Editor’s note: If these guys had guts, they would take on the the unethical, corrupt and illegal minions of the Probate Court of Cook County. Just with the profit created from illegal jurisdiction suits in Wyman, Sykes, Gore and Tyler...unbelievable. Lucius Verenus, Schoolmaster, ProbateSharks.com
Chicago company seeks to profit from lawsuits
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Four lawyers, including two former hedge fund executives, formed a Chicago-based company to invest in lawsuits, a fast-growing and sometimes criticized industry known as litigation finance.
Gerchen Keller Capital LLC said it raised more than $100 million and closed its first deal on April 2. It didn't disclose the size of the transaction or the target but said its investments would average about $5 million.
Litigation finance — where investors take stakes in potential judgments or settlements — is a way of betting on lawsuit outcomes while helping plaintiffs fund costly court actions. The practice, common among the contingency-based personal injury bar, is spreading on the commercial side.
Wall Street, however, has generally shunned the opportunity, opening doors for startups like Gerchen Keller that specialize in pricing legal risk.
Two publicly traded firms in the field, both based in the United Kingdom, have reported returns on invested capital of some 60 percent.
Gerchen Keller's name partners, CEO Adam Gerchen, 31, and Chief Investment Officer Ashley Keller, 34, each worked at Chicago-based hedge fund Alyeska Investment Group. Also joining are Travis Lenkner, 33, chief investment officer, who formerly was a Boeing Co. senior counsel, and Terry Carlson, 60, chairman of the investment committee and a former general counsel at Medtronic Inc. and Synthes Inc.
Mr. Keller puts the U.S. market for litigation finance at about $1 billion yearly and the estimated annual cost of litigation at $250 billion to $300 billion.
While the U.S. Chamber of Commerce complains that litigation finance only inflates legal expenses for business, Mr. Lenkner argues, “That's silly. We seek to invest in meritorious litigation. What we do is, frankly, is add another layer of diligence.”
Read more: http://www.chicagobusiness.com/article/20130408/NEWS01/130409842/chicago-company-seeks-to-profit-from-lawsuits#ixzz2PsN9sfyv
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