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The Benefits of Litigation Funding Companies

Wed, 06 May 2009 18:30:51 GMT

The law provides a potential remedy for plaintiffs who are hurt due to the negligence or recklessness of others. Specifically, state and federal laws allow plaintiffs to sue defendants to recover the damages that they incur as a result of the defendant’s legal negligence. While the effects of the personal injury can never be fully negated, damages are intended to put the plaintiff in the position he was prior to the accident, to the greatest extent possible. So, for example, damages may include compensation for medical bills, lost wages and pain and suffering.

However, many times plaintiffs must engage in costly litigation in order to recover those damages. A plaintiff who has costly medical bills and lost wages may not be in a position to cover the costs of litigation even if the potential damages are important to the plaintiff’s future and the litigation costs are recoverable from the defendant. Accordingly, litigation funding is important to both plaintiffs and to the justice system.

Litigation Funding May Allow for a Fair Conclusion to a Legal Dispute

The financial pressure associated with recovery from a personal injury is often an important factor in determining whether a plaintiff accepts a settlement offer from an insurance company or defendant. Often, insurance companies and defense attorneys are aware of the plaintiff’s mounting bills and obligations and offer settlements that are significantly lower than what a plaintiff is likely to recover at trial. They reason that plaintiffs need the money quickly to pay their lawyers, their doctors and in some cases to keep their health insurance or their homes and that plaintiffs will therefore take the early settlement even if it is for less money than they are entitled to recover.

Litigation funding companies can remove much of the immediate financial pressure for plaintiffs. The money that is obtained from litigation funding companies can be used to fund the litigation itself or to pay any of the plaintiff’s bills. Without the immediate financial pressures, many plaintiffs may be willing to wait for a better settlement offer or be willing to take the case to trial.

Litigation Funding May Provide the Plaintiff with Cash Quickly

Many litigation funding companies quickly provide cash to plaintiffs who are approved for their programs. The funds may be used for any purpose. Often, they are used to pay medical bills, rehabilitation services, household help and everyday expenses while the plaintiff is recovering from injuries. For many plaintiffs, litigation funding companies can provide funds months and even years earlier than the judicial system can award damages. That can significantly help a person’s recovery by reducing the stress associated with the mounting bills and expenses.

Litigation is lengthy, stressful and, costly. Litigation funding companies can help plaintiffs in their quest for justice by removing some of the financial barriers that often prevent them from pursuing their case until a fair settlement is offered or a jury renders its verdict.

If you are interested in benefits of litigation funding, please contact a litigation funding company for additional information.

How to Choose a Litigation Funding Company

Wed, 06 May 2009 18:31:44 GMT

Many plaintiffs find litigation funding to be an important part of their personal strategy to maximize the amount of damages that they can recover from a defendant in a personal injury lawsuit. Litigation funding companies can provide plaintiffs with the money that they need to fund their lawsuit and to pay their expenses while their case is being litigated. In return, the litigation funding company is entitled to recover its money plus any agreed upon fees or interest from the plaintiff if the plaintiff is awarded damages in litigation or a settlement.

It is important for plaintiffs to remember that not all litigation funding companies have the same policies or fees. Therefore, plaintiffs should research the following information prior to entering into an agreement with a litigation funding company:

Ask about upfront payments/ monthly charges: Litigation funding companies often charge fees in return for their services. Some charge both an upfront or an origination fee and a monthly maintenance fee while others only charge one of those types of fees.
Ask about application fees: Some companies require you to pay an application fee regardless of whether the company decides to provide you with the funds for your lawsuit.
Ask what happens if you lose your case: Some litigation funding companies only recover the money that they provided to a plaintiff if the plaintiff wins the lawsuit. So, if the plaintiff loses the lawsuit then the litigation funding company does not recover anything. If you seek to do business with a litigation funding company that does not have this policy and will instead require you to repay the money even if you lose your case, then you should be prepared to repay the money if you lose your lawsuit.
Testimonials: A reputable litigation funding company should be able to provide you with references so that you can speak to previous customers about their experiences before doing business with the company.
Attorney recommendations: Many states allow attorneys to recommend specific litigation funding companies to their clients. Your attorney can be a reliable source for finding a reputable company.
Understand what happens if you win your case: Litigation funding companies recover their money if you win your case. However, it is important to understand just how much money the litigation funding company will be entitled to if you recover damages. Most companies recover the amount provided by the company to the plaintiff plus an additional amount for every month between the time the money was provided to the plaintiff and the money was returned to the company. That amount varies from company to company but is typically in the 3-5% per month range.

If the litigation funding company is hesitant to provide you with the information that you seek or if previous customers or attorneys have reservations about the company then it is important that you think carefully before entering a contract. There are plenty of reputable litigation funding companies available that provide plaintiffs with the money necessary to win their case.

What is Litigation Funding?

