Category Archives: Harbour News

Stephen O’Dowd & J-P Pitt give their views on the funding market in Australia

Harbour travelled to Australia to meet our long-term strategic partners and attend key events. Ellora McPherson speaks to Stephen O’Dowd, Senior Director of Litigation Funding and J-P Pitt, Director of Litigation Funding about their trip and their views on the Australian market.

Stephen, can you tell me if there are any trends emerging that you learned on your trip or anything new on the funding landscape our readers should be aware of?

Class actions and litigation funding are more in the spotlight than ever before. In January, the Australian Law Reform Commission (ALRC) completed its extensive inquiry into this space, tabling a number of key recommendations in Parliament. In February, a Royal Commission concluded its inquiry into misconduct in the banking, superannuation and financial services industry, leading to the commencement of a number of high-profile class actions. And the Court’s general management of competing class actions and settlement approvals has made numerous headlines.

How is funding currently regulated in Australia?

Currently there is no licensing regime and the ALRC did not recommend that one be put in place. Funders are required to manage conflicts and demonstrate that they have adequate processes to enable them to do so.

What we are seeing, however, is an increasing trend towards Court-led regulation of funded class actions, particularly in the Federal Court. This ranges from enhanced disclosure of funding arrangements to increased judicial scrutiny of litigation funding charges and legal costs, and management of competing claims.

J-P, perhaps you could develop this point around competing claims?

Certainly, one of the cases that I oversee involved a competing claim. The Court made it clear, at the first case management conference, that in light of the similarity between the two claims it was preferable for only one to proceed. Ultimately, the Court ordered consolidation of the two claims and avoided the kind of “beauty contest” we have seen of late in Australia. It is an interesting solution to the challenge of competing class actions and demonstrates a clear focus by the Court on the speed of justice.

Coming back to the ALRC inquiry, can you tell us more about the biggest change that is proposed?

As matters currently stand in Australia, lawyers are prohibited from charging contingency fees. However, the ALRC has recommended that contingency fees be permitted in limited circumstances for class actions, subject to close oversight by the Federal Court.

Do you see contingency fees as a threat to litigation funders?

No, I don’t see it that way, just as they haven’t been following their introduction into the UK market. The ALRC is trying to provide class members with more options and better access to justice and attempting to remove economic barriers facing medium-sized actions. But such actions will remain expensive to run, and I expect funders to continue to play a key role in the market.

Stephen, you mentioned funders continuing to play a key role. What is Harbour’s role in the market and how do you see it developing in future?

We are a global leader in the funding market and our experience and expertise is second-to-none. Our funding provides Australian claimants with an important connection to their justice system, giving them the freedom to bring good claims without the burden of litigation risk.
That freedom extends to law firms as well, with which we develop risk-management solutions so that their practices can adapt and grow in an increasingly competitive marketplace. We are fortunate to have strong relationships with several strategic partners in Australia. I expect those relationships to grow even stronger, and for Harbour, working alongside its strategic partners, to continue to play a key role in the development of the litigation landscape in Australia.

J-P, a final word from you about your specialist area of enforcement. What is the landscape for enforcement proceedings in Australia and do you see this changing in the near future?

Enforcement is reasonably quiet in Australia at the moment, mainly due I suspect to a relatively strong economy. It means we are not seeing the same sort of opportunities that we see in other jurisdictions, arising from insolvencies. Another aspect is that Australia is not an easy jurisdiction through which to move assets, where a defendant is seeking to dissipate them. That of course could change in the coming months, and is something that we at Harbour will be monitoring with interest.

If you have any comments in the article please get in touch with either Stephen or J-P.

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Harbour retains Chambers & Partners Band 1 ranking

We are pleased to learn that we have retained our Band 1 ranking in the U.K in which we are described by lawyers as having an “impeccable reputation in the marketplace.” Clients say they have “…never met a funder so involved – they work hand in glove together with clients” and another describing us as “structured, considered and diligent.”

