Law Firm Litigation Funding Investment Deal Would Level The Playing Field For Fighting Corporates
A ‘social and environmental justice’ law firm based in London and established just five years ago has secured the largest litigation funding deal in legal history and the largest investment in a law firm worldwide.
Sources including Business Wire and Bloomberg, report that Pogust Goodhead, a UK-based law firm, has announced a $552.5 million investment partnership with Gramercy Funds Management LLC, an American emerging markets investment manager.
Pogust Goodhead, 41, founded by English barrister Tom Goodhead (pictured, right) and American lawyer Harris Pogust in 2018, has had an investment of more than $552 million injected into the firm that employs 100 lawyers and 500 staff.
An American fund manager, Gramercy Funds Management, has announced the largest investment in an English law firm since the implementation of radical reforms permitting external capital injections.
Pogust Goodhead recently made headlines when it secured a £193 million settlement with Volkswagen, addressing claims of British consumers who alleged fraud related to emissions tests.
The firm represented 200 British women in a lawsuit against Bayer, the German pharmaceuticals giant, which centered on injuries allegedly caused by a “sterilization” device, receiving approval from a judge for the case.
Largest Class Action Case
Pogust Goodhead is actively involved in what is touted as the largest class action case of its kind against BHP and Vale, two of the world’s largest mining companies, concerning the Mariana dam disaster in Brazil. The firm is representing over 720,000 alleged victims, with a High Court trial in London scheduled to commence in a year.
Gramercy Funds Management is an investment manager dedicated to emerging markets, with offices in North, Central and South America.
According to their website, they have managed assets on behalf of a diverse and sophisticated global client base that includes pension plans, sovereign wealth funds, endowments & foundations, fund of funds, family offices, and ultra-high net worth individuals for over 25 years.
The company was founded in 1998 by Robert Koenigsberger, who acts as Managing Partner and Chief Investment Officer.
Pogust Goodhead characterized it as “the largest worldwide investment in a law firm and the largest single investment from Gramercy to date.” They said that the capital investment is aimed at “addressing the growing demand from consumers and other victims of injustice to access redress against corporates through group litigation.”
The investment comes some 15 years after the enactment of legislation that permitted solicitors’ firms to accept external investments.
Under the Legal Services Act of 2007, alternative business structures were introduced, allowing non-lawyers to become part of law firm partnerships, along with the acceptance of outside investments. Some firms have chosen to abandon the traditional partnership model and have gone public as legal services companies on the London Stock Exchange.
Robert Koenigsberger, the 58-year-old founder of Gramercy, praised Pogust Goodhead for its “exceptional” litigation track record. He said that the law firm deal aligns with Gramercy’s mission to positively impact clients, portfolio investments, their communities, and team members.
Harris Pogust, the 60-year-old chairman of the law firm, noted Gramercy’s expertise in litigation finance, saying that the partnership would empower Pogust Goodhead to challenge wrongdoers effectively.
Pogust stressed that it is in the “financial interests” of companies and their shareholders to either settle or confront a firm equipped with both financial resources and litigation prowess to secure the justice their clients rightfully deserve.
Pogust Goodhead operates with approximately 270 staff members in London and has additional offices in Edinburgh, Amsterdam, the United States, and Brazil. Tom Goodhead, the 41-year-old chief executive, emphasized that the firm is now “taking on some of the largest companies in the world,” entities that possess seemingly boundless resources for litigation.
He said that this partnership would level the playing field and empower them to engage on an equal footing with formidable adversaries.