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Back in the summer of 2018, two years and approximately an eon ago, you might recall a little political kerfuffle about the Trump administration separating families. Elie Mystal put it well when he characterized it as terrorism; this was the brainchild of alleged “white nationalist” Stephen Miller, who is willing to traumatize hundreds of children for life in the name of deterring immigration because he clearly doesn’t think Latinos are people.

Now, just in time for the anniversary of the original family separation scandal, we have what the American Immigration Council calls Family Separation 2.0. This time, instead of literally taking screaming children from their parents’ arms, they have framed it as a choice for parents to make. Parents can allow the children be released without them, or they can all be detained by ICE together for as long as ICE wants. Spoiler alert: ICE wants to keep them so long that they give up and take voluntary deportation.

To understand why the Trump administration is expressing its racism in this particular way, you need a bit more background. The rights of minors in U.S. immigration custody are governed by the 1997 settlement of a case that was, at that time, called Flores v. Reno. (It’s been reopened so many times, due to violations by the federal government, that most of the AGs of the past 30 years have been named at some point.)

The Flores settlement has been interpreted to protect minors accompanied by their parents as well as unaccompanied minors, and it requires (among many other things) that those minors be released “without unnecessary delay.” This is, obviously, directly contrary to the Trump administration policy of deterring immigration through abject cruelty. Unfortunately for them, binding contracts are binding even when you don’t like them, and the outright stealing of children turned out to be less popular than Miller believed, even when the victims have the bad taste to be brown-skinned.

So they had to come up with something new, and that turns out to be “binary choice”: Give up your child or give up your child’s rights. The administration has, in the past, argued in court that the mean old Flores settlement forced them to do this, an argument with a hole so big you can drive an ICE prisoner van through it. No law or rule or norm — literally nothing — is stopping them from releasing the parents with the children, as was routine for most asylum seekers under the Obama administration. But somehow, I doubt that possibility is going to make it into the briefs of whatever DOJ attorney has to defend this steaming turd in court.

Out of respect for the work the ACLU Immigrant Rights Project and other advocates are doing, I’d like to add that family separation never really went away. If you look through the docket in Ms. L v. ICE, the lead lawsuit trying to stop family separation, you will see that the Trump administration continued separating families whenever it had a thin excuse — a minor or accused crime by the parent, or “suspicions of trafficking” because the adult is an extended family member. America’s attention moved on, but the policy really didn’t. It just adapted, like a Borg drone.

That’s what I think they’re counting on now. I think they believe the pandemic is so distracting that we’re not going to notice them doing it all over again. Please notice.

Lorelei Laird is a freelance writer specializing in the law, and the only person you know who still has an “I Believe Anita Hill” bumper sticker. Find her at wordofthelaird.com.

We knew, in the back of our minds, that our post-COVID work world would be very different than the one we left. Some firms are extending work-from-home policies, others are trying to make their spaces safer (office tents are for real, people), and now we’re hearing about a firm that is eschewing office space on a permanent basis.

According to a report from Law.com, Australia-based Slater and Gordon is saying goodbye to its London physical offices once its lease is up in September. That means all 200 of the firm’s London employees will transition to working from home for good, though Slater and Gordon said they may look for meeting space in London. Also the firm will provide extra screens or office furniture to those who need the equipment.

The firm’s chief executive, David Whitmore, had this to say about the change:

“Today we have announced to our staff that we won’t ever go back to how we worked before COVID.”

He added, “When we do look to return to our offices they won’t look like they used to and colleagues will be encouraged to continue working remotely for the majority of the time. Working smart is better for everyone.”

The firm has not made any announcements about office space in any of the firm’s other locations.

Kathryn Rubino is a Senior Editor at Above the Law, and host of The Jabot podcast. AtL tipsters are the best, so please connect with her. Feel free to email her with any tips, questions, or comments and follow her on Twitter (@Kathryn1).

Ed. note: Litigation finance is transforming the fields of both law and finance. To help our readers gain a better understanding of what litigation finance entails, we’ve partnered with Lake Whillans to present a new series so you can better understand how litigation funding works, its pros and cons, and its past, present, and future.

