Waldrep Wall Babcock & Bailey PLLC Partner Tom Waldrep was recently cited in an article in Bloomberg Law published July 31, 2023, “Litigation Funders See Growing Opportunities in Bankruptcy Boom.”
The article discussed how litigation finance is working its way into corporate bankruptcy proceedings as Chapter 11 cases pile up, enabling more lawsuits and strengthening plaintiffs’ claims against third parties who may have caused or worsened a bankrupt company’s distress.
The article goes on to mention:
“This year, the trustee for a group of bankrupt rural hospitals across the South and Midwest took on a third-party investment to fund claims accusing the hospitals’ former owners and managers of using the companies to perpetuate a fraudulent insurer billing scheme. Trustee Thomas W. Waldrep Jr. in June won approval from a North Carolina bankruptcy court to bring in Omni Bridgeway Ltd. to finance the suit.
Carmel, who helped Waldrep secure the financing, said he thinks bankruptcy practitioners have become more familiar with litigation funding than they were just a few years ago. Although it’s not the right fit for every bankruptcy case, litigation funding allows trustees “to pursue more litigation that they might not have pursued to begin with,” he said.
In many situations, that outside funding “reduces the pressure of taking an early settlement,” said Carmel.”
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