BlackRobe dropped from litigation funder’s suit against founder
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BlackRobe Capital Partners, a firm that invests in litigation, has been dropped as a defendant from a lawsuit filed by another legal financing firm against one of its co-founders.
Balance Point Divorce Funding last week voluntarily dismissed BlackRobe from the lawsuit, which centers around funding that Balance Point provided to the former wife of BlackRobe co-founder Timothy Scrantom in their divorce.
The case, filed in February in U.S. District Court in Manhattan, continues against Scrantom and Juridica Capital Management Ltd, another litigation funding firm that he founded.
The lawsuit has provided a rare inside look at the burgeoning field of litigation finance, in which investors provide money to litigants in exchange for a share of any settlements.
Scrantom in 2007 helped found Juridica, which today is one of the largest litigation finance companies, with more than $200 million in assets under management. He left in 2011 to start the privately held BlackRobe.
Stacey Napp, the founder of Balance Point, said her firm agreed to dismiss BlackRobe from the lawsuit after “obtaining certain assurances and representations” from its two other managing directors, Sean Coffey and Michael Chipega. She declined to provide further details.
Balance Point, based in Beverly Hills, California, advertises that it provides financing for spouses to fund high-end divorces with more than $2 million in assets at stake.
The company provided $310,435 to Scrantom’s former wife, Lila Masters, to cover her legal fees and expenses in their Montana divorce in exchange for a 25 percent cut of her marital asset claims, according to the lawsuit.
The lawsuit claimed misappropriation of company trade secrets, saying that Scrantom contacted Masters during the proceedings to receive confidential communications with her lawyers as well as various agreements and emails with Balance Point.
The lawsuit also asserted unjust enrichment and unfair competition claims against BlackRobe and Scrantom. Balance Point contends in the case that Juridica and Scrantom interfered with Masters’s obligations to pay Balance Point.
A separate lawsuit is pending in Montana federal court by Balance Point against Masters. Her lawyer has said his client contends her contract with Balance Point is unenforceable.
Scrantom did not respond to a request for comment on Monday, but he previously has called the lawsuit “frivolous.” Juridica declined comment.
Coffey, a prominent onetime plaintiffs’ lawyer who co-founded BlackRobe with Scrantom, did not immediately respond to a request for comment.
The case is Balance Point Divorce Funding, LLC v. Scrantom, U.S. District Court, Southern District of New York, No. 13-1049.
For Balance Point: Judith Lockhart, Carter Ledyard & Milburn.
For the defendants: Not immediately available.
Read original articleTags: Balance Point, Timothy Scrantom
