through using a variation of a typical funding structure, allows law firms to offer contingency fee-based services to their litigation clients,
Continue reading “Covering Every Contingency – Portfolio Funding of Litigation”
London’s litigation funders are turning their attention to international arbitration. Can this deliver their breakthrough?
No sooner had Excalibur begun to drift from memory than another setback befell the litigation funding industry: the decision in August of the RSM v Saint Lucia majority to award security for costs on account of an unnamed funder’s involvement in the case, the first time such an order had been issued in the context of investment arbitration.
Nick Rowles-Davies of Burford Capital talks facilitating recovery while mitigating risk
Litigation is an ever-present issue to trustees, whether bringing claims or defending cases. Now more than ever there is a need for trustees to be aware of the options available for funding this litigation.
There has been a significant increase in certain types of litigation in the last few years, for example, fraud cases such as the Stanford and Madoff matters, media litigation caused by events at News Corp and the largest area of litigation in recent times – banking and finance litigation. Continue reading “Litigation finance for trustees”
Third-party funding (TPF) has suddenly become the black sheep of the litigation finance industry. In the wake of the spectacularly unsuccessful TPF-backed Excalibur Ventures case – a huge piece of litigation that Lord Justice Christopher Clarke described in December as “speculative and opportunistic” – questions are now being asked about what the problems that are emerging with some of the funding in that litigation mean for the rest of the industry. Continue reading “Guest Post: Third party funders, out of the shadows”
The UK’s leading litigation funders have taken further steps to improve their PR and attack head on suggestions that they lack transparency by introducing a new complaints procedure and capital requirements, which could see funders given public warnings or struck off their voluntary quasi-regulatory body. Continue reading “Litigation funders seek greater credibility with introduction of new complaints procedure”
As third-party funders enjoy robust growth within a buoyant disputes climate, Legal Business assesses current attitudes towards litigation’s controversial bankrollers.
Third-party litigation funders have suffered bad PR for more than 40 years. Often depicted as lurking in the shadows of the courtroom, waiting to collect their share of damages, lawyers have historically been curiously wary of funders since their inception.