Following his high-profile move from Clyde & Co together with fellow partners Milena Szuniewicz and Ian Hopkinson, Ben Knowles sat down with Legal Finance Expert editor Nick Rowles-Davies to discuss international arbitration, the structural pressures reshaping large law firms, and the shifting landscape of litigation funding.
Ben, you were at Clyde & Co for most of your career, most recently chairing the disputes group. For people who don’t know your background, how did you end up as one of the most recognised international arbitration lawyers in London?
“I joined Clyde & Co in 1993. In those days everything was paper-based. You applied to firms through brochures, attended interviews, and made career decisions with very limited information. There was no internet and almost no email.
“One unusual feature of Clyde’s interview process was that they were experimenting with psychometric testing. I had studied psychometrics at Cambridge, so I told them I had answered the questions in the way I thought a disputes lawyer should. That led to an interesting conversation and ended up being the interview I enjoyed most. I got the offer and joined.
“I started in marine disputes, then spent time in insurance during the Lloyd’s LMX spiral, when the firm had a huge amount of work and even junior lawyers were given significant responsibility. I also spent some time in corporate before deciding to focus on disputes.
“From there I moved into trading disputes for some of the largest commodity trading companies in the world. Over time those companies began investing directly in assets – mines, oil and gas fields and infrastructure – and the disputes followed those investments. Gradually the work evolved from trading disputes into oil and gas and infrastructure disputes.
“A key moment came when a client introduction led to an arbitration involving a major oil and gas producing block in Yemen. That case ran for about seven years and, at the time, was the second-largest arbitration by value in history. It led to a long-term client relationship and a number of other major disputes.
“So the practice evolved gradually – marine disputes, then trading disputes, then oil and gas and infrastructure arbitration – and over time that became what people now describe as an international arbitration practice. Alongside the disputes work, I have also developed an advisory practice, particularly in oil and gas, focusing on many of the issues that have cropped up over the years in our various arbitrations.
“About ten years ago, at Clyde, we formalised arbitration as a dedicated discipline within the firm, which I ended up leading for a number of years. In total I spent around 34 years at Clyde & Co, during which the firm grew from a small international practice to more than seventy offices worldwide.”
You joined Keystone at the start of 2026. What actually drove that decision? After leading a disputes group at a major international firm, what does Keystone offer that tipped it for you?
“For some time I have been interested in law firm models, and the pros and cons of different approaches. It is no secret that there has been a trend, in recent years, for more senior lawyers to move away from big law into alternative models, and that has been particularly apparent in the arbitration space, which I know best. There are a variety of reasons for this, and they include freedom from conflicts, commercial flexibility and the ability to focus on delivering good work for clients..
“International arbitration often involves disputes across different sectors and jurisdictions, so you need to be relatively conflict-free to take on the work. As large firms grow and represent more clients globally, conflicts inevitably increase.
“That was particularly relevant in my case because much of my work came from the Middle East, where Clyde & Co also has a very large presence.
“I was interested in a structure that was more flexible and commercial, with fewer conflict constraints. I did consider other firms, but that ultimately led me to the Keystone model.
“Keystone provides many of the benefits of a large firm – infrastructure, recruitment and business development support – but it is much leaner and gives lawyers much more flexibility. So there was both a push factor in terms of conflicts and a pull factor in terms of the structure.”
Keystone’s model is structurally very different – no lock-step, no eat-what-you-kill pressure in the traditional sense. Has that changed how you think about the work, or how you serve clients?
“From a client perspective the biggest difference is that they get more senior input.
“Because of the structure of the model, senior lawyers spend less time on internal management and administration and more time advising clients directly.
“When I was a senior partner in a large firm I was probably spending about 70% of my time on management. That has largely gone. I now spend the vast majority of my time advising clients and developing the practice.
“The model also offers significant commercial flexibility. In effect you can run your own practice without the administrative burden of running a firm – things like insurance and infrastructure are handled centrally.
“It also means that for some international matters I will collaborate with other firms rather than everything being handled within a single global platform. That has pros and cons, but it is simply a different way of structuring work.
“Overall I’m very happy with where we’ve landed. Our clients have followed us and it gives us a strong platform to continue building the practice.”
Litigation Funding Landscape
You’ve been working with litigation funders for a long time. If you had to characterise where the market is right now – funder appetite, deal volume, quality of cases being brought – what does it actually look like from where you sit?
“I’ve been working with litigation funders on and off for about ten years in the UK and other jurisdictions. Over that period the market has grown steadily, although there have been occasional disruptions driven by commercial conditions or regulatory changes.
“Funding is now permitted in most major jurisdictions, but new regulations in some places have made it easier or harder at different times. Overall, though, the market has grown consistently.
“At the same time the industry is maturing. Litigation funding has been around for roughly twenty years in the UK and there have been some notable failures, particularly in the mass claims space where law firms were funded to run certain types of cases and those cases collapsed, leaving firms owing funders significant sums.
“Some funders have also been in the market for a long time without generating the returns their investors expected. As a result there is something of a shake-out taking place.
“A large proportion of the capital still comes from US hedge funds and private equity – firms such as Fortress and others. Some investors come and go, but much of the underlying capital remains consistent.
“Over the last couple of years other asset classes, such as private credit, have offered comparable returns and attracted some of that capital. But that tends to be cyclical. If those returns fall, some of the money will likely move back into litigation funding.
“My sense is that in two or three years’ time the largest and most established funders will still be around, but there may be further consolidation among smaller players.”
One narrative is that after PACCAR the market effectively paused, restructured, and is now coming back with more confidence. Is that the picture you recognise, or is it more complicated than that?
“In 2023 the UK Supreme Court handed down the PACCAR decision. However people describe it, it posed something close to an existential threat to the litigation funding market.
