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Guardian
7d
24
Image Credit: Guardian
Revealed: how Wall Street is making millions betting against green laws
- Financial speculators are increasingly funding lawsuits against governments over environmental regulations, netting lucrative awards.
- Litigation finance has expanded into financing massive arbitration lawsuits under ISDS, allowing corporations to sue countries for profit losses.
- The system has become profitable for hedge funds with average awards exceeding $200 million.
- ISDS has awarded over $120 billion, with fossil fuel and mining companies receiving substantial sums.
- Third-party funded cases are on the rise, with over 75 identified, often involving wealthy countries suing developing ones.
- Third-party funding in ISDS is criticized for leading to costly and potentially frivolous cases.
- Cases include South American Silver suing Bolivia and Silver Bull suing Mexico, with multimillion-dollar claims.
- Burford Capital is backing a case against Greenland over a uranium mining ban with potential compensation of $11.5 billion.
- Critics argue that third-party funding incentivizes speculative claims, driving more arbitration.
- The lack of penalties for funders and soaring legal costs in third-party funded cases raise concerns among arbitrators.
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