Value drivers in the proactive management of insolvency proceedings
LITIGATION FUNDING A CONCRETE AND IMMEDIATE SOLUTION
A tool for mitigating and transferring litigation risk
In this case, Litigation Funding serves as a strategic tool, as it allows proceedings with limited liquidity to pursue legal actions that would otherwise be abandoned. In particular, it is beneficial for assuming the risk of losing the case and for maximizing the value of so-called "dormant" legal assets.
LITIGATION FUNDING AS A STRATEGIC ASSET FOR TRUSTEES
A financial and management lever for optimizing insolvency assets
In the case of credit rights or claims for damages (such as liability or clawback actions) that the proceedings hold but do not pursue due to a lack of funds or fear of increasing liabilities with legal costs and the risk of losing, Litigation Funding acts as a financial catalyst. It allows for the conversion of latent legal claims into liquid assets without affecting the limited resources of the proceedings.
Advantages of using Litigation Funding in Insolvency Proceedings
Elimination of entry barriers: we cover 100% of the costs (lawyers, experts, court-appointed experts, court fees), allowing the start of complex and expensive lawsuits that would otherwise remain at a standstill.
Risk transfer (de-risking): Since the funding is non-recourse, in the event of a negative outcome, the risk of the proceedings having to pay the counterparty's legal fees is transferred entirely to LexCapital.
Signal of litigation quality: when LexCapital decides to invest in a dormant asset after a careful free due diligence process, this decision certifies the strength of the claim, increasing the chances of a favorable out-of-court settlement.
