When Should Clients Seek Litigation Funding?

Litigation Finance is a complex and growing industry for good reason. It’s a boon to potential plaintiffs of limited means, as it increases their access to the pursuit of justice. It’s helpful for legal firms keeping the balance sheets tight while still pursuing a heavy caseload. Litigation funding is also good for the court systems at large, as funders only want to fund meritorious cases—cutting down on frivolous litigation clogging courts.

Above the Law details that a client doesn’t need to set up a funding agreement at the early stages of the case. There is any number of ways that bringing in a third-party financing partner can help a case at any stage of the process—before an award is collected.

Teaming with a funder at the outset of your case can be advantageous, especially financially—even when it’s not strictly necessary in order for the case to move forward. The best time to get advice from an experienced funder is before you’ve invested too much time and money. That’s a good time for cases to be tested, and their merits weighed.

If a case seems to be going well, it can be good to bring in a funder at the midway point. Once it’s determined that an early settlement won’t be reached, morale might be down while expenses pile up. Bringing in funding to mitigate risk and expenses can be a big plus at this stage of the case.

Even after a judgment has been provided in your case, a funder can help. Additional funding might be needed to mitigate an appeals process or ensure that an award can be collected. In class action cases, it may take months or longer to determine individual payouts and get them distributed.

While earlier is probably better when considering Litigation Finance, there’s really no stage in the game where it’s too late to bring in an experienced funder. The right funder can offer sage guidance, help ease financial strain, and limit risk for all involved.