John Quinn is joined by Jack Neumark, Managing Partner and Co-Head of Specialty Finance of Fortress Investment Group and founder of its Legal Assets Group. They discuss the emergence of legal assets as a distinct investment class. Fortress is a leading player in litigation finance with over $6.5 billion deployed in legal assets and a current portfolio of approximately $3 billion. While most litigation funders typically invest in individual cases, Fortress invests in diversified portfolios of litigation claims and contingent fee receivables. Fortress underwrites and finances these portfolios the same way it does other specialty finance products. To underwrite a portfolio, Fortress has lawyers examine the cases in the portfolio to determine how strong and likely to settle they are. They consider factors including the defendants and how creditworthy they are, the damage theories asserted, how far the case has progressed, what motion practice has revealed, and whether related criminal charges have been filed. They also consider the law firms involved, the judge, and the venue. Fortress also conducts quantitative analyses of the historical results of similar cases based on publicly available data and proprietary data it has accumulated in the 15 years it has invested in legal assets. Legal asset portfolios are attractive to many investors because the results of lawsuits are less subject to the performance of the economy in general than many other classes of assets. Also, because the market for legal assets is still developing, sophisticated investors can often obtain better returns than in more mature markets. Jack believes that as the industry matures, especially with potential regulatory changes around law firm ownership, litigation finance will become more mainstream and integrated into broader investment strategies.

John is joined by Christian Athanasoulas, KPMG’s Global Head of International Tax and M&A Tax and U.S. Tax Practice Leader – Services. They discuss the groundbreaking shift in the U.S. legal industry arising from Arizona’s decision to allow non-lawyers to have ownership interests in law firms. This move aligns the U.S. with countries like the U.K. and Australia, where non-lawyers have been permitted to own law firms for years. KPMG has successfully operated legal practices in over 80 countries, but U.S. regulations previously prevented it from offering legal services alongside its consulting, tax, and advisory work. Arizona’s new rules allow KPMG to offer the non-legal services it typically offers clients together with related legal services performed by the new law firm. Previously, KPMG’s clients would have to retain law firms with no formal ties to KPMG for those services. Christian led the effort to establish KPMG Law US, a wholly owned Arizona law firm under the KPMG umbrella. KPMG Law US is an independent LLC with Arizona-licensed lawyers and a compliance officer to ensure adherence to legal ethics rules. Although owned by KPMG, the law firm maintains autonomy. It can assist clients with legal matters such as contract integration and regulatory compliance. KPMG Law US leverages its parent company’s technological advancements, including AI-driven contract analysis and process automation, to improve efficiency in the provision of legal services. The new law firm will not engage in litigation. For matters outside of Arizona, it will co-counsel with lawyers admitted in the appropriate jurisdiction. While Arizona is currently the only state permitting non-lawyer ownership of law firms, other states are exploring the possibility of passing similar laws. The creation of KPMG Law US could signal broader changes in the legal profession, potentially reshaping traditional law firm structures.

John Quinn is joined by Caleb Harris, Co-Founder and CEO of &AI, a startup focused on using artificial intelligence to transform patent litigation. They discuss how &AI uses AI to accomplish complex patent litigation tasks such as invalidity and infringement analysis, dramatically reducing the time and cost associated with these traditionally labor-intensive efforts. The service features four components: searches for prior art or infringing products, in-depth legal analysis (including creating claim charts), drafting litigation-ready documents like invalidity contentions or IPR petitions, and automating workflows using AI agents that operate independently. Patent litigation is particularly well-suited to AI because so much of the underlying data—such as patent filings, litigation histories, and prosecution records—is publicly available. &AI continuously updates its data sets and can provide summaries, detailed claim charts, and customized drafts in as little as 10 minutes. Unlike generative AI tools, &AI minimizes hallucinations by relying heavily on document retrieval rather than generation, and by providing verified citations in its output. The platform can also help streamline early-stage litigation decisions, such as assessing the strength of a patent portfolio or evaluating potential infringement claims in the marketplace. It also helps defense teams efficiently assess and respond to weak claims, including those from patent trolls, by producing tailored response letters and evidence. &AI uses AI agents—AI that develops multi-step plans to accomplish tasks and automatically adjusts those plans based on how the work is progressing. This allows the user to focus on the end product they want rather than the steps needed to get there. AI agents will enable faster, more scalable, and more economically viable litigation, especially patent litigation. This may lead to a boon for litigators as more lawsuits are filed and resolved quickly. Although human performance will remain crucial in areas like persuading a jury or a judge, law firms may gain a competitive edge by pairing their expertise with firm-specific AI tools trained on the firm’s proprietary data and preferred styles.

John Quinn is joined by Michael Barlow, Managing Partner and Founding Member of Quinn Emanuel’s Wilmington, Delaware office. They discuss the evolving state of Delaware corporate law and the legislative response to growing dissatisfaction among corporations over the recent legal treatment of conflicted transactions. Traditionally, Delaware law has deferred in general to corporate decision-making under the business judgment rule, but rigorously reviewed transactions involving conflicts of interest—particularly those involving controlling shareholders—under an “entire fairness review.” Entire fairness reviews are fact-intensive and include scrutinizing both the process and terms of the transaction, making early dismissal of claims rare. In response, Delaware courts developed a safe harbor called the “MFW” framework. The “MFW” framework involved approval by a special committee of disinterested directors and the minority shareholders. Still, even under the MFW framework, motions to dismiss were granted in fewer than 40% of cases, leading to frustration among deal planners. Despite these odds, a Quinn Emanuel team led by Michael recently won a rare complete dismissal of an entire fairness case on behalf of Fidelity National Financial, Inc. In that case, the court ruled that there were no alleged facts that could support the conclusion that the preferred stock transaction at issue was unfair. Frustration among corporate deal planners with what was perceived as activist judicial decisions creating uncertainty (e.g., as to what was a “controlling stockholder,” among other things) has recently led to Tesla, Dropbox and other corporations to express their intent to leave Delaware as their state of incorporation. “DExit,” is the term coined to describe this trend. To address these concerns, Delaware enacted Senate Bill 21, a bipartisan effort to clarify and narrow the standards for conflicted transactions. The legislation provides clearer definitions of controlling stockholders and establishes safe harbors for dismissing cases early if certain procedural protections are followed. It also reforms the state’s books-and-records statute (Section 220) by limiting the scope of pre-suit corporate document demands. The next few years will test how effectively the new legislation meets the corporate world’s demand for greater legal certainty. Finally, Michael believes that Delaware will continue to lead the nation in corporate law due to its unparalleled legal infrastructure and judicial expertise.