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During the first couple of days in class we briefly discussed litigation funding, which is the advancing of funds to law firms in exchange for a portion of the proceeds from litigation or arbitration. The key feature of litigation finance is that recourse is generally limited to the proceeds of the litigation/arbitration award or settlement, meaning that, the funded party only pays the litigation funder if the party successfully wins or settles its case. This has been a growing field in the investment industry as people are looking to diversify their portfolio of stocks and bonds as it doesn’t have a strong correlation to the overall markets. I stumbled upon this deck from LexShares that I think does a great job of explaining how it works. These guys are looking for a minimum commitment of $250k which I know is steep but this deck gives you a good starting point for how to understand the space. I’m invested with a company that does Pre-settlement funding that is very similar to this but I didn’t want to be super cheesy and post that deck so take a look at this one.
Joscelyn