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LITIGATION FUNDER BENTHAM ISSUES U.S. INVESTMENT HIGHLIGHTS FOR 2014

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Portfolio yields $100 million in recoveries for the year – IP, breach of contract, commercial disputes; Bentham commits to 10 new investments in 2014 – three of which successfully monetize this year; nearly 200 cases reviewed; firm names new investment manager, former Gibson Dunn trial lawyer David Kerstein

Leading litigation funder Bentham IMF is ending 2014 on a strong note in the U.S., with robust dispute recoveries, a set of freshly completed cases and the addition of an experienced new member to its U.S. investment management team.

The firm’s calendar-year performance for dispute funding in the U.S. has shown strong metrics in all key areas. In just its third year of U.S. operations, Bentham has achieved:

  • Ten American deals funded in 2014, with additional commitments expected to fund early in the New Year.  Cases backed include major contract disputes, a patent infringement jury trial for a prominent technology company, partnership disputes, and five law firm case portfolios.

    Ø Client recoveries of nearly $100 million resulting from jury verdicts and settlements.

    Ø Gross returns of more than $31 million for the year, with a net profit of $17 million.

    Ø Clients and outside counsel returns of 69% of recoveries, with Bentham drawing the remaining 31%.

    Ø Four U.S. cases resolved in 2014 – including three that also commenced in the same year.

    Ø Nearly 200 total cases reviewed for possible funding in the U.S., from a pipeline of major law firms, corporate counsel, businesses and individual claimants.

With its 10 new commitments added in 2014, Bentham IMF has now invested in 20 American-based disputes.

Further expanding its U.S. presence, the firm announced that David Kerstein, former litigation counsel at Gibson Dunn & Crutcher in New York, has been added to its investment team. Mr. Kerstein brings an extensive background handling complex commercial disputes, with a focus on corporate control contests, bankruptcy matters, shareholder disputes, trade secrets, employment cases and other business matters.

Bentham launched in 2011 as the U.S. arm of leading Australian dispute funding firm IMF Bentham Limited.  Since its founding in 2001, Bentham has invested in nearly 200 cases worldwide, securing approximately $1.5 billion in recoveries for litigation claimants.  The firm has enjoyed a success rate exceeding 95% in wins and settlements.

“Without question, this has been our breakout year in the American litigation funding market, with a robust portfolio of new commitments and cycled returns,” said Ralph Sutton, Bentham’s Chief Investment Officer.  “The pace and volume of new funding opportunities has grown sharply in the past year, and so has the range of cases and their origination, as major law firms and companies have come to recognize the value of funding to lower litigation risk.”

Mr. Sutton noted the data point that surprised him the most.  “Bentham has a historically strong track record in case selection, so we’ve come to expect high-octane returns, reaching almost 3x annually over 14 years.  But what really stands out are the three cases that went from commitment to financial return in the same year,” he said.

“Litigation is not normally known for quick results and investors in dispute funding should also not be looking for fast turnarounds,” added Mr. Sutton, himself a former commercial litigator.  “However, to have three major matters monetize in the same year of funding is a reflection of the strength of our investment team in identifying cases with significant potential and aligning our capital and expertise with the law firms and businesses with whom we partner.”

Charlie Gollow, a Bentham investment manager since 2003 and a key driver of the firm’s U.S. agenda, said the 2014 numbers indicate the changing nature of litigation funding economics. “We’re seeing success not only among large law firms and corporations looking to cover the enormous up-front costs associated with their biggest cases, but with smaller businesses and even individuals with serious claims that require funding in order to match up with their adversaries,” he said.  “The U.S. market has matured to the point where there are now enough case studies and outcomes that make third-party funding a necessary part of the equation for all types of disputes. We expect to see an even larger set of opportunities and results in 2015.”

Mr. Kerstein, the firm’s newest investment manager, brings substantial courtroom experience, having recovered large financial sums and injunctive relief for plaintiffs, as well as scoring major defense wins.  His clients included private equity funds, investment managers and other financial industry clients in numerous complex cases.  A graduate of the University of Pennsylvania for both his B.A. and J.D., he also spent time on Capitol Hill, interning for Wyoming Senator Alan Simpson and New York Senator Alfonse D’Amato.

“We are excited to add Dave Kerstein to our U.S. team,” said Allison Chock, who heads Bentham’s Los Angeles office. “Like our other investment managers, Dave has a serious litigation background in complex, large-scale cases that are challenging to run as well as to fund, and scoring major financial outcomes.  He’s handled a wide range of matters in venues in the U.S. and internationally. As our purview and portfolio of cases continues to grow, we see a terrific upside in having Dave part of our U.S. braintrust, not only for case selection but in working closely with the counsel and companies in the trenches as their matters proceed.”

Earlier this fall, Bentham named a new investment advisory panel in the U.S., bringing together a group of leading litigators nationally.  They include:  Stephen Susman of Susman Godfrey; Reed Oslan of Kirkland & Ellis; Roman Silberfeld of Robins Kaplan; Peter Ostroff of Sidley Austin; Peter Gillon of Pillsbury Winthrop; and noted legal ethicist W. Bradley Wendel of Cornell Law School. Here is more on the panel: http://www.benthamimf.com/docs/default-source/default-document-library/advisor-press-release.pdf?sfvrsn=8

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Sunak to use budget to expand apprenticeships in England

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Sunak to use budget to expand apprenticeships in England 1

LONDON (Reuters) – British finance minister Rishi Sunak will announce more funding for apprenticeships in England when he unveils his budget next week, the government said on Friday.

