The International Growth of Third-Party Litigation Finance
Outside financing can shape litigation incentives at several levels; from individual litigant choices to international cooperation. The availability of outside funding potentially affects the initial decision to file suit. Additionally, the availability of funding may change settlement incentives once the suit is filed.
Outside funding can also affect forum choice, potentially offsetting the overall effect in the United States and making it easier to maintain suit in other countries. In turn, these individual litigant incentives affect the social and regulatory choices made at the national level. Likewise, these national choices affect countries’ international cooperation and coordination in transnational litigation procedures.
In an article prepared for a symposium on “International Law in Crisis,” speculations were made about how the growing litigation finance industry may reshape transnational litigation in the coming decades. The article argues that the individual economic incentives created by third-party financing will likely increase the number of transnational lawsuits filed and will raise the settlement values of those lawsuits. Additionally, it argues that third-party financing will spread out the lawsuits among a larger number of countries than was typical in the past.
Topics: third-party litigation finance, transnational litigation, transnational lawsuits
Work Cited: Cassandra Burke, THE IMPACT OF THIRD-PARTY FINANCING ON TRANSNATIONAL LITIGATION, Case Western Reserve Journal of International Law (2011).
