While litigation funders can directly rock the political and economic boats of entire countries with lawsuits targeting sovereign assets, they also directly impact all consumers through their reliance on insurance from companies like CAC. Image Source: InsuranceJournal

CAC is a specialist insurer, and is reportedly targeting one of the most controversial assets in modern finance: litigation funding. And at a time when the sector may need the extra help more than ever.

The litigation funding industry has been rocked by a series of setbacks. Some specialist funders have struggled badly, while several high-profile cases have ended in company-killing disappointment.

Among the biggest blows was the reversal of Burford Capital's blockbuster case linked to Argentina's state-controlled energy company YPF. A New York appeals court overturned the ruling, wiping out what would have been an $18 billion award and helping send Burford's share price tumbling by roughly half.

Then there is the notorious Sulu arbitration saga. Moore spent six years at Therium between 2015 and 2021, serving as a senior investment officer during a period when the case became one of the most talked-about disputes in global litigation funding.

The arbitration generated headlines with a purported $15 billion award that was later found to have been illegally issued. In 2025, the Paris Court of Appeal ultimately set the award aside. While the dispute exploded into public view in 2019, speculation has long surrounded earlier planning for the case, including allegations that the claimants were selected to construct the litigation itself. Those alleged preparations overlapped with Moore's time at Therium.

“The arbitration generated headlines with a purported $15 billion award that was later found to have been illegally issued.”

The business model of litigation funding is straightforward: funders back lawsuits on a no-win-no-fee basis and take a sizable share of any recovery if the case succeeds. The problem is that major losses and lengthy appeals have left funders short of cash.

That financial pressure may have encouraged some firms to pursue increasingly ambitious claims, betting that the potential rewards would justify the risks. But the YPF and Sulu disputes show the danger of chasing eye-catching payouts. Cases promising enormous returns can also become toxic assets when legal uncertainty and political controversy pile up.

With the prospect of failed claims rising, insurance is stepping into the picture.

The calculation appears simple. Insurers evidently believe that providing cover to litigation funders can still generate profits, even as parts of the funding industry retrench.

And the market is far from disappearing. While big name specialist funders are shrinking or shutting down, larger financial players are moving in. Fortress Investment has assumed control of Therium's caseload, underscoring the shift.

Insurance Journal has also reported that industry insiders have seen hedge funds attending litigation funding conferences and acquiring the portfolios of struggling funders for as low as 10 cents on the dollar. The numbers suggest there is still plenty of business to chase. Insurance Business cited industry estimates placing the UK litigation funding market at approximately £400 million to £650 million in gross written premiums each year. Meanwhile, a European Commission mapping study published in March 2025 identified nearly 300 active funders across the EU, with investments exceeding €3 billion and projected to reach €7 billion by 2032.

“Insiders have seen hedge funds attending litigation funding conferences and acquiring the portfolios of struggling funders for as low as 10 cents on the dollar. The numbers suggest there is still plenty of business to chase.”

The result may be a changing industry rather than a shrinking one. Appetite for the bold, highly visible bets associated with firms such as Therium may have cooled. Instead, the large population of remaining funders appears increasingly focused on smaller, lower-profile disputes—the kind of cases insurers are eager to cover.

For consumers, however, the consequences remain deeply problematic. With cases large or small, litigation funding insurance is ultimately linked to the broader insurance market. As coverage expands across growing numbers of funded claims, the costs can spread through the system, increasing expenses for businesses and, eventually, customers.

Critics point to the United States, where some estimates place the household cost of litigation funding's wider economic effects at $6,000 through higher business costs and reduced competitive pressures.

If that pattern repeats itself, CAC's European expansion—and the arrival of a Therium veteran whose career overlapped with the legally toxic Sulu arbitration era—could signal the start of similar inflationary pressures for consumers across Europe.

REFERENCES

Bloomberg Law. (2025, April 22). Litigation funder Therium conducts layoffs amid upcoming shift. https://news.bloomberglaw.com

Burford Capital. (2026, March 30). Burford Capital further statement on YPF appeal decision. https://investors.burfordcapital.com

Business Wire. (2026, June 3). Rocade Capital accelerates market leadership in legal finance with strategic acquisition of Law Finance Group. https://www.businesswire.com

Dickerson, C. (2026, January 21). Report: Third-party litigation funding affects affordability. Florida Justice Reform Institute. https://www.fljustice.org

Hyde, J. (2025, April 23). Jobs lost as high-profile lit funder restructures. The Law Gazette. https://www.lawgazette.co.uk/

KnowSulu. (2025, November 12). Sulu claimants’ desperate $18 billion claim against Spain thrown out. https://know-sulu.ph

Legal Funding Journal. (2025, June 11). Therium taps Fortress to manage caseload amid restructuring. https://legalfundingjournal.com

Recamara, J. (2026, May 13). Insurers warn legal system abuse is adding to US cost-of-living squeeze. Insurance Business America. https://www.insurancebusinessmag.com

Rosanes, M. (2026, June 10). CAC enters UK litigation insurance market with London appointment. Insurance Business UK. https://www.insurancebusinessmag.com

Shaw, W., Clark, E., & Naik, G. (2026, May 11). Hedge funds make their move as litigation finance assets slump. Insurance Journal. https://www.insurancejournal.com

The Lawyer. (2025, June 10). Therium hands off case portfolio to Fortress in major shift. The Lawyer. https://www.thelawyer.com

Therium. (n.d.). Therium Capital Advisors. Therium. https://www.therium.com

Therium. (2025, October 6). Therium Capital Advisors launched to provide litigation finance advisory services. Therium (News, Insights & Events). https://www.therium.com

U.S. Chamber of Commerce Institute for Legal Reform. (2022, November). ILR Briefly: A new threat: The national security risk of third-party litigation funding. Retrieved from https://instituteforlegalreform.com