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The Impact of Third-Party Financing on Transnational Litigation


Cassandra Burke Robertson


Case Western Reserve University School of Law

November 29, 2011

44 Case Western Reserve Journal of International Law 159 (2011) (Symposium Issue)
Case Legal Studies Research Paper No. 2011-32

Abstract:     
Third-party litigation finance is a growing industry. The practice, also termed “litigation lending,” allows funders with no other connection to the lawsuit to invest in a plaintiff’s claim in exchange for a share of the ultimate recovery. Most funding agreements have focused on domestic litigation in Australia, the United Kingdom, and the United States. However, the industry is poised for growth worldwide, and the recent environmental lawsuit brought by Ecuadorian plaintiffs against Chevron demonstrates that litigation funding is also beginning to play a role in transnational litigation.

This article, prepared for a symposium on “International Law in Crisis,” speculates about how the growing litigation-finance industry may reshape transnational litigation in the coming decades. It argues that the individual economic incentives created by third-party financing will likely increase the number of transnational lawsuits filed, raise the settlement values of those lawsuits, and spread out the lawsuits among a larger number of countries than was typical in the past. It further hypothesizes that these individual choices about transnational litigation will lead countries to reassess their internal balance of litigation and regulation and will create pressure for greater international coordination of litigation procedure, including transnational forum choice and cross-border judgment enforcement.

Number of Pages in PDF File: 24

Keywords: transnational litigation, third party litigation funding, Australia, England, United States, Ecuadorian litigation, forum selection, forum non conveniens, Burford Capital, champerty, economic incentives, social impacts, regulation and litigation, enforcement of foreign judgments

JEL Classification: K33, K39

working papers series





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Date posted: December 1, 2011 ; Last revised: April 26, 2014

Suggested Citation

Robertson, Cassandra Burke, The Impact of Third-Party Financing on Transnational Litigation (November 29, 2011). 44 Case Western Reserve Journal of International Law 159 (2011) (Symposium Issue); Case Legal Studies Research Paper No. 2011-32. Available at SSRN: http://ssrn.com/abstract=1966202 or http://dx.doi.org/10.2139/ssrn.1966202

Contact Information

Cassandra Burke Robertson (Contact Author)
Case Western Reserve University School of Law ( email )
11075 East Boulevard
Cleveland, OH 44106-7148
United States
216-368-3302 (Phone)

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