Hello, some boring stuff out of the way. This is not legal, tax, accounting, or investment advice by any means whatsoever, and please speak to a licensed professional in your jurisdiction. Next to any pictures, mentioning of Tesla and Cybertruck are fully the property and trademarks of Tesla Inc.

I believe 2022, Tesla has to fully focus on the Cybertruck and it has to do with something really really boring and we all do not like a lot, Taxes! Section 179, check out www.section179.org for more information. So let's assume the Cybertruck is over 6,000 pounds (this is an assumption do not have weights yet) a business even a small business can write off the full purchase of the Cybertruck. So if we take the Tri-Motor Cybertruck(I am using the Tri-Motor as I believe this will be the heaviest version) and with FSD is roughly at $80,000.00. So that the price of $80,000.00 could be written off/deducted and saving the buyer of $16,800.00 at the 21% tax bracket. This does not include any EV tax credit. Now before you say Heck Yes, speak to your CPA and or financial advisor. The vehicle would need to be in the name of the business also.

Next, the full $80,000.00 can be written off via section 179 for 100% if used for 100% of the time for business. Now if this Cybertruck is the only vehicle you will need to track and see is it 60/40 split or whatever. So if the Cybertruck is only used 60% of the time for business then can deduct 60% of the value. So section 179 is supposed to end at the end of 2022. Section 179 had a nickname in the back of the day as the Hummer rule. As a lot of business owners would by Hummers and expense them off via 179. So it is very unique a gas-guzzling car and yes I know the new Hummer will be Electric will help usher new technology and lower carbon emissions. It is truly the Circle of Life.

So 2022, Tesla has to move as many Cybertrucks as possible as Section 179 will be a great tool for it to even sell more Cybertrucks and customers wanting their CyberTrucks. If Tesla is able to focus on the CyberTruck which rumor has there are over 1.1 Million plus reservations will be able to move a lot of vehicles as the demand is there and the possibility of cancellations. I believe if more and more companies have a large of profits and need a vehicle, Tesla could even sell more Cybertrucks. I believe this could push the Tesla stock to $884.12 by the end of 2022. A 32.21% increase over 18 months. Should the Delta variant of Covid 19 This estimation would need to be revised.

If Tesla is able to sell at least 300,000 Cyber Trucks in 2022 that will increase sales and profits and drive earnings to the bottom and increase the stock price which could have a major positive movement for the stock price. I believe this could push the Tesla stock to $884.12 by the end of 2022. Excluding any income from FSD and or insurance. I am budgeting should there any substantial income from FSD or insurance that those will go either for scaling and assisting with R&D.

So in recap Section 179 can be a major driver for volume purchasing in 2021 and 2022. Would love to hear your comments and questions below. All the best.

Currently, their is supposedly over 1.1 Million Cybertruck orders. It currently costs $100 to hold a reservation and estimating that a reservation holder would get their vehicle delivery 3.5 years from reservation and a possible FSD price increase of $500. That would mean you made a little over 46.8% compounded return on a $100 holder. Looking at the history of FSD it is possible but no guarantee FSD will go up. I personally believe their could be 1 more time increase on FSD and then it goes to just a monthly recurring fee for all drivers.

May the Plaid be with You!

Longford Capital has hired John Garda, most recently the managing partner of K&L Gates’ Dallas office, as a managing director.

While Big Law partners have been joining litigation finance firms for years, Longford said Garda would be the first hire of a Big Law partner in Dallas by a major funding firm. Large litigation funders that do not list employees in Dallas include Burford Capital, the largest funder by assets under management, as well as Validity Finance, Bentham, Parabellum Capital, and Lake Whillans Capital.

Longford’s William Farrell Jr. said the company was attracted to Dallas as a slew of major law firms, including Winston & Strawn, Dorsey & Whitney, and Katten Muchin Rosenman, who have opened offices in the city in the past two years. More broadly, Texas has been one of the most desirable states among 100 law firms in recent years to launch offices or expand.

“The Dallas legal market and the Texas legal market is really thriving,” said Farrell, managing director and general counsel at Longford. “Lots of domestic and non-U.S. companies are establishing a presence in Dallas. Some are setting up global corporate headquarters in Dallas.

