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Does Pre-settlement Funding Promote Frivolous Lawsuits?

We all remember that scene from the movie Liar Liar where the Fletcher’s Secretary Greta, describes a frivolous lawsuit as she's quitting.  “Mr. Reede, several years ago my friend had a burglar on her roof, a burglar, he fell through the kitchen skylight, landed on a cutting board, on a butcher’s knife, cutting his leg.  The burglar sued my friend, he sued my friend and because of guys like you, he won.  My friend had to pay the burglar $6,000.  Is that justice?”  Fletcher, incapable of telling a lie responds, “No, I’d a got him ten.” 
 

Is Lawsuit Settlement Funding Usurious?

Usury was once defined as the interest paid for the use of money.  Various religions considered charging any interest on borrowed money usury.  In present times we know usury to be an exorbitant amount of interest, charged above the legal rate.  Many states have their own laws and specific rates.  Most state laws share the following components of usury detailed in the Ives

How Champerty Can Help Disadvantaged Plaintiffs

Champerty
Champerty is an illegal agreement in which a person with no previous interest in a lawsuit finances it with a view to sharing the disputed property if the suit succeeds.  Champerty has been frowned upon since the practice of law began.  It is argued that champerty promotes frivolous lawsuits, drags out settlements and increases damages but th

Everything You Need to Know About Legal Funding

Consumer legal funding is an agreement where a legal funding company lends money to a plaintiff in a lawsuit and receives a fee when the case settles. 
 
Legal Funding goes by several other names including:
  • Pre-settlement Funding
  • Settlement Funding
  • Litigation Financing
  • Lawsuit Financing
  • Non-recourse Funding
  • Lawsuit Loan
  • Cash Advance
The consumer legal funding industry began in the mid-1990s, but has grown significantly in the past ten years with estimated capital invested of $100 million per annum.  While small compared to the revenue of the personal injury law industry of $35 billion per annum, many plaintiffs do not know they can borrow against their case. 
 

Hypothetical Lawsuit Funding Examples

We're you involved in a personal injury lawsuit?  Thinking about taking lawsuit funding?  We give two short examples to show you how lawsuit funding works and how it can be beneficial to the plaintiff.

Attorney Role in Lawsuit Funding

All litigation requires some sort of monetary funding.  Attorneys usually pay for legal fees up front and bill for them in the form of a contingency fee when the case settles.  In some situations, plaintiffs find themselves with an urgent need to pay their medical bills or living expenses.  This is especially true in tort cases.  They may not have access to other sources o

Why Peter Thiel Funded Hulk Hogan’s Lawsuit Against Gawker

Terry Gene Bollea, also known as Hulk Hogan won a settlement for $140 million against Gawker in March of 2016.  The suit was over a sex tape released by the gossip media outlet in 2012.  It’s no surprise that Gawker would eventually be sued as they make themselves enemies with the rich and famous.  One enemy they wish they hadn’t made is billionaire Peter Thiel. 

The 3 Biggest Reasons to Take Lawsuit Funding

Before making a decision to take funding against your lawsuit, consider the following.  Do you really need the money?  Do you want to settle your case for less than it’s actually worth?  Can you borrow money elsewhere? 
 
You Need the Money
During the aftermath of a personal injury accident, money can be

Legal Funding Company Best Practices

Before you borrow money against your lawsuit settlement, you should learn what the industry best practices are and make sure the funding company you use follows these practices. 
  1. The funding company must obtain a written acknowledgement from your attorney before funding your case.  The reason for the attorney acknowledgement is so that the funding company will get paid back if and when your case settles.
 
  1. The funding company cannot acquire ownership in your case.  The funding company is entitled to be paid back based upon a rate agreed on by both parties.  The funding company cannot buy a “stake” in someone’s case in return for a fixed portion of the settlement. 
 
  1. The funding company cannot interfere with your case.  They cannot force you take a settlement, which is a decision for you and your attorney to make. 
 

Driver Dies While Using Tesla Autopilot

Yesterday Joshua Brown, a 40-year-old owner of a Tesla Model S passed away when his vehicle drove itself under a tractor trailer on a highway.  The electric car’s autopilot feature failed to differentiate between the white side of an 18-wheeler and the sunny sky.  Joshua previously uploaded a video to YouTube, showing his Tesla Model S avoiding an accident with a truck driver
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