Litigation funding and financing is a form of capital investment that provides financial support to those involved in legal disputes. It involves a third-party providing capital to cover the costs of litigation, such as court fees, expert witness fees, and other related expenses. This type of funding is often used by individuals or businesses who may not have the resources or desire to pay for their legal costs upfront.
There are several different types of litigation funding and financing available.
The most common type is known as “non-recourse” financing, which means that the funder does not expect repayment unless the case is successful.
Other types include “contingency fee” arrangements, where the funder will receive a percentage of any settlement or award; “advance fee” agreements, where the funder pays for all legal costs upfront; and “costs only” arrangements, where the funder covers only certain costs associated with the case.
Litigation funding and financing can be used in a variety of cases, including personal injury claims, business disputes, class action lawsuits, bankruptcy proceedings, intellectual property disputes, employment law matters, and more.
It can also be used in cases involving multiple parties or jurisdictions. In these cases, multi-party litigation funding (also known as lawsuit financing for group claims or class actions) can provide financial support to all parties involved in the dispute.
The use of litigation funding and financing has grown significantly over recent years due to its ability to provide access to justice for those who may not otherwise have been able to afford it.
It also helps reduce delays in resolving disputes by providing an alternative source of funds when traditional sources are unavailable or insufficient. Additionally, it allows litigants to focus on their case rather than worrying about how they will pay for it.
Overall, litigation funding and financing can be invaluable for those involved in legal disputes who need additional financial support. By providing access to justice and reducing delays in resolving disputes, it has become an increasingly popular option among individuals and businesses alike.
Answers to some of our most commonly asked questions.
Litigation financing involves a third-party providing funds to litigants or their attorneys to cover legal expenses such as filing fees, expert witness fees, and other costs associated with pursuing a lawsuit. The funder typically receives a portion of any settlement or judgment that may be awarded.
Yes, multi-party litigation funding (also known as lawsuit financing for group claims or class actions) is available in non-US jurisdictions. This type of financing typically involves the funder agreeing to pay all or part of the legal costs associated with the case in exchange for a share of any settlement or award that may be received.
