Challenge: Limited flexibility to take on new business
A top regional US law firm wished to significantly expand its plaintiff practice. The firm had identified multiple attractive antitrust matters but was struggling to balance client cost expectations with the firm’s risk tolerance levels. The firm had previously sought to finance some of the matters individually, but the cases were simply too small to meet the economic requirements for financing, despite having strong merits. As a relatively new entrant to the antitrust space, the law firm needed to act quickly to resolve its pricing challenge—or else risk losing clients to its better-known competitors in the space.
Solution: A $52 million legal finance portfolio to fund plaintiff practice
To give the firm flexibility to grow its plaintiff practice, Burford structured a $52 million facility that could be used by the firm across a pool of antitrust matters, including existing and future matters.
The portfolio financing structure ensured that the firm had access to the cash it needed to competitively approach new clients about pursuing cases they wouldn’t otherwise have been able to finance. By limiting the risk of taking on more contingency work and gaining access to the cash it needed, the firm was able to expand its client base and ultimately add more than 15 matters to its portfolio arrangement with Burford. A further benefit: By bundling the matters under a single financing arrangement, the firm received a lower cost of capital than if it had successfully secured financing for the cases on an individual basis.
Impact: Expanded growth opportunity
The portfolio finance facility gave the firm immediate access to a pool of capital that enabled it to attract new clients and grow its antitrust practice—without exceeding the firm’s tolerance for risk.