Using Litigation Finance to Get and Retain Clients

Every lawyer is familiar with the constant pressure to find new clients and retain old ones.  In many situations, business development and retention opportunities turn not on the client’s willingness to hire the lawyer but, instead, on the client’s financial ability to pursue a legal matter.  Litigation finance can solve this problem for clients, and lawyers who want to maximize their chances to develop business should be prepared to help clients find this solution.

Flexibility in the management of litigation costs is an increasingly important factor in lawyers’ ability to acquire and retain clients.  The days of building business through “the old boys’ network” and of keeping business through client loyalty are over.  Similarly lawyers can no longer rely on their professional skills alone to convince clients to hire them.  Clients want lawyers who can make litigation a financial as well as a legal success.

The most direct way for lawyers to do this would be to make a discussion of litigation finance a party of every pitch for new business or for extended business with existing clients.  Lawyers need not recommend a particular funder or method of funding, but they can discuss how litigation finance fits into menu of alternative fee arrangements that the firm can offer.  Through such a discussion, lawyers can show their flexibility and responsiveness in anticipating and addressing client concerns.

In many situations, clients are highly motivated to preserve cash and avoid incurring extraordinary expenses that are not built into their own financial model. Along similar lines, clients frequently hesitate to pursue even the most meritorious litigation because of the inherent risk that something may go wrong.  Often, this concern leads clients to seek contingency fee arrangements, which many firms simply are unwilling or unable to offer.

Litigation finance can make it much easier for lawyers to respond effectively to these situations. Cost sensitive and risk-averse clients can find comfort regarding their concerns, and lawyers don’t have to make as many compromises in their rates or fee structures.  When lawyers bring litigation financing into their business pitch, they can establish an alignment of interests and expectations with the client that will build a durable professional relationship with better long-term prospects.

 Topics:  litigation finance, legal reform, third-party funding, litigation costs, business development, client development, law practice management

Works Cited:

 Michael McDonald, Business Development for Lawyers Is Imperative, Above the Law (April 18, 2017)

TownCenter Partner Team

TownCenter Partners, LLC lead Asset Manager is Mr. Roni A. Elias. From modest beginnings, and with the help of a hand-picked dream team of professionals we have built one of the most dynamic and fastest growing companies in the country. TownCenter Partners LLC(TCP) is a real estate partner and master-planner providing development, leasing, management, and third party services. The company’s demonstrated ability to apply big ideas in creative and innovative ways has played a defining role in the firm’s success. Yet, TCP's most important insight has been the core understanding that it is not sight lines or site plans, but human activity, that defines a space and creates a place.

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