In an interview about his decision to join the company, Garda said he has represented Longford in corporate matters since the funder’s inception. While he has likely been privy to inside information about the financial health of Longford, Garda declined to comment when asked if his new job would come with a pay raise. K&L Gates last year recorded average profits per equity partner of $990,000, according to preliminary data from The American Lawyer.

“I’ve been able to understand the industry through representing Longford, and I am a believer in the industry,” Garda said. “It is growing. You could see the product demand continuing to increase. It started with smaller companies in need of capital, but it has grown significantly to law firms needing the offering or wanting the offering to balance out cash flow.”

Longford in 2017 raised a $500 million litigation finance fund. The company said in August that it had spent about two-thirds of that fund when it announced a $67 million portfolio funding agreement with an unknown law firm.

Topics: Litigation Finance

Work cited: Law.com, April 21, 2019

Innovative Risk Transfer Arrangements
Funding arrangements for defendants involve cases where the defendant does not want to bear the upfront costs of litigation but will pay out-of-pocket, a share of the perceived value of a successful defense, upon dismissal of the claim. Increasingly, defendants not only want the litigation-related expenses funded, but also the risk of an adverse decision transferred. For this, the market is evolving instruments that provide insurance and other arrangements (like “After the Event (ATE) Insurance”) that transfer the risk of a dispute for an upfront price paid by the party.

Increasing legislative sanction for Third-Party Funding
Beginning with Australia, many countries are moving away from the outdated common law concepts of champerty, barratry, and maintenance, and have legalized third-party funding. Most recently, Singapore introduced the amended Civil Law Act and the Civil Law (Third-Party Funding) Regulations, 2017 making third party funding in international arbitration and related proceedings legal. On the same lines, Hong Kong enacted and amended its legislative framework to enable third-party funding in arbitration and mediation.

Artificial Intelligence Driving Investment Decisions
Artificial Intelligence enabled algorithms are increasingly being used to determine the outcome of disputes, and to analyze and price the risk in funding a case. For instance, Legalist, a tech third party funding company, uses an algorithm that determines the chances of winning the case using its database of 10 million court cases before investing.

Portfolio Funding and other evolving structures
In Portfolio Funding, several claims brought by a single claimant against the same or different defendants are funded. This helps the claimant get more favorable terms since the funder’s investment and return is spread across the claims, minimizing exposure to a single claim.
Funders are also being approached for transactions like early payment to creditors of an insolvent company who would otherwise have to wait for the conclusion of a claim before being paid, accelerating the proceeds of a settlement, and even funding the costs of business, which might be dependent on a successful claim.

Topics: Litigation Finance, Artificial Intelligence, Finance Market, Legal Development
Work cited: http://www.cyrilshroff.com/wp-content/uploads/2019/06/Third-Party-Funding-in-India.pdf

There are two theories to this phenomenon, one says that litigation finance is not loans, as it does not come with the interest or with the liability to repay. Another theory says that this is a loan, which borrowers have to repay/payback once they successfully won the case. Litigation funding, also known as legal financing and third-party litigation funding enables a party to litigate or arbitrate without having to pay for it, whether because they are unable to pay for it or because they do not want to.

When it comes to any litigation, only certain thing is that the outcome is uncertain because nothing matters how good is the petition still the decision lies in the hands of judge, jury, and evidence. This is why claim holders and lawyers frequently share litigation risk with litigation funders, and it is why courts have held that usury laws do not prohibit litigation finance agreements. Usury laws apply only to loans, which have an absolute requirement that the borrower repay. Litigation funders are repaid only if the plaintiff wins.

