The bankers, brokers, and big money transforming litigation finance from a lawyer’s hustle to a multibillion-dollar asset class

Headshots of Ralph Sutton, Aviva Will, Brandon Baier, and Stuart Grant on a background of gavels and dollar bills
From left: Ralph Sutton, Aviva Will, Brandon Baer, and Stuart Grant.

  • Litigation finance is growing, with a reported $11 billion invested or ready to invest in lawsuits.
  • What was once a niche industry is now swarmed with consultants, bankers, and public companies.
  • We spoke to over 25 funders, lawyers, and finance professionals to learn who’s shaping the field.
  • See more stories on Insider’s business page.

Paying for someone else’s lawsuit used to be illegal. Now it’s a multibillion-dollar opportunity.

Commercial litigation funders make money by advancing money to businesses that lack the resources or the patience for a lawsuit. In return, they get a multiple of what they invested (often double or triple) or a return anchored to an interest rate. Litigation funders now have $11.3 billion invested or ready to invest in US commercial litigation, according to a recent estimate by Westfleet Advisors.

The original litigation financiers in the US were often plaintiffs’ lawyers, whose contingency-fee model – “no fee unless we win” – is a form of self-funding. A simple slip and fall might net just a $10,000 fee, but complex and risky cases can be lucrative; the lawyers hired by states to sue tobacco companies in the 1990s made billions.

Today, litigation finance is much more specialized, even corporate. While funders still back large groups of little guys, like drivers who bought a dirty diesel from Volkswagen or shops that say Visa and Mastercard charged excessive fees, they also cut deals with big businesses, like supermarket chains that overpaid for broiler chickens and manufacturers that believe their trade secrets have been stolen.

“This asset class is growing and maturing and becoming an accepted part of the litigation industry,” said Bill Farrell, a managing director at Longford Capital, a private-litigation funder.

Westfleet Advisors, the source of the $11.3 billion estimate, has said there are at least 46 litigation funders active in the US market.

Heavy-hitting industry players include hedge funds like Fortress Investment Group and D.E. Shaw & Co. Bankers at Stifel and Jefferies have also worked on legal-industry deals. And some of the biggest funders have formed a trade group, the International Legal Finance Association, meant to be a counterweight to groups like the US Chamber of Commerce that would like to see more regulation of their industry.

Commercial-litigation finance is fraught with risk. In many cases, the money is nonrecourse, meaning that if a case is unsuccessful, investors suffer a total loss. But many funders have made investments in portfolios of cases, in which a win against one adversary can offset a loss against another. And some companies specialize in making loans to law firms that are backed by guarantees, though such companies aren’t the focus of this article.

Since 2020, Insider has spoken with dozens of funders, lawyers, and finance professionals about the commercial-litigation finance industry, with a focus on the US and on investments in categories other than patent litigation. Below are some of the companies and individuals they singled out for their influence and savvy.

Billion-dollar behemoths

Aviva Will, co-chief operating officer of Burford Capital.
Aviva Will, co-chief operating officer of Burford Capital.

Burford Capital, which reported a $4.5 billion portfolio in its last annual report, is one of the top dogs in litigation finance. It pursues a mix of strategies, funding single cases and groups of cases while also cutting deals directly with corporations that might have large legal claims but lack the bandwidth to pursue them. Its co-chief operating officer Aviva Will is involved with underwriting major deals, with support from a large staff with expertise in insurance, IP, and other areas.

One of Burford’s biggest cases is the so-called Peterson case, which started as a claim against the Argentinian government that Burford paid €15 million ($18 million) to acquire. Its value has risen as the case has progressed, and the company sold 10% of the claim for $100 million in 2019. Burford has also been targeted by the short-seller Muddy Waters.

Omni Bridgeway, with locations around the globe, manages about AU$2.2 billion ($1.7 billion), according to its most recent annual report. With roots in Australia, it still has major cases there, like a firefighting-foam contamination case that settled for AU$213 million ($167 million) last year. But it also has dozens of employees in the US, including Jim Batson in New York and Matthew Harrison in San Francisco. Chief Investment Officer Allison Chock gets involved in big deals.

Eric Blinderman of Therium Capital Management.
Eric Blinderman of Therium Capital Management.

Therium Capital Management is another major funder, though unlike Burford and Omni, it isn’t publicly traded. It says it’s raised $1.1 billion, including a £325 million ($460 million) raise in 2019 from institutional investors and an unspecified sovereign wealth fund. While its work in the US is somewhat under wraps, it has worked on several major cases in Europe, including funding claims against Volkswagen in its 2015 emissions scandal.

Neil Purslow runs the group, and Eric Blindermann runs the Therium Inc. team in the US. He said the US investments run the gamut, from a recent $5 million investment in an antitrust lawsuit to a $10 million-plus investment in a portfolio of insurance cases brought by a major international law firm.

