The litigation funding world just hit the jackpot—twice. In a whirlwind week of courtroom drama and Capitol Hill maneuvering, funders of lawsuits—once viewed as shadowy financial players—found themselves squarely in the winner’s circle.
It started with a legislative bullet dodged. Tucked into a sprawling federal budget bill was a hefty 40.8% tax proposal targeting proceeds from litigation finance deals. But that threat evaporated when Senate parliamentarian Elizabeth MacDonough struck it down, declaring it out of bounds under reconciliation rules. Senate Republicans were left to pass the bill without the punitive tax provision, despite its origins with outgoing Senator Thom Tillis.
Legal financiers cheered. The International Legal Finance Association didn’t mince words: the tax would have “discouraged investment in justice.” For now, they’re breathing easy—while watching a ballooning federal debt get $3.4 trillion heavier.
Meanwhile, litigation finance juggernaut Burford Capital had its own fireworks in the courtroom.
In one massive ruling, a U.S. judge ordered Argentina to fork over its majority stake in energy giant YPF. That’s part of a whopping $16.1 billion award tied to its 2012 nationalization of the company. Burford, which backed the winning claimants Petersen Energia and Eton Park, could rake in over $6 billion from the haul—plus interest that’s piling up at $2.5 million a day.
But Burford wasn’t done. In Chicago, it secured another win when a judge upheld its right to litigate as plaintiff in a turkey price-fixing case, even though its subsidiary never actually bought any turkey. The court was unbothered by arguments that it violated public policy for a financier to take center stage in a lawsuit it didn’t live through.
Burford CEO Christopher Bogart summed it up: “Big institutions have long had the upper hand in litigation—and they’re not thrilled about losing it.”
The numbers back him up. At last count, over 42 active funders collectively manage more than $16 billion in litigation assets, according to Westfleet Advisors. Still, not everyone is celebrating.
Critics continue to push for mandatory disclosure of funding arrangements, citing risks of hidden influence. Lawmakers in Indiana, Louisiana, and West Virginia have already passed regulations. And a bill introduced by Representative Darrell Issa aims to require disclosure nationwide—a move backed by the U.S. Chamber of Commerce’s legal reform arm.
Funders argue that would choke access to justice, especially for small businesses. Their message: transparency shouldn’t come at the cost of affordability.
Elsewhere in legal billing drama, powerhouse litigator Roberta Kaplan offered a rare discount. Defending New York’s embattled congestion pricing program, she agreed to represent transit authorities for $1,450 an hour—a 27.5% markdown from her usual $2,000 rate. It’s not uncommon for lawyers to trim rates for government work, but the price tag still turned heads.
And in the legal tech world, a billion-dollar handshake just rewrote the playbook. Canadian legal software firm Clio announced a deal to acquire Barcelona-based AI legal research company vLex, calling it a “new era” for tech-powered law. Clio, last valued at $3 billion, shelled out $1 billion to bring vLex into the fold, signaling serious intent in the AI law race.
In the same breath, AI darling Harvey just pulled in $300 million at a $5 billion valuation, reminding everyone that legal AI is no passing trend—it’s the next gold rush.
This week, litigation finance got a boost not from a gavel, but from a shift in the wind. And for the funders, the message is clear: the game is still on—and the stakes just got higher.