By now you’ve likely heard about litigation finance and some of the advantages it can offer to claimholders (in a nutshell, the flexibility to pursue a claim without having to pay attorneys’ fees or other costs from the company’s balance sheet, as well as the ability to monetize all or a portion of a claim).  “Sounds great,” you might be thinking, “but how much is this going to cost me?”

This article will review the basic pricing structures that litigation funders typically employ and the reasons why a claimholder may prefer one approach over another.  At Lake Whillans, we have transacted using each of these pricing structures, and approach each transaction flexibly with the mindset of utilizing whatever structure works best for the claimholder.  Further, we provide pricing early in the process; you can generally expect to have terms from us within 5-10 days of reaching out to discuss your matter.

Factors driving litigation finance pricing

Litigation funders consider two primary factors when setting pricing for an investment: risk level and timeline of the case.  For a funder, investments in a single litigation or arbitration claim investment involves significant risk.  Funders provide capital on a non-recourse basis, meaning that if the claim fails, the funder loses its entire investment.  The greater the risk that a case will fail to achieve a return, the greater the cost of funding will be.  Key drivers of the risk level of a case are the strength of the claim (and any defenses), the certainty and amount of damages, and likelihood of collection.  When claims are bundled in a portfolio, the risk of loss is generally mitigated to a degree (as long as the claims do not all turn on the same risk), and therefore portfolios will generally receive lower pricing than a single claim.

As for timeline, the longer the funder anticipates its capital will be tied up, the greater the return the funder needs to reflect the time value of money.  Key drivers of the timeline of a case include the stage of the case at the time of investment, the type of case, and the particular decision maker (i.e., the court/judge/tribunal).  Litigation funders can make an investment at any stage, ranging from before the case has been filed through to after a judgment has been secured (but before it has been collected).  Early-stage cases tend to be riskier and to have a longer timeline than later-stage cases, and the pricing will reflect those differences.

Given the high degree of uncertainty inherent to a litigation investment, funders naturally must require a larger return than, for example, a bank would earn on a fully secured recourse commercial loan.  At the same time, responsible funders agree that the claimholder should keep the majority of any litigation proceeds.  An experienced funder like Lake Whillans will work with the claimholder to structure a funding agreement that makes sense for all parties.  Responsible funders will model various outcomes in terms of timeline, range of awards, and settlement projections, and may decline to fund a case if, in the likely scenarios, too little is left for the claimholder, in particular when the funding would prevent the claimholder from accepting a reasonable settlement.  

Fixed multiple vs. percentage of litigation proceeds

There are two basic models for structuring a litigation funder’s return on capital: fixed multiple and percentage of proceeds, and a combination of both is often utilized.  In the fixed multiple model, the funder recoups its capital along with a multiple of the amount it invested.  The multiple can vary over the duration of the case: for example, the funder may be entitled to a multiple of 0.5 on capital invested if the capital is returned within a year and then to a larger multiple as time increases.   As an example of this type of arrangement, suppose the funding agreement entitles the funder to (i) return of the capital it invested plus (ii) a 2x multiple on the capital invested.  Let’s suppose the capital invested is $1 million; when the matter concludes successfully, the funder would receive $1 million as return of capital, plus a 2x multiple or $2 million for a total of $3 million. (This might be referred to as 3x pricing since the funder receives 3x what it put in).  

In a percentage of proceeds model, the funder recoups (i) return of its invested capital plus (ii) a percentage of the proceeds from the litigation, 20% for example.  So using our $1 million investment hypothetical, if the claim recovers $10 million, the funder receives $1 million plus 20% of $10 million (i.e., $2.0 million) for a total of $3.0 million.  In the percentage model, the funder’s share of proceeds may be subject to a maximum dollar amount, or the percentage may decrease as the award size increases.

These two basic models can also be combined.  The funder may be entitled to a certain multiple, plus an additional percentage return.  In this hybrid structure, both the multiple and the percentage return are smaller than in a pure fixed multiple or percentage structure, but the combination of the two provides a risk-balanced approach to account for the possibility of achieving either the low end or high end of possible award size outcomes, which we will demonstrate below.

