Burford Capital’s second annual survey on litigation finance showed a sharp increase in the number of lawyers who said that they think litigation finance is a useful tool – up 15% from last year to 79%. The survey also found CFOs to be dramatically more active in thinking about and managing litigation costs.
Other highlights of the survey include:
- Pressure on law firm fees and in-house legal budgets is intense. 77% of private practice lawyers surveyed said the number one business challenge they face is pressure to discount their fees; amongst general counsel and financial executives, the number one business challenge is increased costs cutting and cost-consciousness generally (75% and 81%, respectively);
- Awareness of litigation finance is high. 91% of private practice lawyers are aware of the option of litigation finance (also known as third-party funding); the same is true of 85% of in-house counsel; and
- CFOs appear to be more focused on litigation costs than ever before: 83% of CFOs believe that litigation finance is a useful tool and 58% of CFOs believe that their companies have had a case that could benefit from litigation finance – almost triple last year’s response of 22%. Moreover, fully half of all CFOs believe that counsel should present litigation finance as a payment option in every new case.
- For the second year in a row, 20% of the private practice lawyers surveyed indicated they are currently handling a case that could benefit from litigation finance. At the same time, 79% of such lawyers said that they think litigation finance is a useful tool and allows non-contingency firms to do cases they otherwise would not, an increase of 15% over the prior year.
Christopher Bogart, CEO of Burford Capital, remarked:
“Our survey results this year reinforce the significant market need for litigation finance. The practice of litigation finance offers a solution to the increasing expense of litigation for clients, and allows good cases to get to great firms – firms whose chosen business models don’t allow for a significant number of full contingency fee cases.”
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Burford Capital is the world’s largest provider of investment capital and risk solutions for litigation. Burford’s annual survey is the only such survey of the litigation finance market in the U.S. This year, the topic areas addressed included i) general business climate; ii) awareness of litigation finance; iii) perceptions of litigation finance; and iv) demand for litigation finance. In addition to the highlights above, the survey also includes data on the increased use of boutique firms by in-house counsel, and the involvement of financial executives within corporations regarding decisions on litigation.
The survey was conducted by Briefcase Analytics, a leading business intelligence firm, and surveyed litigation partners at private practice law firms as well as general counsel and financial executives serving large and mid-sized corporations.
For more information, see the 2013 survey results: www.burfordcapital.com/2013/12/survey-results/