Is committed litigation capital the same as money already invested?

No. A commitment is a ceiling; capital is deployed in stages as the case incurs costs, or up front for a monetization. Silver Bull's funder committed up to $9.5 million from September 2023 and had paid $5,925,000 of legal and arbitration costs, plus corporate cost reimbursements, by the time the claim was dismissed in May 2026 and the agreement was terminated. The rest was never deployed.

Why does the distinction matter for an investor?

Returns are earned on deployed capital, while fees and headline sizes are often quoted on commitments. A fund that reports a large commitment total may have spent far less, and its eventual return depends on cases that have not yet drawn their full budgets. AltStreet's Omni Bridgeway review notes the newest funds charge about 2% a year on active investment commitments and target transaction fees of 2.5% to 3.0% of commitments.

How large is the gap at a big funder?

Large. Burford reported undrawn commitments on its capital provision assets of $1,264.4 million definitive, $627.4 million discretionary and $47.0 million of definitive legal risk commitments at September 30, 2026, about $1.94 billion in all, against a deployed cost of $2,595.2 million. AltStreet's Burford review cites a group-wide portfolio of $7.5 billion for FY2025, a figure that includes undrawn commitments.

What is the difference between definitive and discretionary commitments?

Whether the funder must pay. Burford's definitive commitments are those where it is 'contractually obligated to advance incremental capital and failure to do so would typically result in adverse contractual consequences (such as a dilution in our returns or the loss of our deployed capital in a case).' Discretionary commitments leave it 'a considerable degree of discretion' and are 'subject to further case-level underwriting.'

Do commitments always get drawn?

No. Cases settle early, lose, or cost less than budgeted, and agreements terminate. Silver Bull's facility stopped when its claim was dismissed. Burford's discretionary commitments fell from $793.5 million at December 31, 2025 to $627.4 million at September 30, 2026. Some commitments, such as AmBase's, also grow: its 2026 agreement covers an initial $6.0 million 'plus such additional amounts as may be necessary,' and a July 2026 letter agreement added $1.0 million.

How should an investor read a fund's size?

Separate three numbers: investors' commitments to the fund, the fund's commitments to cases, and the capital actually deployed into cases. Each is a step down from the one before, and returns, multiples and IRRs are calculated on the last. Ask for all three at the same date.

Funding Commitments vs Deployed Capital

Litigation Finance & Legal Claims

Definition

A funding commitment is the maximum a funder has agreed to provide on a case or portfolio; deployed capital is the amount actually paid out so far. The difference is undrawn commitments. Burford's 2025 Form 10-K defines deployment as 'financing provided for an asset,' and defines its 'portfolio' as 'the sum of the fair value of capital provision assets and the undrawn commitments,' so a headline portfolio figure mixes money spent with money only promised.

Why it matters

Litigation finance reports blend promises and spending. Headline 'portfolio' figures add undrawn commitments to the value of what has been deployed, fee bases can be set on commitments, and investors' own commitments to a fund are another layer again. None of that is wrong, but it means a large number can rest on much less capital at work. Reconcile commitments, deployments and remaining obligations at one date, and separate definitive from discretionary. Then read returns on deployed capital, which is what actually earns them.

Common misconceptions

•A commitment is not an investment, because capital is paid out in stages and some of it is never drawn.
•A funder's 'portfolio' figure is not money deployed, because Burford defines it as fair value plus undrawn commitments.
•Discretionary commitments are not obligations, because the funder can decline them after further case-level underwriting.
•Undrawn commitments do not only shrink, because agreements such as AmBase's allow additional amounts to be agreed as the case needs them.
•A fee on commitments is not a fee on capital at work, because a fund can charge on promised amounts that cases have not yet drawn.

Technical details

Worked example (illustrative): reconciling a fund at one date

Investors commit $200 million to the fund; $120 million has been called.

The fund has committed $150 million to cases; $90 million has been deployed into them.

Undrawn case commitments: $60 million, of which $40 million definitive and $20 million discretionary.

Uncalled investor capital: $80 million, enough to meet the definitive $40 million.

Returns are earned on the $90 million deployed; a fee of 2% on $150 million of commitments is $3.0 million a year, 3.3% of deployed capital.

Worked example: Burford at two dates (10-K and 10-Q)

December 31, 2025 undrawn: $1,269.7 million definitive, $793.5 million discretionary, $47.2 million legal risk; about $2.11 billion.