Wed, 06 May 2009 18:32:27 GMT

Sometimes you have no choice but to sue another party in court for personal injuries that sustained in an accident. The reasons for the lawsuit may be just and the potential outcome of the lawsuit may be important. However, no matter how just or important a case is the potential plaintiff must weigh the potential benefits of litigation against the actual costs of litigation.

The Costs of Litigation

There is no arguing that litigation is expensive. In addition to attorney’s fees, plaintiffs usually have to pay court costs and may also need to pay for things such as expert witnesses and discovery. Some plaintiffs feel that they cannot handle these litigation costs and they either choose not to file a lawsuit or they accept a quick and often low settlement offer in order to avoid incurring further expenses. They should be aware, however, of different litigation funding options which may help them effectively handle the costs of litigation.

Litigation Funding Options

Few plaintiffs have the resources to pay all of the costs described above out of pocket. Instead, many personal injury plaintiffs use one or more of the litigation funding options that are available. Depending on his or her financial situation and the circumstances of his or her case, a plaintiff may find one of the following litigation funding options beneficial:

· Contingent Fee: Many persona l injury attorneys are hired by plaintiffs on a contingent fee basis. That means that the attorney does not collect a fee unless the plaintiff recovers damages either through a settlement or a court proceeding. If the plaintiff does not recover any damages then the attorney is not paid. However, plaintiffs should be aware that attorneys who are paid pursuant to a contingent fee arrangement may take a relatively high percentage of the damages in return for the risk that they take of not being paid at all. Also, the plaintiff is still responsible for all court costs, expert witness fees and other litigation costs. Often, these costs must be paid periodically throughout the course of the ligation.

· Loan from a Relative or Friend: Many plaintiffs find it necessary to borrow money from friends or relatives in order to pay their attorney fees and / or their litigation expenses. The terms of every loan are different. Some plaintiffs might find these the least complicated and least expensive way of borrowing money to fund their lawsuit. However, other plaintiffs may find it uncomfortable to borrow money from a friend or relative.

· Litigation Funding Company: Litigation funding companies provide qualifying personal injury plaintiffs with funds in advance of the lawsuit’s resolution. If the litigation funding company finds it likely that the plaintiff will recover damages then the company may provide money to the plaintiff. Then when damages are awarded the litigation funding company is repaid the money that was borrowed along with any previously agreed upon fees and interest.

· Personal Loan: It is often difficult for personal injury plaintiffs to obtain personal loans through banks in order to finance their lawsuits. Banks typically view these loans as too risky since it is difficult to predict how a jury will view the facts of the case and what kind of award the jury might make in a case.

If you are a personal injury plaintiff then it is important to consider all of your funding options prior to deciding how best to proceed with your lawsuit.

Legal Negligence

Mon, 26 Oct 2009 18:01:09 GMT

Negligence is a term that is commonly used to mean that someone did not act with the appropriate level of care. However, when negligence is used as a legal term it has a very specific definition and in order for a person who sustained injuries in an accident to recover damages, each element of the legal definition of negligence must be satisfied.

Generally, there are four elements that a plaintiff must prove in a negligence case. Those elements include:

· Duty of Care: A plaintiff first needs to establish that the defendant had a legal responsibility to exercise a reasonable degree of care toward the victim. The way in which you determine whether a defendant owed the victim a duty of care depends on the jurisdiction in which the case is heard. Some states have adopted a “foreseeability” test to determine if a duty of care exists. In these states, the defendant owed the victim a duty of care if harm to the victim was a foreseeable consequence of the defendant’s actions. Other states determine whether a duty of care exists by applying a balancing test that considers the forseeability of the harm, the degree of certainty that someone will be harmed, the burden that would be placed on the defendant if he tried to prevent the harm and other similar factors.

· Breach of the Duty of Care: Once a duty of care is established, the plaintiff must prove that duty of care was breached. Typically, the duty of care is breached if the defendant knew what the consequences of his or her actions would be or failed to act like a reasonable person would have acted given the circumstances. The reasonable person standard considers both the location and qualifications of the defendant. For example, a cardiologist is compared to other cardiologists in his jurisdiction when the court is deciding if he failed to act like a reasonable person would act in a medical malpractice action.

· Causation: If a defendant is found to have breached his or her duty of care, the next step for the plaintiff is to prove that the defendant’s actions caused the plaintiff’s injuries which would not have happened but for the defendant’s actions. For example, if the victim was hurt in a car accident then the victim’s injuries must have occurred because of the defendant’s breach of his duty of care (for example, speeding) and not for any other reason (for example, the victim suffered a heart attack while driving).

· Damages: If a plaintiff is successful in proving that the defendant had a duty of care that was breached and that caused the victim’s damages then the plaintiff must prove that he or she is entitled to damages pursuant to state law.

It is important to remember that negligence cases are most often tried in state court and that while many jurisdictions follow the basic definition of negligence provided above, every jurisdiction has its own laws about what constitutes legal negligence. Therefore, it is important to contact a personal injury attorney in the state in which your accident occurred if you believe that you might have a negligence case in that jurisdiction.