How Litigation Funding Ensures a Fair OutcomeAugust 22, 2013
Personal injury and FELA clients often feel like David against the Goliath of the defense, which often has an army of lawyers paid for by their insurance policy to cover law suits. The defense can afford to drag out the lawsuit, offering lowball figures to settle the case as a nuisance without regard to the plaintiff’s actual damages.
However, plaintiffs don’t have the luxury of waiting for long litigation periods to end. Often, their injuries will keep them out of work, cutting off their income. Without a steady income, they face foreclosure, eviction, utility shut-offs and even pulling their children out of school. It’s a stressful situation, and many of them will do anything to save their homes and continue to provide for their families – even if it means accepting a settlement that is lower than the value of their case.
Not only does accepting a lowball settlement adversely affect the plaintiff; it also hinders the plaintiff’s attorney. It’s difficult to provide the best representation possible when the client wants to settle so that he can pay his bills.
Fortunately, litigation funding can tip the scales in the plaintiff’s favor and ensure a fair outcome. By receiving a settlement advance, the plaintiff is able to meet his expenses: mortgage payments, rent, car payments, utility bills, tuition and even groceries. Settlement advances provide the bridge necessary for plaintiffs to keep food on the table while waiting for the case to resolve. Without this additional worry, plaintiffs can then allow their attorneys to provide the best representation possible and negotiate a fair settlement.
The plaintiff’s attorney benefits too, not only monetarily since most of these cases are taken on a contingency basis, but reputation-wise. Attorneys who can negotiate larger settlements from their clients receive favorable word of mouth referrals, and in some cases, are featured in state legal publications for settling matters as favorably as possible to the injured plaintiff.
Instead of taking an offer that is much too low to compensate the plaintiff for his injuries, the attorney can hold out for fair compensation. This means that if the plaintiff remains unable to work, he’ll receive enough from the settlement to cover his bills and further medical expenses. Waiting can mean the difference between receiving only a temporary reprieve, forcing the plaintiff to later file for bankruptcy or turn to subprime lending options, or securing a settlement that ensures financial security for the foreseeable future. Settlement advances provide the luxury of time.
And because litigation funding isn’t a loan, if the plaintiff doesn’t recover, there is no need to pay back the money. The litigation funding company bears the risk so that the plaintiff doesn’t have to, and the right settlement advance company will be able to provide an answer – and cash – within 48 hours after the plaintiff applies. There are no payments to make; the settlement advance is repaid from the proceeds of the settlement. This eliminates most of a plaintiff’s financial worries, affording him the time to recover and rebuild his life while his attorneys work toward a fair outcome.