Employers taking part in the Apprenticeship Initiative Scheme will from April 1 receive 3,000 pounds ($4,179) for each apprentice hired, regardless of age – an increase on current grants of between 1,500 and 2,000 pounds depending on age.

The scheme will extended by six months until the end of September, the finance ministry said.

Sunak will also announce an extra 126 million pounds for traineeships for up to 43,000 placements.

Sunak’s March 3 budget will likely include a new round of spending to prop up the economy during what he hopes will be the last phase of lockdown, but he will also probably signal tax rises ahead to plug the huge hole in the public finances.

Sunak is also expected to announce a “flexi-job” apprenticeship scheme, whereby apprentices can join an agency and work for multiple employers in one sector, the finance ministry said.

“We know there’s more to do and it’s vital this continues throughout the next stage of our recovery, which is why I’m boosting support for these programmes, helping jobseekers and employers alike,” Sunak said in a statement.

(Reporting by Andy Bruce, editing by David Milliken)

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UK seeks G7 consensus on digital competition after Facebook blackout

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UK seeks G7 consensus on digital competition after Facebook blackout 2

LONDON (Reuters) – Britain is seeking to build a consensus among G7 nations on how to stop large technology companies exploiting their dominance, warning that there can be no repeat of Facebook’s one-week media blackout in Australia.

Facebook’s row with the Australian government over payment for local news, although now resolved, has increased international focus on the power wielded by tech corporations.

“We will hold these companies to account and bridge the gap between what they say they do and what happens in practice,” Britain’s digital minister Oliver Dowden said on Friday.

“We will prevent these firms from exploiting their dominance to the detriment of people and the businesses that rely on them.”

Dowden said recent events had strengthened his view that digital markets did not currently function properly.

He spoke after a meeting with Facebook’s Vice-President for Global Affairs, Nick Clegg, a former British deputy prime minister.

“I put these concerns to Facebook and set out our interest in levelling the playing field to enable proper commercial relationships to be formed. We must avoid such nuclear options being taken again,” Dowden said in a statement.

Facebook said in a statement that the call had been constructive, and that it had already struck commercial deals with most major publishers in Britain.

“Nick strongly agreed with the Secretary of State’s (Dowden’s) assertion that the government’s general preference is for companies to enter freely into proper commercial relationships with each other,” a Facebook spokesman said.

Britain will host a meeting of G7 leaders in June.

It is seeking to build consensus there for coordinated action toward “promoting competitive, innovative digital markets while protecting the free speech and journalism that underpin our democracy and precious liberties,” Dowden said.

The G7 comprises the United States, Japan, Britain, Germany, France, Italy and Canada, but Australia has also been invited.

Britain is working on a new competition regime aimed at giving consumers more control over their data, and introducing legislation that could regulate social media platforms to prevent the spread of illegal or extremist content and bullying.

(Reporting by William James; Editing by Gareth Jones and John Stonestreet)

 

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Britain to offer fast-track visas to bolster fintechs after Brexit

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Britain to offer fast-track visas to bolster fintechs after Brexit 3

By Huw Jones

LONDON (Reuters) – Britain said on Friday it would offer a fast-track visa scheme for jobs at high-growth companies after a government-backed review warned that financial technology firms will struggle with Brexit and tougher competition for global talent.

Finance minister Rishi Sunak said that now Britain has left the European Union, it wants to make sure its immigration system helps businesses attract the best hires.

“This new fast-track scale-up stream will make it easier for fintech firms to recruit innovators and job creators, who will help them grow,” Sunak said in a statement.

Over 40% of fintech staff in Britain come from overseas, and the new visa scheme, open to migrants with job offers at high-growth firms that are scaling up, will start in March 2022.

Brexit cut fintechs’ access to the EU single market and made it far harder to employ staff from the bloc, leaving Britain less attractive for the industry.

The review published on Friday and headed by Ron Kalifa, former CEO of payments fintech Worldpay, set out a “strategy and delivery model” that also includes a new 1 billion pound ($1.39 billion) start-up fund.

“It’s about underpinning financial services and our place in the world, and bringing innovation into mainstream banking,” Kalifa told Reuters.

Britain has a 10% share of the global fintech market, generating 11 billion pounds ($15.6 billion) in revenue.

The review said Brexit, heavy investment in fintech by Australia, Canada and Singapore, and the need to be nimbler as COVID-19 accelerates digitalisation of finance, all mean the sector’s future in Britain is not assured.

It also recommends more flexible listing rules for fintechs to catch up with New York.

“We recognise the need to make the UK attractive a more attractive location for IPOs,” said Britain’s financial services minister John Glen, adding that a separate review on listings rules would be published shortly.

“Those findings, along with Ron’s report today, should provide an excellent evidence base for further reform.”

SCALING UP

Britain pioneered “sandboxes” to allow fintechs to test products on real consumers under supervision, and the review says regulators should move to the next stage and set up “scale-boxes” to help fintechs navigate red tape to grow.

“It’s a question of knowing who to call when there’s a problem,” said Kay Swinburne, vice chair of financial services at consultants KPMG and a contributor to the review.

A UK fintech wanting to serve EU clients would have to open a hub in the bloc, an expensive undertaking for a start-up.

“Leaving the EU and access to the single market going away is a big deal, so the UK has to do something significant to make fintechs stay here,” Swinburne said.

The review seeks to join the dots on fintech policy across government departments and regulators, and marshal private sector efforts under a new Centre for Finance, Innovation and Technology (CFIT).

“There is no framework but bits of individual policies, and nowhere does it come together,” said Rachel Kent, a lawyer at Hogan Lovells and contributor to the review.

($1 = 0.7064 pounds)

(Reporting by Huw Jones; editing by Jane Merriman and John Stonestreet)

 

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