Profile: Marius Nasta
Marius Nasta, LL.M., is co-founder and Chief Executive Officer of Redress Solutions. As he prepares to address the 2017 Litigation Funding Conference, we sat down to get his perspective on the past, present, and future of the company, as well as that of litigation funding in general.
An extensive legal background
Having studied Law in Belgium and Cambridge, Marius began his legal career with Slaughter and May, part of London’s Magic Circle of top law firms, where he trained and qualified as a Solicitor of the Supreme Court in the firm’s corporate department. Realising that private practice wasn’t quite the right fit for him, he quickly moved in-house with Cendant Corporation, who were then a global services giant listed on the New York stock exchange with interests in travel and leisure, technology, real estate, and financial services. In his own words:
“My position as General Counsel in the international markets enabled me to realise that I wanted to run and own my own business. After almost ten years with Cendant, the conglomerate was split into four distinct parts and I was offered several jobs within those companies.
It was the perfect moment for me to leave and start up on my own using the legal and business skills that I had acquired as a lawyer both in private practice and in-house.”
Laying the groundwork for Redress
It wasn’t long after leaving Cendant that Marius was presented with the opportunity to put those legal and business skills to use helping others, rather than large corporate interests.
A former colleague from Cendant was engaged in a dispute with a large insurer regarding their critical illness policy. He approached Marius for help, who thought that the claim looked promising. However, without taking costly legal action against the insurer, the claimant was unlikely to see a penny from them. Marius then decided to get funding for his friend to help get the claim off the ground and secured the backing of a family office in the process.
Enter Michael Zuckerman, a partner in a West End law firm with over 35 years’ experience as a litigator.
Alongside his litigation practice, Michael, and one of his friends Stephen Wiseman – a business leader and former solicitor – had identified third party funding as a new industry with huge potential and had been involved in funding cases as a legal angel investor since 2007.
Their investment vehicle was called Redress Solutions, which was one of the first important players on the market. With no experience in the third-party litigation funding market, Marius reached out to Michael to get his views as a professional investor.
Having reached the same conclusion as Marius, Michael offered to co-invest and a joint venture was formed to fund the claim. One year later, the insurer paid up. The claimant was understandably delighted, while Marius and Michael felt that they could work as partners in Redress.
A new partnership was born, run by two executives with extensive legal, corporate and business experience and backed by two prominent family offices which could build on the already successful investment track record.
The future of legal angel investing
Now, some years later, Marius retains this vibrant optimism about the benefits of the legal angel investment model:
“I believe that legal angel investment in claims is what car leasing is to cars. It is an alternative, smart and efficient way of funding legal claims.
Redress offers much more than capital, we also bring experience which comes with many years of investing successfully. Claimants – be they individuals or companies – sometimes tend to be overly emotional when choosing a course of action during the lifetime of a claim. They or their legal team then turn to us to ask for our advice and we are happy to tell them candidly what we think.”
Coming on board with claims early is another key part of the Redress process, allowing claimants to hire the right expertise from day one. To make this happen, Marius values quick action, wasting no time in deciding whether or not to invest.
Looking back on seven years in the business, he can also make some educated guesses about the course things might take in the coming years, predicting three major trends:
- Claimants will find it increasingly difficult to justify self-funding a claim to themselves, with such a proven alternative at their disposal.
- Investors themselves will gain experience of the process, with those who choose to invest on a professional basis pushing out those who simply try their luck with one-off investments.
- More jurisdictions around the world will open up to the idea, creating a truly global market for legal angel investing.
Silencing the critics
Despite this success and rosy outlook, areas of the legal industry still retain some healthy scepticism when it comes to legal angel investment. Some worry that investors will insist on appointing their own lawyers, effectively stealing clients. Others worry about the possibility of investors experiencing cash flow difficulties, or even going bust!
Then there’s the perception held, by some, that third-party funding encourages spurious litigation, with claimants being lured into bringing fanciful claims against large companies just to try and squeeze a settlement from them.
“As a general comment,” replies Marius, “I would say that those who refuse to accept that the third-party litigation funding model is here to stay are in denial of what is happening around them. Legal investment should be regarded as an opportunity rather than a threat and should be embraced.
That being said, like in any other industry, there will always be bad apples. Professional funders like Redress, who have been around for a number of years, understand that their reputation is only as good as the investment in claims that they successfully exit.”
Addressing these concerns forms a major part of Redress’ ongoing strategy, shaping the way we tackle cases. Marius understands that the chemistry between a claimant and their own lawyers, along with the established understanding that helps monitor a lawyer’s performance during the life of a claim, are important contributors to a successful outcome.
As for non-meritorious claims, that is an issue for the industry to address. Some investors are endowed with hundreds of millions of dollars and are under pressure to find cases to use that budget up, in order to satisfy shareholders and earn commission. Others are not professional legal angel investors, and are simply looking for a one-off case to invest in as a quick earner.
In either case, investors risk either failing to carry out proper due diligence before taking on the case, or assume that the defendant will take one look at the forces arrayed against them, roll over and offer a settlement. Either of these mistakes can have disastrous consequences for those involved.
As you’d expect, Marius is keen to distance himself from such operations:
“These types of investors are in a minority, and their actions will eventually lead to them going out of business. Steps are also being taken to self-regulate; the Association of Litigation Funders of England and Wales (ALF), of which Redress is a member, is a good example.
ALF imposes on its members a minimum of £5 million of capital available for investment in claims. Membership requires each member to abide by a code of conduct which specifically prohibits the control of claims, or a funder member pulling out of a claim without reason. ALF now has seven funder members that have hundreds of millions to invest between them. It is to be hoped that others will join.”
Join Redress at the 2017 Litigation Funding Conference
Litigation funding has taken huge steps forward, from as recently as 2010 when just a couple of companies had even heard of the service, let alone offered it. Nowadays, the ALF has verified eight companies, regulating a market worth approximately half a billion pounds.
Having been there from day one, it won’t surprise you to learn that Redress Solutions has a uniquely informed perspective on this promising industry.
If you’re interested in learning more about Marius’ approach to legal angel investing, you can join him at the Litigation Funding Conference on October 2 in London.
This flagship industry event is a must for lawyers, insolvency practitioners and business owners. Register today and receive £50 off the ticket price.
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