27 August 2020

LCM signs latest in series of portfolio funding deals

LCM's deal with Norton Rose Fulbright will support one of its construction industry clients

Funder agrees construction sector portfolio deal for Norton Rose Fulbright client

AIM-listed litigation funder Litigation Capital Management has agreed its latest corporate portfolio deal, this time with Norton Rose Fulbright. 

The multi-jurisdictional funding facility was concluded with a subsidiary of an unnamed global construction and infrastructure contractor. The deal supports funding for up to 20 claims seated in jurisdictions ranging from London to Dubai, and involved UK, Australian, and United Arab Emirates-based approvals.

The deal is the third in an ongoing series of portfolio arrangements, following similar tie ups with Clyde & Co and another unnamed law firm, spanning the aviation and construction sectors. 

The funder also recently agreed a deal with DLA Piper, which will see LCM support the work of new litigation funder Aldersgate Finance, staffed by ex-DLA Piper lawyers, as well as working with DLA’s clients itself. 

LCM remains upbeat

Patrick Moloney, LCM’s chief executive officer said the deal reflected the funder’s experience in “originating and executing industry-changing dispute financing solutions,” while Nick Rowles-Davies, Moloney’s right-hand man, added the deal came at “a time of considerable growth and increased opportunity” for the funder.

Speaking exclusively to The Global Legal Post, Rowles-Davies said encouraging the use of such financing was a key strategy goal for LCM: “The financial and accounting benefits to a corporate client of using external capital rather than its own have the biggest impact in high-volume, low-margin industries such as construction, energy, outsourcing and aviation.”

Asked if there was interest from other global law firms, he noted a rise in approaches from all levels, saying he felt there was “increasing understanding… about what we can do for them.”

He added: “The most innovative firms now understand that we can help them differentiate themselves and the use of financing as a business development tool to increase work from existing clients and to win new clients.”

Geographical reach

The deal was equally welcomed by Norton Rose Fulbright, playing to the firm’s strengths in disputes across a range of countries, but also its own dedicated focus to infrastructure and similar sectors.

The firm’s global head of disputes, Cameron Harvey, said the facility would greatly benefit his client, and its ability to manage legal claims across multiple jurisdictions, with Paul Stothard, a Dubai-based disputes partner at Norton Rose Fulbright explaining the deal was “testament to our expertise and depth of reach in areas tailored to this client’s needs.”

Stothard explained: “Our team on these matters straddles at least six time zones, from London to Dubai, to Singapore and on to Perth, Melbourne and Sydney, and brings deep litigation experience across contentious construction and international arbitration in all of the relevant seats worldwide.”

Meeting client needs

Harvey was upbeat about the alliance with LCM, saying: “We foresaw a growing need for corporate litigants to be able to engage in necessary dispute resolution without having the experience cripple their balance sheets, something which is even more crucial during the COVID-19 pandemic.”

Nor, said Harvey, could this be the last such opportunity, saying the firm looked forward “to working with LCM to offer financing and legal solutions” to clients, as they adjusted to post-pandemic realities. 

Litigators occupy a number of key leadership positions in the firm—Middle East chair Deirdre Walker is a disputes specialist, as is EMEA chair Peter Scott, while Gerry Pecht, a veteran US commercial disputes partner, is due to succeed Peter Martyr as chief executive officer at the start of next year. 

Both Scott and Walker are familiar with the use of funding, while Pecht has been actively involved in the firm’s flagship Litigation Trends survey which has tracked such issues for more than a decade. Australian-based Harvey, meanwhile, oversaw his firm’s submission to an Australian parliamentary review on the issue.

In response, Rowles-Davies agreed the pandemic had accelerated industry awareness of such solutions, saying: “The pandemic has forced law firms to think about how they are going to assist their clients in providing alternative ways to finance their disputes.”

There had, he felt, been “an acceleration of the education process and awareness of what we can do for law firms and their clients by way of financing,” suggesting further deals may yet follow.

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