Related Party	6 Months Ended
Jun. 30, 2022
Related Party Transactions [Abstract]
Related Party	Note 13. RELATED PARTY Loan from related parties During the three months ended June 30, 2022, the Company issued an unsecured promissory note in an aggregate principal amount of $112.8 million (the “Promissory Note”) to John H. Ruiz and Frank C. Quesada, the Company’s Chief Executive Officer and director and Chief Legal Officer and director, respectively (collectively, the “MSP Principals”), to provide operating cash to the Company. The Promissory Note bears interest at an annual rate of 4%, payable in kind, and will mature on the four year anniversary of the issuance. The Promissory Note is payable by the Company at any time, without prepayment penalties, fees, or other expenses. A portion of the proceeds under the Promissory Note in an amount equal to $36.5 million was advanced to the Law Firm, an affiliate of certain Members, for certain operating expenses as contemplated by the Legal Services Agreement. This amount is reflected in prepaid expenses and other current assets within the condensed consolidated balance sheets and had a balance of $36.5 million as of June 30, 2022. The payments of Law Firm expenses is reflected in Professional fees - legal within the condensed consolidated statement of operations. Legal Services – MSP Recovery Law Firm Certain Company entities have previously entered into legal services agreements (the “Existing LSAs”) with the Law Firm, an affiliate of certain Members, for the recovery of claims. Pursuant to the terms of the Existing LSAs, the Law Firm provides the Company with investigation, case management, research and legal services in the pursuit of recovery of claims in exchange for a portion of the recovered proceeds relating to such claims. The Existing LSAs also provide that the Law Firm serves as exclusive lead counsel for any litigation relating to such claims. As of June 30, 2022 and December 31, 2021, $0.1 million and $5.5 million, respectively, was due to the Law Firm and included in the condensed consolidated balance sheets in Affiliate Payable. For the three and six months ended June 30, 2022, $27 thousand and $31 thousand, respectively was included in Professional fees - legal for expenses related to the Law Firm in the condensed consolidated statements of operations. For the three and six months ended June 30, 2021, the amounts were de minimus. For the three and six months ended June 30, 2022, $231 thousand and $271 thousand, respectively, were included in cost of claims recoveries for expenses related to the Law Firm in the condensed consolidated statements of operations. For the three and six months ended June 30, 2021, no amounts were included cost of claims recoveries for expenses related to the Law Firm in the condensed consolidated statements of operations. The Law Firm may also collect and/or hold cash on behalf of the Company in the ordinary course of business. As of June 30, 2022 and December 31, 2021, $1.8 million and $3.4 million, respectively, was due from the Law Firm and included in the condensed consolidated balance sheets in Affiliate Receivable. In addition, the Company rents office space from the Law Firm as discussed in Note 8, Operating Lease. For the three and six months ended June 30, 2022, the Company issued 8,022,000 Class A common stock shares to Law Firm employees, which was deemed to be share based compensation. As such $20.1 million of expense was included within Professional fees - legal for expenses related to the Law Firm in the condensed consolidated statements of operations. MSP Recovery Aviation, LLC The Company may make payments related to operational expenses on behalf of its affiliate, MSP Recovery Aviation, LLC (“MSP Aviation”). MSP Recovery Aviation, LLC was created to provide aircraft rental to third party customers and the Company. The Company has made payments in the periods of the financial statements only related to specifically billed flights and these rates are at or below the market rate for such services. As of June 30, 2022 and December 31, 2021, $195 thousand and $153 thousand was due from MSP Aviation and included in the condensed consolidated balance sheets in Affiliate Receivable. For the three and six months ended June 30, 2022, $156 thousand and $250 thousand, respectively was included in General and administrative expenses related to MSP Aviation in the condensed consolidated statements of operations. For the three and six months ended June 30, 2021, the amounts were de minimus. Funds held for other entities The Company may collect and/or hold cash on behalf of its affiliates in the ordinary course of business. As of June 30, 2022 and December 31, 2021, $20.1 million and $39.7 million was due to affiliates of the Company and included in the condensed consolidated balance sheets in Affiliate Payable. These amounts were primarily due to Series MRCS LLC, an affiliate of MSP, and will be repaid either through excess cash flows from operations or other financing. During the year ended December 31, 2021, the Company also entered into a note payable with Series MRCS as outlined in Note 7, Intangible Assets, Net. As of June 30, 2022 and December 31, 2021, the balance of the note payable was $0.5 million and included in the condensed consolidated balance sheets in Claims financing obligation and notes payable. As of December 31, 2021, $0.4 million was due to MSP National, LLC from Series MRCS LLC and as of June 30, 2022 and December 31, 2021, there were additional receivables from other affiliates of $130 thousand and $92 thousand, respectively. These were included in the condensed consolidated balance sheets in Affiliate Receivable. VRM Historically, MSP Recovery, LLC has received claims recovery service income for services provided to VRM. The Company concluded that VRM is a related party due to ownership interests in the entity held by Series MRCS LLC, an affiliate of MSP. During the three and six months ended June 30, 2022 and 2021, $3.2 million and $10.6 million, respectively, and $2.6 million and $5.3 million, respectively, of claims recovery service income was received from VRM as part of the servicing agreement and was included in the condensed consolidated statements of operations.

