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Full-Text Articles in Law
Global Laboratories Of Third-Party Funding Regulation, Victoria Sahani
Global Laboratories Of Third-Party Funding Regulation, Victoria Sahani
Faculty Scholarship
Third-party funding, also known as "dispute finance," is a controversial, dynamic, and evolving arrangement whereby an outside entity ("the funder") finances the legal representation of a party involved in litigation or arbitration, whether domestically or internationally, on a non-recourse basis, meaning that the funder is not entitled to receive any money from the funded party if the case is unsuccessful.' It has been documented in more than sixty countries on six continents worldwide-including in many of the jurisdictions highlighted in this symposium that are experimenting with other aspects of international commercial dispute resolution. Indeed, funding greases the wheels of this …
Rethinking The Impact Of Third-Party Funding On Access To Civil Justice, Victoria Sahani
Rethinking The Impact Of Third-Party Funding On Access To Civil Justice, Victoria Sahani
Faculty Scholarship
Third-party funding indisputably puts a gold-weighted thumb on the scales of justice in favor of funded parties for two main reasons: (1) funded cases already tend to be calculable winners on the merits, and (2) third-party funders seeking a profit generally do not fund cases that are demonstrably likely to lose on the merits. Thus, we are left with both the promising potential for winners to be more likely to win with third-party funding and the alarming realization that not all winners are offered this same chance. This provokes a larger, fundamental question: If funders are picking winners among the …
Reshaping Third-Party Funding, Victoria Sahani
Reshaping Third-Party Funding, Victoria Sahani
Faculty Scholarship
Third-party funding is a controversial business arrangement whereby an outside entity—called a third-party funder—finances the legal representation of a party involved in litigation or arbitration or finances a law firm’s portfolio of cases in return for a profit. Attorney ethics regulations and other laws permit nonlawyers to become partial owners of law firms in the District of Columbia, England and Wales, Scotland, Australia, two provinces in Canada, Germany, the Netherlands, New Zealand, and other jurisdictions around the world. Recently, a U.S.-based third-party funder that is publicly traded in England started its own law firm in England. In addition, some U.S. …
Judging Third-Party Funding, Victoria Sahani
Judging Third-Party Funding, Victoria Sahani
Faculty Scholarship
Third-party funding is an arrangement whereby an outside entity finances the legal representation of a party involved in litigation or arbitration. The outside entity—called a “third-party funder”—could be a bank, hedge fund, insurance company, or some other entity or individual that finances the party’s legal representation in return for a profit. Third-party funding is a controversial, dynamic, and evolving phenomenon. The practice has attracted national headlines and the attention of the Advisory Committee on the Federal Rules of Civil Procedure (Advisory Committee). The Advisory Committee stated in a recent report that “judges currently have the power to obtain information about …
Third-Party Litigation Funding And The Dodd-Frank Act, Victoria Sahani
Third-Party Litigation Funding And The Dodd-Frank Act, Victoria Sahani
Faculty Scholarship
This article questions whether the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”) should apply to the growing phenomenon of third-party litigation funding, in which outside entities invest in litigation or arbitration for profit. Currently, the United States, Australia, and the United Kingdom lightly regulate third-party litigation funding, but the majority of the day-to-day oversight comes through voluntary funder self-regulation. Most third-party funders of commercial disputes are private hedge funds that are subject to the securities regulations of the jurisdictions in which they operate. The Dodd-Frank Act is a relatively new statute in the United States that regulates …
Toward A Regulatory Framework For Third-Party Funding Of Litigation, Keith N. Hylton
Toward A Regulatory Framework For Third-Party Funding Of Litigation, Keith N. Hylton
Faculty Scholarship
Because third-party funding and sales of legal rights are equivalent in terms of their economics, I examine arrangements in which third-party sales of legal rights are permitted today; those arrangements include waiver, subrogation, and settlement agreements. These existing arrangements provide valuable lessons for the appropriate regulatory approach to third-party financing of litigation.
Recent Developments In Third-Party Funding, Victoria Sahani
Recent Developments In Third-Party Funding, Victoria Sahani
Faculty Scholarship
This article addresses recent developments in third-party funding that occurred during late 2012 and early 2013 in the three leading jurisdictions: Australia, the United Kingdom and the United States. The most important developments are the following. On 22 April 2013, the Australian Securities and Investment Commission (ASIC) issued regulatory guidelines clarifying the status of funders with respect to ASIC’s regulations and detailing how funders should manage conflicts of interest and handle certain provisions of their funding arrangements. In the United Kingdom, the Jackson Reforms took effect on 1 April 2013, bringing sweeping changes to the allowable fee agreements, discovery rules …