Litigation Funding Contract Didn’t Violate Ethics Rules

A class action law firm can’t invoke ethics rules to void a litigation funding agreement that gave a hedge fund a security interest in the firm’s accounts receivable, the New York Supreme Court, New York County, held Aug. 17 (Hamilton Capital VII, LLC, I v. Khorrami, LLP, 2015 BL 265453, N.Y. Sup. Ct. N.Y. Cnty., 650791/2015, 8/17/15).

The ruling allows Hamilton Capital VII to go forward with a $12 million lawsuit seeking repayment of principal and interest and damages for unjust enrichment from the law firm, which was given a revolving line of credit under the parties’ agreement. ...