As the coronavirus crisis shutters courts and businesses nationwide, law firms and companies across the U.S. are seeking ways to conserve cash or access credit, leading some of them to turn to litigation funders, said Stuart Grant, the co-founder and managing director of Bench Walk Advisors.
Grant said his litigation financing firm has seen a “dramatic increase in demand” for funds since the pandemic hit the U.S.
Reuters recently spoke with Grant, who was previously a prominent shareholders’ lawyer at Grant & Eisenhofer, about where that demand is coming from and the impact of the pandemic on litigation finance investments.
REUTERS: Where is the increased demand for litigation finance coming from?
GRANT: Top-tier plaintiffs’ side contingency-fee law firms, who up until this time were financing things themselves are saying, “We’re concerned that our income stream could be stretched out and we’re not sure that our balance sheet can deal with that.”
We’re also seeing corporate litigants say, “We were fine paying hourly rates and weren’t interested in litigation finance. Now the world has changed, and our ability to borrow, our revenue is going to be dramatically off. We have to find quick access to capital to finance our case.”
Read the full story on Westlaw Practitioner Insights, here.