In June 2020, In New York, USA federal appeal is filed to decide whether a unique type of litigation funding transaction violates New York’s usury laws. New York courts have the opportunity to recognize help cash-poor litigants access the courts and make litigation finance as risk-free for the petitioner because for financer this will always remain risky funding. This dispute comes in light in the recent cases of Fast Trak Investment Company v. Sax involves a dispute over whether Fast Trak’s funding agreement with attorney Richard Sax and his clients violates New York’s usury laws. Fast Trak provided funding backed by contingent case proceeds payable to both Sax and his clients, across a portfolio of at least 18 cases. When Sax failed to pay Fast Trak after obtaining recoveries in several cases, Fast Trak sued Sax.
In the year 2019, scholar J.B. Heaton wrote a law review article contending that litigation finance is unlikely to be profitable for most investors because litigation is simply too uncertain. “Litigation is far more complex and random than most investors understand,” Heaton argued. Courts should hesitate to declare nonrecourse litigation finance a risk-free endeavour.
In the end, the decision of the court would affect the claim holders. Claimholders and their lawyers should hope the New York Court of Appeals gets it right: litigation finance investments are not loans subject to usury laws.
Topics: Third-Party Litigation Funding, New York Court, Investment
Work Cited:
Wendie Childress and William C. Marra, Litigation finance is not risk-free loans, June 15, 2020

One of the very early entrants into litigation finance in Germany was Allianz, a large German insurance company with over $100 billion in gross written premiums. It stands to reason that an insurance company would be an early mover in the marketplace as there is no entity better placed than an insurance company to have a significant depth of data about case outcomes upon which they can analyze risk and reward.
In 2012, an article was written by Christian Stuerwald of Calunius Capital LLP which aptly described the reasons for their exit:
“The business grew, quickly became profitable and expanded into other jurisdictions, mainly Switzerland, Austria and the UK, with time and growing market penetration and acceptance the cases became bigger; as claim values grew, so did the size of the defendants, that meant that more and more often cases would be directed against large corporate entities. This is really where the problems began, because most corporate entities, certainly the ones that are domiciled in Germany, are customers of Allianz, typically of course in the insurance sector.
“Because of the nature and sheer size of the organisation it was not always easy to detect potential business embarrassment risks in time, as the checks needed to be done on a global basis. This led to some instances where a litigation funding agreement was entered into when it was discovered that the case was directed against a long-standing corporate client, who declared himself not amused when the fact of funding was disclosed.”
“it was decided to keep the business and place it into run off,”.

The same phenomenon applies to hedge funds that have many similar relationship conflicts. Hedge fund conflict checks have presented significant issues for certain funders who have spent time analyzing cases only to find out at the last minute that the case presents a conflict for their main investor, with many of these investors having veto rights to avoid this very situation. For funders, this is a bit of a double whammy, as not only are they prevented from making a good investment, but they also suffer reputationally with the law firm that brought them the case, which may have longer term implications for origination.
I further believe that the investors who invest in hedge funds should not be concerned with the specific contents of the hedge funds’ litigation finance portfolio. Rather, they should take the enlightened perspective of their investment as a financial hedge against any other pieces of litigation in which they otherwise find themselves.
Topics: Litigation Finance, Hedge Funds, Conflict of Interests, Market Risk
Work cited: Ed Truant, Slingshot Capital, June 10, 2020

The COVID-19 pandemic has created an economic fallout in its wake. It is estimated that state budget shortfalls stemming from the pandemic’s financial impact will total $615 billion over the 2020, 2021, and 2022 fiscal years. Now, more than ever, insurance-related cases are rapidly rising. Policyholders and insurers alike are contemplating how they will proceed with claims. In their time of need, litigation financing may be the solution that maximizes recoveries in extensive cases.

Benefiting Policyholders

Policyholders wishing to recover claims may benefit from the assistance of litigation finance. In these scenarios, claimants are often denied coverage following a catastrophic event that they believe is within the scope of the policy. While amid a pandemic, financial strains have placed policyholders in a particularly precarious situation. This leaves the claimant ill-equipped to proceed with litigation against the insurer for refusal of coverage. Without additional litigation, policyholders are forced to forego their claims or to settle for mere crumbs. These claimants are not financially equipped to litigate a case to its fullest potential.

Litigation financers want to fund meritorious coverage claims, particularly instances where the policyholder has incurred or paid substantial costs for property damage losses. The additional funding can help the claimant face the stresses of lengthy litigation. If the policyholder chooses, they may choose to negotiate alternative fee arrangements that allow them to mitigate their own risk. Instead of being forced to settle for less or spend a lot on a lengthy litigation process, with the help of top-notch counsel, policyholders may decide to resolve for the appropriate amount.

