How Commercial Litigation Financing Helps
Companies Waiting For Lawsuit Settlement?
Commercial lawsuit funding is the non-recourse cash advance provided to plaintiff
companies involved in business litigations. The pre-settlement financing is provided
to bring down the monetary burdens of the contending plaintiff companies.
Commercial litigations are on a constant rise and the monetary obligations that it
may bring upon the contending party may be huge.
How Commercial Litigation Financing Helps the Plaintiff Companies:
Commercial lawsuit funding facilitates a large amount of non-recourse cash
advance to those who are in dire need of cash while waiting for their business
litigation to settle. Using this facility and by leveraging the unique financial strength
of commercial litigation funding, plaintiff company increases its prospects for a
favorable outcome. An advance on pending settlement also allows attorney the time
needed to get the full value for the case and the time period to negotiate a better
Commercial Lawsuit Funding has Following Features:
1. Non-Recourse: It is non-recourse. It is paid back only if the plaintiff wins the
case at trial or reaches an out-of-court settlement with the defendant. If plaintiff is
unsuccessful in getting the claim, the borrowed amount is never paid back.
2. No Monthly Payments: Once plaintiffs are approved and funded, they pay back
directly from the proceeds of their successful settlement.
3. No Personal Guarantee: Unlike conventional loans that almost always require
the personal guarantee of the business owners, commercial lawsuit funding is a
non-recourse investment, secured by the prospective proceeds of pending claim
and not the cash-flow of their business or their personal assets.
4. Off-Balance Sheet: Financing provided by is off-balance sheet and non-
recourse. It allows businesses to prevent and protect from litigation risks. In
addition, financing may be used to supplement working capital and to remove
liabilities from balance sheet of the business.
5. Unrestricted and Unlimited Use: Cash obtained from commercial litigation
financing can be used to pay down debt and invest to maintain or help in business
expansion. Company can use the cash advance for fixed and variable costs such as
payroll and operating expenses. Funds can also be used to invest in the expansion
of their business, which maintains the confidence of creditors, investors, and
Business lawsuits are, in general, one of the long and expensive legal processes
that take out several years together for a settlement to occur. Many people find
arranging for funds quite difficult when a particular lawsuit is going on in the court
A commercial lawsuit funding offers a financial support to plaintiffs when they need
it most. Their attorney provides the legal help and the financial support provided by
commercial lawsuit funding can create a win – win situation for the client. In this
win-win scenario, financial help provided by lawsuit funding will allow the plaintiff
business to take care of pressing financial needs and wait for a just and equitable
settlement. In the final analysis, they net more from a settlement than would have
been possible without the commercial lawsuit funding.
Introduction of the commercial litigation financing service has come in for greater
appreciation from all corners of business world. Commercial lawsuit funding helps
to fulfill the monetary obligation that a business gets to meet when facing a
commercial lawsuit and it is a solution in the form of legal financing facility. Best
part is that being non–recourse it is risk-free and one can pay back upon settlement
completion or after winning over the trial.
What Types of Cases Qualify for Commercial Lawsuit Financing?
There are variety of cases that can qualify for commercial lawsuit loan, these
include, but are not limited to: Contract Disputes, Trademark and Copyright
Infringement, Fraud, Industrial Products Liability, Construction Disputes,
Intellectual Property, Shareholder Suits, Securities and Investment Fraud, Banking
and Insurance Disputes, ERISA, Professional Negligence and more.
It is a well-known fact that commercial legal processes will drag for several years
and it serves best to settle the case at the earliest. An organized pre-settlement
funding from a well-funded legal financing company aids one in getting immediate
cash and the time period to negotiate a better settlement deal. Commercial lawsuit
funding allows these firms to leverage the expected settlement from their case to
obtain the capital they need now. Commercial lawsuit financing helps the plaintiff
company regain their financial freedom.