North America Litigation Funding Investment Market Size Likely to Surpass at a CAGR of 9.3% By 2033

As per the current market research conducted by CMI Team, the North America Litigation Funding Investment Market size is expected to record a CAGR of 9.3% from 2023 to 2032. In 2023, the market size is projected to reach a valuation of USD 5.8 Billion. By 2032, the valuation is anticipated to reach USD 13.1 Billion.

North America Litigation Funding Investment Market: Growth Factors and Dynamics

• Increasing Demand for Litigation Funding: Litigation funding has gained popularity as an alternative financing solution for legal cases. As awareness grows among law firms and litigants, the demand for litigation funding in North America has been on the rise.

• Rise in Complex Legal Cases: The increase in complex legal cases, particularly in areas such as class actions and commercial litigation, has driven the need for external funding. Litigation funders play a crucial role in supporting these cases by providing financial resources to pursue lengthy and intricate legal battles.

• Risk Mitigation for Plaintiffs: Litigation funding serves as a risk mitigation strategy for plaintiffs who might not have the financial means to pursue a legal case. Funding allows them to access legal representation and navigate the legal process without the burden of upfront costs.

• Growing Acceptance by Law Firms: Law firms have become more accepting of litigation funding as a legitimate and ethical means of financing legal cases. This shift in perception has contributed to the market’s growth, with more law firms incorporating litigation funding into their business models.

• Expansion of Litigation Funding Providers: The North America market has witnessed the entry of new litigation funding providers, fostering competition and innovation in the industry. This expansion has led to a variety of funding options and structures, providing litigants with more choices.

• Regulatory Developments: Regulatory developments have played a role in shaping the litigation funding landscape. As the industry matures, regulators may implement guidelines and standards to ensure transparency and ethical practices, providing further stability to the market.

• Investor Interest and Capital Inflow: The North America litigation funding market has attracted significant interest from institutional investors and hedge funds. As these investors recognize the potential returns associated with funding legal cases, the influx of capital into the market has increased, further fueling its growth.

• Evolution of Funding Models: The market has seen an evolution in funding models, with variations such as portfolio funding and law firm financing gaining traction. Portfolio funding involves financing multiple cases as a package, spreading risk across a portfolio of legal matters. Law firm financing allows firms to secure capital based on their anticipated legal fees, providing them with financial flexibility.

North America Litigation Funding Investment Market: Partnership and Acquisitions

• In 2022, Legalist is generating excitement in the tech startup sphere by exploring the potential of private credit. Similar to iconic firms like D.E. Shaw or Renaissance Technologies, Legalist’s convergence of market ideas, bold strategies, and technology positions it as a notable player in the evolving landscape of legal and financial innovation.

• In 2023, Burford Capital has expanded its European presence, driven by increased client demand for services like corporate monetization and law firm portfolio financing. The surge is propelled by a growing need for legal finance in Europe, spurred by legislative changes, leading to Burford’s establishment in London, Frankfurt, Zug, Paris, Rome, and Stockholm.

Report Scope

North America Litigation Funding Investment Market: COVID-19 Analysis

The COVID-19 pandemic has had a significant impact on the North America Litigation Funding Investment Market, with the industry experiencing both positive and negative effects. Here are some of the key impacts:

• Case Delays and Court Closures: Many courts faced closures, delays, and reduced capacities during the pandemic, leading to disruptions in legal proceedings. This resulted in a slowdown of cases, affecting the expected timelines for returns on litigation investments.

• Financial Strain on Litigants: Economic uncertainties caused by the pandemic led to financial strain on individuals and businesses. Litigants faced challenges in securing the necessary funds to pursue legal actions, potentially reducing the demand for litigation funding.

• Shift in Legal Priorities: The legal landscape experienced a shift in priorities as resources were redirected to urgent matters related to the pandemic. This reshuffling of legal priorities impacted the volume and nature of cases available for litigation funding.

• Adaptation to Remote Legal Proceedings: With the adoption of virtual court proceedings and electronic filings, the legal system adapted to the new normal. Litigation funders adjusted their strategies to accommodate remote legal processes, enabling them to continue evaluating and funding cases.

• Increased Focus on Non-Pandemic Related Cases: As the legal system stabilized, there was a renewed focus on non-pandemic-related cases. Litigation funders shifted their attention to areas less directly impacted by the pandemic, such as class actions, intellectual property disputes, and commercial litigation.

• Diversification of Funding Portfolios: To mitigate risks associated with any potential future disruptions, litigation funders diversify their funding portfolios. This diversification involved spreading investments across different types of cases, industries, and jurisdictions to create a more resilient and balanced portfolio.

• Collaboration with Law Firms: Litigation funders enhanced collaboration with law firms, providing financial support to firms facing economic challenges during the pandemic. This collaboration facilitated the continuation of legal services and maintained a steady flow of cases for litigation funders.

• Regulatory Clarity and Stability: Clear and stable regulatory environments became crucial for the recovery of the litigation funding market. Regulatory bodies provided guidance and clarity on the industry’s practices, fostering confidence among investors and litigants and contributing to the market’s recovery.

In conclusion, the COVID-19 pandemic has had a mixed impact on the North America Litigation Funding Investment Market, with some challenges and opportunities arising from the pandemic.

List of the prominent players in the North America Litigation Funding Investment Market:

• Burford Capital
• Omni Bridgeway
• Therium Capital Management
• IMF Bentham
• Vannin Capital
• Augusta Ventures
• Longford Capital Management
• Balance Legal Capital
• Motive Legal Finance
• Parabellum Capital
• Validity Finance
• Lake Whillans
• Ally Law
• Legis Finance
• Legalist
• Others

The North America Litigation Funding Investment Market is segmented as follows:

By Type

• Commercial Litigation
• Bankruptcy Claim
• International Litigation
• Others

By Enterprise Size

• Large
• SMEs

By End User

• BFSI
• Manufacturing
• Media & Entertainment
• IT & Telecom
• Healthcare
• Others

Regional Coverage:

North America

• U.S.
• Canada
• Mexico
• Rest of North America