Reasons to prefer a given model

A claimholder’s preference for a given pricing model will depend largely on its risk tolerance and its assessment of the expected recovery relative to the funder’s investment. In our above example, assuming a $1 million investment and a $10 million return, the 3x pricing and the 20% of proceeds model yield the same result for funder and claimholder ($3 million to funder/ $7 million to claimholder).  But the ratio changes depending on the size of the award.

In our example, if the award comes in at the high end of the expected range at $20 million, the 3x multiple pricing yields the funder the same $3 million, and the claimholder receives $17 million (or 85%).  But if it was priced using the return of capital plus 20%, the funder recovers $5 million, and the claimholder receives $15 million (or 75%).   Thus, if the claimholder expects a large recovery (as compared to the capital provided by the funder), it might prefer a fixed multiple model because the claimholder retains more of the upside in a high-recovery scenario.

The converse is also true: in a low-recovery scenario, the fixed multiple is relatively more favorable to the funder.  Using the same example, if the award is $5 million, the 3x multiple pricing again yields $3 million for the funder, and the claimholder receives $2 million (or 40%).  This result would likely be undesirable to the claimholder, so it may prefer the return of capital plus percentage model.  Applying the return of capital plus 20% pricing would yield $2 million to the funder and the claimholder would receive $3 million (or 60%).  Thus, if the claimholder wants to protect against the downside risk of a lower recovery, it may prefer a percentage of proceeds model, in which it has to share more of the upside in the high-recovery scenario but is relatively more protected in the low-recovery scenario.  

Of course, the funder’s view of the case and its risk tolerance will also inform the pricing it prefers, and a hybrid model provides a compromise option that often appeals to both funder and claimholder.  For example, hybrid pricing may include (i) return of capital, plus (ii) a 1x multiple plus (iii) 10% of proceeds.   If the award yields $10 million, the split is the same ($3 million to funder, $7 million to claimholder) as it was in our two pricing examples above, but allots the risk/reward more equitably between funder and claimholder in the low recovery scenario ($2.5 million to funder, $2.5 million to claimholder) or the high recovery scenario ($4 million to funder and $16 million to claimholder).

The reserved facility vs. disbursed funds

To further understand pricing, especially in the context of a fixed multiple return structure, it is important to be aware of the distinction between the reserved facility and amount disbursed.  Funders typically do not pay out their full investment in one lump sum; instead the funder makes a series of payments over the course of the case.  The reserved facility is the amount that the funder sets aside to cover its full (projected) investment.  Disbursed funds are what the funder has paid out at any given point.  For a case litigated through trial, the reserved facility may equal the amount disbursed.  Conversely, if a settlement offer is accepted at an early stage, only a small proportion of the reserved facility is likely to have been disbursed.

From a claimholder’s perspective, it may seem most appropriate to pay the multiple on the amount disbursed: why should the claimholder have to pay for funds it never actually receives?  From the funder’s perspective, however, the reserved facility is capital that cannot be used for other investments and is at risk from the moment it is reserved or committed, so if the case settles before a large portion of the earmarked funds have been disbursed, payment of the multiple only on the disbursed funds will result in a low return to the funder that may not adequately compensate it for the risk that it took. These conflicting aims are frequently addressed by pricing that is based on a multiple of amounts actually disbursed, coupled with a minimum return for the funder.  

The waterfall

The last key term of a pricing agreement is the waterfall.  The waterfall is the order of priority in which shares of any recovery are paid to entitled parties, including the funder, the claimholder and, in some cases, counsel (if counsel has a contingent stake in the litigation). 

A standard waterfall provides for the funder to recoup its invested capital before any other party is paid.  The order of allocation of the remaining proceeds will be a product of negotiation, but it typically involves pro rata payments to the funder and counsel, based on their relative entitlements.  The claimholder typically takes the remainder, after the funder and counsel have been paid.

