ONTIER Spain Managing Partner Pedro Rodero presented and moderated the session, which included a conference by Neil Purslow, Co-Founder and Chief Investment Officer at Therium Capital, a British Litigation Fund. This firm has already started investing in international arbitration procedures with a Spanish party involved as well as in litigation procedures before the ordinary courts. 'Litigation funding is currently one of the hottest trends for international litigation' stated Purslow. According to Pedro Rodero, 'litigation funding keeps proving how the legal industry is changing, and it's already having a strong impact in Spanish litigation procedures.' According to an article by Expansión, Spain provides the perfect environment for litigation funding, since 'the amount of litigation procedures taking place in the country keeps rising and Spanish courts and arbitration entities provide legal security.'
Litigation Funding: How it works
Therium's Litigation Funding method relies on funding the expenses facing the plaintiff in litigation procedures (lawyers and qualified experts) and also the resulting expenses if the case fails. If the plaintiff wins the case then the funder gets a part of the earnings. But if the case fails, the funder (Therium) would lose the full investment. 'Investment is lost if the case is lost' noted Purslow. He explained that 'that's why Therium allocates many human and financial resources to choosing the right clients.' Then Purslow noted that getting to know the legal professionals and specific lawyers taking part in the case is also key for a successful litigation procedure.
According to Pedro, litigation funding and third party funding are playing a key role in the future of litigation and arbitration. 'When working on a case, we need to start thinking of litigation funders as new players in the legal industry, and also as new partners for our clients and for the law firms.' Rodero also added that litigation funding keeps rising in certain countries including the UK, which is currently the leading country in litigation funding. As for Spain, our current legislation does keep the door open for third party funding, according to the judgement delivered by the Supreme Court on November 4, 2008 and as per Article 1255 of the Civil Code. However Pedro Rodero noted that Spain still lacks a specific regulation for these procedures.
Although there's still plenty of challenges ahead for litigation funding, Rodero believes that 'it makes a really helpful tool for those clients having trouble with the financial assets they need to deal with a litigation procedure.' And he also noted that 'it's also an opportunity for those lawyers about to start collaborating with investment funds to bring their clients value and solutions.' Pedro Rodero concluded that it's the financial industry that boosts economy and business, and he believes that litigation funding is playing a key role in the development of litigation in Spain, as it already happened in the UK, USA, Germany or France.