Affirmative Recovery System
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What is a “corporate recovery program” or an “affirmative recovery program”?
What we’re talking about is a in house general counsel team, system, or program that monitors and initiates claims and complaints to recover funds on behalf of the company. There is no hard and fast word for these types of programs. Keibler Law Group consults corporations on how to form these types of systems and can ultimately assist in prosecuting some of the claims as well.
Dupont became the first well-known company to implement and then share its Affirmative Recovery Program. The idea started by changing the C-Suite’s perception of the General Counsel’s office. Typically, lawyers at a company are non-revenue generating divisions that can be expensive. Staffing lawyers and paying out settlements is a line-item on the P&L chart that may stick out. Instead, Dupont decided to change the perception of the General Counsel’s office as one that is/can be profit generating and resourceful throughout the entire company.
How did it do this? It created a series of systems to monitor potential claims, evaluate the claim and possible recovery, and successfully pursue the claims. In its first ten years, Dupont’s Affirmative Recovery Program generated more than $2.6 Billion for the company.
This is not unusual; often times corporate clients (through its Affirmative Recovery Program) receive tens or hundreds of millions when they opt out of antitrust class actions and pursue claims individually.
Affirmative Recovery System Consulting
Chase offers consulting services to corporations to assist in setting up a corporate affirmative recovery system. This allows general counsel offices to monitor, track, and evaluate potential affirmative recovery claims and then provides a process for how to process those claims.
No longer is “legal” just a (negative) line item, but it can be a profit-driving center for your business as well. Contact Keibler Law Group today if you have a potential claim you would like to discuss or if you would like to learn more about our Affirmative Recovery System Consulting services.
What types of cases of claims should an Affirmative Recovery Program monitor?
There are many instances when a corporation can and should consider being the “plaintiff” in an action. For example, perhaps a large supplier breached its agreement and failed to deliver the items it promised. This is an example of situation where the Affirmative Recovery Program steps in, gathers evidence, evaluates the claim, and determines whether to pursue legal action.
Below are a few instances and types of claims the Affirmative Recovery Program should monitor:
- Class actions and class action settlements
- Class action opt-out cases
- Antitrust actions regarding the corporations upstream and downstream markets
- Unclaimed funds
- Reimbursement for corrective actions
- Product defects
- Contract disputes
What is Litigation Funding?
Financed litigation or litigation funding is an often un-tapped resource is becoming much more widely used. Litigation funding can take several shapes. For example, the funder may offer to fund or pay the expenses to prosecute your claims. While many law firms will take on this fee up front and recollect on the backend upon settlement, often times these claims are incredibly expenses and the corporation may have internal reasons for wanting to fund the claim upfront. Litigation funding is a great tool in these scenarios for a low-risk funding alternative.
Second, litigation funding can also be used to alleviate risk and receive compensation for your claim. The litigation funding companies can essentially purchase the corporations claim proceeds before the corporation receives them. For example, perhaps the corporations potential claim is worth $100M. The litigation funding company may offer you $20M for the claim, and it will be owed dollar for dollar of any recovery plus a certain capped dollar amount – say, $40M. Typically, these loans are “risk-free” and the litigation funding only gets paid if you successfully recover funds for your claim.
Therefore, the Affirmative Recovery Program can quickly pocket $20M for the claim with the potential of recovering an additional $60M in the future. The litigation funders will recover the initial $20M provided and contractually will recover additional funds as described in the agreement up to $40M. It’s a win-win scenario.
Keibler Law Group has experience in both assisting corporate clients in structuring their Affirmative Recovery Programs and in successfully prosecuting claims on behalf of the corporation. In addition, Chase has years of experience working with and alongside litigation funders and can counsel you in the process. Please reach out today if you’d like to discuss how Keibler Law Group can help you.