The legal battlefield over third-party litigation funding is intensifying in a Chicago federal court, spotlighting a high-stakes conflict between meat processing giant Tyson Foods and leading litigation finance firm Burford Capital. The dispute highlights the complex dynamics of litigation finance, a sector that has increasingly influenced high-profile legal battles.
In April, Tyson Foods launched a lawsuit against Burford Capital, alleging that the financier unlawfully obstructed a potential settlement in a significant chicken price-fixing lawsuit. Tyson claims that Burford’s interference aimed to secure a larger financial gain from the settlement involving food distributor Sysco, which was a client of the litigation funder.
Burford’s Counteraction
This week, Burford Capital responded by filing a motion to dismiss Tyson’s lawsuit, arguing that the allegations are unfounded and serve as a diversion from the core price-fixing claims. In court documents, Burford contended that Tyson was responsible for declining Sysco’s final settlement offer in late 2021. The financier described Tyson’s accusations as “threadbare” and “rank speculation,” firmly denying any wrongdoing or obstruction in the settlement negotiations.
Background of the Dispute
Litigation funding, where financial backing is provided to plaintiffs in return for a share of any settlements or judgments, has become a significant player in the legal landscape. Since 2019, Burford Capital has invested approximately $140 million in supporting Sysco’s antitrust claims against Tyson and other meat processing firms, according to court filings. The contract between Sysco and Burford granted the latter a role in some of the settlement discussions, underscoring the financier’s influence in the case.
The broader context involves a series of lawsuits accusing Tyson and other major meat producers of conspiring to fix prices across various meat markets. Several of these cases have resulted in settlements amounting to tens of millions of dollars. Despite the allegations, Tyson has consistently denied any involvement in price-fixing.
Burford’s Active Role
Burford Capital is known for actively managing the litigation it finances. In 2023, the firm successfully prevented Sysco from settling with another defendant due to what it considered an inadequate settlement amount. Subsequently, Sysco exited the litigation after transferring its rights to Carina Ventures, a Burford affiliate.
The ongoing legal battle between Tyson Foods and Burford Capital sheds light on the growing influence of litigation finance in major legal cases. As this dispute unfolds, it underscores the complexities and potential conflicts that can arise when third-party financiers play a substantial role in legal proceedings.
Note: This article is inspired by content from https://www.pymnts.com/cpi-posts/litigation-finance-battle-heats-up-in-tyson-foods-price-fixing-case/. It has been rephrased for originality. Images are credited to the original source.