Recent case studies illustrate some of the ways in which Burford has helped companies generate value from what would otherwise be illiquid assets or a drain on corporate budgets.
Legal finance is often described as a range of products: Fees and expenses financing, portfolio financing, monetization financing and so forth. But when a GC is considering how to improve budget certainty or a CFOs needs to reduce risk, they aren’t looking for a product—they’re simply looking for a solution to a specific business need.
Burford has reviewed well over 10,000 requests for funding, each representing unique client needs and each offering our team of more than 65 lawyers an opportunity to provide a customized legal finance solution to optimize the financial impact of clients’ commercial litigation and arbitration assets.
Below, we share recent case studies to illustrate some of the ways in which Burford has helped companies generate value from what would otherwise be illiquid assets or a drain on corporate budgets.
Fortune 100 company accelerates (and guarantees) $45 million
A Fortune 100 company was devoting considerable resources to pursuing arbitrations related to price fixing allegations against suppliers but had no way of knowing when (or if) it would receive the damages it was due.
To help the company minimize uncertainty around its legal assets, Burford provided a $45 million advance, with terms tied to the successful outcome of the underlying matters. In the event of a loss, the company would owe Burford nothing, thus protecting it against downside risk; should the claims prove successful, the company would preserve significant upside.
By monetizing a portion of its arbitration portfolio, the company was able to realize the value locked away in contingent legal assets on its own schedule and use the immediate cash injection for strategic business purposes.
Manufacturer preserves OPEX while pursuing bet-the-company litigation
An industrial manufacturer faced an existential, multi-year dispute with one of its suppliers, which resulted in the loss of customers and business as well as reputational harm. Following an unsuccessful mediation attempt, the company initiated an AAA arbitration. Although the company was committed to pursuing damages it valued in the low nine figures, the client wished to preserve capital for use in day-to-day operations.
To help the company preserve cash for operating expenses, Burford committed almost $6 million to pay for fees and expenses relating to its dispute. The capital was provided on a nonrecourse basis, meaning the company faced no downside risk and would repay Burford only in the event of a successful case resolution.
With financing from Burford, the company was able to assert its right for relief under the contract with its supplier, without having to devote precious operating cash to its outside lawyers—thereby enabling the company to keep its focus on the business.
Startup avoids settling for less, thanks to portfolio financing
A startup faced numerous matters relating to a dispute with its former joint venture partner in a company that manufactured, sold and distributed personal grooming products. The defendant took a litigious approach, threatening the startup’s ability to adequately pursue its claim.
To enable the startup to proceed, Burford committed $10 million across a portfolio of ongoing and future commercial litigations and arbitrations in Europe and the US. To ensure significant upside for the company, Burford structured the deal to fund its return if it enforced any successful judgment or award against the defendant and/or from the proceeds of the sale of the investee company.
With financing in place, the startup could hire its counsel of choice and avoid being forced into early settlements. Within a year, it had already won two awards against the defendants.
Fortune 500 brand name enhances liquidity by monetizing a valuable antitrust claim
A household name Fortune 500 company had a large and meritorious opt-out claim against producers for anticompetitive collusion. Simultaneously, it needed to cut costs due to revenue generation pressures following a brief decline in profits.
Without ceding control of the matter, the client was able to monetize $29 million of the expected proceeds from its opt-out claim. Burford provided upfront capital for a portion of the opt-out claim, allowing the client to pursue the meritorious litigation without downside risk and without taking on debt.
The company thus enhanced liquidity by unlocking some of its contingent legal assets significantly in advance of resolution— providing an immediate cash injection that could be used for strategic business purposes when it was needed.