Public enforcement by competition authorities imposes fines and sanctions – but it does not compensate victims.

Private enforcement ensures that unlawful overcharges and market distortions are economically reversed. It restores competitive balance by enabling those harmed by cartel conduct or abuse of dominance to recover their losses.

In many cases, damages significantly exceed regulatory fines. Active enforcement is therefore not merely complementary to public action – it is essential to achieving economic justice.

Competition damages cases are highly complex and evidence-intensive. They typically require:

• extensive economic modelling,
• industry-wide data analysis,
• and sustained procedural resources.

By participating in a homogeneous claimant group, victims benefit from shared economic analysis, efficiency of costs, and enhanced negotiating leverage.

A follow-on action is a private damages claim brought after a competition authority has already issued a final infringement decision (for example, a cartel decision by the European Commission or a national competition authority).

In such cases, the unlawful conduct itself no longer needs to be proven again before the civil courts. The authority’s decision is binding as to the existence of the infringement. This significantly reduces evidentiary complexity and procedural uncertainty.

The central focus of a follow-on action therefore shifts from proving liability to quantifying damages.

In practice, this means:

• determining the extent of the overcharge,
• analysing pass-on effects,
• modelling counterfactual pricing scenarios,
• and establishing causation and damage volume.

Economic analysis becomes the core battleground. Well-funded, coordinated claimant groups are particularly effective in this context, as they can finance high-calibre economic expertise and develop robust, data-driven damage models.

Defendants in cartel cases are often multinational corporations with substantial legal and economic resources.

Legal finance provides the capital required to fund high-calibre economic experts, forensic analysis, and coordinated litigation strategy. This ensures that enforcement is not constrained by the relative size of the claimant.

By transferring downside risk to the funder legal finance neutralises structural imbalances and enables well-resourced prosecution of claims.

No. Each claimant retains its individual legal claim and to a large extend its decision-making authority.

momentum provides capital and supports to syndicate a plaintiff group. It offers strategic support but does not assume control over litigation strategy or settlement decisions. Key procedural decisions - including whether to settle, appeal, or discontinue - rest with the claim holder and its counsel. That said, certain safeguards must be in place to protect the funder's investment.

The role of legal finance is to align interests and share risk — not for the funder to take over the proceedings.

momentum is remunerated only in the event of a successful recovery.

Its compensation is typically structured as a pre-agreed share of proceeds or a multiple of deployed capital, on a strictly non-recourse basis. If the claim is unsuccessful, momentum bears the financial loss and covers the court set adverse party costs.

This alignment ensures that incentives are fully shared: momentum succeeds only when the claimants succeed.

In short:

Claim valuation follows a disciplined, investment-style underwriting process.

We assess:

• Probability of success based on legal merits and procedural posture,
• Expected quantum using robust economic modelling and scenario analysis,
• Enforcement risk including counterparty strength and jurisdictional recoverability,
• Duration and cost risk, reflected through an appropriate risk-adjusted discount rate.

The result is a probability-weighted, discounted present value of the expected recovery – comparable to underwriting a contingent asset with defined risk and time parameters.

Monetization structures can include an earn-out component, allowing the original claim holder to participate in additional upside if recoveries exceed base-case assumptions.

This approach combines immediate liquidity with disciplined risk transfer and retained exposure to exceptional outcomes.

More in detail:

The valuation of a claim in a monetization structure follows a structured, capital-markets-based assessment. The objective is to determine the risk-adjusted net present value (NPV) of the expected recovery profile.

The analysis typically focuses on the following key parameters:

1. Legal merits (Probability of Success)

The starting point is an assessment of the probability of prevailing. This includes:

• liability strength and evidentiary support,
• procedural posture (e.g. follow-on action),
• jurisdictional considerations,
• anticipated defences and litigation strategy of the defendant.

These elements determine the weighted probability of success applied in the valuation model.

2. Quantum and economic modelling

The expected damages form the economic upside of the claim. This requires:

• modelling the overcharge or loss scenario,
• analysing potential pass-on effects,
• incorporating statutory or compound interest,
• running base, upside, and downside scenarios.

The robustness and defensibility of the damages model materially affect valuation.

3. Enforcement and counterparty risk

A claim only has economic value if recovery is realistically achievable. The analysis therefore considers:

• the financial strength of the defendant,
• enforceability across relevant jurisdictions,
• insolvency or restructuring risks.

These factors influence the haircut applied to the expected gross recovery.

4. Duration and cost risk

Expected timeline has a direct impact on discounting. The assessment includes:

• time to first instance judgment,
• appeal probability,
• settlement likelihood,
• projected litigation and expert costs.

The longer the anticipated duration and the greater the procedural uncertainty, the higher the discount rate applied.

Valuation Methodology

The outcome of this analysis is a probability-weighted expected recovery stream, discounted to present value using an appropriate risk-adjusted discount rate reflecting duration, enforcement, and litigation risk.

From an investment perspective, claim monetization resembles the underwriting of a contingent asset with a defined risk and time profile – comparable to structured or opportunistic investments.

Earn-Out: Participation in Upside

Monetization structures can include a contingent earn-out component.

This allows the original claim holder to participate in additional upside if the ultimate recovery exceeds the base-case assumptions underlying the valuation. Such structures combine:

• immediate liquidity and balance sheet clarity,
• defined IRR realisation,
• and retained exposure to exceptional outcomes.

Monetization therefore does not necessarily imply a full economic exit. It can be structured as a disciplined risk transfer that balances certainty today with participation in unexpected upside.