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Category: Litigation Funding

Court: No Fraud By Owners In Financing Of Settlement Factoring Company Sale

Court: No Fraud By Owners In Financing Of Settlement Factoring Company Sale

A New York court last month issued an opinion in a long-running dispute over the financing of a sale of a structured settlement factoring company, dismissing the claims that the owners of the factoring company engaged in fraud to shield assets from the prospective purchaser. In describing the decision, one news report put it this way: “A New York state judge . . . threw out an investment company’s lawsuit accusing the majority owners of a structured-settlement buyout company of…

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Billionaire’s Investment Is ‘Latest Twist’ in Lawsuit Funding, Say Reports

Billionaire’s Investment Is ‘Latest Twist’ in Lawsuit Funding, Say Reports

News reports say that billionaire investor George Soros is getting involved in backing a litigation funding company – the “latest twist on the litigation funding market, which has drawn criticism for monetizing and encouraging the lawsuit culture in the U.S. The firm.” That’s the way one report described the development – see Soros Sees Mighty Big Gains In Investment Portfolios Made Out Of Lawsuits (available here). Other stories include the following: “How George Soros Is Making Money Off Personal Injury Financing,”…

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Court That Ruled CFPB Unconstitutional Also Concludes That Judge In NFL Concussion Litigation Was Correct To Invalidate Lawsuit Funding Deals

Court That Ruled CFPB Unconstitutional Also Concludes That Judge In NFL Concussion Litigation Was Correct To Invalidate Lawsuit Funding Deals

A federal court has concluded that the structure of the Consumer Financial Protection Bureau is unconstitutional.  In the ruling, described here and here,  the court dismissed the CFPB as a party but allowed the New York Attorney General to proceed with claims against a litigation funding company, RD Legal Funding (RD), for violations of federal and state law. One important issue that the court reached was whether the judge overseeing the NFL concussion litigation was correct in is view of…

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Court Describes Circuitous Route of NFL Concussion Litigation, Other Claims, to Recent CFPB Ruling

Court Describes Circuitous Route of NFL Concussion Litigation, Other Claims, to Recent CFPB Ruling

As described here, a federal court this month ruled that the structure of the Consumer Financial Protection Bureau is unconstitutional. The court nonetheless denied the motion to dismiss by litigation funding company RD Legal Funding, because it ruled that the New York Attorney General had authority to challenge the transactions between RD and personal injury victims, including ex-National Football League players. U.S. District Court judge Loretta Preska also described the circuitous route by which she was asked to address the…

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In Litigation Over Litigation Funding Matters, Court Rules that CFPB’s Structure Is Unconstitutional

In Litigation Over Litigation Funding Matters, Court Rules that CFPB’s Structure Is Unconstitutional

The structure of the Consumer Financial Protection Bureau is unconstitutional, and therefore claims of federal law violations against a litigation funding company fail. So ruled a U.S. District Court judge in a lawsuit brought by the CFPB and the New York Attorney General against a litigation funding company over, for one, the litigation funding company’s dealings with former National Football League players and, for another, the company’s transactions with individuals who suffered injuries as a result of the September 11,…

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U.S. Chamber of Commerce: Litigation Financing Means More Lawsuits, Prolonged Proceedings, Fewer Settlements

U.S. Chamber of Commerce: Litigation Financing Means More Lawsuits, Prolonged Proceedings, Fewer Settlements

The President of the U.S. Chamber of Commerce has penned an opinion piece stating that litigation financing “leads to more lawsuits, undercuts plaintiffs’ control of a case, and unnecessarily prolongs litigation.” Lisa Rickard’s op-ed article quoted recent news reports about how litigation funders have said they “make it harder and more expensive to settle cases.” She praised the recently-enacted Wisconsin legislators who passed “the first state law requiring transparency for all third-party funding arrangements” and said that Congress should recognize…

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New York Legislation Would Regulate Litigation Funding Deals

New York Legislation Would Regulate Litigation Funding Deals

New York’s legislature is considering legislation that would regulate consumer litigation funding transactions. The New York Law Journal reported this week that “[t]hird-party litigation financing is getting closer scrutiny in New York, where lawmakers are pushing to regulate an industry in which companies have been accused of charging unreasonably high fees and interest rates.” The May 29 article, NY Lawmakers Considering Bills to Regulate Consumer Litigation Funding, is available here.  

In Seeking To Recover Money Paid To Claimant, Litigation Funding Company Prevails On Some Legal Grounds

In Seeking To Recover Money Paid To Claimant, Litigation Funding Company Prevails On Some Legal Grounds

It is a legal maxim that when a contract is illegal, courts will leave the parties where they find them.  The result is that, if a party to a contract tries to recover on the contract, it will not get any aid from the courts.  But what if the claim is not enforcement of the illegal contract, but a request for recovery of monies paid pursuant to the unenforceable contract – on an equitable theory of unjust enrichment?  There, the…

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Judge Overseeing Consolidated Opioid Litigation Wants Litigation Funding Information

Judge Overseeing Consolidated Opioid Litigation Wants Litigation Funding Information

The judge overseeing the multi-district litigation claims involving the opioid epidemic has ordered plaintiffs’ attorneys to disclose whether they have entered into any litigation funding agreements. U.S. District Court Judge Dan Polster, of the U.S. District Court for the Northern District of Ohio, is overseeing several hundred consolidated lawsuits where many government entities – including states and cities – have sought recovery from drugmakers and distributors for the costs of dealing with opioid addiction.  Plaintiffs have claimed that the pharmaceutical…

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Kansas Appeals Court Says Suspended Lawyer Did Not Demonstrate an Interest to Justify Intervention – But If He Had, It Would Have Been Barred By the Public Policy Against Champerty

Kansas Appeals Court Says Suspended Lawyer Did Not Demonstrate an Interest to Justify Intervention – But If He Had, It Would Have Been Barred By the Public Policy Against Champerty

A Kansas appellate court affirmed a lower court decision to reject the motion to intervene of a suspended lawyer to intervene in a personal injury case, saying that the same Kansas public policy against champerty would have barred his interest – if he had demonstrated a sufficient interest to justify intervention.  In Massali v. Farmers Ins. Co., No. 117464 (Kan. Ct. App. Apr. 18, 2018), the Kansas appellate court summed up the case as follows: Maria E. Massali was injured…

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