Governance
The architecture of discipline.
HLC's discipline is procedural, not aspirational. The Investment Committee operates under a fixed protocol that governs composition, voting, recusal, and the conditions under which capital is committed — or withheld.
Investment Committee Protocol
Ten standing provisions.
- I
Composition
The Investment Committee comprises senior professionals drawn from litigation, structured credit, and institutional risk. At least one member must hold formal legal qualifications and active legal practice. Membership is fixed; observers are not permitted.
- II
Voting Threshold
Every commitment requires a supermajority. A single dissent on merits, quantum, or recoverability is sufficient to defer the matter pending further diligence.
- III
Quorum
No commitment may be approved without the participation of all sitting non-recused members. Quorum is calculated on non-recused members. Capital is never deployed by partial committee.
- IV
Recusal
Any member with a personal, professional, or prior counsel relationship to a party, firm, or matter recuses absolutely. Recusal is recorded in the IC minute.
- V
Conflict Register & Clearance
A standing conflict register is reviewed at the opening of every committee session. A written Conflict Clearance from the Compliance Officer is a precondition to any IC consideration. New conflicts trigger immediate disclosure and a fresh recusal review.
- VI
Non-Interference Doctrine
A binding internal rule prohibits HLC staff and IC members from directing litigation strategy, instructing counsel, or interfering with counsel's professional judgment at any point. The authority of counsel and claimant over the conduct of the matter is absolute.
- VII
Concentration Limits
No single matter exceeds 12% of committed capital. No sector exceeds 35% of the portfolio. No single law firm represents more than 30% of matters by count. Limits are tested at every IC commitment.
- VIII
External Counsel
Independent external counsel is retained for every legal-merits assessment above the screening threshold. The IC does not rely on internal opinion alone.
- IX
No Side Letters
There are no side letters, MFN clauses, or undisclosed economics. Every commitment is documented on the same standard form, varied only by transaction-specific terms.
- X
Records & Audit
Every IC memorandum, vote, recusal, and stress-test is preserved for a minimum of seven years. The complete file is available to claimants on request, subject to confidentiality.
§ Privilege & Confidentiality
"All information shared with HLC in the course of evaluating or funding a matter is treated as subject to attorney-client privilege and the common interest doctrine to the fullest extent permitted by applicable law."
HLC does not seek privileged communications from counsel beyond what is reasonably necessary for underwriting and monitoring. The existence of any funding relationship is not disclosed to opposing parties without claimant consent, except where required by law or applicable procedural rules.