Professor Elayne E. Greenberg commented on the ethical issues raised for third-party litigation funders by the Gawker bankruptcy. In the Gawker bankruptcy, the bankruptcy court has allowed limited discovery of Thiel’s funding relationship with Bollea to ascertain if Thiel has any liability for Gawker’s bankruptcy.
The quote follows:
Elayne Greenberg, a professor at St. John’s University School of Law in New York, said that while Thiel bears little resemblance to profit-driven commercial funders, he has amplified legitimate questions about whether legal funding can improperly sway other people’s cases.
Greenberg argued that the publicity around the Gawker bankruptcy and Thiel’s desire to put his money behind Bollea’s case was an opportunity for institutional investors to develop public ethics standards that would address some of the concerns raised by Thiel and distinguish their business goals.
In addition to addressing deals disclosures, those standards could also include a public stance against striking deals with any investor who is personally seeking revenge via the outcome of someone else’s litigation, said Greenberg, who also leads the St. John’s law dispute resolution center.
“Revenge distorts, and when you’re motivated by strong emotions, it’s going to be very difficult to see the true merits of a case,” she said. “Ethical litigation funders presumably pride themselves on their objectivity … which is something that would distance them from the whole Thiel debacle.”
The full article can be found here..
St. John's University Law Faculty Blog 
Leave a Reply