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.
Why does someone need litigation funding? The main benefit of third-party litigation finance is it generates opportunities for citizens to bring cases which would otherwise go unheard. It is no secret that litigation is expensive. In 2009, the average civil litigation case in federal court cost roughly $15,000. This cost could go up drastically if expert testimony is involved. For example, medical malpractice claims often have numerous experts, and cases can quickly climb over $100,000. For the average American who is unsure of the strength of their claim, or simply lacks funding, this financing can be a huge help. Not only does funding help get the ball rolling on cases, but it also keeps them going. Individuals in malpractice, or personal injury claims are often pitted against large corporations. These corporations have pockets which are bottomless pits compared to the average plaintiff. It’s a true David versus Goliath showdown, and one in which corporations attempt to drag on for as long as possible. Corporations drive up the cost of litigation through delay tactics and appeals in an attempt to force the plaintiff into a financial corner and cause them to settle for less. Often times, knowing the plaintiff has funding will lead to quicker settlements.
The business model for the investment is simple. Investment firms will give thousands, or even millions, of dollars on speculation there will be damages paid to the plaintiff. The investment is paid only if the plaintiff wins the case. If so, then the investment firm recoups a portion of the winnings. This opportunity allows investors to further diversify, and earn interest on an asset with no other correlation to previous investments. The market for this type of investment has grown substantially over the past few years. However, please keep in mind there are no guarantees on returns. For possible returns, please review each investment separately, as they each will vary.
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.