Friday, March 21, 2008 6:18 AM
Interesting article in Legal Week, External Funding Booms as Litigators Plot Upturn, concerning the growth of third party funding in the United Kingdom.
Eight out of 10 of London's top law firms are already using or assessing external funding for litigation and arbitration cases, it has emerged, marking a dramatic move of third-party funding into mainstream practice.
All of the top 10 U.K. firms except Linklaters and Slaughter and May are now offering, or considering offering, clients external funding in some cases, Legal Week has established.
The story was mentioned at the Wall Street Journal Law Blog, Third-Party Litigation Funding Stepping up in U.K. and in the comments to that post was a link to related story posted to Francine McKenna's weblog Re: the Auditors, Auditor Litigation - The Vultures Are Hovering.
From Accountancy Age comes this story of a firm called IM Litigation Funding that is bankrolling a suit against Moore Stephens, a next-tier firm. The plaintiff's bar is already all over this stuff, bringing suits against the auditors much more quickly than in the past. But with the possibility that other entrepreneurial types may see opportunity in the deep pockets of the larger firms and their propensity to settle instead of going to trial, there may be something big brewing here.
The story Ms. McKenna references is an October 2007 article in Accountancy Age, Litigation funding: foul play?, discussing the same third party funding storyline Legal Week covers developing in the Accountancy world.
Auditors, long seen as having the deepest pockets by litigants looking to recover cash from collapsed businesses, are facing a new threat. Previously, liquidators could pursue a court action against a former auditor, only if they had enough money for what are generally very costly cases. But more cases against auditors look set to be brought in the future by litigants funded by third parties that hope to get a share of the damages.
Beyond this storyline itself, my own experience in reading about this topic reflects the growing interplay between articles and weblog posts; an interplay I find refreshing.
Online readers often find themselves following hyperlinks to a variety of additional resources that often add context, detail or a counterpoint opinion to the main topic(s) covered in the article. Try doing that with a print article...