Aiding Insurers

Subrogation cases have a rep for being lengthy and costly, with no complete assurance of victory. While there is a prospect for recovery, firms still undertake a high level of risk whenever engaging in subrogation. Separately, disputes frequently occur between reinsurers, regarding which party is liable for payment and the amount of compensation. Like subrogation cases, reinsurance battles can be extensive and expensive.

By utilizing third-party funding, both firms pursuing subrogation and insurers can benefit. Firms no longer bear the full weight of the risks of holding contingency fees. As a result, they are able to recognize revenues immediately, while still receiving a share of the future recovery. Additionally, insurance companies can obtain relief from claims they may have passed along, for lack of resources. Insurers can maximize their profits from reinsurance claims.

In the business of sharing risk, litigation finance may be the perfect solution for you. For more information visit Town Center Partners.

Topics: litigation finance, third-party funding, legal funding, insurance, policyholder, insurer, COVID-19, pandemic

The parent company of listed City firm Rosenblatt Limited has created a litigation funding business to cater for the expected surge in cases following the coronavirus crisis.
LionFish Litigation Finance, a subsidiary of RBG Holdings, will fund complex high-value cases for law firms, individuals, insolvency practitioners, and corporates, across a variety of sectors. Rosenblatt, which specializes in dispute resolution, will provide assessment and advisory services to the funder on litigation risks.
RGB Holdings said the nascent business will be well placed to take advantage of the expected increase in litigation cases on the back of the current economic turmoil and the increased demand for affordable financing and de-risking strategies.
The funder will be led by managing director Tets Ishikawa, who has joined from insurance company Acasta Europe Ltd.
Nicola Foulston, chief executive of RBG Holdings plc, said: ‘Financing legal cases are not new to the legal industry, however, LionFish’s key differentiators are our ability to swiftly manage high-risk complex matters and, where required, restructure them for the United Kingdom market.’
Earlier this week, international firm Fieldfisher challenged third-party funders with a ‘more competitive’ insurance policy for damages-based agreements. Having introduced a litigation funding service for commercial claims last year, the firm has devised a DBA insurance policy that will guarantee a proportion of the firm’s unbilled work in progress and disbursements at the end of the case.

Topics: Rosenblatt Limited | LionFish Litigation Finance | United Kingdom
Work Cited: Jemma Slingo | The Law Gazette | May 01, 2020
https://www.lawgazette.co.uk/news/rosenblatt-parent-group-sets-up-litigation-funder/5104120.article

Over the past decade, bankruptcy filings have dropped. To put it into perspective, there were nearly 61,000 bankruptcy filings in 2009 compared to a little over 22,000 in 2019. This trend is about to make 180, as many confront the crushing effects of the COVID-19 pandemic. In preparation for the impending filings, law firms are in full demand for bankruptcy attorneys. Third-party funding may offer a creative and viable solution for restructuring attorneys and advisors to consider throughout the bankruptcy process.

Think Beyond the Box

While some may have previously preferred more traditional financing sources, the present climate limits the number of conventional means of funding. Without sufficient funds, a claim holder’s capacity to adequately litigate claims is limited. A claim holder will almost inevitably settle for less than their claim’s worth to avoid an unpredictable court battle against a more financially able defendant. Litigation finance offers a solution. Through third-party financing, claimants are given with the resources and flexibility needed to litigate claims in their entirety. Where traditional funding options might fall short, litigation finance can fill in the gaps.

Pull From the Toolbox

Litigation funding provides claimants with a hefty toolbox.
Non-recourse. The claimant can litigate without using their own funds or placing additional assets in jeopardy. In contrast, other financing alternatives require payments throughout the processor, and sometimes after the litigation has concluded, whether or not the case offered a recovery.
Dream team counsel. The additional capital grants the claimant the tools needed to go after the ideal counsel of its choice, instead of settling for a counsel it can just afford.
De-risk risky business. Third-party funding minimizes risks in a time when claim holders cannot afford to lose. Litigation finance takes on the role of sharing and therefore diffusing the risk that claimants take on.