* * *

For an experienced provider of litigation finance like Lake Whillans, each funding agreement is the product of careful assessment and discussion with the relevant stakeholders.  There is no one-size-fits-all pricing structure.  The best way to determine which structure best fits the needs of your situation is to contact us.

After months of business closures, many states are slowly beginning to allow more essential businesses to reopen their doors. In most states, law firms will be among the first wave of businesses permitted to resume providing services to the public.

This is a welcome development for lawyers but one that comes hand in hand with uncertainty. After all, resuming business in the midst of a pandemic is uncharted territory, and opening your firm doesn’t mean you’ll be returning to business as usual. A host of issues must be considered when reopening, not the least of which is to ensure that the health of law firm employees and clients is protected.

Establish A Reopening Committee

Safety is an important goal, but you’re a lawyer, not a public health official. You may be unsure how to proceed. That’s where the guides from two different state bar associations — Indiana and New York — come in.

First, there’s the “New York State Working Group Guidance on Re-Opening Law Firms,” which provides a useful roadmap for law firms transitioning back to the office. According to the guide, firms should establish a reopening committee whose responsibility is to create a plan for the return to work by putting in place processes that will ensure the safety of employees and legal clients.

6 Readiness Essentials

Once the committee has been established, it must address a number of important areas. As explained in the Indiana State Bar Association Guide, “Reopening Your Practice,” there are six readiness essentials that firms need to think about prior to reopening:

• Prepare the building and workplace: Consider cleaning
  plans, pre-return inspections, HVAC, and mechanical checks.
• Prepare the workforce: Develop plans to mitigate anxiety by creating policies for deciding when each employee returns and establishing an employee communications plan.
• Control access points: Consider protocols for safety and health checks, building reception areas, shipping and receiving, elevators, and visitor policies.
• Create a social distancing plan: Consider options to keep workers at a safe distance, which may include new seating arrangements and establishing office traffic patterns.
• Reduce touch points and increase cleaning: Consider keeping doors open and develop protocols for cleaning work areas and common areas.
• Communicate for confidence: Recognize that employees may have concerns about returning to work, so communicate transparently, and listen and survey regularly.

Reopening Committee Objectives

The reopening committee should keep those readiness essentials in mind when creating a reopening plan for the firm. As explained in the NYSBA guide, the committee’s primary objectives should be to:

• Monitor oversight and implementation of the reopening plan.
• Develop and update, as needed, internal policies and procedures for the transition from remote work to the workplace.
• Communicate with legal and support staff with one voice regarding the transition process, set clear expectations, and offer firm-wide training, as needed.
• Field questions or concerns.
• Become familiar with federal and state statutes and programs governing office safety and human resource issues.
• Develop a plan for testing employees for the virus.
• Develop client and visitor policies.
• Conduct business safely.

Ensure Necessary Technology Is Available

According to both guides, another important issue that the transition team will need to address is to establish processes that will facilitate continued social distancing efforts and allow staggered work schedules to be implemented. A necessary and important part of addressing this issue will be providing the necessary technology to allow firm employees to safely and efficiently conduct business from the office and from home.

As a result, providing offsite access to law firm information and the ability to collaborate with work colleagues, no matter where they are, will be paramount. A successful balance of those considerations requires, among other things, investing in technology like cloud-based legal software and videoconferencing tools to facilitate remote work.

Create Written Protocols

Finally, as explained in this Oregon Law Practice Management blog post, written protocols should be drafted, posted around the office, and shared with and explained to employees. The written protocols should address:

• Recommendations or requirements for face masks for employees and clients.
• Procedures regarding any daily health assessments for employees. These can include self-evaluation by each employee, and if deemed necessary, an evaluation conducted by someone in your office, to determine if it’s safe for an employee to return to work each day.
• Processes should be put in place to ensure that employees are maintaining good hygiene at all times, are regularly washing their hands, and are prioritizing physical distancing.
• Plans that provide for the cleaning and sanitizing of the office throughout, and at the end of, the workday.
• Rules that limit the maximum capacity of various rooms in the office in order to comply with distancing guidelines.

