By Monika Gonzalez Mesa
The growth of litigation funding has widened the pool of law firms that can take on big cases, but their increasing popularity means boutique firms that have traditionally landed multimillion-dollar lawsuits by taking them on contingency or offering alternative fee arrangements are now taking a hit…
While boutique firms may feel that third-party funders are undercutting their business, smaller firms that once could not take on big-ticket cases are now able to compete. With the help of third-party funders, they can handle more multi-million dollar lawsuits than they would have otherwise.
“The pool of lawyers available to try a case expands because young lawyers who otherwise could not afford to take the case on contingency can now get funding,” said Alan Kluger, a founding member of Kluger, Kaplan, Silverman, Katzen & Levine. “That’s good. It gives clients a bigger pool of lawyers to choose from. The good lawyers are going to get a lot of work.”
Kluger said his firm does not use third-party litigation funding because it has more than enough work and can take the cases it likes on contingency on its own. Several other managing partners of large firms said they don’t use third-party funding either. But a few said they have used them on occasion as part of an alternative fee arrangement.