What is Litigation Funding?
Litigation is a lawsuit that involves all the proceedings of legal action. Litigation is a very expensive process, and there are a number of options available to ensure you have or can obtain appropriate litigation funding. The most expensive pert of litigation is the lawyer’s fees. In some cases, such as personal injury claims, you may be able to hire a lawyer on a contingent fee basis. This means that there is no lawyer fee unless the case is won, and any lawyer’s fees are a percentage of the win awarded. The law firm advances the litigation funding, which includes all costs of the litigation until the outcome of the case. Some clients are not able to find a lawyer who is willing to do this, or they may have a lawyer who has extra expenses. In this case, litigation funding must be found from another source. There are many litigation funding companies that offer funding options to their clients. This type of litigation funding is most commonly known as a lawsuit loan. With this type o
Litigation funding is not a “loan” at all but rather it is a cash advance based upon the merits of a lawsuit that provides a plaintiff with sufficient funding to reach the conclusion of the case when the plaintiff will receive his/her fair share of the settlement or verdict. Litigation funding companies invest in the lawsuit itself as opposed to advancing money to the plaintiff in the form of a loan. Litigation funding is not based on a plaintiffs prior credit or bankruptcy status. Other terms used for this type of funding include: lawsuit loan, litigation finance, litigation loan, lawsuit funding, lawsuit finance, lawsuit cash advance, case loan, case cash advance, plaintiff cash advance, litigant funding, pre-settlement loan, pre-settlement lending, pre-settlement cash advance, etc. Do I need litigation funding? Litigation funding should not be a substitute for your settlement but rather a raft that helps you stay afloat while your attorney fights for you. Too many plaintiffs apply f
Answer By Richard Wilson This is where a hedge fund dedicates a portfolio or section of a portfolio towards funding litigation that the manager believe highly favors the party they are supporting. With third party litigation funding, the investors cover a portion or all of the costs of litigation in exchange for a share of awards by the court. Funds employing this strategy retain legal experts and refer to niche experts on each case before weighing in on the change of possible victory. MKM Longboat, a British hedge fund has had dedicated $100M towards a litigation funding portfolio focussed on legal cases in Europe. This an important development because it could be yet another way for hedge funds to produce un-correlated returns to the general stock market. Cases are decided and awards appointed regardless of bear and bull markets.
