Brief History & Juridica’s Emergence
Claimants hesitate to commit to complex litigations with unquantifiable risks over indefinite time horizons. Law Firms shy from conditional fee arrangements for fear of pouring countless hours into the failed prosecution of a claim.
Litigation Funding bridges the gab between these competing interests; fronting the capital on behalf of the claimant and displacing the risk of loss from the shoulders' of counsel.
The first form of Litigation Funding originated in Australia 30 years ago. In these early years, investors focused exclusively on funding class action suits, steering clear of investing in one-off commercial claims. During the interim period, select Hedge Funds and Investment Banks pursued one-off commercial claims born out of distressed credit situations.
The only comparable funding model to that of Juridica’s prior to Juridica’s inception were those few dedicated funds which sought to acquire and monetize Intellectual Property. Juridica’s launch in December of 2007, however, marked a meaningful shift in the size and scope of the litigation funding landscape.
Juridica was the first industry participant to close a dedicated fund chartered for the purpose of investing in assorted complex corporate claims. Since inception, Juridica has built a robust portfolio comprised of interests in patent, antitrust, judgments, special situation, law firm portfolio, and an array of commercial claims brought by Fortune 1000 companies, FT Global 500 companies, investors, and major Universities.
The practical benefits of the industry’s evolution are evidenced by the near universal adoption of the industry in US jursidictions as well as in the UK. In parallel to this adoption one can readily see increased regulatory and self-regulatory mechanisms being established. In the UK, a Code of Conduct and the Association of Litigation Funders regulate Third Party Funding. Such regulation seeks to ensure that both legal and ethical standards are met. In the US, notable bodies such as the ABA and the New York City Bar Association have published favorable literature on the practical benefits of Third Party Funding.