An Overview of Litigation Finance
Traditionally, companies have chosen whether to finance claims themselves by paying lawyers hourly fees to litigate a case or, with US lawyers, by arranging alternative fees to align interests and lower transaction costs. In making this decision, company executives are managing several layers of risk – from legal fees exceeding budgets, crowded dockets, and lengthy delays to unfavorable judgments.
Juridica serves as a strategic partner for corporate claimants. Over half of our portfolio is comprised of corporate claims brought by Fortune 500 companies. Juridica’s expertise and stable capital base enables Juridica to adopt wholly or partially the financial risks of delayed, expensive and even unsuccessful litigation while still enabling the claimant to participate in the financial rewards earned from the successful prosecution of their claim. In effect, Juridica’s financing provides corporate claimants with an option that allows for more efficient use of corporate capital.
In so doing, Juridica allows corporate claimants to allocate their working capital towards their core business, instead of litigation. Additionally, Juridica structures each deal in order to tailor fit the needs of clients, enabling the client to enhance cash flow and/or shift, limit or hedge risk in various ways at any time in the claim cycle.
By treating corporate claims as an asset, companies can develop the best strategy for monetizing it. Equally important, investors can obtain exposure to loosely correlated and attractive risk adjusted returns.