Author : Rupert Macey-Dare
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (13 download)
Book Synopsis 3rd Party Litigation Funding Agreements and Derivatives Mis-Selling Risk by : Rupert Macey-Dare
Download or read book 3rd Party Litigation Funding Agreements and Derivatives Mis-Selling Risk written by Rupert Macey-Dare and published by . This book was released on 2018 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: 3rd party litigation funding agreements are a new solution to a traditional problem of how can impecunious potential litigants nevertheless still fund their positive NPV legal claims?These agreements can help complete a particular missing market for litigation funding and also remedy a specific market failure that has historically created a litigation access bias in favour of larger, richer parties, often defendants.3rd party litigation funding agreements can also provide a channel for more sophisticated but risk averse litigants to trade-off and offset some of their litigation cost risk on specific cases or case portfolios.However, lurking just below the surface, 3rd party litigation funding agreements are also typically complex, bespoke, OTC derivatives, with opaque payoff profiles under different potential case outcome scenarios. If a case is successful then damages awarded are typically split on a zero-sum game basis according to the funding agreement contract between the successful litigant and their 3rd party funder. This prospect creates an inherent perverse incentive for the 3rd party litigation funder not to highlight particular scenarios where they receive the lion's share of damages awarded and the litigant is left with the leftovers.In such a case there is a clear risk that the disgruntled litigant will subsequently follow up with a 3rd party funding agreement mis-selling claim against both the funder and their lawyers, analogous to recent derivatives and swaps mis-selling claims. This paper shows how lawyers can best set out and explain the risk-return profiles of alternative 3rd party litigation funding agreements, and help protect their clients from inappropriate or sub-optimal agreements, and in the process also prudently protect themselves from follow-on 3rd party litigation funding mis-selling claim risk and costs.
