How Litigation Funding Indirectly Benefits Law Firm Clients

Cash flow limitations constrain law firms and prevent the realization of full business potential. Firms simply cannot thrive without working capital to invest in cases, employees, and growth. Law firm funding provides that capital and enables firms to improve and better serve clients of all kinds.

Clients of Funded Law Firms Reap the Benefits

A law firm that is financially secure can provide clients with a higher level of service. These firms are able to retain top talent, hire skilled and reputable experts and specialists, investigate claims fully, offer flexible payment arrangements, and so much more.

Law firm funding is often associated with plaintiff claims, and it is an excellent option for those cases. However, the improved quality of service that results from law firm funding benefits clients in all areas, including government entities, defendants in civil defense cases, and corporations with in-house legal departments.

Government Entities Are Better Served by Funded Law Firms

Government entities are regulated by various rules of law and are subject to intense public scrutiny. Government entities need attorneys who have a deep level of knowledge, the support of skilled researchers, and access to top consultants and experts in the field when needed. Varying regulatory issues and the scope and scale of government requires attorneys in this field to process and retain mass quantities of information.

Government budgets are not always large enough to cover unanticipated litigation. Law firm funding gives government agencies, departments, and other public units the financial standing to better serve government clients while conserving tax dollars.

Budgeting is another constraint on government bodies dealing with legal issues. Law firm funding provides relief to firms so they can offer contingent fees and flexible payment arrangements that better suit a government budget.

Defendants in Civil Cases Need Superior Legal Services

When a company or individual is faced with legal charges, there is a lot at stake. The reputation and sustainability of a business can be impaired, and legal cases can wreak havoc on both corporate and personal wealth and well-being.

In defense cases, law firm funding operates much like insurance, sharing the risk of the case between the firm and the funding company to better define the potential outcome. Whether a law firm pledges a single case or a portfolio of cases, this funding scenario enables law firms to offer clients nontraditional payment structures that equate to more controlled expenses. The risk mitigation provided by law firm funding of these cases also eliminates the pressure for early settlement out of fear of a potentially devastating outcome.

Benefits of Litigation Funding for Corporations with In-House Counsel

The pressure on corporate leadership to produce profits and reduce expenses is immense in today’s business climate. Many corporations have legal departments and employ in-house counsel who are tasked with minimizing losses and maximizing gains related to legal matters in addition to advising company leadership.

Corporations can benefit from litigation funding within the company’s legal department as well as funding to outside counsel. In either case, benefits include collateralizing case assets and moving legal expenses off balance sheets, decreasing pressure to settle claims prematurely, and the availability of additional input from the experienced underwriters who work for litigation finance companies.

Law Firm Funding Benefits Legal Clients of All Kinds

There are many reasons why law firm funding is quickly becoming a more common and popular financing alternative for attorneys and law firms: non-recourse capital for plaintiffs, risk mitigation for defendants, higher levels of service, superior expertise for specialized clients, the freedom to offer clients flexible payment options, and more.

Pravati Capital has been helping law firms, clients, and businesses better support legal claims and business growth for more than ten years. Contact us by calling 844-772-8284 or completing our online contact form to learn how law firm funding can help you.

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