By Casey Sullivan
March 13 (Reuters) - High-profile former U.S. federal
prosecutor Andrew Stolper said Tuesday he had teamed up with an
ex-FBI agent to form a private equity firm specializing in
litigation finance, a growing business in the legal industry.
Stolper, whose career included the ill-fated Broadcom case
in 2009, said Crux Capital launched on Monday. He resigned last
week from his position with the U.S. Attorney's office in Santa
Ana, where he had worked for 10 years.
The litigation finance boutique, based in Irvine, Calif.,
will specialize in plaintiff's commercial litigation and
eventually staff up to about five people.
A spokesman for the U.S. Attorney's office declined to
comment about Stolper's move into private practice.
A U.S. District Court judge singled out Stolper for
criticism when he dismissed criminal stock fraud charges against
Broadcom Corp co-founder Henry T. Nicholas III in 2009,
citing a "shameful" prosecution campaign to intimidate
Stolper told Reuters in an interview that a subsequent
investigation by the U.S. Attorney's office had found "no
misconduct" in the handling of the Broadcom case, and he did not
expect his past to have any bearing on his ability to raise
funds for his new venture.
"We are still in the infancy of our business," said Stolper,
who declined to disclose how much money he had raised or who his
Litigation finance is a means for hedge funds and other
investors to provide money to litigants in exchange for a cut of
any settlements or verdicts. It traditionally has been used to
fund personal injury cases but recently has been used to back
commercial litigation, as investors seek to make money from
betting on lawsuits.
Stolper's partner is Peter Norell, a former agent with the
Federal Bureau of Investigations who pleaded guilty in 2010 to
illegally accessing FBI records and threatening to launch a
criminal probe to help an acquaintance collect a debt.
He was sentenced to a year of probation, including three
months of home confinement. Norell said he left the agency
around the time of his conviction.
Norell worked with Stolper in a number of corporate fraud
investigations. In 2009 their work secured fraud convictions
against an Orange County Lamborghini dealer and two former
executives of medical device manufacturer Endocare Inc.