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FRT’s Fast Five: Week Ending November 20, 2020

Financial Recovery Technologies Fast Five provides you with the top news in shareholder class actions. Stay up-to-date on the latest developments in settled (U.S./Canada) claims filing opportunities, Antitrust settlements, Global Group Litigation matters and more. For more information, contact your Financial Recovery Technologies representative or email us.

1. 13 Years After a Bribery Scheme Derailed a Mining Project, Its Investors Get Paid

Tony Harwood had just completed an international roadshow raising 150 million Canadian dollars, equivalent to around $130 million at the time, to develop a lucrative copper-cobalt mine in the Democratic Republic of Congo when he got the call that made it all come crashing down. A competitor was claiming that it—and not Mr. Harwood’s company, Africo Resources Ltd.—held the rights to the Kalukundi mine, the South African learned that Saturday back in 2007. Without a license, Africo’s plans to develop the mine were in jeopardy, and the millions of dollars it had raised might have to be returned to investors. Mr. Harwood tried to unravel the claim, but it wouldn’t be until a 2016 settlement between federal prosecutors and the hedge fund Och-Ziff Capital Management Group Inc. that he would get the full story of a corruption scheme to take over Africo’s rights. A federal judge this year ruled that Mr. Harwood and a group of investors qualified as victims under U.S. law. The investors were paid $138 million in restitution last week. The deal is expected to open the door to such victims’ claims in other foreign bribery cases. Click here to read the full article (subscription may be needed).

2. For Litigation Finance, New Heights Are Within Reach

Fueled by a relative lack of regulation and an upswing in market opportunities presented by the economic downturn, litigation finance — the practice by which third parties provide funding for litigation in return for a share of the proceeds in the event of a winning case — will become more widespread and better understood in 2021. For an industry that has been facing calls for regulation for some time, it looks as though litigation finance is currently winning the battle to remain unregulated. That does not mean, however, that it will remain opaque; more familiarity will breed greater understanding and acceptance. Also, litigation funding deals will more regularly take on other forms beyond single-case financing for the fees and costs of a litigation, as funders aim to meet the needs of the moment. Click here to read the full article.

3. COVID-19 Event-Driven Litigation Continues to Sail

At the start of the pandemic, shareholders of Norwegian Cruise Lines Holdings, Ltd. filed a class action alleging that the company and certain officers violated the Securities and Exchange Act of 1934. The lawsuit alleged that the cruise line made false and misleading statements about COVID-19 in order to persuade consumers to purchase cruises. This allegedly caused the share prices to be cut in half. The Norwegian lawsuit marked the start of these event-driven securities claims. Since then, close to 20 securities lawsuits have been filed, which arise directly or indirectly from COVID-19 and its impact. This alert details how directors and officers (D&O) liability insurance policies should provide coverage for these suits. Click here to read the full article.

4. Australia: Enforceability of Funder’s Class Action Agreements Upheld on Appeal

The Queensland Court of Appeal has unanimously dismissed an appeal which sought to invalidate the third party funding arrangements in the Gladstone Fisheries class action. The court upheld a declaration made at first instance that the funding agreements could not be challenged on public policy grounds as argued by the defendant, Gladstone Ports Corporation Limited (GPC). The court’s decision confirms not only the lawfulness of LCM’s class action funding agreements, but also the legitimacy of the class action funding model generally. Click here to read the full article.

5. Full Impact of Pandemic on Europe’s Banks Won’t Be Clear Until 2021, Official Says

The fallout from the coronavirus pandemic on Europe’s financial institutions will become more apparent in the coming months, according to a senior European banking official, and there could be one or two casualties in the sector. Elke König, chair of the Single Resolution Board of the Single Resolution Mechanism, which oversees the restructuring of failing banks in the EU, said she expected a rise in the number of non-performing loans (NPLs) in the region, which in turn would hit bank balance sheets. When these loans could peak, however, was the ”$60,000 dollar question,” König said. Click here to read the full article.

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SETTLED CLAIMS  I  PASSIVE GROUP  I  ANTITRUST  I  FUTURE CLAIMS  I  OPT-IN MONITORING  I OPT-OUT MONITORING

Founded in 2008, Financial Recovery Technologies (FRT) is the leading technology-based services firm that helps the investment community identify eligibility, file claims and collect funds made available in securities and other class action settlements. Offering the most comprehensive range of claim filing and monitoring services available, we provide best-in-class eligibility analysis, disbursement auditing and client reporting, and deliver the highest level of accuracy, accountability, and transparency available. For more information, go to www.frtservices.com.

This communication and the content found by following any link herein are being provided to you by Financial Recovery Technologies (FRT) for informational purposes only and do not constitute advice. All material presented herein is believed to be reliable but FRT makes no representation or warranty with respect to this communication or such content and expressly disclaims any implied warranty under law. Opinions expressed in this communication may change without prior notice. Firms should always seek legal and financial advice specific to their unique situation and objectives.

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