William Marra – Investment Manager – Validity Finance

An interview with William Marra, Investment Manager at Validity Finance

What is your background and why did you enter the litigation finance space?

I’m a commercial litigator by training. I graduated from Harvard Law School in 2012. Following law school, I clerked for Chief Judge William H. Pryor Jr. of the United States Court of Appeals for the Eleventh Circuit, and for Justice Samuel A. Alito Jr. of the United States Supreme Court. I also practiced law for several years at Cooper & Kirk PLLC, a litigation firm in Washington, D.C. Before entering law school, I worked as a consultant with Bain & Company.

I was attracted to litigation finance for a few reasons. Most importantly, I believe in what we do: I think funding will significantly improve our legal system, help clients access the courts, and ensure that case outcomes more closely track the parties’ legal rights. I also enjoyed practicing contingency-fee plaintiff side litigation at my previous firm, and I wanted the opportunity to focus more on that area of the law. Finally, I wanted to build on my experience at Bain and engage more fully with the business side of the legal industry.

What is one skillset or area of expertise that is important for a litigation funder to have?

It’s always helpful to be able to efficiently analyze a client’s case, and to craft funding structures that meet a client’s particular needs. But it’s also especially important to approach cases as a trusted advisor, assisting clients to reach their business goals. No matter how many cases are on our plate any given day, we need to keep in mind that every litigation is of critical importance to that client’s success. It’s important to respect that, and to give every client the attention and care their case deserves.

What types of cases are you most proud of working on?

Litigation funders talk about “access to justice” so much that it can sound like a catchphrase, but we see in our everyday work how funding really does help people bring meritorious suits they otherwise would not be able to pursue. We see with surprising frequency cases with truly reprehensible conduct by an adverse party, where litigation funding is the client’s best—and sometimes only—opportunity to vindicate its rights. It’s rewarding to help them do so.

What advice would you give to litigants or law firms looking to get their case funded?

Help us help you. That means a couple of things. First, present your case in a cohesive presentation, ideally with a memo discussing the case, its strengths and weaknesses, and the litigation strategy. Second, be candid about the strengths and weaknesses of your case. We know that no case is perfect. The more candid and open you are with us, the more likely we are to fund your case, and to put together a funding structure that works.

Are there any interesting trends or situations in the litigation finance market that you are keeping an eye on?

Two trends. First, there’s a continuing shift towards law firm portfolios. Law firms are increasingly recognizing the benefits of portfolio funding, in terms of not only better pricing but also lower transaction costs in signing up clients. Second, clients are increasingly sophisticated about funding. While we still see many “David vs. Goliath” cases, increasingly there are well-capitalized claimants looking to offload some of the risk of litigation. And clients expect their counsel to offer alternative fee arrangements, often coupled with—or made possible by—litigation funding.

You have an article coming out in the Vanderbilt Law Review entitled The Shadows of Litigation Finance. What’s your argument in that paper?

The article, which I’ve co-authored with Suneal Bedi, a professor at Indiana University’s Kelley School of Business, argues that the public policy debate about litigation finance doesn’t consider all of funding’s positive welfare effects. There’s a lot of discussion about how funding affects everyone’s behavior “post-claim,” or after a lawsuit is filed. For example, scholars and policymakers have debated whether funding makes it more likely that claimants will sue to enforce their rights, whether funding affects the price at which cases settle, and how funding impacts the attorney-client relationship.

We argue that not enough attention is paid to funding’s “pre-claim” effects, or its impact on parties’ behaviors in the real world before a cause of action ever accrues. Focusing on contract actions, we argue that in a world with litigation funding, parties will be less likely to breach their contracts, because they know that the counterparty is more likely to sue to enforce its rights. This in turn should lead to more contracting, since whether people are willing to enter into a contract turns in part on their confidence that they can enforce their rights in the event of a breach. We argue that policymakers need to account for these welfare effects as they entertain possible regulations of litigation finance.