However, the involvement of Therium raises significant questions about the true motivations behind the claim and the ethics of third-party funding in cases involving sovereignty and international law. A closer examination of Therium’s role and its potential backers suggests that the claim may be less about justice for the Sulu heirs and more about financial opportunism.

What Is Therium?

Therium Capital Management is a UK-based litigation funder that finances legal cases in exchange for a portion of any monetary award or settlement. Known for funding high-profile disputes, Therium often targets cases where the potential payout is substantial, ensuring a lucrative return on its investment.

In the case of the Sulu heirs, Therium reportedly agreed to cover the legal costs of the arbitration, including lawyer fees and tribunal expenses, in exchange for a significant share of any award. Given the staggering $14.92 billion initially granted by the French arbitrator, Therium stood to profit immensely if the award were enforced.

Who Is Behind Therium?

While Therium operates as a private company, its funding structure and financial backers remain opaque.

Litigation funders like Therium typically rely on capital from institutional investors such as hedge funds, private equity firms, and high-net-worth individuals. These entities are drawn to litigation funding for its high-risk, high-reward nature.

Could Therium’s backers have political motives? The Sabah dispute is a contentious issue that touches on sovereignty and regional stability. If Therium’s investors include politically motivated entities or individuals, their involvement could be aimed at destabilizing Malaysia or exerting pressure on its government.

Therium is not a charity; it is a business. The firm likely saw the Sulu heirs’ claim as a speculative investment with the potential for an enormous payout. This raises ethical concerns about using private arbitration to pressure a sovereign state like Malaysia into paying an exorbitant sum.

Therium’s reluctance to disclose its investors raises concerns about the sources of its capital. Could rival states or groups with vested interests in weakening Malaysia be indirectly funding this litigation? Without transparency, such possibilities cannot be ruled out.

The Role of Lawyers and Arbitrators

Therium’s involvement also highlights the controversial role of lawyers and arbitrators in the Sulu heirs’ case. The firm likely collaborated closely with the heirs’ legal team to construct a case that would maximize potential damages, even if the legal basis was tenuous.

Gonzalo Stampa, a Spanish arbitrator at the center of the Sulu heirs' claim against Malaysia, has faced significant legal repercussions for his actions in the case. His involvement began in 2019 when he was appointed arbitrator in Madrid for this claim. However, the Madrid High Court annulled his appointment, citing improper procedures and lack of jurisdiction. Despite this, Stampa moved the arbitration seat to France and continued proceedings, culminating in a highly controversial USD 14.92 billion award against Malaysia.

Stampa's actions were deemed illegal by Spanish authorities. The Madrid Criminal Court convicted him for contempt of court and unauthorized professional practice, sentencing him to six months in prison and banning him from acting as an arbitrator for a year. The Madrid Court of Appeal upheld this conviction in May 2024, reinforcing that Stampa willfully disobeyed court orders by continuing the arbitration after his appointment was annulled. His conduct was described as undermining the rule of law and the integrity of international arbitration.

Critics argue that cases like this illustrate how private arbitration can be weaponized by profit-driven entities. Instead of delivering justice, the process becomes a tool to extract wealth from sovereign states.

While Therium and its backers stand to gain, the Sulu heirs themselves remain impoverished. Despite their historical ties to the Sultanate of Sulu, most descendants live in poverty in the southern Philippines. It is unlikely that they will see a significant share of any award, as much of the money would go to Therium and the lawyers involved.

Why Malaysia Will Prevail

Malaysia has mounted a strong defense, challenging the arbitration on multiple fronts. Courts in Spain, Luxembourg, and the Netherlands have already sided with Malaysia, declaring the arbitration award invalid or unenforceable. These victories reflect the broader consensus that private arbitration cannot override principles of sovereignty or adjudicate disputes rooted in historical agreements.

Furthermore, Malaysia’s stance exposes the dangers of litigation funding in sovereignty cases. By pushing back against Therium and the Sulu heirs’ claim, Malaysia is sending a clear message: sovereign states will not be bullied by profit-driven litigation funders. While the firm presents itself as a neutral financier, its opaque funding structure and profit-driven motives raise serious ethical questions.

Stampa's case serves as a warning against forum shopping and ignoring jurisdictional constraints, reinforcing Malaysia's position as the rightful victor in this legal battle. This outcome also bolsters confidence in the international legal system's ability to address such transgressions, particularly when sovereignty and the rule of law are at stake.

The lesson from this case is clear: sovereignty and justice cannot be commodified, no matter how deep the pockets of those seeking to profit from historical disputes. Malaysia’s steadfast defense ensures that it will emerge victorious, setting a precedent for other nations facing similar challenges.