September 30, 2026 undrawn: $1,264.4 million definitive, $627.4 million discretionary, $47.0 million legal risk; about $1.94 billion.

September 30, 2026 deployed cost: $2,595.2 million; capital provision assets at fair value $3,337.6 million.

Definitive commitments barely moved; discretionary fell 21%.

What AltStreet's reviews and filings show

Burford 2025 10-K: some agreements require funding 'over a period of time,' others 'the total commitment upfront'; portfolio defined as fair value plus undrawn commitments; more than $12.1 billion of group-wide commitments since 2009.

Silver Bull 10-Q (July 31, 2026): up to $9.5 million committed; $5,925,000 of legal and arbitration costs paid since September 2023 plus corporate cost reimbursements; agreement terminated after the May 29, 2026 award.

AmBase 10-Q (June 30, 2026): an initial $6.0 million fund amount (including $4.0 million of converted notes) plus additional amounts as agreed; $1.0 million more under a July 2026 letter agreement.

AltStreet's Omni Bridgeway review (October 31, 2026): the newest funds charge about 2% a year on active commitments and transaction fees targeted at 2.5% to 3.0% of commitments, with an 8% hurdle, catch-up and carried interest of 20% up to a 20% IRR and 30% above it, on an American (deal-by-deal) waterfall.

Questions to reconcile commitments

What are investor commitments, called capital, case commitments and deployed capital at the same date?

How much of the case commitment total is definitive?

Are fees charged on commitments or on deployed capital?

How have actual deployments compared with initial budgets on concluded cases?

Does the fund have uncalled capital or liquidity to meet its definitive commitments?

How investors apply the term

Investors usually apply this term by tying the definition back to the controlling documents and then asking which cash flows, rights, restrictions, or valuation assumptions it changes. A useful review looks at the term alongside fees, leverage, liquidity, reporting frequency, and manager discretion rather than treating it as a standalone concept.

The practical diligence test is simple: identify who benefits if the assumption is wrong, who has control when conditions change, and what evidence the investor receives after closing. Terms that cannot be reconciled to documents, cash movements, and monitoring data should be treated as marketing shorthand until proven otherwise.

Frequently asked questions

Is committed litigation capital the same as money already invested?: No. A commitment is a ceiling; capital is deployed in stages as the case incurs costs, or up front for a monetization. Silver Bull's funder committed up to $9.5 million from September 2023 and had paid $5,925,000 of legal and arbitration costs, plus corporate cost reimbursements, by the time the claim was dismissed in May 2026 and the agreement was terminated. The rest was never deployed.
Why does the distinction matter for an investor?: Returns are earned on deployed capital, while fees and headline sizes are often quoted on commitments. A fund that reports a large commitment total may have spent far less, and its eventual return depends on cases that have not yet drawn their full budgets. AltStreet's Omni Bridgeway review notes the newest funds charge about 2% a year on active investment commitments and target transaction fees of 2.5% to 3.0% of commitments.
How large is the gap at a big funder?: Large. Burford reported undrawn commitments on its capital provision assets of $1,264.4 million definitive, $627.4 million discretionary and $47.0 million of definitive legal risk commitments at September 30, 2026, about $1.94 billion in all, against a deployed cost of $2,595.2 million. AltStreet's Burford review cites a group-wide portfolio of $7.5 billion for FY2025, a figure that includes undrawn commitments.
What is the difference between definitive and discretionary commitments?: Whether the funder must pay. Burford's definitive commitments are those where it is 'contractually obligated to advance incremental capital and failure to do so would typically result in adverse contractual consequences (such as a dilution in our returns or the loss of our deployed capital in a case).' Discretionary commitments leave it 'a considerable degree of discretion' and are 'subject to further case-level underwriting.'
Do commitments always get drawn?: No. Cases settle early, lose, or cost less than budgeted, and agreements terminate. Silver Bull's facility stopped when its claim was dismissed. Burford's discretionary commitments fell from $793.5 million at December 31, 2025 to $627.4 million at September 30, 2026. Some commitments, such as AmBase's, also grow: its 2026 agreement covers an initial $6.0 million 'plus such additional amounts as may be necessary,' and a July 2026 letter agreement added $1.0 million.
How should an investor read a fund's size?: Separate three numbers: investors' commitments to the fund, the fund's commitments to cases, and the capital actually deployed into cases. Each is a step down from the one before, and returns, multiples and IRRs are calculated on the last. Ask for all three at the same date.