What is Third Party Funding Litigation?

Third party litigation funding is still relatively new in the UK. For those who don’t know it is a process whereby third parties can invest in another company/persons legal battle to aid them in winning in return for a higher than normal ROI in a usually modest period of time. In our uncertain economic climate it is one of few avenues which is likely to return an increase on your investment, although like with all investments it is not 100% guaranteed.

Those who offer third party funding litigation are able to improve their chances of success however by supporting the side they are investing in. By giving their chosen party access to additional advice or better legal counsel they significantly improve their chance of having the matter settled in their favour.

From a financial stand point the unique thing about litigation funding is bares no relation to the wider economy. Rises and falls in the market have no effect on your potential return. In many cases your return is agreed before the investment of the money is made so all parties are aware of both what they are putting in and what they are getting out.

As more and more businesses and claimants become aware of the possibility of third party funding litigation, the chance are that it will become monopolised by institutional investors. However until this happens private investors who are looking to make a quick return can take advantage of this process.