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BlackRobe Capital Partners LLC, the litigation finance company started by plaintiffs' lawyer Sean Coffey, hired retired Simpson Thacher & Bartlett LLP partner Michael Chepiga to boost the firm’s corporate-defense expertise.
Chepiga joins BlackRobe as a managing partner and will share responsibilities for business development, case underwriting and firm management, the company said in a statement. Chepiga is a 30-year veteran of Simpson Thacher and a former member of the firm’s executive committee.
“Mike brings unsurpassed credibility in management suites and corporate boardrooms, and will greatly enhance BlackRobe’s ability to assist companies as they seek creative ways to address the escalating costs of civil litigation,” Coffey said in a statement.
Coffey, a former partner at New York’s Bernstein Litowitz Berger & Grossman LLP (142230L), won more than $6.15 billion in settlements in 2004 and 2005 for WorldCom Inc. investors following a collapse of the company in an accounting fraud. He started New York-based BlackRobe last year with Timothy Scrantom, co-founder of Juridica Investments Ltd., after failing at a run for New York Attorney General.
BlackRobe is one of a growing number of third-party litigation financiers that fund lawsuits in exchange for a share of the recovery. The company targets investments between $2 million and $8 million in complex commercial litigation cases, including intellectual property, antitrust and breach of contract disputes, that have the potential for damages in excess of $50 million, Coffey said.
In addition to BlackRobe and Juridica, New York-based Burford Group also operates in the space targeting commercial deals. The global market for litigation financing has grown to about $5 billion, Clive Ward, managing director for Tangerine International Ltd., the promoter of a namesake lender to U.K. law firms, said last month.
Chepiga, 64, who’s two years past Simpson Thacher’s mandatory retirement age, was looking for something new when his former courtroom adversary approached with New York Yankees tickets and an idea.
“The nature of the legal practice has changed over the years,” Chepiga said. “Clients want high-quality legal services and want to control their costs. Law firms want to deliver high quality but want to keep up their profits. BlackRobe helps with both.”
While the firm doesn’t provide legal advice, the three partners plan to be more actively involved in cases than just financing them, Coffey said. He said he expects BlackRobe’s model will help create market efficiency leading to more “meritorious litigation.”
In addition to Chepiga, BlackRobe has hired a handful of retired former litigators who help part-time to evaluate cases. The firm, which is raising funds, has looked at about 80 cases since last year and has closed investments in two, Coffey said. He declined to identify the investments.
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