You’ve written about the rise in opt out proceedings before the Competition Appeal Tribunal (CAT). What role can legal finance play in such collective actions?
Large opt out claims are inevitably very expensive, and at the moment budgets of over £15 million are not unusual, along with similar levels of potential adverse costs exposure. It would be difficult for such claims to get off the ground without significant upfront investment. In such instances, litigants can turn to legal finance providers to provide the investment needed. The CAT itself frequently acknowledges the importance of legal finance in bringing forth opt out claims; it is an accepted, inherent part of the opt out regime.
ATE insurance is another facet of opt out and other CAT proceedings in which legal finance can play an important role. ATE coverage is used in managing companies’ exposures to litigation risks—especially in “loser pays” cost-shifting jurisdictions such as the UK that hold unsuccessful litigants responsible for their adversary’s, as well as their own, legal fees. As costs of CAT claims continue to rise on both the claimant and defendant side, securing adequate ATE coverage is essential. Burford is uniquely positioned to provide ATE coverage alongside traditional legal finance with Burford Worldwide Insurance (BWIL).
How has competition law changed since you began practicing as a litigator at Freshfields?
The major change has of course been the enactment of the Consumer Rights Act in 2015, which allowed opt out claims for the first time. It has had an immense impact on the types of claims that are being filed. Although initially there was only a trickle of opt out actions, that has turned into a flood since the decision came down in Merricks.
Claimant-side law firms have grown and become much more sophisticated since I began practicing. At Freshfields a lot of the work I did was defence-side, so that progression really kept us on our toes. Now at Burford, it means that we are dealing with highly skilled claimant firms that are experienced and know what finance providers are looking for, including what our key questions and concerns will be, which makes the financing process run much more smoothly overall. It is much rarer for us now to come across completely new “users” of legal finance.
What is the biggest trend you anticipate following implementation of the European Union’s Digital Markets Act (DMA)?
Big Tech has been in both the regulatory and litigation spotlights over the past few years. The DMA is expected to codify the regulatory expectations on Big Tech that have developed through case law, potentially leading to more public and private enforcement on those areas. However, due to the rapid development of this sphere, I expect the most interesting developments will be in the grey areas. Competition law has history in developing new concepts to deal with the hot topic at the time, and for a while that has been evolving to deal with the unique businesses of Big Tech, and while the DMA is helpful in setting the boundaries based on current business models and regulatory expectations, I don’t believe this will be the end of the development of new law and principles to address the dominance of Big Tech, in particular as technology continues to evolve. It will be interesting to see whether that is led by regulators or by the courts, as the courts are often able to be more agile than regulators.
You were formerly a Senior Counsel at the Royal Bank of Canada. How does Burford’s approach to non-performing loans (NPLs) compare to the approach taken by banks and other financial institutions?
Burford’s in-house asset recovery expertise means that we can look at the risks associated with NPLs differently to many other more ‘traditional’ players in the NPL market. For example, loans which are secured by personal guarantees often fall outside of the institutional appetite of others, but Burford may be able to assist. Over the short term, we anticipate continuing to leverage our NPL experience to help acquire more NPL portfolios, where Burford can take active steps to enforce the loan, including engaging with primary lenders who have not addressed NPLs on their books where such loans may not be within the structural or risk appetite of other financial institutions.
What most interested you about joining Burford’s legal finance team?
Burford is at the cutting edge of legal finance in London and worldwide. While we look at more traditional legal finance opportunities covering fees and expenses of lawyers, the majority of what we do is thinking more dynamically about how we can assist in finding the best solutions for clients. Whether that is providing an upfront monetization of a claim, financing law firm expansion or acquiring portfolios of cases that lawyers are pursuing at risk (under CFAs, DBAs, etc.), we are constantly exploring innovative answers to complex problems. That level of creativity appealed to me greatly. When I joined, I was promised that no two days would be the same and that has very much been the case!
5… tips for new dog owners?
Having brought home a beagle puppy a few months ago, lots of sleepless nights have taught me:
- Eat, sleep, play, repeat. Subject to the tip below…
- You can never have too many trips to the garden. It’s always better to go out in the cold, dark or wet rather than risk cleaning up indoors.
- As heartbreaking as it is, sometimes if your puppy is barking, she’s just doing it for attention and if you ignore her, she will stop.
- Invest in a jacket that is (i) waterproof (in the UK at least), (ii) covered in pockets for all the accessories you now need to carry with you everywhere and (iii) something that you don’t mind being destroyed by little teeth and claws.
- Most importantly, have fun! Raising a puppy is so rewarding and their wagging tail when you get home from work is the best way to start the evening!