Why Commercial Litigation Financing Is Sometimes Needed
What is Litigation Funding?
Litigation funding, also known as third-party litigation funding, is a financial arrangement where a third-party investor provides the necessary capital to a plaintiff or law firm to pursue a legal claim. This type of funding is particularly beneficial for those who may not have the financial resources to cover the high costs associated with litigation. In return for their investment, the third-party funder receives a percentage of the settlement or award if the case is successful. One of the key advantages of litigation funding is that it is non-recourse, meaning that if the case is lost, the plaintiff or law firm is not required to repay the investment. This arrangement allows plaintiffs and law firms to pursue justice without the financial risk typically associated with legal claims.
When pursuing a commercial claim sometimes commercial litigation financing (also known as commercial litigation funding) is needed, it can easily be costlier than thought of in the beginning. With this, the need of capital is almost a certainty to the law firms and the represented companies. If the call of capital goes unanswered the result is a loss for the businesses and the law firms that represent them. We can get funding for all types of cases including but not limited to I.P. (Intellectual Property), Trade Secret Theft, International Arbitration, Complex Business Disputes, and Class Action Lawsuits. All of this can be used for portfolios of litigation or for single case lawsuits. Verum funds litigation by covering various litigation costs, such as expert witness fees, legal fees, and court costs to name a few, which are essential for pursuing a legal claim.
With our commercial litigation funding which is non-recourse (which means if you lose your case, you owe nothing) it is available at almost any stage of litigation. It can be used to pay for legal fees/litigation, acquire working capital, getting the litigation off of the balance sheets, and be used to grow your law firm. By using Verum Funding to help your law firm or business with commercial litigation financing, you are helping by adding value to your business or law firm and in return you can focus on growing your business and or law firm. This is why so many rely on Verum Funding for their commercial litigation financing.
Parties Involved in Litigation Finance
In the realm of litigation finance, three primary parties play crucial roles: the plaintiff, the law firm, and the litigation funder. The plaintiff is the individual or organization that initiates the legal claim, seeking justice or compensation for a grievance. The law firm represents the plaintiff, providing legal counsel and expertise throughout the litigation process. The litigation funder, on the other hand, is the third-party investor who provides the financial resources needed to cover litigation expenses. This collaboration allows the plaintiff to pursue their legal claim without bearing the financial burden, while the law firm can focus on delivering the best possible legal representation. The litigation funder assumes the financial risk, making it a mutually beneficial arrangement for all parties involved. Litigation funding provides the financial resources to the firm, enabling the firm to pursue legal claims without facing prohibitive cost and helping by leveling the playing field in the legal system.
Benefits of Commercial Litigation Funding
Commercial litigation funding offers numerous benefits to law firms, companies, and individuals involved in complex commercial disputes. One of the primary advantages is that it provides access to justice for those who may not have the financial resources to pursue a claim. By covering litigation costs, commercial litigation funding can help level the playing field, ensuring that cases are decided on their merits rather than the financial strength of the parties involved.
Another significant benefit is the mitigation of financial risks associated with pursuing a claim. With non-recourse financing, litigation funders absorb the financial burden, allowing law firms and companies to avoid substantial financial losses if the case is unsuccessful. This arrangement ensures that plaintiffs can pursue their legal claims without the fear of crippling financial repercussions.
Commercial litigation funding also provides law firms with a competitive edge. By offering financing options to clients, law firms can differentiate themselves from competitors and attract new business. Additionally, this type of funding helps law firms manage their cash flow more effectively, reducing the financial strain of handling complex commercial disputes. This financial flexibility allows law firms to focus on delivering the best possible legal representation without being hindered by litigation costs.
So How Does One Get Commercial Litigation Funding for a Lawsuit?
Apply with the intake on this page or call us at 434-535-5229. From there we will put you in contact with one of the many underwriters that we work with. They will look at the good and the bad of your case/cases and weigh out the likelihood of a win. When and if it is approved, they will contact you to wire the funds to you.
Many litigants depending on their case are looking for commercial litigation funding for all the law fees and on some occasions just a partial funding regardless that there is usually a lot of money that is on the line.
Why Use Commercial Litigation Funding?
Commercial litigation financing is an attractive option for many businesses and law firms. If there is cash due to the law firm or business you do not want to leave it on the table, especially when it is possible to go after claims without the cost and risk of using your own and or law firms’ money. It also gives the ability to have working capital and gives the firm considerably more access to expert litigators. It also gives the ability for many attorneys to take on cases that they would not usually be able to, even though the claims are great but due to needed capital they are not able to do so.
Commercial litigation funding investments can alleviate financial burdens and enhance profitability by eliminating legal expenses and providing valuable insights during litigation.