Future

With the aid of litigation finance, a new set of financing options is opened up to debtors. Claimants are equipped with the resources necessary to help them in their time of need.

For more information visit Town Center Partners.

Topics: Litigation finance, third-party funding, legal funding, jurisdictions

The past decade has seen the rise of litigation finance in the United States. Despite its relative infancy, the complex industry is here to stay. As we continue through this next decade, there is a glaring issue that must be addressed within the sector: transparency. There is a disconnect of information, opinions, and impressions regarding nearly every aspect of the litigation finance industry, from market size to ethical concerns. How these disparities are confronted will inevitably shape the sector for the years to come.

Disclosure Rules

Arguably one of the most controversial aspects of third-party financing is whether it should be disclosed during discovery. At the moment, disclosure is not required for litigation funding agreements. Certain pieces of information, such as documents and materials a party expects to utilize, must be initially disclosed, per Rule 26 of the Federal Rules of Civil Procedures. Currently, Rule 26 does not extend to litigation financing agreements. However, it should be noted that some states have passed or are considering adopting mandatory disclosure for litigation funding agreements.

While the federal rule does not require disclosure, when surveyed, 41% of lawyers were “not sure” of how often funding must be disclosed in court. Contrastingly, nearly half of funders maintained that courts rarely compelled disclosure in court. There is a chasm in industry understanding. Moving forward, the disconnect of misinformation must be bridged

Concerns

When surveyed about their concerns regarding litigation finance, the most significant worries that lawyers expressed were:
Ethical implications
Client privilege
Disclosing the financing in court

In contrast, when litigation funders were asked what their clients’ greatest worries were, funders explained that their clients were mainly concerned about:
Understanding how litigation finance works
Disclosing the financing in court

While there are some disparities between lawyers’ thoughts and feelings and what funders believe are lawyers’ biggest concerns, the continued conversation will ensure everyone is on the same page.

For more information visit Town Center Partners.

Topics: litigation finance, third-party funding, legal funding, disclosure, funder, lawyer

Wariness in the Market

The industry has also been weathering scrutiny over its accounting methods. In particular, Burford Capital, one of only two major industry players that are publicly traded, faced a backlash in August after a short seller report questioned its accounting practices and claimed that the firm misled investors about its realized gains, as Bloomberg News reported. Burford saw its stock price plunge by more than half in one day, according to Bloomberg Terminal data, and the company is now facing a shareholder class action lawsuit. Other litigation finance firms have since sought to differentiate their accounting practices from Burford’s
Shortly after Burford’s stock dip, major industry player Vannin Capital was acquired by investment firm Fortress Investment Group. Bloomberg Law Litigation Finance Survey results indicated that litigation funders believe that a top obstacle to funding is that their potential clients do not understand how funding works. These signals of investor wariness and market confusion foretell that more IPOs in this industry are not expected in 2020.

- Room for Growth

Despite current industry scrutiny, Bloomberg Law survey results indicate that interest in obtaining funding outpaces current levels of funding that is, interest in litigation funding is high and there is room for growth, as evidenced by IMF Bentham’s recently announced merger with Omni Bridgeway. Kirkland & Ellis’s launch of a plaintiff-side contingency fee litigation practice is further evidence of law firms’ interest in new ways to increase capital. Additionally, while General Counsels and in-house legal departments are looking for ways to cut costs and increase efficiency, they rarely initiate litigation funding requests suggesting space for growth in the corporations-as-clients space.
With a potential economic downturn looming and budgets constrained, litigation funding presents an opportunity that law firms and their clients may not be able to turn down. Still, the industry can expect continued scrutiny in 2020, in the form of court-ordered disclosures, state disclosure laws, and investor wariness. Shedding more light on this opaque industry will be critical to making litigation funding ubiquitous.
Topics: Burford Capital | Vannin Capital | IMF Bentham | Kirkland & Ellis
Work Cited: Bloomberg Law | Transparency Wanted in Litigation Finance | November 04, 2019
https://news.bloomberglaw.com/bloomberg-law-analysis/analysis-transparency-wanted-in-litigation-finance?context=article-related