Personal injuryNEWS has written about litigation funding in personal injury: is it a godsend?
In addition, they paid extensive attention to the experiment results-related compensation agreements in personal injury cases and the first evaluation that has recently taken place.
It has become clear that only limited result-related remuneration agreements are still made by lawyers, in part because of the financial risk. Does litigation funding offer a solution? Personal InjuryNEWS asked Chris Liesker of Liesker Litigation Funding to talk about how litigation funding works.
To start at the beginning: what is litigation funding?
Chris: “A litigation funder is an independent investor who is a third party funding the lawsuit. The litigation financier takes care of the costs of the lawsuit, such as attorney fees, bailiff fees, expert fees, etc. In the event of a profit, the litigation financier is repaid from the proceeds. In addition, the financier receives a percentage of the (net) proceeds as a reward for his investment. If the case is lost, the lender bears the risk. In this way, litigation funding enables a true ‘no cure no pay’ for the client.”
Litigation finance originated in Australia and later gained a foothold throughout the Anglo-Saxon world. Litigation funding is also now commonplace in Germany and Austria. In some countries, lawyers are even required to alert their clients to the possibility of litigation funding. In the Netherlands, the market is booming.
There are now several Dutch litigation funders, mostly founded by former lawyers. Different financiers serve different segments of the market, in that some only finance claims as low as €5 million, while others already finance claims as low as €150,000. Most litigation funders (domestic and foreign) charge about 30% of the proceeds in exchange for funding and their services.
Also for personal injury victims?
“Sure. Personal injury litigation funding is not just for businesses, but (especially) also for individuals, or, for example, claims foundations looking for a solution to fund the costs of litigation. Continue reading here for the rest of the article.