Litigation finance has become a critical component in the legal industry, facilitating access to capital that enables plaintiffs to pursue litigation without bearing the upfront costs. However, like all transactions, these deals can occasionally falter. Key reasons for collapse often include a lack of trust between parties or misunderstandings regarding the terms of the agreement.
The April report from Bloomberg Law suggests an increasing interest from various capital sources, including well-established hedge funds, in entering this growing market. Legal professionals need to be aware of the common pitfalls to navigate these transactions successfully. Both Rebecca Berrebi of Avenue 33 and Boris Ziser of Schulte Roth highlight the importance of clear communication and understanding to circumvent such issues.
For a deeper dive into the top three deal-killers in litigation finance and expert advice on avoiding them, you can read further insights in the related article on Law360.