Litigation Finance Giant Burford Capital Eyes Law Firm Investments as Regulatory Landscape Shifts
New York, NY – August 21, 2025 – The legal industry is witnessing a seismic shift as Burford Capital, the world’s leading litigation finance firm, sets its sights on a novel investment strategy: acquiring minority stakes in U.S. law firms through Management Services Organizations (MSOs). This move, announced amid evolving state regulations, signals a potential transformation in how law firms access capital, leveraging innovative structures to bypass traditional restrictions on non-lawyer ownership. Meanwhile, other legal developments, including delays in a massive Facebook privacy settlement, highlight the dynamic interplay of finance and law.
For Burford Capital, MSOs Represent a New Form of Law Firm Investment
Burford Capital, known for funding high-stakes commercial litigation and arbitration, is now exploring investments in U.S. law firms through MSOs, a model that separates a firm’s legal and non-legal operations to allow outside investment. This approach, already common in medical and accounting sectors, enables law firms to maintain lawyer-owned practices while creating investor-owned entities to handle back-office functions like technology, marketing, and administration. “It’s not a departure from our existing business but an extension of how we provide capital to law firms,” said Travis Lenkner, Burford’s Chief Development Officer.
The strategy comes as states like Arizona and Utah relax rules on non-lawyer ownership, with Arizona issuing over 100 Alternative Business Structure (ABS) licenses in the past five years. Burford, already a passive investor in a U.K. law firm, is engaging with U.S. firms interested in this model, with Lenkner noting that “we are receiving a lot more phone calls than we are placing.” The MSO structure allows firms to access capital for growth—such as investing in AI or upgrading cybersecurity—without ceding control over legal work. Holland & Knight, a pioneer in advising on MSO transactions, emphasizes that these entities enable law firms to leverage economies of scale, enhancing efficiency and client outcomes.
Industry insiders view Burford’s move as a validation of the MSO model’s potential to modernize law firms. “Burford coming in as a large player kind of just validates what we’ve known for years—that the MSO model is the most viable way for law firms to compete,” said T.J. Henry Jr., co-founder of Federate. With $8.5 billion deployed since its inception, Burford’s entry into this space could accelerate the adoption of MSOs, offering firms a way to fund innovation while navigating ethical constraints.
Facebook’s $725M Privacy Settlement Faces Delays
In other legal news, the $725 million class-action settlement addressing Meta’s Facebook privacy violations, including the Cambridge Analytica scandal, has encountered hurdles due to lawsuits against claims administrator Angeion Group. On August 18, 2025, U.S. District Judge Vince Chhabria ordered Angeion to disclose its revenue-sharing agreement with Blackhawk, the prepaid card provider handling 28% of the settlement’s distributions. Allegations of racketeering and conflicts of interest have raised concerns about the payout process, potentially delaying compensation for 17.7 million claimants. The settlement, finalized in 2022, aims to compensate U.S. Facebook users active between 2007 and 2022, with an estimated average payout of $30 per claimant after fees.
Broader Implications for the Legal Industry
Burford’s push into MSOs reflects a broader trend of financial innovation in law, as firms seek capital to adapt to technological and competitive pressures. Meanwhile, the Facebook settlement delays underscore the challenges of managing large-scale class actions, where administrative transparency is critical. Together, these developments highlight the evolving nexus of law and finance, with Burford positioning itself as a key player in reshaping how legal services are funded and delivered.
For more information on Burford’s initiatives, visit www.burfordcapital.com. Claimants in the Facebook settlement can check their status at facebookuserprivacysettlement.com.