Litigation funding set for EU antitrust litigation – Denver Direct
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BCCE has identified three recently decided EU antitrust cases that it believes are highly suitable for follow-on antitrust litigation: the European Government Bonds Case, the Sovereign, Supra-Sovereign & Agency Bonds Case, and the Foreign Exchange Case. In each of these cases, investment banks participated in a cartel through a group of traders. Cartel behavior between competitors is the most serious form of anti-competitive behavior and carries the highest level of penalties. Fines totaling €1.47 billion ($1.73 billion) were imposed on the investment banks by the European Commission.
Like any investment, lawsuits require an upfront investment in exchange for an uncertain payoff down the road. Lawsuits, in other words, offer the same basic type of structure as stocks, bonds, or options. The distinction, of course, is that lawsuits are generally binary outcomes – the suit either ends favorably or it doesn’t. If the investor’s side of the lawsuit loses, then the money is generally gone completely. In contrast, stocks that decline in value or even bonds from companies that default usually have some sort of pay-out at the end. Lawsuits in that respect share significant similarities to equity options.
BCCE plans to use the capital to hire leading barristers, solicitors, and economic experts to pursue the antitrust damages claims against the banks. Damages are expected to exceed $1 billion.
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