Tag Archive for contingency fees

Delayed Legal Fees? Why Legal Fee Funding is Needed for Contingency Lawyers

legal fee fundingLegal fees are the life-blood of contingency law practice. While it is essential for a contingency fee attorney to find a case to try, take that case to court, and successfully litigate on behalf of the plaintiff, all of this will be for naught if the attorney does not receive a fee at the end of the day. Securing a large fee speaks to the skill of the attorney, as the amount that an attorney receives after a case often correlates to the amount procured in settlement. In turn, the fee becomes a marker of an attorney’s reputation – a case that settled for a large amount also awards the attorney a certain amount of respect, in addition to a sizeable fee.

Unfortunately, there are certain cases, such as large class action cases and MDLs, where court procedures are often delays. These delays include, but are not limited to, settlement payouts, and these settlement payouts affect attorneys’ abilities to collect their fees. This is a risk that contingency fee attorneys knowingly take.

As attorneys are constantly in the process of litigating and reviewing cases, it is important to have easy access to frequently available funds. These funds enable attorneys to finance new cases, pay for experts, witnesses, discovery, and cover other expenses. Without funds, attorneys cannot finance cases, and without cases, attorneys cannot get paid. This burden can be amplified if an attorney is still awaiting payments on delayed fees. This catch-22 can become quite a drain on resources unless attorneys seek external funding.

In the best case scenario, attorneys can seek funding from traditional sources such as banks and credit unions. Often larger, more conveniently located, and willing to offer good interest rates, traditional institutions will provide financingcyclone-of-franklins until the delayed fees are paid off. However, these institutions are very difficult to qualify for; their stringent lending standards may exclude even past borrowers. Fortunately, there are alternative funding methods available to contingency fee attorneys. One such alternative is legal fee funding.

Legal funding companies can advance a portion of the attorney’s legal fee, giving them quicker access to funds. Legal funding companies purchase a portion of the money owed from the court, which expedites the funding process. The company will also communicate directly with the often-reluctant defendant and the defendant’s attorneys, and will work out a payment time frame that is quick and efficient. In some cases, attorney fees can appear frozen and locked, but with legal fee funding, lawyers can now access capital and employ it where they deem necessary to grow their businesses.

Payment delays in any business can be fatal. This is especially true for lawyers. Legal funding alleviates the situation so attorneys can get back to doing what they do best.

Written by Joseph Genovesi, President of RD Legal Funding, LLC

News in the Litigation Funding Space

litigation funding sectorTheLawyer.com published a very detailed story on the changing issues the legal world is going to have to face. The story, which polled attorneys across the United Kingdom, asked them questions on issues like litigation funding, contingency fees, the billing of clients, and reducing overall costs. The story even got the lawyers’ opinion on the future of technology and how it might affect the courtroom and certain procedures in court.

Secondly, the University of New South Wales’ Centre for Law, Markets & Regulation, which is based in Australia, published an article on litigation funding which stated that litigation funding companies do not need an Australian Financial Services License (AFSL) to operate. The exception was granted in part because of the judicial decision International Litigation Partners Pte Ltd v. Chameleon Mining NL. The case made headlines in Australia because it exempted litigation funding companies from getting the AFSL, which other sectors that offer financial products are required to obtain. This exception allows anyone to fund litigation in Australia.

Finally, The Financial Times reported a story about a new investor jumping into the litigation funding sector in the United Kingdom. Jon Moulton is one of the best known private equity investors to have invested in Manolete Partners, a litigation funding company. The litigation finance arena has been growing steadily for over a decade, and it’s starting to breakthrough that it’s a worthwhile investment. The United Kingdom, the United States, and Australia are some of the biggest markets for the sector. Investors are flocking to this field because of its potential return on investment.

Written by Lulaine Compere

Economics and the Litigation Funding Industry

George Steven Swan is an Associate Professor at North Carolina A&T University. He wrote an article about the litigation funding industry titled Economics and the Litigation Funding Industry: How Much Justice Can You Afford for the New England Law Review. The report examined how the industry has evolved, what it actually is, the different perspectives involved in such a field, and how contingency fees work.

Written by Lulaine Compere.

Contingency Fees in the UK

The Judiciary of England and Wales, the judicial body of the United Kingdom and Scotland, released new recommendations on the subject of contingency fees. As many in the civil litigation world know, any kind of new development in regards to those fees is very important.

The United Kingdom’s system of justice and law is different from most countries in the world, especially the United States, but the use of contingency fees is widely disseminated throughout most legal systems. Sometimes countries follow each others’ lead in changes and recommendations.

Written by Lulaine Compere.

Attorney Fees for Moody’s Derivative Settlement

The issue of attorney’s fees can be contentious, especially when it deals with cases where a lawyer’s compensation is deferred. This holds true particularly in cases like personal injury, where the attorney standard is to be paid through contingency fees.

The Moody’s’ case is the latest example of the fight on what is actually fairness in regards to attorney’s fees and the work they do. Reuters recently reported a story about the plaintiff’s attorney fee fight in the Moody’s derivative settlement.

Read the entire story online at thomsonreuters.com.

Written by Lulaine Compere.

Cost and Litigation Funding Forum 2012

Costs & Litigation Funding Forum 2012 is an event happening in London on October 31st, 2012 that will go through some of the issues dealing with the litigation funding landscape, including conditional fee agreements, contingency fees, after the event (ATE) and before the event (BTE) insurance, and third-party funding. The exact location of the seminar is yet to be determined, and the price to attend is £449.

Financial Management for the Contingency Fee Law Firm

Michael G. Blum, CEO of LawFinance Group, wrote a great informational article about how the litigation funding/contingency fee business works. This article has an insider’s perspective and gives different scenarios on how the funds could be used.

LawFinance Group, is a California based litigation funding company that advances fees to attorneys and plaintiffs. Mr. Blum is also a partner in the Litigation Resource Counsel, LLP.