In addition to the market commentary we received, clients also give us glowing recommendations including “fantastic, well run and realistic about cases” and “they listen to what you say, then form their own view and put in a realistic contingency to use if needed.”

Ellora MacPherson, Chief Investment Officer said “The repeat Band 1 ranking is excellent recognition for the team in the U.K and other jurisdictions in which we operate. Thank you to the ongoing support of our clients and all who acted as referees for us.”

Susan Dunn has also retained her Band 1 ranking in the ‘leading individuals’ section which she is one of only four ranked Band 1 individuals. One commentator describes Susan as the “doyenne of the litigation funding industry” while another client describes working with Susan as “she is very clear from the outset. She will not waste hours and hours looking to progress a matter. She has a good sense of when things will work.” In September, Susan will take up the position of Chair of the Association of Litigation Funders.

This year we have also been ranked in the Asia-Pacific guide as Band 2. This is the first time they have included a guide for the Asia-Pacific region and we believe our ranking is due to the stellar work of Stephen O’Dowd and the wider team. Stephen is particularly active and known in Australia for class actions and he is named as a key contact for the region. Our approach to funding there has been described as “straightforward and ethical.” Client testimonials for Stephen include “Stephen is a real group/class action funding specialist, who knows his market well, is pragmatic, commercial but also extremely thorough” and “Stephen has a calm, considered yet direct approach and is a pleasure to deal with.”

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Q & A with Tom Conlon

Tom Conlon joined Harbour in May 2019 as Sales Planning & Business Development Manager to support the Investment Management team. Now that he’s had a chance to settle in for the past few months, we asked him more about his role and how he is enjoying it.

Tom, tell me why you decided on Harbour?
Of course, Harbour are a leader in a rapidly growing area and a great set of people – no brainer! I’m really enjoying getting stuck in.

Can you describe your role?
My job is to understand Harbour’s market position and to develop plans to enhance that position and to develop more business. Part of that is about together agreeing business development plans. Its then about working with each team member to deliver on these plans, developing client conversations and profile-raising activity to support these plans and in turn to build our brand and reputation. In time, I may also get involved on the investor relationships and fundraising side of the business.

What is your background and what do you bring to the role?
I led the clients, sectors and markets business development team at Freshfields and before that raised third party capital for private equity at Probitas and Deloitte. Litigation funding brings these two worlds together because we get a lot of our cases from law firms and our capital is third party.

What I bring is the ability to think creatively about how to develop relationships and win new business – the common thread of my roles has been working with sales people on developing client relationships, making more of an impact with client conversations and structuring and organising business development activities.

How did you get to know Harbour?
I was introduced to Harbour by a former colleague and friend with whom I used to work. I got acquainted with you and the team and we spent time evolving and developing a role together – I was really excited about where the business was going and really glad we got there.

Can you tell me what you think the biggest challenges are for third party funding?
Simplistically, our clients could see us as people who just provide capital, just like law firm clients could view lawyers as people who just review contracts. This would significantly underplay our value and contribution. Funders face a dual challenge of on the one hand educating the market on the value they can bring and on the other hand developing broader relationships with existing clients to work with those clients across the whole risk management spectrum.

What’s Harbour like to work at?
High quality people, working at speed, communicating openly and honestly …. with sparkling water on tap!

Tom can be contacted via email thomas.conlon@harbourlf.com or on +44 203 829 9326.

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Legal Training Contract Vacancy with Harbour

Harbour is recruiting for a trainee solicitor to start with the firm in Autumn 2019! This is an exciting opportunity for a trainee to gain their legal qualification within the unique environment of one of the largest and leading litigation funders.

Please click here for further details of the role.

Interested applicants should send their CV and covering letter to trainee@harbourlf.com  by 31 July.

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Q & A with Maurice MacSweeney

Maurice MacSweeney joined Harbour in July 2019 as Director of Litigation Funding.

Maurice, what first attracted you to Harbour?
For me it was Harbour’s credibility and integrity.  Harbour has achieved a leading position not by aggressively pursuing market share, but rather by being genuinely committed to the cases and legal teams in which they invest.