Ellora MacPherson of Harbour Litigation Funding.
Ellora MacPherson of Harbour Litigation Funding.

Harbour Litigation Funding is well known in its base in Europe, but it has been looking for opportunities in the US, which amounts for about 10% of its investment portfolio, according to Chief Investment Officer Ellora Macpherson. The company, which is privately held, says on its website that it has raised more than $1.5 billion and has financed litigation against Uber in Australia, arbitration against Italy’s government and numerous shareholder lawsuits around the world. Its US representative is Kory Parkhurst.

Longford Capital is another major player and has made headlines with an effort to team up with schools like the University of California, Santa Barbara to monetize the patents developed by its researchers. Longford has raised more than $1.1 billion, including $435 million earlier this year. A recent regulatory filing lists a Fund P with more than $119 million in gross assets whose existence hasn’t previously been reported. Bill Farrell, Tim Farrell and Michael Nicolas are its leaders.

Pure-play private funders

Stuart Grant of Bench Walk Advisors.
Stuart Grant of Bench Walk Advisors.

Bench Walk Advisors was cofounded in 2018 by Stuart Grant, a former lawyer at Skadden who also cofounded Grant & Eisenhofer, a top firm for shareholders litigation. Grant said in an interview with Reuters that he shifted focus to litigation finance after a few adverse court rulings because “I don’t like losing.” His litigation-funding shop claimed a 93% win rate as of the end of last year. It says it’s invested more than $300 million.

Brandon Baer of Contingency Capital
Brandon Baer of Contingency Capital.

Contingency Capital was launched in November by Brandon Baer, an experienced lender who co-led the legal-assets group at Fortress. While the firm is still new and not much about its activities are known, it’s minority-owned by TFG Asset Management, which manages $30.7 billion, and has coinvesting commitments from Fortress and an undisclosed fixed-income manager totaling $1.4 billion.

The team has recently grown with hires including Jeff Cohen from Southpaw Asset Management and Kacey Wolmer, who joined from FirstKey Mortgage.

From left to right, Adam Gill, Jamison Lynch and David Spiegel of litigation funder GLS Capital.
From left: Adam Gill, Jamison Lynch and David Spiegel of GLS Capital.

GLS Capital is a relatively new firm run by familiar faces. Adam Gill, Jamison Lynch, and David Spiegel, its three managing partners, got their start at Gerchen Keller Capital, which was sold to Burford for $160 million in 2016. Several people listed on the firm’s website have backgrounds in pharmaceuticals and life sciences, where disputes involving licenses, patents, and other intellectual-property matters are common.

“We review deals anywhere between $1 million and $50 million in size,” Spiegel said. “Our sweet spot is between $5 million and $10 million.”

Lake Whillans, founded by Lee Drucker and Boaz Weinstein, is also cited as a major player. Said by one observer to be “comfortable with more distressed, hairy situations,” the company raised $125 million in late 2017. At least one of its cases has been publicly disclosed: a $5 million stake in a case brought by Cel-Sci, a drug developer.

Eva Shang of Legalist.
Eva Shang of Legalist.

Legalist has funded commercial claims and mass-tort litigation. The company, run by the Harvard dropout Eva Shang, has emphasized its use of analytics to identify investment opportunities. Shang has said its investments average $500,000 apiece, smaller than those made by other funders.

LexShares, run by Jay Greenberg, has also emphasized a data-driven approach, using a program it calls the “Diamond Mine” to find investment opportunities in court filings. The company courts individual investors as well as institutions and announced last year that it was raising an additional $100 million to invest in cases.

Aaron Katz and Howie Shams of Parabellum Capital.
Aaron Katz and Howie Shams of Parabellum Capital.

Parabellum Capital is run by Howie Shams and Aaron Katz, two veterans of Credit Suisse’s legal-risk strategies and finance unit, one of the earliest involvements by a mainstream financial institution in the litigation-funding space. Its Form ADV lists more than $666 million in discretionary regulatory assets under management as of the end of 2020 and says its investments tend to range from $2 million to $15 million depending on whether it’s investing in a smaller single case or a larger portfolio. Parabellum is one of a subset of funders that also invests in patent litigation.

Ralph Sutton of Validity Finance.
Ralph Sutton of Validity Finance.

Validity Finance is led by Ralph Sutton, another alumni of Credit Suisse’s early venture. The firm, which was set up with $250 million from TowerBrook Capital Partners, said last year that it has deployed $125 million across a range of court cases and arbitrations and raised another $100 million.

Mainstream investors

David Gallagher and Sarah Johnson, the leaders of D.E. Shaw & Co.'s litigation finance unit.
David Gallagher and Sarah Johnson, the leaders of D.E. Shaw & Co.’s litigation finance unit.

