Prudential Regulation Catches Up With Litigation Funding

Key Points:
Litigation funders must now be very cautious in proceeding with any funding schemes they currently are operating.

Potential defendants may have some breathing space after the Full Federal Court's decision in Brookfield Multiplex Limited v International Litigation Funding Partners Pte Ltd [2009] FCAFC 147.

The Court held that the litigation funding scheme and solicitors' retainers involving International Litigation Funding Partners and Maurice Blackburn was a managed investment scheme which required either registration with, or an exemption from, ASIC. A critical feature of the proceedings (as is common to the funding schemes used by litigation funders in the last few years) is that the class of claimants is limited to those who have signed up to the litigation funding scheme and solicitors' retainer.