litigation funding agreements

A litigation funding agreement is a financial arrangement where a third-party, called a funder, agrees to pay some or all costs of a legal case in exchange for a share of any monetary award or settlement. This helps plaintiffs or law firms manage expensive legal expenses without risking their own resources. If the case succeeds, the funder receives a pre-agreed portion; if it fails, the funder typically absorbs the loss. These agreements provide access to justice for parties with viable claims but limited funding, while offering funders potential returns based on case outcomes.