D.E. Shaw’s litigation-funding team is led jointly by David Gallagher, an alumnus of one of Omni Bridgeway’s predecessor companies, and Sarah Johnson, who has spent 15 years in D.E. Shaw’s corporate credit unit. The team’s “sweet spot” is investments of $20 million to $50 million, according to the company, and it focuses on quick decisions and flexible terms.

The Fortress team is led by Jack Neumark, with Joe Dunn described by some people as his right-hand man. (The firm has also been involved in high-stakes patent disputes, but a different team led by Eran Zur handles those deals.) While Fortress has directly funded some high-stakes disputes and bought litigation claims, it’s also been known to extend credit to other litigation funders, including Vannin Capital.

Tenor Capital has $5.4 billion and has used some of that money to back several mining companies in their claims against foreign governments. Led since 2004 by Robin Shah, a JPMorgan alumnus, with Blair Wallace, formerly of Och Ziff, managing a portfolio of litigation, the firm has backed Crystallex, which is trying to seize Citgo in order to collect a $1.2 billion award against Venezuela; Eco Oro, which has sued Colombia; and Gabriel Resources, which seeks to hold Romania liable for scuttling its operations there.

The brokers and bankers

Westfleet Advisors and its founder, Charles Agee, are one of two names that regularly spring from the lips of lawyers and funders in the litigation-finance industry. He and his colleagues Gretchen Lowe and Barry Kamar connect claimants, lawyers, and investors. They also regularly conduct and publish surveys of the industry.

Andrew Langhoff is also regularly cited as a trusted source of perspective and opportunities by people in the industry. A former Big Law litigator who went on to hold roles at Burford and at Gerchen Keller, Langhoff now runs Red Bridges Advisors.

Stifel Financial made headlines in 2019 when it hired Justin Brass and Sarah Lieber from Jeffries. Brass, a former bankruptcy lawyer, and Lieber, who worked for an insurer after years at Jones Day, are both Burford alumni. While many commentators said a lack of standardization has made litigation-finance investments hard to flip, Stifel said Brass and Lieber have syndicated more than $1 billion in litigation investments since joining in 2019.

“If I’m playing checkers, they’re really playing three-dimensional chess,” one lawyer who’s worked with them said.

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After being shot in the face while covering a protest, a freelance journalist and her attorney alleged a conspiracy. A judge just ruled to let the case move forward.

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Police advance on demonstrators who are protesting the killing of George Floyd on May 30, 2020 in Minneapolis, Minnesota.

  • Linda Tirado was covering a protest when she she shot by police with a “less-lethal” munition.
  • The incident left her blind in one eye. She’s suing police and the city of Minneapolis.
  • In an interview, she discussed a recent court victory and her hope for justice.
  • Visit the Business section of Insider for more stories.

The arc of history may ultimately bend toward justice, but Linda Tirado says she isn’t waiting around for the passage of time. 

“I think that, every step in the process, the judicial system has a chance to kind of nudge things toward being more right,” Tirado said in an interview following a legal victory that could have broad ramifications for police and how they treat reporters. “And I think that any time you can nudge things towards being more correct or more just, that’s a net good outcome, not only for me but for anybody who’s going to be affected by this.”

A freelance photojournalist, she says she was shot in the face last summer with a “less-lethal” round fired by a cop in Minneapolis, where, identified as press, she was covering the civil unrest that followed the police killing of George Floyd.

It left her partially blinded, in pain – the headaches persist to this day – and racking up tens of thousands of dollars in medical bills for two surgeries. In a lawsuit filed last year, Tirado alleged that she was not the victim of a mere accident, but of a conspiracy, involving city leaders, police, and recently retired union boss (and Trump rally speaker) Bob Kroll, to tolerate rank-and-file officers targeting the press.

Last August, Kroll filed a motion to dismiss the amended complaint. The police chief did as well. The city filed a motion to dismiss part of the amended complaint. (The city did not dismiss Tirado’s “common-law battery claim.”)

“How am I doing? It’s pretty mixed, man,” Tirado said in an interview, eight months later. “It’s a pandemic, and I don’t have sight in my left eye.”

Tirado has slowly returned to her craft; she now specializes in extreme close-up photography, while still venturing out to cover protests from time to time. “When I’m using a camera, I find I’m able to see what I could before, and that’s been really kind of soothing,” she said.

Beyond the comfort of a routine, Tirado also has that court victory.

In a February 22 order, US Judge John R. Tunheim wrote that what happened to Tirado was not only “serious and troubling,” but seemed to be part of pattern that gestures toward a policy of institutional disregard for the US Constitution. 

“Although not every incident involved the use of foam bullets or projectiles,” Tunheim wrote, “the alleged police misconduct toward journalists occurred under similar circumstances: journalists were identifiable as press, separated from protestors and at a distance from police, and were not engaging in any threatening or unlawful conduct.”

