Articles & Publications

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  True Sales in Litigation Funding Agreements

  February 04, 2021

  An issue that keeps some litigation funders up at night concerns the possibility of a claimant filing for bankruptcy after receiving funding and before their underlying case is resolved. Proceeds from the case may become property of the bankruptcy estate and made available to the transferor’s creditors. A carefully drafted litigation funding agreement can increase the likelihood that the right to receive a portion of litigation proceeds is legally isolated and beyond the reach of the transferor’s creditors or a bankruptcy trustee.

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  Litigation Finance - A Modest Proposal

  June 23, 2020

  High stakes commercial claims are costlier to assert and the likelihood of success more uncertain than ever; clients are challenged to pursue even the most meritorious claims; and claimants often feel pressure to settle prematurely due to a need for cash. Litigation finance can equalize the bargaining power between plaintiffs, who may lack the financial means to pay litigation costs, and defendants, who may have deeper pockets and may sometimes be better able to shoulder the duration and uncertainties of commercial litigation. Litigation financing ensures access to justice for claimants with meritorious claims but who lack the means to bring or sustain a cause of action. Negotiated sliding scale caps on returns to funders upon repayment, like the contingency fee limits set in Connecticut, may strike a fair deal for all sides and ensure a litigation funding agreement is enforced or, if challenged, less likely to be disturbed.