Inflation, Recession, and Consumer Legal Funding
The Litigation Finance Journal just published a great article titled “Inflation, Recession, and Consumer Legal Funding” discussing what legal funding is, also commonly referred to as Pre-Settlement Funding, how it’s used, and why it’s under attack.
Litigation Finance Journal states “funds from Consumer Legal Funding, also called Pre-Settlement Advances, can be used to cover non-legal expenses like rent or mortgage payments, medical bills, or groceries. This is of particular value to individuals who have been injured and are unable to work.”
This sounds to be of great value to injured plaintiffs, so who is attacking access to pre-settlement funding? The answer might surprise you, but the source won’t.
“The most prominent and powerful organization behind the push for CLF regulation is the U.S. Chamber of Commerce.”
“The Chamber has been issuing a full court press against the Consumer Legal Funding industry (and to a somewhat lesser extent, the Commercial Litigation Finance industry) for years now, at both the state and federal level. And the reason the U.S. Chamber is so adamantly opposed to litigation funding? Two words: Big Insurance.” [emphasis added]
And Why is Big Insurance so opposed to plaintiffs having access to pre-settlement funding?
“In practice, Consumer Legal Funding leads to more meritorious cases being filed, with more and larger awards that insurers must then pay.” If plaintiffs can receive help paying for their ongoing living expenses, this could afford attorneys more time to fight for the justice the plaintiff deserves and not be pressured to take the first low-ball offer they receive because of the plaintiff’s financial hardships.
“Ultimately, Consumer Legal Funding is a necessary, even essential part of leveling the playing field of our legal system. Regulation is increasingly becoming a tool leveraged by insurers to limit the amount of recourse available to those who have been injured, cheated, or otherwise wronged by larger entities.”
Please read the article Inflation, Recession, and Consumer Legal Funding for a better understanding of the merits of Consumer Legal Funding and why it can be so important to injured plaintiffs nationwide.