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Litigation funding management firm aims to capitalise on UK market turmoil

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ILF and IGS Group have announced the launch of Independent Litigation Funding, a joint venture partnership that aims to raise finance for the wave of corporate litigation cases they exp

ILF and IGS Group have announced the launch of Independent Litigation Funding, a joint venture partnership that aims to raise finance for the wave of corporate litigation cases they expect to come to court in the wake of financial market turmoil.

Independent Litigation Funding is expected to raise up to eight new funds this year dedicated to financing the legal costs of litigants barred from fully funding their cases, such as companies in administration. It expects to launch its first fund within the next few weeks.

The venture will focus on investing in financing mid-sized corporate litigation cases brought before the UK courts all of which will be fully insured against loss.

Typical claim values will range from GBP500,000 to GBP3m but can extend to GBP6m. It is anticipated that most of these will settle in advance of court action. Cases take an average of nine to 18 months to reach trial or settlement.

ILF and IGS Group believe litigation funding as an alternative assets investment class will benefit from significant growth in 2009. Dislocation of the financial markets throughout last year, which has led to significant investor losses in most securities, coupled with the collapse of many of the global investment banks that structured and sold these securities, have given rise to an environment where proving the ultimate ownership of underlying loss making or defunct securities has become imperative. It is expected that many situations will only be settled by legal court action or the threat of legal action backed by a litigation fund.

ILF is a commercial litigation insurance broker while IGS Group is an advisory firm dedicated to providing a range of services to alternative assets product structuring and investor communities.

Leslie Bland, the veteran Close Brothers banker who was chairman of several of the banking group’s subsidiary companies until his retirement in 2007, will be chairman of the new limited liability partnership. The chief executive will be Ken Arnold, who holds the same position at the litigation insurance broker.

Brown Rudnick will provide legal counsel. Fund administration and custodial services will be provided by Vistra Fund Services.

Bland says: ‘This is an exciting new venture which fills an important need for litigants at a time when they are facing challenges. This fund provides an accessible vehicle through which qualified investors will be able to participate in a dynamic growth area.’

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