How Litigation Finance Is Leveling the Playing Field in the Fight for Justice
We have seen justice as blind in the legal world, however what we see in the back stage is that those with financial strength can fight and others are compelled to fold. Viable lawsuits are dismissed each year not due to the lack of merit but due to the lack of a government. This is where the litigation finance comes in-to make sure that there is no end to the state of justice at the courthouse door.
The Cost of Pursuing a Case
Trials are costly. Lawyers, legal consultants, court costs, discovery and document control can soon run expenses into the six or seven figure range, without even an actual trial date. Not only does it take a lot of money to sustain litigation, it takes a lot of money to do it in the case of individuals, startups or under-resourced plaintiffs. In other instances, deep-pocket defendants deliberately take advantage of this, leading to the prolonging of proceedings to deplete the other parties resources and either settle the matter, or abandon the case altogether. It is this imbalance in the system that litigation finance aims to fix.
What Is Litigation Finance?
Litigation finance — also known as third-party legal funding — is the practice of providing capital to plaintiffs or law firms in exchange for a portion of the proceeds from a successful case. It’s non-recourse, meaning that if the case is lost, the capital provider absorbs the loss — not the client.
It’s not just about funding — it’s about access:
- Access to justice for under-resourced claimants
- Access to high-caliber legal representation
- Access to time — the time needed to properly build and argue a strong case
Why “Don’t Drop the Case” Matters
Don t Drop the Case. The slogan, in particular, Fund It.” actually relates to a more level-running legal system. It represents a shift toward the understanding that justice barriers are financial barriers and that the sound claims must not be foregone due to the shortage of capital. Access to litigation funding allows the outcome of the case to be reliant on its merits as opposed to how much money an individual can spend. It may be a whistleblower action against wrongs committed in the corporate world, a patent misuse claim filed by an inventor, or a civil rights lawsuit demanding redress of grievances, litigation finance will enable claimants to persevere until final judgment.
Benefits of Litigation Finance
For Plaintiffs:
- Immediate access to capital without adding debt
- Risk transfer to funders
- Leverage in settlement negotiations
- Ability to pursue justice without financial ruin
For Law Firms:
- Reduced risk on contingency matters
- Working capital to grow operations
- Ability to take on more complex or longer-term cases
For Investors:
- Non-correlated returns
- High potential yield in a growing asset class
- Social impact through access to justice
Closing the Justice Gap
Litigation finance is more than a financial product, it is a lever. The funders achieve this objective because it means that litigation on meritorious yet under-resourced cases can ensure that the court is not a playground of only the powerful.
Don’t Drop the Case. Fund It.
Be a part of the movement that emboldened legal battles that are worth waging and makes justice not a privilege of the richest party.