Related Party

6 Months Ended

Jun. 30, 2022

Note 13. RELATED PARTY

Loan from related parties

During the three months ended June 30, 2022, the Company issued an unsecured promissory note in an aggregate principal amount of $112.8 million (the “Promissory Note”) to John H. Ruiz and Frank C. Quesada, the Company’s Chief Executive Officer and director and Chief Legal Officer and director, respectively (collectively, the “MSP Principals”), to provide operating cash to the Company. The Promissory Note bears interest at an annual rate of 4%, payable in kind, and will mature on the four year anniversary of the issuance. The Promissory Note is payable by the Company at any time, without prepayment penalties, fees, or other expenses.

A portion of the proceeds under the Promissory Note in an amount equal to $36.5 million was advanced to the Law Firm, an affiliate of certain Members, for certain operating expenses as contemplated by the Legal Services Agreement. This amount is reflected in prepaid expenses and other current assets within the condensed consolidated balance sheets and had a balance of $36.5 million as of June 30, 2022. The payments of Law Firm expenses is reflected in Professional fees - legal within the condensed consolidated statement of operations.

Legal Services – MSP Recovery Law Firm

Certain Company entities have previously entered into legal services agreements (the “Existing LSAs”) with the Law Firm, an affiliate of certain Members, for the recovery of claims. Pursuant to the terms of the Existing LSAs, the Law Firm provides the Company with investigation, case management, research and legal services in the pursuit of recovery of claims in exchange for a portion of the recovered proceeds relating to such claims. The Existing LSAs also provide that the Law Firm serves as exclusive lead counsel for any litigation relating to such claims. As of June 30, 2022 and December 31, 2021, $0.1 million and $5.5 million, respectively, was due to the Law Firm and included in the condensed consolidated balance sheets in Affiliate Payable. For the three and six months ended June 30, 2022, $27 thousand and $31 thousand, respectively was included in Professional fees - legal for expenses related to the Law Firm in the condensed consolidated statements of operations. For the three and six months ended June 30, 2021, the amounts were de minimus. For the three and six months ended June 30, 2022, $231 thousand and $271 thousand, respectively, were included in cost of claims recoveries for expenses related to the Law Firm in the condensed consolidated statements of operations. For the three and six months ended June 30, 2021, no amounts were included cost of claims recoveries for expenses related to the Law Firm in the condensed consolidated statements of operations.

The Law Firm may also collect and/or hold cash on behalf of the Company in the ordinary course of business. As of June 30, 2022 and December 31, 2021, $1.8 million and $3.4 million, respectively, was due from the Law Firm and included in the condensed consolidated balance sheets in Affiliate Receivable. In addition, the Company rents office space from the Law Firm as discussed in Note 8, Operating Lease.

For the three and six months ended June 30, 2022, the Company issued 8,022,000 Class A common stock shares to Law Firm employees, which was deemed to be share based compensation. As such $20.1 million of expense was included within Professional fees - legal for expenses related to the Law Firm in the condensed consolidated statements of operations.

MSP Recovery Aviation, LLC

The Company may make payments related to operational expenses on behalf of its affiliate, MSP Recovery Aviation, LLC (“MSP Aviation”). MSP Recovery Aviation, LLC was created to provide aircraft rental to third party customers and the Company. The Company has made payments in the periods of the financial statements only related to specifically billed flights and these rates are at or below the market rate for such services. As of June 30, 2022 and December 31, 2021, $195 thousand and $153 thousand was due from MSP Aviation and included in the condensed consolidated balance sheets in Affiliate Receivable. For the three and six months ended June 30, 2022, $156 thousand and $250 thousand, respectively was included in General and administrative expenses related to MSP Aviation in the condensed consolidated statements of operations. For the three and six months ended June 30, 2021, the amounts were de minimus.

Funds held for other entities

The Company may collect and/or hold cash on behalf of its affiliates in the ordinary course of business. As of June 30, 2022 and December 31, 2021, $20.1 million and $39.7 million was due to affiliates of the Company and included in the condensed consolidated balance sheets in Affiliate Payable. These amounts were primarily due to Series MRCS LLC, an affiliate of MSP, and will be repaid either through excess cash flows from operations or other financing. During the year ended December 31, 2021, the Company also entered into a note payable with Series MRCS as outlined in Note 7, Intangible Assets, Net. As of June 30, 2022 and December 31, 2021, the balance of the note payable was $0.5 million and included in the condensed consolidated balance sheets in Claims financing obligation and notes payable.

As of December 31, 2021, $0.4 million was due to MSP National, LLC from Series MRCS LLC and as of June 30, 2022 and December 31, 2021, there were additional receivables from other affiliates of $130 thousand and $92 thousand, respectively. These were included in the condensed consolidated balance sheets in Affiliate Receivable.

VRM

Historically, MSP Recovery, LLC has received claims recovery service income for services provided to VRM. The Company concluded that VRM is a related party due to ownership interests in the entity held by Series MRCS LLC, an affiliate of MSP. During the three and six months ended June 30, 2022 and 2021, $3.2 million and $10.6 million, respectively, and $2.6 million and $5.3 million, respectively, of claims recovery service income was received from VRM as part of the servicing agreement and was included in the condensed consolidated statements of operations.