Once the reopening committee has shared the necessary written protocols, the next steps include reorganizing your law firm’s workspace and addressing employee issues and concerns. Both bar association guides offer additional tips on those and many more issues, so make sure to read each one in its entirety.

Reopening your law firm during a pandemic may seem a bit overwhelming at first; that’s understandable since no one has ever done this before. But rest assured, as long as your firm follows the reopening schedule established by officials in your area and implements the recommendations set forth in the guides, you’ll be well on your way to successfully reopening your firm as safely as possible, with the health of your employees and clients top of mind.

Nicole Black is a Rochester, New York attorney and Director of Business and Community Relations at MyCase, web-based law practice management software. She’s been blogging since 2005, has written a weekly column for the Daily Record since 2007, is the author of Cloud Computing for Lawyers, co-authors Social Media for Lawyers: the Next Frontier, and co-authors Criminal Law in New York. She’s easily distracted by the potential of bright and shiny tech gadgets, along with good food and wine. You can follow her on Twitter at @nikiblack and she can be reached at niki.black@mycase.com.

* Three members of a $31.7 million fraudulent slip-and-fall ring have been sentenced to prison. Wonder if they got the idea from Slippin’ Jimmy. [Insurance Journal]

* Former presidential candidate Tulsi Gabbard has abandoned her short-lived defamation lawsuit against Hillary Clinton. [CNN]

* A Louisiana attorney who was suspended from practice for chest bumping a prosecutor has been reinstated as a lawyer. Apparently the chest bump was not like the kind seen in football. [Advocate]

* The Los Angeles City Attorney has sued a company for selling allegedly fake COVID-19 tests. [Orange County Register]

* There is some hope that a TV series based on The Lincoln Lawyer will be produced after all. Thought I already saw the reboot, but realized it was just a Matthew McConaughey car commercial. [Hollywood Reporter]

* Since this website has not published a Lawyerly Lairs article in a while, just wanted to report that a top Chicago criminal lawyer has listed his posh pad for sale. [Crain’s Chicago]

Jordan Rothman is a partner of The Rothman Law Firm, a full-service New York and New Jersey law firm. He is also the founder of Student Debt Diaries, a website discussing how he paid off his student loans. You can reach Jordan through email at jordan@rothmanlawyer.com.

• Zimbabwe Peace Project (ZPP)
• Media Institute of Southern Africa (MISA)
• Zimbabwe Lawyers for Human Rights (ZLHR)
• Counselling Services Unit (CSU)
• Zimbabwe Association of Doctors for Human Rights (ZADHR)
• Zimbabwe Human Rights Association (ZimRights)

• How safe am I if schools are opened? Are students’ books safe to mark?
• Do I get free medication if I get COVID19 at work?
• Is my family compensated if I die after getting COVID19 at school?
• Will I get risk allowance when schools open?
• Is it worth it to die for 40 USD which is not enough to feed, clothe and shelter my family?
• Will I be able to teach six 35 minutes period classes in a day with a face mask on?
• I have other health conditions that may affect me in this COVID19 pandemic and I am supposed to teach my Ordinary level classes? How do I go about it?

Post published in: Featured

“Zimbabwe’s COVID-19 cases have now spiked to 132,” the Zimbabwe Broadcasting Corporation (ZBC) reported.

“All new cases except one have been registered among returnees from South Africa and Botswana. Only one is a local transmission,” it said, adding that the 76 new cases were recorded in Beitbridge, Masvingo and the capital Harare.

Zimbabwe has recorded four deaths from the respiratory infection since the first case was reported on March 20.

In southern Africa, South Africa is the most affected by the pandemic, with more than 24,000 cases and 524 deaths.

Since the end of March, landlocked Zimbabwe has been observing a coronavirus lockdown imposed by President Emmerson Mnangagwa.

Its nearly 15 million citizens have suffered more than decade-long economic downturn under the ruling ZANU-PF party including perennial food shortages which have forced hundreds of thousands to emigrate mainly to South Africa and Botswana in search of better lives.

Post published in: Featured