On 8 September, investors in litigation finance provider Burford Capital (BUR:AIM) were treated to a 22% spike in the share price to a four-year high of £13.43 following a landmark US ruling on its largest case.

For the past eight years Burford has been pursuing a legal case against Argentina for damages on behalf of several plaintiffs after their shares in YPF, the former state-owned oil producer, were renationalised in 2012.

The US District Court for the Southern District of New York judged that by law the Argentine government should have tendered for YPF shares in April 2012, rather than requisitioning them, and that as well as repaying the capital it should pay interest at a simple rate of 8%, which in round numbers makes the judgement worth $16 billion.

Burford described the ruling as ‘a complete win against Argentina at the high end of the possible range of damages’.

While Burford didn’t quantify what the decision means in terms of its own income, analyst Julian Roberts at Jefferies estimates the firm is entitled to around $6.3 billion or $28.77 per share compared with a share price of around $16.05 for the US-listed version of the shares as of 11 September.

However, Burford has warned shareholders this isn’t the end of the issue as the Argentine government has already signalled it will appeal the decision, meaning the plaintiffs will either have to reach a negotiated settlement – which could be for a lot less than $16 billion – or they may have to engage in a lengthy ‘enforcement campaign’ and further legal proceedings.

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