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How Litigation Funding Can Help You Pursue Justice Without Financial Risk Or The Dos and Don'ts of Working with a Third Party Litigation Funder Or Litigation Funding: A Win-Win Solution for Claimants and Litigants “Litigation finance is the new email, not knowing what it is or how it works is simply not an option.” Litigation funding , also known as third-party funding (TPF), has become a vital tool for businesses of all sizes to manage the financial risks associated with legal disputes. Contrary to popular belief, litigation finance is not just for underdog battles but serves as a valuable resource for all parties involved in high-stakes litigation. In recent years, the global litigation finance industry has grown exponentially, offering support to both underdogs and well-backed parties in need of financial assistance. It is significant to note that TPF stands acknowledged for civil suits under Order XXV Rule 1 of CPC. Further, the Indian judiciary has discussed TPF agai...

Introduction Third-party litigation funding (TPLF) is an arrangement whereby a third party, usually a professional investor, provides finance to a claimant or litigant in return for a share of any damages or settlement awarded by the court. It has been gaining prominence in recent years as it provides an opportunity for individuals to pursue legal claims without bearing the financial burden of litigation costs.  In India, TPLF is still at a nascent stage. There are very few players offering this service, and most of them are start-ups. The industry is highly unregulated, as there are no specific regulations governing this sector. This article will discuss the current scenario of third-party litigation funding in India and its potential future. Developments in the Recent Time There has been a growing trend towards third-party litigation funding in India over the last few years. This has been driven by various factors, such as increasing awareness among litigants about their...

As per the reports by Daksh India, the average cost (other than fees of lawyers) incurred by a litigant is ₹1,039 per case per day, and the average cost incurred due to loss of pay/business is ₹1,746 per case per day. Legal expenses of listed Indian companies were Rs 36,973.75 crore in the fiscal year ended March 31, 2021 Thus, litigation has been an expensive affair since the very beginning. In the past few decades, many jurisdictions have introduced the concept of third-party litigation funding to ease this burden. Third-party litigation funding companies supply the capital to litigators in exchange for a portion of the settlement or other remedies. This funding is non-recourse which means that if the lawsuit fails, the funded party is not required to pay the funder after the case. The funders provide capital to businesses and business owners to help them protect and enforce their commercial rights and interests and strengthen their legal positions. On the ‘demand side’, companies ...

On 13 th November 2020, Insolvency and Bankruptcy Board of India (“ IBBI ”) issued the Insolvency and Bankruptcy Board of India (Liquidation Process) (Fourth Amendment) Regulations, 2020. One of the major purposes, for which this amendment was brought in was to ease the process of sale of liquidation assets. As we all are aware that realization  of some assets (such as continent claims, disputed receivables, disputed assets, refund from government etc.) have been an uphill task for any liquidator. Since realization  of these assets may take quite some time, they are referred in these regulations as ‘Not Readily Realizable  Asset’ or NRRA, which term has been introduced by inserting Regulation 37A. There is always a sense of urgency in a liquidation process and liquidator tries to ensure that the creditors of corporate debtors are able to realize maximum value of the assets of corporate debtor. However, these NRRAs create a sort of hurdle in this urgent process. Regul...

Litigation Financing, also popularly known as ‘third-party litigation or ‘litigation funding’ is a non-recourse funding alternative wherein a party with no direct interest in an ongoing or potential litigation/arbitration funds the litigation/arbitration cost completely or partially and gets a portion out of the final claim in return. Litigation Funding helps in lowering the litigation/arbitration burden on the claimant as the cost of litigation/arbitration falls heavy on the pockets of claimants which is the biggest factor people worry about when it comes to lawsuits. Litigation Financing is not only a boon for an individual claimant, it is also a great tool for start-ups and other businesses. Start-ups on any given day face a number of challenges in the attempt to make a name and sustain themselves in the market. These hurdles often get take the form of disputes and get routed towards the doors of the courts and tribunals. In India particularly, litigation is a lengthy and expens...