Investments are ONLY available to Accredited Investors. Third-party Litigation Finance is a way to fund other people’s lawsuits and get a portion of the awarded claims if the lawsuit is successful. The earnings potential of this investment is very large.
Lawsuit funding/Litigation Finance provides cash advances to individuals or companies projected to win a significant settlement from a lawsuit, who need funds to cover their expenses while they wait for the case to settle. Most states prohibit law firms from lending money to their clients and as a result, more and more law firms are turning to litigation finance to help clients who need financial support. Law firms also use legal finance to manage their own cash flow, this is often called ‘law firm financing).
Lawsuit funding/Litigation Finance helps level the legal playing field by providing plaintiffs or plaintiff law firm with the money they need to fight and win the settlements they deserve from better-funded opponents. Lawsuit funding/Litigation Finance enables the injured to fight as long as it takes to win instead of accepting inadequate, unfair settlements just to pay their bills.
The Defendant or Defendant insurance company is ultimately responsible for making payment to the plaintiff. Once a case is settled or tried and an award is granted, the Defendant or Defendant insurance company must pay the plaintiff who in turn fulfills the commitment to repay any lawsuit funding advances.
The fund will have diversified group of cases rather than just one type. Major cases in the portfolio will include motor vehicle accidents, such as pedestrians hit by a car on the road or in a rear-end collision, assault, police brutality, wrongful imprisonment, sexual abuse, labor law, law firm funding, settled cases, and Jones Act and Federal Employers Liability Act (“F.E.L.A”) cases.
Many other categories that might appear in a pre-settlement funding portfolio, such as slip and fall, medical malpractice and premises liability, are common case types with a high probability of settlement. The Fund maintains a high level of due diligence on all case types, so when a plaintiff requests a pre-settlement advance, The Fund can perform proper due diligence.
The Fund portfolio is comprised of cases drawn from across a multitude of states and jurisdictions to ensure proper diversification.
Once the team or its Manager assigns a value to a case, the Fund advances the plaintiff only up to 9% of the expected value, protecting the Fund from overexposure and ensuring plaintiffs have enough money left after legal fees to benefit from the legal process.
Litigation Finance/Lawsuit Funding advances provide plaintiffs & plaintiff law firms with access to capital prior to their case settling during the litigation process and or costs of the case.
The plaintiffs are often involved in a personal injury lawsuit and the provided capital helps with medical bills and/or supplements income if they are unable to work. In return, the Fund has a lien on the proceeds of plaintiffs’ monetary settlements. The advances are non-recourse, which means if the plaintiff loses its case, the plaintiff does not owe the Fund anything. The non-recourse nature of pre-settlement funding protects plaintiffs and requires the Fund to be diligent in its underwriting. The Fund manager, TownCenter Partners LLC, has shown an ability to adequately manage that risk.
The outcome of personal injury litigation is not correlated to the broader market.
TownCenter Partners team has been involved in over $10.5 Billion of litigation. The time between an application being received and getting approval can vary, depending on how far along the plaintiff is along in the lawsuit. When reviewing the application, our team will want to consider information about the economic and medical costs of the injury, the evidence being used to prove the case, and the insurance resources that the defendant has. All of this information is developed by the plaintiff's attorney during the pre-trial phase of the lawsuit. If the information is readily available at the time of application, our team can make a very quick decision. If the plaintiff is at a very early stage of the lawsuit and this information is not fully developed, the assessment will take longer.
At times, our review process and vetting will cause us to turn down a request for funding. For example, our team might be discouraged about the total value of the plaintiff's case if they have had prior accidents that caused injuries similar to the ones they’re currently suing about. Or, perhaps the plaintiff has already received an advance from another investor and our team concludes that it will cost too much to pay off the previous investor.
The bottom line is, TownCenter Partners exercises great care in determining which cases have the right set of circumstances and characteristics upon which we can base a reasonable investment decision.