Ryan Mee, CEO of Fulcrum Metals, reviews FY23 and progress on the Gold Tailings Hub in Canada. Watch the video here.
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An aside, but it is also worth noting that live cases have increased by over 10% from year end results - (from 351- 390 to the end of June)
Forensic I don’t think that is all that relevant, since only ~5% of Manos cases are funded.
Oldbutnowisa - I was wondering the same thing, but wanted to check myself in case it was just rose-tinted glasses. But yes, it would seem that if some portion of the industry is in turmoil after this ruling, it can only benefit operators who are less affected. It sounds like both Mano and LIT are in this category.
Isn't it the case that the 50% limit for civil litigation is for the total of all "legal fees" (including VAT) and "funding costs"? The IP gets to keep 50% of the Gross under all circumstances. LIT's RNS is worth a read as they seem to be 100% in the clear.
I agree oldbutwisa.
A subtle but important point from this whole PACCAR thing is: pricing. MANO have always said (including in their most recent annual results presentation) that they split the net recovery on any funded cases 50%/50% with the creditors. That now becomes very important because DBAs have to be at a maximum 50% of the gross recovery to the Funder. The fact that MANO is 50% of the NET means its share is always below 50% of the gross (the difference being the costs of the case). So that positions its funding proposition very well. We have seen their returns over many years, and it clearly works for MANO very well. No need to be greedy (and maybe that is what the Supreme Court ruling was really all about? If that is right, I think its sensible. Funders arent regulated so some control on them to ensure they arent exploiting desperate claimants makes good sense).
I have never seen a standard split disclosed by other Funders but they are now going to have to get used to effectively capping their model at 50%. That may be an issue for them, it may not, but it is a new hurdle that MANO self imposed from the outset.
,,,,,if Mano is possibly barely adversely affected (as the co believes) it is quite possible that the opposition may be much more affected by this decision. They have been for the most part longer established. I would certainly not mind if MANO
wnt up the pecking order!
"Over 95% of Manolete's successfully completed cases are completed by way of a consensual settlement agreement with the defendant (often an individual previous company director). Very few end at a trial. The Board considers that the prospect of any party seeking to re-open a previously completed Funded Case as highly remote."
FoMo, isn't this pretty much saying that they think this is OK? (With the caveat that they're still looking into it and may update further)?
Took a small top-up now. At £1.94 seem a bargain now this is out o the way.
"Of the 23 (out of a total of 390 live cases) that are Funded cases, Manolete is working with specialist counsel to determine any amendments that may be required to the terms of Manolete's standard funding agreement."
BUT see Linklaters note from link below about past expenses rather than going forward. Perhaps we will have firmer numbers at the AGM
Well I had a few quid from divi payments lying around and thought I would put it in now there is clarification. Hope it goes over £2.60 where my averages are lying.
Few Directors buying in at this price would help speed things up.
Oh lol RNS came out while I was writing that. Guess it's less speculation now!
It's all speculation at this point. Manolete seem to be pretty sharp, and I'm sure they've had good advice and were aware of the possibility of this decision, but that doesn't mean their contracts are bulletproof.
As for clawback and/or future payments at risk - I'm absolutely not an expert, but at this point it seems like the best case scenario is that people will at least _try_ to get some of their money back. Even if they are unsuccessful (or only partially successful) it will be a big distraction for Manolete, lots of legal fees, etc.
A potential silver lining: if this causes turmoil in the funded litigation segment of the industry, could that drive claimants towards Manolete's established purchasing model?
Is that model at risk too??
FoMo - The co would have had all their contract documents drafted by specialiist barristers who should have also advised them of risks. Needless to say, they are not gods ( although many of them would take issue with that!) And of course, their advice would have been long before the Paccor decision in the Supreme Court. I was going to average down again yesterday because the entire industry is affected. Then I took the view that in this case discretion is the best policy.
Is there a possibility that the future payments are at risk? Might the payee be able to run an argument about illegaility?
There must be a risk that the extended payment terms might be unenforceable if the Payee argues to re-open the case.
There must also be a risk that liquidators with personal liability will have to seek to claw back if their Statutory Bond insurer kicks off, and/or creditors start to ask for more - nb dissolved companies can always be reinstated and perhaps some entrepreneur will be thinking about seeking to buy up unpaid creditor claims and go for the IPs and their insurers and funders.
Very grateful , United. Yes, it will make a difference to MANO since they have always bought out their clients' claims wherever possible. But the uncertainty will not do their quote any favours for some time. They should now clarify their position in an RNS quickly.
Https://www.linklaters.com/en/insights/blogs/linkingcollectiveredress/2023/july/paccar-and-litigation-funding#:~:text=On%2026%20July%202023%2C%20the,amount%20of%20damages%20recovered%20are
What rumour? Are you saying the supreme court ruling is a rumour?
The fall in price makes 100% sense given the large dose of uncertainty this adds to Manoletes future.
....RNS urgently needed. Sounds to me like potential bidder is rather successfully putting out a rumour so it can get MANO on the cheap!
Right, unless it turns out they have to hand back £5m from the whopper of a funded case last year (plus however much from the last 6 years).
My understanding is this has no impact on Mano given nearly 100% (c.96%) of their cases are owned, NOT funded.
If I had the cash I'd top up but I don't!
OK interesting, thanks FOMO. I expect we'll get an update soon.
I think the decision is that such arrangements have always been unenforceable (subject to contract wordings) and if that is the case then I suspect the 6 year rule kicks in and Creditors can compel liquidators to act.
I do think the Directors should put out a clarification and "best impact estimate" statement
Cartel cases are all purchased
Wait, I think I misread the articles. I don't see anything about funders having to pay back any revenues they made on cases settled before this decision. The articles all say that for cases that are still ongoing but have already had work done, there may be significant writedowns on that work. But again, MANO has relatively a few such cases.
I think the funded whale settled just in time!
Obviously not good, but may not be too catastrophic.
According to their report, 96% of their new cases last FY were purchased, not funded. So the fundamental business model shouldn't be too badly affected.
But in 2023 a whale of a funded case settled, accounting for £4.9m in realised revenue. I have no idea what kind of "clawback" will be possible here, but all the articles state that this is a definite concern. Presumably MANO is trying to figure out their exposure here before they update the market.
Does anyone know whether the cartel cases are funded? Seems like this supreme court case was based on the cartel cases, so I assume they are.