Ralph Sutton, CEO of Validity Finance, has issued a bristling, statistics-laden response to the U.S. Chamber’s recent calls for regulation of the litigation finance industry.
An LFJ Conversation with Michael Kelley, Partner, Parker Poe
Ralph Sutton, CEO of Validity Finance, has issued a bristling, statistics-laden response to the U.S. Chamber’s recent calls for regulation of the litigation finance industry.
Writing in CFO.com, Sutton explains that the growing legal threat to American businesses is cost, not litigation funding. He cites a BTI Consulting report which found that litigation costs have risen between 4%-8% annually over the last three years. Additionally, Sutton points out that it takes two years on average to bring a civil case from filing to trial. That adds up to a pretty sizable check that needs to get written, and we haven’t even reached opening arguments yet.
Sutton contends that the Chamber should be more concerned with the above statistics, and how they impact business affairs, than with a potential solution to the growing problem of access to justice – that being third party funding. In fact, the Chamber’s efforts – if successful – would actually harm business as they would further buttress the ongoing trend of cost increases.
Sutton also called out the recent letter sent to the Committee on Federal Rules of Civil Procedure by the U.S. Chamber, on behalf of 30 GCs and in-house counsel of major corporations. As Sutton points out, the signatories of the letter stand to benefit from the reduction (or outright elimination) of litigation funding in the legal system, given that they constitute a ‘who’s who’ of Fortune 500 companies.
Ironically, it should be the Chamber standing on the side of the 99.7%, Sutton claims. Instead they’re backing Goliath over David.
