Change has come to the insolvency world
There have been a number of fundamental changes to the way that IP’s must approach formal insolvencies and litigation in the past year:
Changes to the approval and recovery of remuneration SIP 9
Changes to the recovery of ATE and CFA costs at trial
Changes to the right to assign claims in insolvency proceedings.
The sum of these changes provides both a problem and an opportunity for IP’s with respect to how they deal with litigation.
Before these changes IP’s could, on the discovery of a potential cause of action instruct solicitors on a CFA and obtain ATE insurance and then proceed to trial safe in the knowledge that in the worst case that whilst there may be some WIP that would have to be written off there would be no other liabilities. In the best case all costs would be recovered all the IP’s WIP would be paid and the pot of damages would not be reduced by the ATE and CFA uplift.
Now an IP entering into a CFA and ATE agreement will have to pay the uplift costs out of the damages pot. Given that ATE insurance can cost around 30% of the claim value and Legal fees can reach 50% of the claim value in some cases the uplift can effectively destroy any value in the claim. The IP’s own WIP is also subject to estimation and review and percentage of recoveries may well be requested resulting in significant WIP being written of even if the claim is successful.
There is a way out of this dilemma for IP’s. With the growth of litigation funding and assignments this new model can be used to enable IP’s to maximise the value of any litigation for the estate and minimise risks.
Cavendish IP solutions can take assignment of your claim, in doing so we will:
Pay you an amount up front for the assignment putting money into the case.
Pay you, if requested, a percentage of recoveries.
Indemnify you against any adverse costs.
At Cavendish IP Solutions we always look to provide the right solution for your litigation needs looking at all possible options so that we can provide the best package for you.
Want to know more
Please contact Cavendish IP Solutions on 0207 612 7631 or email@example.com or have a look at our website www.cips.uk.com