Chancery Court decides work product treatment covers litigation funding
In a recent decision, Vice Chancellor Parsons of the Delaware Chancery Court held that documents and communications relating to third party litigation funding were protected as lawyer work product.
The 30-page decision analyzed the issues around litigation funding in detail and concluded that “there is not anything so unique about third-party funding as to require a different inquiry than usual.” Indeed, the Court held that “in the context of third-party funding, the overlap between business and litigation reasons … is more extensive than usual” but that the policy interests “to maintain a level playing field among adversaries in litigation” make it appropriate to protect litigation funding.
Burford is not involved in the matter before the Court, but—given the importance and significance for its business of the Court’s decision—has chosen to comment on it.
Burford’s Chief Executive, Christopher Bogart, stated: “This decision is consistent with Burford’s views about the legal issue addressed and with the majority of other court decisions to consider the issue. However, having a clear and detailed analysis of the issue from one of the country’s leading and most respected courts is significant.”
It is also noteworthy that the Court accepted without question the appropriateness of litigation funding in the justice system, noting that “third-party funding literally may allow a lawsuit to proceed.”
The decision in question was Carlyle Investment Management L.L.C., et al. v. Moonmouth Company S.A., et al., C.A. No. 7841-VCP (Del. Ch. Feb. 24, 2015).