📈 Legal financing is expected to boom post-Covid
How will litigation continue with companies and law firms hurting in the coronavirus economy? With outside financing, according to Law.com.
The litigation financing industry was already rising: The number of companies or law firms using litigation financing had already doubled in the last three years.
A new survey revealed the likelihood of an uptick: Burford Capital, which provides financing, polled 233 firm lawyers and 266 in-house counsel. About half of the in-house attorneys said their companies had meritorious claims they had stepped away from because of litigation costs and would be more comfortable litigating the claims with a third-party financier.
Covid-19 as a game-changer: With companies reconsidering nearly everything the last several months, the same will be true with litigation. Some 70% of firm lawyers and in-house counsel told Burford Capital they believed litigation financing could be used as a new strategy going forward and to offset losses from the down economy.
Another factor could push the use of litigation financing: pressure. A GC for a Fortune 500 company told Burford Capital, “There is more pressure to justify your value and one of those metrics is to quantify recoveries.”