Litigation funding involves the financing of legal claims by third parties to meet the costs of conducting such litigation. Generally, the litigation funder assumes all or part of the responsibility for all litigation costs.
For taking this risk, the litigation funder receives a reimbursement of all costs, plus a percentage of the settlement or judgement. This percentage is normally between 20 per cent to 40 per cent of the settlement or judgement amount.
All case investments are monitored on an on-going basis and progress is constantly reviewed.
After initial receipt the documentation is compared to investment criteria and an Initial Merits Assessment undertaken covering prospects, nature of claim, quantum, defendant’s ability to pay, number of parties and other factors.
Terms, subject to due diligence and an independent opinion, are agreed with the plaintiff and the law firm acting.
The case is reviewed by the Advisory Committee and if deemed necessary the case is referred to independent specialist, such as law firms, litigation advisories and counsel who review and comment on the case’s merits.
Assessment by Investment Committee
The results of the Initial Merit Assessment and Independent Opinion are considered by the Investment Committee together with the agreed terms and a decision made regarding whether to proceed.
Any changes in terms are negotiated and Funding Documentation is agreed with the plaintiff and legal representative.