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(Sharecast News) - Litigation Capital Management said on Wednesday that a trademark dispute it funded in Australia has been upheld by the High Court, marking a key development in a long-running case that could generate a return on the company's investment once damages are determined.
The dispute finance specialist said the High Court of Australia had ruled in favour of its funded client, Sydney-based fashion designer Katie Perry, in a trademark claim against pop singer Katy Perry and her related corporate entities.
The case was initially heard in the Federal Court of Australia, which found that the singer and one of her companies had infringed the designer's trademark.
However, the decision was overturned by the Full Court of the Federal Court on appeal, which also ruled that the designer's trademark should be cancelled on the basis that it had been filed with knowledge of the singer's reputation.
The designer was subsequently granted special leave to appeal to the High Court in April last year.
Following a hearing in September, the High Court allowed the appeal by majority, reinstating the designer's claim.
The matter would now return to the Full Court to resolve outstanding issues, including costs related to earlier proceedings.
Damages would then need to be quantified, after which LCM expected to determine its return on the investment.
LCM said it had committed AUD 3.3m (1.76m) of shareholder capital to the case since 2019, funded directly from its balance sheet rather than through external funds.
The investment had been carried on the company's financial statements at a value of AUD 3.3m.
The company added that it was also awaiting a judgment in another smaller case investment involving AUD 1.4m of shareholder capital, with a decision expected within the next week.
Chief executive Patrick Moloney said the case demonstrated the role of litigation finance in supporting claimants who may otherwise lack the resources to pursue legal action.
"LCM has provided funding for this claim from its balance sheet since 2019.
"It is a classic instance of disputes finance enabling a claimant to bring a claim which they would otherwise not have the resources to fund," he said.
"The case was successful at first instance, then overturned on appeal and now the case has succeeded in the High Court.
"We now look forward to pursuing this claim to conclusion."
LCM also said it expected to announce the date of its half-year results presentation in the coming weeks.
The presentation was likely to take place later than usual, around the end of March, as the company looked to provide investors with a more substantive update on the outcome of its ongoing strategic review.
At 1036 GMT, shares in Litigation Capital Management were up 8.97% at 8.5p.
Reporting by Josh White for Sharecast.com.