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2016 US Litigation Finance Survey

The economics of law have changed in the wake of the 2008 financial crisis. As a result, clients and firms alike are increasingly searching for financial solutions that satisfy client needs for cost containment without overburdening law firms.

Burford’s 2016 Litigation Finance Survey shows that litigation finance is helping bridge the gap between clients and firms—and that it’s more popular than ever before.

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Highlights include

Litigation finance continues to grow and evolve

  • 28 percent of private practice lawyers say their firms have used litigation finance directly—a four-fold increase since 2013
  • 75 percent of outside counsel and 61 percent of clients predict that litigation finance will grow in the next five years
  • 35 percent more private practice lawyers and 50 percent more clients predicted that litigation finance will grow in 2016 vs. 2014
  • For the first time, Burford surveyed lawyers about financing portfolios of litigation, an emerging and relatively novel form of litigation finance—and about as many lawyers said they had experience with portfolio financing in 2016 (9 percent) as had experience with single-case financing, the most commonly understood form of third-party funding, in 2013 (7 percent)

Access to capital a major challenge faced by law firms

  • 81 percent of private practice lawyers say lack of capital to invest back into the firm is a major challenge—an obstacle faced in large part due to the unique capital structure of the partnership-based law firm business model
  • 41 percent of clients and 48 percent of private practice lawyers are confident that law firms will increasingly seek outside financing to fuel growth