In 2024, the landscape of litigation funding is marked by significant developments, reflecting broader shifts in the legal and financial sectors. Let’s explore five key trends shaping the market this year.
1. Expansion of law firm lending
The year has seen a surge in litigation funders diversifying into law firm lending. This trend addresses the unique financial needs of legal practices, including establishing new firms and managing working capital. Funders’ legal expertise positions them as valuable partners. This trend is expected to continue, enhancing financial flexibility within the sector.
The Legal Services Board’s recent research highlights litigation funding’s critical role in improving access to justice. The report notes that while only a minority of cases receive funding, this support is essential for individuals and organisations otherwise unable to pursue legal action.
2. ESG-related claims
Environmental, social, and governance (ESG) issues are increasingly becoming a focus for litigation funding. As companies face heightened scrutiny over their ESG practices, funders are anticipating a rise in disputes related to corporate governance and environmental impact.
3. Consumer protection cases
Consumer protection remains a significant area for litigation funding. High-profile cases such as the ‘dieselgate’ scandal and the Post Office’s Horizon IT case underscore the sector’s focus on collective actions that protect broader consumer interests. Claimants can receive litigation funding for individual cases and collective actions from specialists such as https://www.novo-modo.co.uk/ .
4. Regulatory developments
The rules for litigation funding are important. If the PACCAR decision – a legal ruling that affects litigation funding – is overturned by the proposed 2024 bill, it could change how funding agreements are enforced and affect future deals.
5. Importance of funders’ track records
The track record of litigation funders is increasingly critical. The Association of Litigation Funders (ALF) provides a framework for voluntary self-regulation, with the reliability of a funder often outweighing its membership status. This focus on past performance ensures ethical standards and commitments are upheld.
As 2024 progresses, these trends illustrate the evolving and dynamic nature of the litigation funding market, which continues to play a pivotal role in facilitating access to justice.
