We have people that can underwrite and evaluate those matters and shepherd them through. And so we achieved diversification because it’s a robust, diverse legal market. And I found there’s a nice mix of small and large matters. There’s a nice mix by jurisdiction. Does it ebb and flow one quarter to the next, where we’ll have a very rich arbitration pipeline for a couple of months, and then there’s a whole bunch of patent matters that come in. Yes, but generally, we’re firing on all cylinders in all the pipelines. On the YPF point, I can’t get into as much as I’d love nothing more than to keep you on the phone for hours talking about the merits of the case. I can’t really get into it, and I don’t want to sort of preview our pellet briefing, but all I can say is it shouldn’t come as a surprise to you that we’ve been litigating this for nine years.
We would be very familiar with all the traps that Argentina would run and all the points their lawyers would make. And so I don’t think there’s going to be anything surprising, but I can’t really comment on the merits. And you’ll see our brief will be filed, and you’ll get to see all the responses.
Christopher Bogart: So operator, we are two minutes past the hour, but I think we have time for one more question.
Operator: Our last question today will come from Andrew Shepherd-Barron from Peel Hunt. Please go ahead.
Andrew Shepherd-Barron: Okay. Thank you very much and thanks for the presentation. Well, actually, I had three questions, so let’s see how we do. One is on IRRs. I don’t think you’ve actually published what IRR was for the cases completing this last year. But if I look at lifetime, lifetime has dropped from 29% a year ago to 27% now, which suggests that IRRs were probably somewhere around 23%, 24% for last year. So can you talk a little bit about that? And if that is right, and if you’re thinking — if you’re going to be taking the advantage funds in-house, which I think you said we are teen IRRs, what does that say about future IRRs? Second question, if I may. As you said that — I think you said that you throttle back effectively a new business because you have a sort of resource constraint, and so much of your team was focused on settlement.
Isn’t that going to repeat next year when logic continue there? And thirdly, if we have time, I wonder if you could talk about at all about what are the large deals might be out there outside of YPF? Thank you.
Christopher Bogart: Sure. So maybe I’ll take them in reverse order. So I think we’re not really in a position to talk about individual matters that are out there. But just looking at the nature of even if you just look at the US, looking at the nature of the US litigation market, there are a significant number of large matters there. And if the premise of your question is what we wrote in the shareholder letter, about basically being able — being willing to take on to consider to take on a couple more Pearsons, if you will. What we’re seeing there is that there are matters that are very potentially large, but also come with probably outsized risk and we are very careful about how much risk we’re prepared to take in the business and we calibrate it very carefully.
But when we can find something like Pearson that has such an asymmetry between the risk that we’re taking, the capital risk that we’re taking and the potential upside, those are potentially attractive to us. And so we keep our eyes open for things like that. In terms of the new business point, I think the answer is sort of yes, but. And what I mean by that is we have a finite number of people I’ll keep on using the patent group that I just described. And those people are, as I said a moment ago, they’re sort of doing it all. And so it’s a natural outcome, but if they have a lot of time being spent on a case in a particular week that because that case is going into trial, they’re probably going to spend less time during that particular week on originating new business.
But the week following that, they might not have a case going to trial and they can be full bore on new business. And we don’t — they would never be in a position of being 100% full bore on new business anyway. So is it a constraint? Sure. It’s a constraint. If I were to double or trouble the size of the patent group and devote all the new people that we’ve just hired to only trying to find and originate new business, would we probably do somewhat more new business, yes. But is that a sensible way to run the business? Jon and I have not historically taken that view. We’ve been pretty moderate in how we’ve expanded both with an eye to cost base and with an eye to not trying to get it over our skis. And so if the price of that is that in some periods, when we’re breaking in the cash, we’re not doing quite as much new business activity, that’s from our perspective of sort of an acceptable short-term compromise.
But the stuff always from our perspective, comes back and rights itself.
Jonathan Molot: I would just add to that, we are hiring. And as Chris said, the idea is hiring a new patent Pearson, you don’t want to double the size of the team in a short period of time and change the quality control. But integrating people one by one is a good way to do it. And we’re in the process of doing that now. Not just in patent, but in various areas too.
