#11516. Third-party funding in a sequential litigation process

August 2026publication date
Proposal available till 30-05-2025
4 total number of authors per manuscript0 $

The title of the journal is available only for the authors who have already paid for
Journal’s subject area:
Law;
Economics and Econometrics;
Business and International Management;
Places in the authors’ list:
place 1place 2place 3place 4
FreeFreeFreeFree
2350 $1200 $1050 $900 $
Contract №11516.1 Contract №11516.2 Contract №11516.3 Contract №11516.4
1 place - free (for sale)
2 place - free (for sale)
3 place - free (for sale)
4 place - free (for sale)

Abstract:
Third party litigation financing (TPF)—for-profit, nonrecourse funding of litigation by a nonparty—is a new and rapidly developing industry. As a novel phenomenon that involves various normative concerns, TPF has sparked much debate and controversy among scholars and policy-makers, speculating about its potential effects on issues such as the volume of litigation and the quality of claims filed. Under the TPF scheme, we decompose the litigation decisions into two parts: the plaintiff is in charge of the legal decisions, while the TPF has the freedom to decide in each stage of the litigation process whether to continue the financial support in the litigation process. The contract that achieves these desired results has a few interesting properties. First, it provides a pre-specified remedy to the plaintiff if the TPF funder terminates the financing prior to the conclusion of the litigation process. Second, the contract also specifies the compensation to the TPF funder, which is due upon completion of the litigation process, and it is conditioned upon the awarded verdict.
Keywords:
Contract theory; Game theory; Litigation funding; Third party funding

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