Litigation funding “explosion” driving class actions across Europe

The “explosive growth” of litigation funding is behind an increase in class actions across Europe over the past two years, a report by the law firm CMS has argued. Kenny Henderson of CMS warns though that “as litigation funding expands, and in particular into class actions where the class members are often private individuals without independent legal advice, we are expecting increasing calls for formal statutory regulation.”

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Litigation funder keen on taking more stakes in law firms

Following its successful investment in specialist London fraud firm PCB Byrne, Burford is reportedly looking for more law firms willing to exchange a minority stake for capital as an alternative to a stock market listing. Separately, London dispute resolution law firm Pallas Partners has said it is open to the possibility of external investment.

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CMS European Class Actions Report 2022

CMS has published its European Class Actions Report 2022. It notes that 2021 saw a record high for the number of collective proceeding order (CPO) applications filed in the Competition Appeal Tribunal (CAT) in the UK. 85% were stand-alone claims – a marked change from 2016 to 2020 when the majority of claims filed were follow-on claims. Stand-alone claims are often seen as attractive for claimant law firms and funders in that regulatory scrutiny attracts attention from various potential claimants.

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Tory backbencher calls on government to close ‘loopholes’ letting London firms work for the Kremlin

Tory backbencher Kevin Hollinrake has called on the government to close the “loopholes” that have allowed UK professional services firms to continue carrying out bankruptcy proceedings on behalf of the Russian state. The Conservative party MP accused accountancy giant Grant Thornton, litigation funder Harbour, and London law firm CMS of undermining the UK’s efforts to “restrict the Kremlin’s access to funds,” by carrying out bankruptcy proceedings against Russian oligarch Alexey Motylev. A spokesperson for Harbour noted that the litigation funder had not been involved in the case since June 2021.

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