RCS - Burford Capital Ltd - Burford Capital-Report on Class Action Recoveries

Burford CapitalAnnouncement

13/09/2022 15:30

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RNS Number : 3201Z  Burford Capital Limited  13 September 2022

FOR IMMEDIATE RELEASE

 

 

New research shows companies with large claims recover more and preserve
budgets by using legal finance as part of their class action opt out
strategies

 

Legal finance use is 3x likelier among companies that mostly/always opt out of
the class vs. those that mostly/always remain in the class

 

 

New York City, September 13, 2022 - Burford Capital, the leading global
finance and asset management firm focused on law, today releases new
independent research demonstrating the value of legal finance for companies
with valuable commercial class action claims. In recent years, Burford has
seen an increasing number of major corporations choosing to opt out of class
action lawsuits to pursue high value claims individually and has commissioned
independent research to examine the trend in greater depth.

 

Although companies are currently still more likely to remain in the class than
they are to opt out, the research reveals that their reasons for doing so are
economic-and solvable with legal finance, which de-risks the choice to opt out
and provides a clear benefit to corporations with high value claims. As most
legal finance is non-recourse, companies can receive risk-free funding to
pursue meritorious claims as individual plaintiffs, as well as to accelerate
the often-significant value represented by pending claims.

 

Given the results of the research, Burford expects the trend toward opt outs
will continue, with major companies choosing to rethink their opt out
strategies with legal finance.

 

Christopher Bogart, CEO of Burford Capital, said: "Burford's independent
research on commercial class actions demonstrates the clear benefit that legal
finance provides to companies with significant claims. If you're a GC and you
have a claim that's big enough to merit opting out, you should, because you'll
recover more, and you can do so without budget implications by using legal
finance capital. Further, your competitors who are already using legal finance
are opting out three times more often. As a former GC, I recognize the
importance of maintaining control and maximizing returns in litigation, and
Burford works with many GCs to use legal finance to reduce risk, maintain
greater control and enhance the likelihood of achieving greater recoveries."

 

Key findings from the research include:

 

·    Use of legal finance correlates to opting out.

o  Use of legal finance is 3x likelier among companies that mostly/always opt
out vs. companies that mostly/always remain in the class, and 2x likelier than
all companies.

·    Companies' top reasons for opting out are maintaining control and
maximizing return.

o  The #1 reason large company GCs opt out is their fiduciary duty to
maximize recoveries to their company.

·    Companies' top reasons to stay in the class are economic.

o  Not being able to justify the cost of pursuing an opt out claim (64%) and
not having the budget to do so (61%) are the top 2 reasons companies remain in
the class.

o  Legal finance ameliorates both cost and budget constraints.

·    GCs say the availability of legal finance would impact their opt out
strategy.

o  1 of 2 (52%) say that while they have not used legal finance, its
availability would positively impact the decision to opt out.

 

 

The Report on Class Action Recoveries
(https://www.burfordcapital.com/2022-class-action-recoveries-report) can be
downloaded on Burford's website, where full results are also available. The
research report was conducted in June 2022 by GLG via an online survey, with
responses from 150 US GCs, heads of litigation and other senior in-house
lawyers responsible for their companies' commercial litigation.

 

END

 

 

Contact:

David Helfenbein

Vice President, Public Relations

dhelfenbein@burfordcapital.com (mailto:dhelfenbein@burfordcapital.com) , +1
212 235 6824

 

About Burford Capital

Burford Capital is the leading global finance and asset management firm
focused on law. Its businesses include litigation finance
(https://www.burfordcapital.com/) and risk management, asset recovery and a
wide range of legal finance and advisory activities. Burford is publicly
traded on the New York Stock Exchange (NYSE: BUR) and the London Stock
Exchange (LSE: BUR), and it works with companies and law firms around the
world from its principal offices in New York, London, Chicago, Washington, DC,
Singapore, Sydney and Hong Kong.

 

For more information, please visit www.burfordcapital.com
(http://www.burfordcapital.com) .

 

 

This communication shall not constitute an offer to sell or the solicitation
of an offer to buy any ordinary shares or other securities of Burford.

 

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