Litigation finance securitization structures the funding of legal claims as a security. The funding arrangement is held in a compartment of a Luxembourg SPV that Luxembourg law ring-fences, and a note with its own ISIN is issued from it. Proceeds from the note cover litigation costs, and the note is linked to the outcome of the identified claims.
Litigation funding is normally a private contract between a funder and a claimant, which makes it hard to place with investors who need a security. MTCM opens one of the compartments of its six Luxembourg SPVs for that arrangement, ring-fenced from the rest, and a note bearing its own ISIN is issued from it. The compartment can hold a single claim or a defined set of claims, and can be structured at any stage of the proceedings. It takes its form from the Luxembourg Securitization Law of 22 March 2004: bankruptcy remote in both directions, with the exposure leaving the funder’s balance sheet. GSK Stockmann is legal counsel to the platform. Its auditors are PwC and Atwell, a Luxembourg audit firm.
Held in custody, transferred or listed like any other security.
Segregated by law from every other transaction on the platform.
Protection runs in both directions.
The exposure leaves the originator’s balance sheet.
One identified claim, funded through its own compartment.
A defined set of claims held together, so no single outcome determines the compartment.
Commercial and investment treaty arbitration, domestic or international.
Funding the enforcement of an award or judgment already obtained.
Claims brought by administrators, liquidators or creditors’ committees.
Follow-on damages claims arising from a regulatory finding.
Patent, trademark and licensing disputes with quantifiable damages.
Facilities secured on a firm’s portfolio of contingent-fee matters.
Funding introduced after a first-instance decision, for the appeal only.
The compartment structures exposure to a costs order made against the funded party.
Litigation finance securitization structures the funding of legal claims as a security. A ring-fenced compartment of a Luxembourg SPV takes the funding arrangement, and issues a note with an ISIN of its own. Proceeds cover litigation costs and the note is linked to the outcome of identified claims.
Court and tribunal fees, counsel, expert witnesses, valuers, auditors, disclosure and document review, and enforcement costs. The budget is agreed when the compartment is structured, and drawdowns are made against it as the case progresses.
At any stage. Before filing, during first-instance proceedings, at the appeal stage, or once an award or judgment exists and the requirement is enforcement. The stage affects how the compartment is structured, not whether it can be.
Yes. A defined set of claims can be held in a single compartment, so that the compartment does not depend on any one outcome. The claims are identified when the compartment is structured; it is not an open mandate to acquire claims later.
No. MTCM is a securitization boutique, not a law firm or an adviser. Merits are assessed by legal experts appointed for that purpose, and their assessment is on file before the compartment is structured. MTCM designs and administers the vehicle.
Litigation funders that need to place exposure with investors who require a security, law firms structuring facilities over a portfolio of contingent-fee matters, and family offices and wealth managers seeking exposure uncorrelated with market cycles.
| Structure | What the note is linked to | Where it is used |
|---|---|---|
| Outcome-linked | A defined share of what the compartment recovers | Single claims and portfolios where recovery is the point |
| Fixed-term | A defined payment schedule, independent of the case timetable | Where the funder retains the outcome exposure |
| Hybrid | A base payment plus a share of recoveries above a threshold | Longer cases where the timetable is uncertain |
Each structure describes how the note is calculated, not what it will pay. Outcomes in litigation are not known in advance.
80+ active compartments · €2.5 bn+ assets structured. Indicative platform figures.