Burford Capital Faces Investor Suit for Manipulating Metrics (1)

Burford Capital Ltd. investors sued the litigation funder Aug. 21, asserting it manipulated metrics to make its returns look better.

The litigation finance firm is actually “at high risk for a liquidity crunch and is already arguably insolvent,” according to the would-be class complaint filed in the U.S. District Court for the Eastern District of New York. The investors based their allegations on short seller Muddy Waters’ report about Burford.

U.K.-based Burford misled investors about the value of the cases it invests in, according to portions of the Aug. 7 report reproduced in the complaint. But the short seller’s “false” ...