“Litigation and dispute resolution are inherently risky, and funders are used to assessing those risks. But they also need certainty around the enforceability of funding arrangements.
“PACCAR introduced significant uncertainty about which funding terms were enforceable and which were not. That affected the UK market and, to some extent, had repercussions internationally.
“It also led in part to the Civil Justice Council review in the UK.
“Despite that uncertainty, funders have continued to operate and deals are still being done, whether in the UK or elsewhere. But there is definitely an additional layer of uncertainty that funders now have to factor into their decisions.
“If you are putting a funding arrangement in place today, you have to consider what the legal position might look like several years from now when the case concludes. That uncertainty has inevitably affected the market.”
You work heavily with Middle Eastern clients – sovereigns, NOCs, VC investors. Is funding penetrating those relationships, or is there still resistance to third-party involvement in disputes from that part of the world?
“There are still sectors and markets where funding is relatively unfamiliar, and to some extent the Middle East is one of them. Historically there has been some resistance to third-party funding.
“But that picture is becoming more mixed. It is no longer accurate to say that Middle Eastern clients simply do not like funding. Some do, while others are less familiar with it.
“There are certainly opportunities opening up in places like the UAE. Part of the reason is that much of the business conducted there involves international companies. Funding may be arranged in the UAE while the underlying disputes are heard in other jurisdictions such as the UK or the US.
“So while adoption is uneven, the market is gradually opening up.”
Are funders getting more selective? The perception is that ticket sizes are going up, case quality thresholds are rising, and smaller claimants are finding it harder to get funded. Do you see that?
“Funders have always been selective.
“If a particular type of case performs poorly – or several cases go wrong – funders tend to move away from that sector and allocate capital elsewhere. That is simply how markets operate.
“But in terms of their core criteria, most funders still look for broadly the same things: strong legal merits, enforceable awards and a realistic pathway to recovery.
“In some markets, including parts of the Middle East, you could even say funders are becoming less selective in the sense that they are now willing to consider opportunities they would previously have declined entirely.”
Regulation and Policy
The CJC published its final report in June last year, making 58 recommendations. The Government then confirmed in December it would accept the two headline ones – reversing PACCAR and introducing proportionate regulation. From a practitioner’s perspective, is that the right call, or should they have gone further?
“The Civil Justice Council review was very thorough and produced around 58 recommendations.
“No stakeholder agrees with every single one, but most people agree with most of them – whether they are funders, claimants, lawyers or other market participants.
“There is relatively broad consensus about the key issues, such as conflicts of interest and the level of funder returns.
“Overall I think the review was a useful exercise and produced sensible recommendations, even if there is disagreement on certain details.”
The CJC recommended regulation by the Lord Chancellor rather than the FCA and explicitly kept arbitration outside the formal regime. Do you think that’s the right call on both counts?
“Yes, I think keeping arbitration outside the formal regime is absolutely right.
“Arbitration is inherently international. You might have an arbitration heard in London where the parties are foreign, the arbitrators are foreign and the lawyers are foreign.
“It therefore makes little sense to regulate arbitration funding under the same regime that applies to domestic court litigation. Arbitration itself is not regulated in the same way as the courts, so keeping it outside that framework is logical.
“In practical terms it would also be extremely difficult to regulate arbitration funding through a national regime.”
There’s a specific certification proposal in the CJC report, requiring funders and lawyers to certify they didn’t approach the funded party themselves. In practice, how does that interact with the way cases are actually originated and structured?
“All of this is happening against a volatile political environment in the UK.
“When governments are dealing with major economic and geopolitical challenges, litigation funding reform may not be high on the legislative agenda.
“There is therefore a risk that addressing litigation funding – including reversing PACCAR – could end up being delayed.
“That may not happen, but the pace of change has certainly been slower than many people expected, and that contributes to the uncertainty funders are currently facing.”
My own view is that funders may have been able to have passed the previously legislation, tabled by the previous Government, if they had not stubbornly focused on retrospective legislation. The issue has been raised again recently some two years after PACCAR and when many, many, commercial deals have been struck. Do you have a view on the retrospective proposals?
“One proposal was to reverse PACCAR retrospectively as well as prospectively.
“Some funders supported retrospective legislation because they had existing funding agreements that might otherwise be unenforceable.
“But retrospective legislation is unusual and generally unattractive. It effectively changes the legal consequences of actions taken in the past.
“For commercial parties that creates uncertainty, because the government can alter the outcome of transactions that people believed were lawful at the time.
“In practice it can turn winners into losers and vice versa. My view is that if the debate about retrospective changes had not arisen, the PACCAR issue might already have been resolved.”
Cross-Border Trends
Burford Capital made headlines saying they’d stopped defaulting to London as an arbitration seat because of PACCAR-related uncertainty. Now that the Government has indicated it will act, does London reclaim that position or has some of the reputational damage stuck?
“Some of the commentary about London losing ground is partly strategic positioning intended to encourage the government to act.
“If funders want to avoid the risks created by PACCAR, they can structure funding agreements under US law rather than English law.
“London remains a very strong arbitration centre for many reasons – the legal system, the judiciary, the quality of lawyers and the supporting infrastructure.
“Other centres such as Singapore and Dubai are growing, but I do not think London will lose its leading position any time soon.”
For an in-house counsel or a CEO sitting on a substantial claim right now, not sure whether to pursue it, not sure whether to fund it, what’s the one thing you’d tell them before they make that call?
“Speak to a funder.
“You have very little to lose other than the time spent briefing them about the case and seeing whether funding might be available.
“Even if funding is not secured, the process often provides valuable feedback. A funder might identify issues with enforcement, damages or other aspects of the claim.
“That information can help you strengthen the case or decide not to pursue it.
In some situations funders may even buy the claim outright, which is another option within the funding market.”
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