Virage Capital Management, a Houston-based litigation funder, seems to have a distinct taste for risk. A close look at its operations since its inception in 2013 reveals that its funding activities are intricately linked to a series of high-profile law firm implosions. On no less than four occasions, it has found its lending involved in instances of notable law firms going under. Notably, in at least three of these cases, lawyers from the respective firms have faced regulatory investigations or charges relating to fund misappropriation.
The firm, led by former Enron executive Edward Ondarza, has on numerous occasions had to resort to legal action to recover defaulted loans from its borrowing clients. Records from Harris County, Texas, display an active involvement of the company in ongoing lawsuits amounting to amounts as diverse as $300,000 to $85 million, all in an effort to recoup its finances from failing law firms.
Among its troubled borrowers is Philadelphia-based law firm Sacks Weston, who in August declared bankruptcy, adding to the growing list of law firms that had dealings with Virage Capital before encountering financial difficulties.
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