I was also attracted by Harbour’s commitment to creating an ethical and self-governing industry through their early involvement with the Association of Litigation Funders, (including Harbour’s work helping to draft its Code of Conduct).  Litigation is a stressful business, and if you’re supporting parties to litigation I think it’s really important to be viewed as a totally trustworthy partner.

Could you describe your role in a bit more detail?
My job will focus on identifying cases in which Harbour may be able to help with investment, so I will be engaging primarily with law firms to explore how we might support and offer solutions to their clients.  Even though Harbour has one of the largest amounts of capital available for investment, there are many law firms out there, and I’m really looking forward to meeting lots of new people and talking about how Harbour can help.

What is your background and what do you bring to the role?
Most recently I was the Business Development Director of Doughty Street Chambers, comprising 150 barristers.  We worked across many practice areas ranging from fraud to multi-party environmental tort claims, but a common thread running through our caseload was ensuring clients had proper access to justice, and their rights were being properly protected.  Those are two things I am very passionate about, and I look forward to continuing to promote those at Harbour.  Prior to that I worked for another set of barristers, and at a boutique firm of fraud litigators, and studied law at Cambridge. What I’ve found most rewarding in all my jobs, and what I will enjoy at Harbour, is developing close, consultative relationships with clients, and coming up with suggestions and solutions that address their needs.

How did you get to know Harbour?
I first met Harbour about six or seven years ago when they were investing in a particular form of VAT litigation, and I worked with barristers practising in that area. I’ve always remembered being struck by their creative way of thinking, their trust and complete willingness to let legal teams and their clients run the litigation, and their very good humour.  When I was speaking to you about my current role I was delighted to see those traits of the business in its early days were still very much to the fore!

Can you tell us what you think the biggest challenges are for third party funding?
There seem to be some common misconceptions which persist – for example, that funding supports unmeritorious claims, that it potentially gives rise to conflicts of interest, or that funders have an improper influence over litigation.  It’s incumbent on funders to be really upfront about explaining why such concerns are misplaced, and I look forward to having those conversations.

Maurice can be contacted via email maurice.macsweeney@harbourlf.com or on +44 20 3829 9349.

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Harbour-funded claimant defeats jurisdictional objections in ICSID arbitration

We are pleased to announce that the ICSID tribunal in Rockhopper Italia SpA, Rockhopper Mediterranean Ltd, and Rockhopper Exploration Plc v Italian Republic (ICSID Case No. ARB/17/14) rejected Italy’s objections to jurisdiction in an interim award.

We are funding Rockhopper’s claims against Italy for breaches of the investment protections provided by the Energy Charter Treaty (the ECT) in relation to Rockhopper’s investment in the Ombrina Mare oil and gas field located off the Italian coast in the Adriatic Sea.

Italy had objected to the tribunal’s jurisdiction primarily on the grounds that the ECT’s arbitration provisions cannot apply to intra-EU disputes, i.e., where the dispute is between an EU Member State and an investor of another EU Member State.

“The tribunal’s rejection of the so-called intra-EU objection was unanimous”, notes Dominic Afzali “and its decision was consistent with each of the known prior decisions of tribunals considering the intra-EU objection in investment arbitrations to date. The case should now proceed to a consideration of merits and damages.”

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One of the largest Funders of litigation and arbitration is recruiting

This is a rare opportunity to bring your hard-earned experience into a dynamic and fast-growing funder. You will be integral to the way that we work, supporting the deployment of the £760 million of capital in the Harbour Funds.

We are looking for experienced litigation/arbitration solicitors or barristers to join us as Director of Litigation Funding in order to assess, recommend and manage the Harbour Funds’ investments in global litigation and arbitration.  A probing intellect and strength in project management, risk assessment and financial acumen are more important than a specific number of years PQE.

This is a role for someone who wants to be in a very commercial and fast-paced environment making exceptional returns for investors.

