Litigation Financing: Burgeoning Asset Class And Boon To Litigants In Need Of Liquidity

Litigation Financing is the idea of a third party independently providing funds to parties to a dispute in exchange of a portion of monetary rewards recovered from the proceedings. This kind of funding helps unlocks the value of legal claims even before they can be recovered before a court or tribunal. Many a time access to justice is blocked because meritorious claims are hindered by high costs of litigation. Litigation funding aids parties realize the full potential of their claims and deter protracted litigation. This funding not only encourages parties to access top legal talent and not settle for anything less than the worth of their claims, but investors availing this new asset class can gain outsized returns compared to other investment avenues with moderate time for realization of liquidity. Litigation funding has become a fairly commonplace practice in jurisdictions like USA, UK and Singapore, and has outperformed¹ private equity and hedge funds as an asset