Settlement Funding

Lawsuit Settlement Funding

Settlement funding groups offer lawsuit financing for such civil litigation as employment discrimination, wrongful death, personal injury, and medical malpractice. Such cases involve at least one plaintiff and one defendant. The plaintiff is the injured or wronged party, and the defendant is the person or corporation whose conduct injured the plaintiff. Frequently, insurance companies are defendants because they balk at paying a claim presented by their customer, who then becomes a plaintiff in a case against the company.

Into this picture steps a lawsuit funding group that will finance a plaintiff's lawsuit in order for it to proceed to a legal conclusion. These are often emergency interventions because the plaintiff is of modest means and is running out of money to put into the claim. In short order, the settlement funding group decides whether or not to finance the case and, if so, issues a check for an agreed-upon amount.

Early Settlements Favor Defendant

In such lawsuits, the unequal bargaining power of each side is apparent, and because of the very limited resources of the plaintiff, pressure mounts to settle. Of course, the defendant will offer as little as possible. The tragedy is that the plaintiff frequently has to accept an inadequate settlement in order to receive any compensation at all, since the lawsuit will be dropped.

One of the purposes of settlement funding by outside investment groups is to prevent such premature settlements that let corporate defendants off easy. The plaintiff may have suffered severe injuries, discrimination, or economic loss because of the wrongful death of a loved one, but be left with next to nothing in order to survive. Litigation financing is intended to rectify such unfair situations and offer a plaintiff a chance to obtain justice in court.