You must be a team player able to work to tight deadlines with great inter-personal skills and:

  • have a good understanding of how large scale commercial disputes are managed in England and Wales and in other common law jurisdictions
  • have commercial acumen, be numerate & possess strong analytical & project management skills
  • be accustomed to working with a wide range of legal and other professionals
  • be robust in negotiation

Market remuneration and a great benefits package are on offer. London based.

Interested candidates should send their CV & a covering letter to recruitment@harbourlf.com, specifying Director of Litigation Funding in the subject field before 31st July. Telephone and personal enquiries will not be considered. No agencies.

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London remains key disputes hub

By Colin Johnson, Vice President with Charles River Associates, one of the founding members of LIDW.

May 2019 marked the inaugural London International Disputes Week (LIDW) with more than 1100 delegates from 47 countries attending events over four days. The conversation around a London arbitration event began some 20 months earlier. Since similar events are so prevalent in other parts of the world, the organising committee decided to take the opportunity to remind people that, regardless of whether the UK was in or out of the European Union, the UK (and London in particular) still has a lot to offer for dispute settlement.

One of the key messages from the week is that there are multiple venues around the world for disputes, and each venue has its own advantages and disadvantages. In that context, London welcomes international parties wishing to use English law, the UK courts and/or London as a seat or venue for arbitration, and it has a lot to offer as such. The multi-lingual, multi-cultural, multi-faceted disputes community in London continues to offer skills to tackle a similar diversity of cases and plans to continue to foster this dynamic international community.

As LIDW developed, the organising committee agreed that it did not want the conference to be just about London or the UK. The intention was for London to use its privileged position as the home of so many international practitioners to help shape the future of dispute resolution to better deliver what the users and participants of the dispute settlement ecosystem need. London has within one city a world-renowned courts system, several top arbitral bodies, many companies that are the users of dispute resolution and a strong support network of experts, funders and legal technology service providers.

With the inaugural event having come and gone, the organisers of LIDW want to ensure that the second event is even more international so that we continue to develop a diverse disputes marketplace. Plans have begun on how best to do that, so please view the website (lidw.co.uk) for more information. We hope to see many of you from all around the world at our second LIDW. Looking ahead, we wish our Scottish colleagues the very best with the International Council for Commercial Arbitration Congress next May in Edinburgh, and we look forward to seeing many familiar faces there.

 

The views expressed herein are the views and opinions of the author and do not reflect or represent the views of Charles River Associates or any of the organisations with which the author is affiliated.

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Q&A with… Darrell Porter, Senior Business Development Director

In 2018, the Harbour group grew again with the addition of Harbour Solutions Group (HSG), a business designed to offer our corporate clients the problem-solving skills of a team of commercially experienced risk management experts. Ellora MacPherson speaks with Darrell Porter, Senior Business Development Director at Harbour Solutions Group.

Darrell you joined Harbour in late 2018, can you tell me briefly about your past experience and what you bring to the role?

I have worked in finance for over 25 years, enjoying senior positions at Barclays Capital,  Deutsche Bank and most recently as a Managing Director within the Risk Solutions Group at Nomura (which was awarded Risk Solutions House of the Year 2018 by Risk Magazine).  For much of that time I helped corporate and institutional clients mitigate their exposure to changes in exchange and interest rates, including bespoke deal-contingent hedging solutions for clients engaged in M&A activity. These organisations are now showing interest in using similar strategies to manage their financial exposure to commercial litigation.

Can you explain to readers what Harbour Solutions Group offers and how it fits in with Harbour Litigation Funding?

Certainly. Since its inception in 2007, Harbour has focused on litigation funding, with the vast majority of cases being referred by law firms. Harbour Litigation Funding is expert at understanding and meeting the needs of this important constituency. Harbour Solutions Group was formed last year in recognition of the fact that our corporate clients can have a different set of needs to law firms and consider litigation risk in the context of other solutions with which they are familiar. We adopt a consultative approach knowing that any cases that corporate clients are considering are at a very early stage and require  consideration of a range of risk management solutions that can include litigation-related  insurance policies as well as funding. Many companies are intrigued to learn about the After-The-Event insurance market, the fact that such insurance can be purchased right up to the start of a trial, and that they may be able to cap damages should they go to trial…

To read the rest of the interview, go here. 