The judge, while not in a position to issue a final judgment, did determine that Tirado’s lawyers (at the powerhouse firm Sidley Austin) had made a compelling case that the lawsuit should move forward. To dismiss it as but a single injustice from one police action would give police a de facto “window” for violating the constitution on the basis that, legally – as the city and its law enforcement argued – it is not possible to demonstrate a pervasive, formal custom of abuse based on actions that transpired over a period of just a few days.

In Minneapolis, over a half-dozen other journalists alleged abuse at the hands of police around the time of Tirado’s injury. These incidents were widely reported, her attorneys note, arguing that subsequent failure to rein in police suggests widespread complacency, if not outright support.

“There are important constitutional rights that we believe were violated,” Tai-Heng Cheng, global head of international arbitration and trade at Sidley Austin, told Insider. He took up the case not because it’s a singular injustice, but because it speaks to a broader and systemic wrong in the United States. “This case of course is important not just for Linda, but for journalists everywhere – and especially for journalists who put their lives at risk in covering civil protests in America.”

This week’s ruling means that Tirado’s legal team can now proceed with discovery, gaining access to communication between the city, the police, and their union. The goal is to demonstrate that the repeated targeting of the media was known, and hardly discouraged.

A spokesperson for the city of Minneapolis declined to comment.

Law enforcement elsewhere will likely be watching the case, and not just on the local level. In Portland, for example, Trip Jennings, who has worked with PBS and National Geographic, told Insider last June – just weeks after Tirado was shot – that he believed he was likewise targeted by law enforcement with a less-lethal round. His vision was saved by protective eyewear (Tirado had protection too, but any safety gear will struggle to withstand a direct hit).

On March 8, meanwhile, a trial will begin in another case: that of Derek Chauvin, the former Minneapolis police officer charged with killing George Floyd.

“I’m going to be watching that with close attention,” Tirado said. She has friends who will be covering it and any protests that take place outside. “My concern right now is, well, I hope we all collectively learned some lessons because what we don’t need is for happened to me to ever happen again to any citizen,” she said, “but particularly a journalist who is reporting out a story.”

Have a news tip? Email this reporter: cdavis@insider.com

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Pennsylvania Republicans spent $1 million in tax dollars on 2020 election lawsuits to suppress voters

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A woman participates in a protest in support of counting all votes in Philadelphia, Pennsylvania, on November 5, 2020.

  • Pennsylvania Republicans spent $1.04 million in taxpayer dollars on 2020 election lawsuits.
  • That’s according to documents obtained Thursday by the news organization PA Spotlight.
  • Republicans had sought to disenfranchise millions of people who voted by mail.
  • Visit Business Insider’s homepage for more stories.

Pennsylvania Republicans spent more than $1 million in taxpayer dollars on litigation aimed at making it more difficult to vote ahead of the 2020 election, according to documents obtained by the news organization PA Spotlight. Over $650,000 went to the same law firm that tried and failed to place Kanye West on the ballot in another swing state.

In a post on Thursday, PA Spotlight revealed that the Pennsylvania Senate Republican Caucus, which controls the commonwealth’s upper chamber, spent a total of $1,042,200 in the runup to November trying to restrict methods of voting. In particular, the state GOP sought to overturn key provisions of Act 77, a law passed in 2019 – with unanimous support from Senate Republicans – that allowed voters to request mail-in ballots for any reason.

At the time, the Pennsylvania state Senate Majority Leader Jake Corman called the legislation “the most historic reform bill we’ve done.” But as time went on, Republicans began to see the measure as a boon to their political opponents, with Democratic voters far more likely to vote by mail during the pandemic. The Senate GOP also sought to prevent those ballots from being placed in secure drop boxes and to throw out millions of mail-in votes altogether, an effort rejected by the Pennsylvania Supreme Court.

According to PA Spotlight, money on such litigation went to two firms, the bulk of it going to Holtzman, Vogel, Josefiak, and Torchinksy, founded by a former lawyer for the Republican National Committee. That firm also tried to place Kanye West on the ballot in Wisconsin.

Obermayer, Rebmann, Maxell, and Hippell also received just under $385,000 in tax collars for election work in Pennsylvania. Lawrence Tabas, chairman of the Pennsylvania Republican Party, is a partner at the firm, PA Spotlight reported.

Neither Tabas nor the Senate Republican Caucus immediately responded to Insider’s requests for comment.

In the meantime, having lost in the courts, Pennsylvania Republicans are turning to legislation: On Thursday, state Sen. Doug Mastriano – who spent thousands of dollars busing protesters to the January 6 insurrection at the US Capitol, falsely claiming the 2020 election was stolen – introduced a bill that would eliminate “no excuse” mail-in voting.

Have a news tip? Email this reporter: cdavis@insider.com

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