It also allows litigants the ability to pursue complicated case that they might not be able to afford if they did not have commercial litigation financing. It can help with the ability to hire expert witnesses, reducing the risk of premature settlement, and the relief from running out of capital during litigation. It can also help many businesses avoid using their capital that could be used as working capital for the business during the litigation. If you have any of these problems then Verum Funding could have the ability to help you with commercial litigation funding.
Litigation Funding Agreement
A litigation funding agreement is a critical document that outlines the terms and conditions of the funding arrangement between the plaintiff, law firm, and litigation funder. This contract specifies the amount of funding provided, the percentage of the settlement or award that the litigation funder will receive, and the repayment terms. Additionally, the agreement may detail the litigation funder’s involvement in the litigation process, such as the right to review and approve settlement offers. This ensures that all parties are clear on their roles and responsibilities, providing a transparent framework for the funding arrangement. By clearly defining these terms, a litigation funding agreement helps to align the interests of the plaintiff, law firm, and litigation funder, facilitating a smooth and cooperative litigation process.
Regulation and Restrictions
Litigation funding is subject to various regulations and guidelines to ensure ethical and transparent practices. Organizations such as the Association of Litigation Funders (ALF) and the European Litigation Funders Association (ELFA) set industry standards that litigation funders must adhere to. These standards promote transparency, fairness, and accountability within the industry. Additionally, some jurisdictions have specific laws governing litigation funding. For example, the UK’s Litigation Funding Act provides a regulatory framework that litigation funders must comply with. These regulations are designed to protect all parties involved and ensure that litigation funders operate lawfully and ethically. Compliance with these regulations is crucial for maintaining the integrity and credibility of the litigation funding industry.
Litigation Financing in the News
In March 2020 as reported by Bloomberg. There was a 25-person working group on commercial litigation funding report for New York City Bar Association. This committee was meeting for over a year and included lawyers, a former federal judge, litigation funders, and ethicists among others. It was a 90-page report and as of now is the most in-depth study of the litigation finance industry in America history. It was reported that litigation finance is a good thing for the legal system. In the report it is stated “lawyers and the clients they serve will benefit” from lawyers’ expanded access to funding.
In May 2020 as reported by LF. With the pandemic far from being over legal firms are taking actions to mitigate it. There is a major upswing in funding requests. With many requests coming in from the pandemic including breach of contract, securities, insurance recovery and more. Many claims already have been filed due to supply chain issues, business closures and other losses. With commercial litigation financing becoming very accessible over the last couple of years and especially with low-income litigants who would otherwise have no affordable legal recourse. We will see a major uptick with commercial litigation funding.
In December of 2020 the website law com reported that 50% of attorneys are more likely looking for capitol to ramp up firm growth and also help their clients in reaching fair recoveries. Especially because of the recent COVID 19 environment that continues to affect law firms and corporate clients.
Verum Funding Is Different in Many Ways from Other Commercial Litigation Funders…
- We are fast: Many funders and brokers have the same issue. It takes months to get an answer on if a case or a portfolio of cases can get funding. With us we take that away and get the answers fast. Verum funding provide quick and efficient funding solutions, ensuring that litigants can proceed without delay.
- You can always reach us: We are always just a phone call away and you can always get ahold of somebody at Verum to answer any questions that you have.
- Updates: To make sure that you know of the progress of what is happening we provide updates 0n a weekly basis. After all you want to know that you funding that you need is moving forward. After all our financing has been the building blocks of how Verum Funding has become a leader in helping supplying capital for commercial legal proceedings. If you need an update right away just give us a call, we are here for you.
- Access to our experts: If you need to run ideas or thought past us we can help. We have some of the most experienced litigation finance employees in the industry.
How Can Verum Help You?
With Verum we try to use commercial litigation financing that is non-recourse, so it is not another worry for you while you are in the middle of a lawsuit, to the litigant and the law firm. Legal finance plays a crucial role in managing litigation costs and risks, enabling access to justice through funding for litigation, and providing capital to improve cash flow while maintaining control over litigation decisions. Also, with this you know that we believe in your case and what you are trying to do to in this lawsuit. Applying for the funding can be done during the appeal phase of the lawsuit, the trial phase of the case, the enforcement time after the lawsuit, or even the pre-trial portion of the lawsuit itself.
Verum Funding can help clients navigate legal disputes effectively, ensuring they have the financial support needed to pursue justice.
At Verum Funding we care about your success in your lawsuit. After all, since it is non-recourse, we are in this together. So contact us today to get in touch with an underwriter that get you on to the road to success. Help us help you with the security that you need with commercial litigation financing today! Contact us today by calling 434-535-5229, emailing us at or filling out the intake form on this page. So what is stopping you from creating the success that you need in the court room? Call us today and let us help you with your capitol want and needs.
Verum Funding, the litigation funding firm that helps you get the funding that you need!