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The use of flexible remedies and procedures to combat fraud

Paul Lowenstein QC and Matthew McGhee, 20 Essex Street

In Summer 2018, the Lord Chancellor announced that a new flagship court would  be opening in London and be specifically designed to tackle fraud, cybercrime and economic crime. Plans for its opening are underway and it is hoped that the court will be in full service by 2025. Judging by current trends, the new court will be very busy from day one.

Reliable estimates of the prevalence of fraud, especially cyber-fraud, are difficult to assess. What is clear, however, is that such activity is increasing. Earlier this year, for example, Santander announced that it closes 24,000 UK bank accounts per year on suspicion of fraud, of which about 11,000 are suspected of being operated as ‘money mule’ accounts – i.e. operated by fraudsters (who may or may not be the account holder) to conduct illegal activities such as money laundering.

The problem is not just with Santander. Nationwide closes about 12,000 bank accounts per year for similar reasons, of which about 6,000 are suspected ‘money mule’ accounts. Facebook has also recently taken steps to remove adverts from its platform where fraudsters were offering its users £1,200 in exchange for those users allowing their accounts to be operated as ‘money mule’ accounts.

In such times, lawyers and judges must recognise the need for the law to respond appropriately. There is no need to reinvent the wheel; well-established processes and remedies can be adapted and applied to the new challenges. In this update, we provide a brief overview of some of the ways in which this has been achieved in recent months.

Development of the ‘persons unknown’ jurisdiction

In CMOC v Persons Unknown [2018] EWHC 2230 (Comm), the High Court confirmed that it has jurisdiction to make worldwide freezing orders against persons unknown. In the case of a cyber-fraud, this enables a victim to freeze the accounts to which sums were sent in  the course of the fraud even if the victim does not (yet) know the identity of the account holder.

There is similarly a growing body of cases where American Cynamid injunctions are  granted against persons unknown who have been involved in gaining unauthorised access to claimant parties’ IT systems. Threats are often made to disclose commercially sensitive data unless a ransom payment is made. See PML v Person(s) Unknown [2018] EWHC 838 (QB) and Clarkson Plc v Person or Persons Unknown [2018] EWHC 417 (QB). In such cases, the respondents are routinely ordered to not disclose the data, and may additionally or alternatively be asked to destroy any copies of the data that they have made (cf. Bloomsbury Publishing v News Group Newspapers [2003] 1 WLR 1633).

‘Spartacus’ (or self-identification) orders may also be made in such instances. A ‘Spartacus’ order requires the unnamed respondent is ordered to identify him or herself to the Court. Although such ‘Spartacus’ orders may not be complied with, the threat of contempt proceedings should the respondents later be unveiled may act as a spur to prompt compliance of some individuals.

However, helpful as the ‘persons unknown’ jurisdiction is, it should not be seen as a magic panacea for any difficulty in identifying the parties to a fraud. In Cameron v Liverpool Victoria Insurance [2019] UKSC 6, the Supreme Court explained that there are two kinds of unnameable defendants: defendants who were identifiable but whose names were unknown; and defendants who were anonymous and could not be identified. Claims can only be made against ‘persons unknown’ in the first category, not the second. The first category covers the defendants/respondents in PML, Clarkson & CMOC, where it was plain that there was a conspirator or body of conspirators operating from certain email addresses or bank accounts, but the actual identities were unknown. The second category would include (in the case of Cameron) the unknown hit-and-run driver, but also other defendants who are not only anonymous but are also unidentifiable. It seems that the distinction may be between ‘persons unknown’ who can or cannot be served, whether  that be directly or by alternate means.

Continue reading the full article here

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