Aceris Law is pleased to announce that it has won another arbitration, this time funded by a third-party funder, with its client receiving payment of all amounts awarded, minus the portion to be paid to the third-party funder. Aceris Law assisted its client to secure third-party funding at no cost, prosecuted the arbitration successfully, and then secured and distributed payment to the third-party funder and its client.
“Clients in need of funding do not realize that it is typically harder to secure third-party funding that to win an underlying arbitration,” said William Kirtley of Aceris Law. “While we have assisted clients in securing third-party funding a number of times, and Aceris Law has a significant advantage in securing funding since our arbitration budgets are always quite reasonable, only highly meritorious cases can, in fact, be funded.
We have developed a checklist in order to see whether potential claims are likely to be funded based on our past experience. In our experience, arbitrations are likely to be funded if:
- The value of the claim is large. If the value of the claim is less than USD 3 million, the case is highly unlikely to be funded.
- The arbitration budget is reasonable. While Aceris Law’s own legal fees are always reasonable, if co-counsel is required costs may escalate.
- Third-party funding has not already been rejected. While this is not conclusive, if third-party funding has already been rejected by other funders, even for a meritorious case, additional third-party funders are less likely to be interested.
- The claims are supported by significant documentary evidence, willingly provided by the client. If they are not, third-party funders are highly unlikely to be interested.
- The claim is not at risk of becoming time-barred. If there is a statute of limitations issue, third-party funders are highly unlikely to be interested.
- There are no major jurisdictional problems. If there are major jurisdictional hurdles, third-party funders are unlikely to be interested.
- The claim does not face any obvious issues on the merits. If it does, third-party funders will be unlikely to be interested.
- Damages are non-speculative and can be proven with a high degree of certainty. If not, third-party funders are unlikely to be interested.
- No significant counterclaims are likely to be made against the claimant or claimants. If counterclaims may be set off against the amount awarded, third-party funders are less likely to be interested.
- No other creditors will have a claim on the amount of compensation received. If this is the case, for instance because the claimant is being sued by creditors, third-party funders are less likely to be interested.
- The respondent has sufficient assets to pay the resulting arbitral award. If not, third-party funders are unlikely to be interested.
- It is unlikely that there will be enforcement problems. If there may be enforcement problems, for instance because the respondent is located in a State with a poor record of enforcing arbitration awards, or because the claim is against a State that routinely refuses to respect arbitral awards, third-party funders are less likely to be interested.
- The client has clean hands and establishes a productive relationship with the third-party funder. If the client and the third-party funder do not get along, and do not trust one another, the client’s case will not be funded.”
Aceris Law does not charge for assistance in securing third-party funding, although it does attempt to ensure that cases have a realistic chance of securing third-party funding after considering the above criteria.