Burford’s Options After Argentina Reversal: Litigation Finance

Happy Friday! As everyone awaits Burford’s write-down of the YPF asset in its portfolio, I explored some of Burford’s options.

The reversal of the $16.1 billion ruling in the case against Argentina was a major loss for Burford Capital, which funded the claims. In the aftermath, Burford will now write down the value of the oil company YPF’s claims in its portfolio, previously tabbed at $1.7 billion. That write-down could affect Burford’s ability to take on new debt and maintain the ambitious growth target it had previously projected.

Options include a secondary transaction, preferred equity raise and possibly job reductions.

“They do need to think about these various paths and think about capital structure options just because time is of the essence,” said Gian Kull, an investor in legal assets who previously managed the UK portfolio for rival litigation funder Omni Bridgeway. “But there is also a lot of wiggle room they have that they can play with.” Read More

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What I’m Reading

• My colleague at Bloomberg News, Bob Van Voris, wrote that former YPF SA investors told a trial judge that they intend to pursue international treaty arbitration along with further appeals. A lawyer for the investors asked US District Judge Loretta Preska to let them use evidence from the court case in a planned arbitration.
• Netflix is seeking $3 million in attorneys’ fees from Finnish businessman Lauri Valjakka and his patent lawyer, Bill Ramey, saying they both knew Valjakka didn’t own a patent asserted in infringement suits against the streamer and several other tech companies, Michael Shapiro reports. Valiajakka, Ramey, and Virginia-based litigation funder AiPi LLC “went to great lengths to hide this fact from Netflix and the Court: they withheld key evidence and settled early with defendants who uncovered the issue,” counsel for Netflix wrote in a motion for attorneys fees.
• Spanish law firm ESKARIAM secured a strategic €50 million senior secured credit facility from global alternative investment firm Victory Park Capital. The financing will bolster the firm’s litigation teams, enhance operational and technological infrastructure and continue advancing its model of strategic litigation based on specialization and quality, supported by key alliances with leading European law firms, Victory Park Capital said in a news release.

LISTEN: K&L Gates on the Legal Talent Wars

When it comes to winning the legal industry talent wars, the best defense is a good offense, according to K&L Gates’ global managing partner, Stacy Ackermann.

Her firm is actively seeking talent rather than waiting to see who comes their way or relying solely on headhunters, she told Bloomberg Law editor Chris Opfer on our podcast, On The Merits.

In the episode, they discuss how competitive the legal talent market has become, even in secondary markets. She also discussed why K&L Gates is continuing to push its attorneys to use AI, even after some were reprimanded last year for using hallucinated citations in a court case.

Listen here and subscribe to On The Merits on Apple Podcasts, Spotify, Megaphone, or Audible.

Business & Practice

Sullivan & Cromwell Apologizes to Judge for AI Hallucinations

A Sullivan & Cromwell lawyer apologized to a bankruptcy judge for filing documents with incorrect case citations caused by artificial intelligence.

Top Paul Weiss Litigator Shanmugam Bolts for Rival Davis Polk

Prominent appellate lawyer Kannon Shanmugam is leaving Paul Weiss for Davis Polk & Wardwell.

DOJ’s Kambli Entrusted to Pull Off Win in Trump-Big Law Fight

The last lawyer who defended President Donald Trump’s attacks against law firms lost four times and fled to a MAGA think tank. If anyone can now salvage at least a partial win, it might be Abhishek Kambli.

Paul Clement Will Argue for Trump-Targeted Law Firms Next Month

Paul Clement, who served as solicitor general under President George W. Bush, will do battle with the Justice Department at oral arguments next month over the constitutionality of President Trump’s sanctions against Big Law.

Commentary & Opinion

Thomas Unlocks Doors to Federal Courts for Suits Against Big Oil

The US Supreme Court cleared some brush on the path to federal court for private parties pursuing federal goals in a transformational and unanimous 8-0 opinion, Donald Kochan, a law professor at George Mason University’s Antonin Scalia Law School, writes.

Justices Need to Clear Up Murky Waters of ‘Stream of Commerce’

The Supreme Court should provide clarity on the stream of commerce doctrine for personal jurisdiction, which has created uncertainty for businesses about where they can be sued for nearly 50 years.

The Solo Rainmaker Era Is Over. We Pitch Clients an Elite Team

Star litigator Beth Wilkinson writes that the most effective pitch starts with humility. No matter how talented a single lawyer is, the scale and complexity of modern litigation requires a full team that can adjust to changes in strategy while focusing on key aspects of advocacy.

Columnist Corner

General counsel are uniquely prepared to address the danger of speed mixing with misalignment, a risk amplified by AI’s velocity and infamously embodied by the WeWork crash, where fast growth in long-term building leases didn’t mesh with signing short-term tenants, Eric Dodson Greenberg writes in the latest Good Counsel column.

“Compliance—legal’s daily bread—is really alignment by another name,” and GCs who have implemented AI in legal operations have transferable experience, Eric writes. “Alignment work positions legal not as the function that slows things down but as the function that prevents speed from tearing the company apart,” he adds.