Dublin, April 25, 2024 (GLOBE NEWSWIRE) — The Litigation Finance Investment Market – Global Industry Size, Share, Trends, Opportunities and Forecast, 2018-2028F report has been added to the ResearchAndMarkets.com supply.
The global investment litigation finance market was valued at USD 18.2 billion in 2022 and is expected to project steady growth during the forecast period at a CAGR of 13.2% till 2028.
Global investment in litigation finance has witnessed a significant surge, reflecting a dynamic change in the legal and financial landscape. Litigation funding involves third-party funding for legal proceedings that allows claimants to pursue claims without shouldering the full financial burden. This industry has seen steady growth as investors have recognized its potential for lucrative returns.
Traditionally, litigation has been funded by the parties involved or through law firms. The rise of litigation finance firms, however, has changed the landscape, attracting institutional investors, hedge funds and private equity firms. This influx of capital allows litigants to gain access to the resources needed to fight complex and expensive legal battles.
The appeal of litigation funding lies in its potential for significant returns. Investors usually receive a portion of the settlement or judgment if the case is successful. The growing acceptance of litigation finance as a legitimate asset class is fueling the development of specialist funds and platforms dedicated to connecting investors with viable legal cases.
This trend is particularly pronounced in regions such as the United States, Europe and Australia, where the regulatory environment has become more favorable. As litigation costs continue to rise, litigation finance serves as a strategic financial tool for corporations and individuals alike, changing the dynamics of litigation and creating new opportunities for savvy investors in the global financial landscape.
Market Refinement
One important trend in litigation finance is the increasing complexity of the market. As the industry has grown, participants have become more skilled at identifying promising cases, conducting due diligence and structuring financing arrangements. This maturity has led to better risk assessment and more efficient capital allocation.
In particular, litigation finance firms are using advanced data analytics and artificial intelligence to more effectively evaluate potential cases. These tools help assess the merits of a case, assess potential damages, and predict the likelihood of success. Such data-driven approaches improve decision-making and improve the overall performance of litigation funders.
Additionally, the industry is witnessing the emergence of specialist litigation finance firms that focus on specific areas of law, such as intellectual property, antitrust or international arbitration. This specialization allows funders to develop in-depth expertise in specific legal areas, further enhancing their ability to identify and evaluate investment opportunities.
Expanding geographic reach
Another notable trend is the expansion of the geographic scope of litigation funding. While the industry initially took root in common law jurisdictions such as the United States, the United Kingdom and Australia, it has now spread to common law countries and regions around the world.
As businesses and individuals in various parts of the world recognize the benefits of litigation financing, the demand for financing has grown. This trend is particularly pronounced in Europe and Asia, where regulatory frameworks are becoming increasingly conducive to litigation finance.
In addition, cross-border disputes and international arbitration cases are fueling the globalization of litigation finance. Funders are increasingly involved in cases that span multiple jurisdictions, adding to the global reach of the industry.
Different sources of funding
The litigation finance landscape is becoming increasingly diverse in terms of funding sources. Although specialist litigation finance firms continue to play a significant role, institutional investors and alternative capital providers have entered the market in greater numbers.
Institutional investors, including pension funds, hedge funds and private equity firms, are attracted to litigation finance as an alternative asset class that offers returns unrelated to traditional investments. These large-scale investors bring significant capital into the industry, leading to larger fund sizes and more substantial investments.
Additionally, crowdfunding and online platforms have emerged as alternative means of funding lawsuits. These platforms allow individual investors to participate in litigation funding by contributing smaller amounts of capital to a set of cases. This democratization of funding sources has expanded access to litigation funding to a wider range of investors.
Portfolio diversification
Portfolio diversification is becoming increasingly important for both litigation finance firms and investors. Traditionally, litigation funders have focused on funding individual cases. However, many are now adopting portfolio strategies where they invest in a diverse set of cases to spread risk and improve returns.
Increased transparency and regulation
Transparency and regulation are increasingly important in the litigation finance industry. As the industry has grown, regulators and legal authorities have taken steps to establish clearer guidelines and ensure ethical behavior. In jurisdictions such as the UK, Australia and Singapore, regulators have introduced codes of conduct and disclosure requirements for litigation funders. These provisions are intended to increase transparency, protect the interests of litigants, and maintain the integrity of the legal system.
Increase in non-recourse funding
Non-recourse funding is gaining traction in the litigation funding industry. This funding model allows litigants to access funding without personal liability for repayment if the case is unsuccessful. Instead, the funder bears the risk of losing the investment. Non-recourse funding appeals to a wide range of litigants, particularly those with limited financial resources or businesses looking to manage legal costs. It gives litigants the peace of mind that they will not face adverse financial consequences if their case is unsuccessful.
Key Attributes:
| Report attribute | Details |
| Number of pages | 177 |
| Forecast period | 2023 – 2028 |
| Estimated Market Value (USD) in 2023 | 18.2 billion dollars |
| Estimated Market Value (USD) to 2028 | $37.5 billion |
| Compound Annual Growth Rate | 13.2% |
| Regions covered | Global |
The competitive environment
Company Profiles: Detailed analysis of major companies present in the global litigation finance investment market.
- Parabellum Capital
- Bentham Capital
- Key to Juridica Brickell
- Burford Capital LLC
- Woodford Litigation Funding Ltd
- Apex Judicial Finance
- Omni Bridgeway
- Vanin
- Augusta Ventures
- Longford Capital Management LP
Report Scope:
Investment market for litigation financing, by type:
- Commercial disputes
- Bankruptcy claim
- International Arbitration
- Personal injury
Investment market for litigation financing, by enterprise size:
- Micro, Small and Medium Enterprises (MSMEs)
- Large enterprises
Litigation Funding Investment Market, by End User:
- Banking
- Media and entertainment
- IT and communication
- production
- Healthcare
- others
Investment market for litigation financing, by region:
- North America
- United States
- Canada
- Mexico
- Europe
- France
- Great Britain
- Italy
- Germany
- Spain
- Asia-Pacific region
- China
- India
- Japan
- Australia
- South Korea
- Indonesia
- Middle East and Africa
- South Africa
- Saudi Arabia
- UAE
- Turkey
- South America
- Argentina
- Colombia
- Brazil
For more information on this report, visit https://www.researchandmarkets.com/r/vfl28a
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Global Litigation Funding Investment Market
