The inaugural Litigation Finance Conference Asia 2026, hosted by Siltstone Capital, will take place at the glamorous Marina Bay Sands. Image Source: Marina Bay Sands

Though it will be held at the iconic Marina Bay Sands, the pomp and fare cannot disguise that the event comes at a time when the sector faces fundamental questions around oversight, accountability, and transnational disruption—particularly in Southeast Asia. Indeed, while capital continues to flow into disputes across the region, the industry’s recent track record suggests that growth is not necessarily a measure of stability.

Few cases illustrate these tensions more starkly than the Sulu arbitration. The dispute, financed by litigation funder Therium, has increasingly come to be seen not merely as controversial, but as a stress test for the limits of modern litigation finance. Rooted in an 1878 agreement over Sabah, the claim might once have remained a marginal historical grievance but for the events of 2013, when an armed incursion into Lahad Datu by individuals linked to the self-proclaimed Sultanate of Sulu triggered a violent standoff with Malaysian forces. In the aftermath, Malaysia halted the long-standing annual payments tied to the agreement—transforming what had been a largely symbolic arrangement into the basis for an expansive and highly monetized legal claim.

What followed was an ambitious arbitration pursued through European forums, culminating in a multibillion-dollar award that far exceeded the scale of the original payments. Critics have pointed to the case as an example of legal opportunism, where a tenuous historical arrangement was leveraged into a modern investment vehicle, raising difficult questions about proportionality and legitimacy. The proceedings themselves were marked by jurisdictional controversy and procedural irregularities, with European courts later intervening to suspend or question the validity of the award—further undermining confidence in the claim’s legal foundation.

“Critics have pointed to the case as an example of legal opportunism, where a tenuous historical arrangement was leveraged into a modern investment vehicle.”

The profile of the lead claimant, Fuad Kiram, also quickly became a point of serious concern. Malaysia has designated the individual as a terrorist, citing alleged links to militant groups in the Philippines—raising uncomfortable questions about whether existing due diligence frameworks within litigation finance are capable of identifying and managing politically sensitive or high-risk actors.

That Sulu arbitration ultimately met its limits. On December 9, 2025, a court in Paris definitively rejected enforcement of the award, delivering a decisive repudiation of the claimants’ efforts in one of the final major jurisdictions available to them. The ruling underscored a central risk in litigation finance: that even the most substantial arbitral awards may prove effectively worthless when subjected to sustained legal scrutiny across borders.

“Malaysia has designated Fuad Kiram as a terrorist, citing alleged links to militant groups in the Philippines.”

What’s on the Agenda?

Against this backdrop, the themes outlined in LITFINCON Asia 2026’s agenda read less as forward-looking ambition and more as a response to exposed vulnerabilities. Indeed, it’s hard to imagine that the Sulu arbitration could avoid taking center stage, with sessions focused on enforcing and monetizing arbitral awards in “sovereign and investor-state disputes” echoing, in unsettling ways, the trajectory of the Sulu arbitration.

It’s perhaps concerning that there might be what amounts to a “brainstorming” session on targeting sovereign entities. After all, the Sulu demonstrates how such strategies can escalate disputes beyond their original scope, introducing legal and political risks that extend well beyond the parties themselves.

Mention of enforcement risks and strategies to realize awards also call to mind the conduct of the Sulu claimants. Specifically, the Sulu legal strategy sought to move enforcement attempts rapidly across multiple jurisdictions, at times advancing faster than courts could respond, highlighting how fragmented legal systems can be leveraged in pursuit of favorable outcomes. The arbitrator overseeing the dispute, Gonzalo Stampa, was later convicted in Spain for contempt of court when he facilitated this strategy by shifting the forum of the arbitration in defiance of a judicial suspension order.

“Against this backdrop, the themes outlined in LITFINCON Asia 2026’s agenda read less as forward-looking ambition and more as a response to exposed vulnerabilities.”

The Sulu claimants, along with their legal advisers and litigation funder Therium, continue to face significant legal consequences. In Jersey in the Channel Islands—reportedly used as a financial hub to structure transactions beyond closer regulatory scrutiny, they now face allegations of “unlawful means conspiracy.”

Other discussion items at LITFINCON Asia 2026 on regulatory developments and insurance as risk mitigation tools further underscores the extent to which the litigation finance industry remains only partially regulated. In many jurisdictions, litigation finance continues to operate within a patchwork of oversight, with limited external scrutiny of how cases are selected and funded. The Sulu arbitration, in this context, does not appear as an anomaly, but as a case that exposed how those gaps can be tested.

Taken together, the agenda points to a sector attempting to reconcile rapid expansion with unresolved structural risks. The Sulu arbitration serves as a cautionary example of what can happen when aggressive legal strategy, complex jurisdictional dynamics, and insufficient oversight converge. It highlights not only the fragility of enforcement, but also the reputational and legal risks that can accompany poorly scrutinized claims.

As the industry gathers for its first regional conference, the case is likely to be an unavoidable reference point. Its legacy is not one of innovation or success, but of exposure—revealing gaps in due diligence, enforcement, and regulatory oversight that have yet to be fully addressed.

For a sector still confronting these unresolved challenges, the conditions for celebration appear, at best, premature.

REFERENCES

KnowSulu. (2025, July 4). What comes after the July 7 Sabah arbitration ruling? https://knowsulu.ph

KnowSulu. (2025, October 17). Spain’s top court upholds criminal conviction of arbitrator in Sulu case against Malaysia. https://knowsulu.ph

LitFinCon Asia. (n.d.). Agenda. Retrieved March 20, 2026, from https://www.litfinconasia.com

Majangkim, R. (2026, February 28). Sabah: A sovereign choice the world witnessed. Jesselton Times. https://jesseltontimes.com

Morcillo, N. (2025, November 3). Malaysia arms itself with confidential banking information to sue the arbitrator in the Sultan of Sulu case and the heirs’ lawyers. El País. https://elpais.com

Zarzalejos, Á. (2025, October 21). Caso del Sultán de Joló: La nueva guerra judicial millonaria que esconde la condena penal a Stampa. El Confidencial. https://www.elconfidencial.com