A recent 60 Minutes episode on litigation finance explores how investors are increasingly funding lawsuits in exchange for a share of the settlements. The practice ...
Legal finance has experienced remarkable growth over the past decade, evolving from a niche concept to a critical resource used by law firms and businesses. The adoption rate has surged from 9% in 2012 to 82% today, driven by escalating litigation costs and the need for innovative financial solutions. Law firms and clients now view legal finance as an indispensable tool for managing financial risks and pursuing complex legal claims.
The scope of legal finance has also expanded significantly, moving beyond simple fee coverage to more sophisticated strategies like portfolio financing, monetizations, and patent divestitures. Initially seen as a solution for clients lacking funds, legal finance is now used by law firms and businesses of all sizes. Perception of the industry has shifted accordingly, with 80% of senior lawyers reporting a positive view, and initial concerns about frivolous claims being dispelled as funders now provide validation of claim merits.
Looking ahead, law firm lawyers anticipate continued growth and innovation in legal finance. 89% believe a broader set of users will employ legal finance to solve increasingly complex challenges. Corporate clients, including CFOs and general counsels, are recognizing litigation as a potential revenue-generating asset and a strategic tool for risk management. The integration of AI and data analytics is expected to further professionalize the field.
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