Bentham IMF unveils new portfolio model for litigation funding
In the past year, the firm has committed $30 million in funding over 60 cases handled by seven law firms in New York, Washington, Los Angeles, New Jersey and London; matters include cases in insurance coverage, intellectual property, commercial disputes, whistleblower claims and art repatriation.
NEW YORK, November 16, 2015: Leading litigation funder Bentham IMF announced that it has assembled a portfolio of investments with a group of law firms around the country that could signal a new model for financial risk-sharing.
Like other litigation funders, Bentham has traditionally committed capital to single matters based on specific case merits and prospects for financial recovery. Now it has also begun to provide funding to law firms based on their existing track record and basket of cases, as well as to support their overall mission in particular areas of client representation.
In the past year, Bentham has provided over $30 million in funding deals with seven separate law firms, backing more than 60 cases involving disputes in intellectual property, insurance coverage, entertainment, health care, contracts and other areas, including civil justice. The firms – located in New York, Washington, DC, New Jersey, Los Angeles and London – include two winners of the National Law Journal’s Litigation Boutiques Hot List.
In one instance, Bentham helped launch a new litigation firm, supporting its work in several areas of trial practice and a docket of more than 150 cases.
“We haven’t wavered from the discipline we apply to evaluating individual disputes,” explained Bentham chief investment officer Ralph Sutton. “However, with our strong performance over the past several years, we’ve established close relationships with a number of smaller, top-tier firms with whom we are partnering. We view our portfolio approach as a way of providing strategic capital to elite litigation specialists. We help them recruit talent, launch a promising new litigation specialty, or provide a safety net for their own risks, allowing them to pursue new cases. In short, we help incubate firms and practice groups.”
“Importantly, we plan for the long term success of our partners,” he added. “Of course, we’re not a bank, which is why we are extremely selective about choosing firms with strong winning records and with an eye on growth and innovation.”
The law firms that have benefitted from Bentham’s funding have used the capital for over 60 cases, including about 40% for insurance coverage matters, and about 25% each for commercial disputes and intellectual property cases. Another 10% are qui tam whistleblower cases involving health care fraud and other claims.
Washington, DC-based Weisbrod, Matteis and Copley is one of the firms working with Bentham. Among its more noteworthy matters was the recovery of an oil painting by German artist Max Liebermann, originally stolen by the Nazis in the 1930s. The painting was discovered by German authorities in 2012 in the apartment of an infamous Nazi art dealer’s son.
Entitled “Two Riders on a Beach,” the Liebermann painting was recovered following suit brought by the Republic of Germany on behalf of the painting’s rightful owners – it recently sold at auction in London for a record £1.9 million pounds.
Bentham is also working closely with Weisbrod Matteis in funding a large series of insurance coverage cases involving property damage claims.
"Bentham has strengthened our risk-sharing advocacy for clients, and the company is aligned with the long-term success of our firm,” said Stephen Weisbrod, founding partner of Weisbrod Matteis. The firm was named to the National Law Journal’s Litigation Boutiques Hot List in 2014 and recently profiled by Corporate Counsel magazine for “its dogged, determined approach to complex litigation – and its ability to get stellar results.”
“Bentham's funding terms have consistently been fair and its investment team - which includes former practicing trial lawyers - is sophisticated and extremely knowledgeable,” Mr Weisbrod added. “In addition to helping support our growing caseload, Bentham has been a terrific source of case referrals for our firm.”
In another example, Bentham recently backed business litigator Jeffrey F. Ryan, principal of a firm based in Redwood City, CA. Mr Ryan called on Bentham to cover a large tranche of expenses tied to a portfolio of qui tam cases he was litigating. In one key case – alleging massive overcharges to the federal government by a major technology provider – Mr Ryan’s whistleblower client helped the government secure a $75 million settlement.
“Unfortunately, we had to wage a very costly litigation against our former co-counsel in the midst of our whistleblower case and Bentham provided a critical lifeline to cover nearly $1 million in expenses that could have torpedoed our practice,” Mr Ryan said. “Their support, coming at such a crucial time, ensured that we could stay totally focused on the whistleblower matter before us, as well as a related case with an even larger damage projection.”
“Banks and conventional financing sources don’t understand the level of up-front capital needed to handle a large, complex litigation effort, one that could take years to complete,” Mr Ryan said. “With its impressive history of funding civil justice cases in the US and Australia, Bentham’s funding gave us the flexibility to pursue our most important cases based on their merits.”
About Bentham IMF
Bentham provides access to justice for companies and individuals who would otherwise have difficulty funding expensive commercial cases against larger defendants. Bentham adheres to its own highly selective “Australian funding model,” which enjoys a better than 90% success rate.
Bentham and its Australian parent company have reviewed thousands of commercial cases in the past 14 years and invested in more than 180. Over 160 completed cases have generated over $1.6 billion in recoveries, of which Bentham’s clients have retained 63%. The American Lawyer magazine recognized the co-founders of Bentham IMF among the “Top 50 Big Law Innovators in the Last 50 Years” in July 2013. For more information, please visit www.benthamimf.com.