- Third-Party Litigation Funding
On the heels of a RAND Institute for Civil justice conference on the topic, the New York Law Journal has a story on the rise of third-party funding of litigation, a topic we covered in last year in our annual print magazine. Timothy Scrantom of Juridica Investments authored for us Capital Access to Law Markets, in which Scrantom critiqued the separation of capital markets from litigation in the American legal system. He wrote: “If the industry of professional legal services and capital markets are so interwoven, why should capital flow into law markets be constrained at all?”
The NY Law Journal piece explains that, though the trend started in Australia and the UK, litigation funds are looking for U.S. cases to finance in return for a stake in the verdict or settlement. Cadwalader’s Louis Solomon “is among a handful of corporate litigators” using outside funding. The U.S. Chamber of Commerce is against third-party funding and has called for a ban, and other critics have cited possible ethical issues. The Chamber believes that the use of outside financing will lead to more lawsuits. However, Solomon argues: "If it has the effect of giving a client a greater choice of which law firm to hire, you might say that is a good thing.”
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| 07:43 AM Jun 4, 2010 | Email the Daily Dragon | Email this Article | Post Comments |
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