With the new year finally here, we are sure you are excited to see what the legal world has in store for you and your clients. While legal funding is not a new concept by any means, it has, until recently, remained relatively underappreciated. We anticipate that that will change in 2019. Below are a few predictions we have for this market and how the coming trends could benefit law firms, plaintiffs, and defendants alike.

More Players

As of now, there are only about two dozen companies devoted exclusively to providing pre-settlement cash advances to individuals who find themselves strapped for cash during the pendency of their case. However, The American Lawyer anticipates that that number will more than double in 2019 as more non-legal companies realize the earning potential in litigation.

In addition to there being more players in the field, The American Lawyer also anticipates that more lawyers will be taking advantage of settlement advance loans in 2019. The study predicts that seven out of 10 lawyers who are not already taking advantage of legal funding will within two years.

Defense Funding

Up until recently, structured settlements served to help solely plaintiffs. However, that is expected to change in the coming years. Already, some of the bolder companies have begun to offer defense funding. Defense funding allows defendants to enjoy the same contingency-fee type benefits as plaintiffs in that it does not force them to front huge amounts of cash only to obtain disappointing case results. While legal funding was initially adopted to help level the playing field for injured parties with mounting medical costs and living expenses, some companies have recognized the benefits in offering advance funding for corporations that want to contain their spending on complex litigation. This is something to keep your eye on if you are in the business of business litigation.


As pre-settlement funding becomes more popular, it is only natural that the development of a regulatory body would be in the works. While there is no news of such a body yet, The American Lawyer anticipates that some of the major players will join forces to create an association tried with the responsibility of creating and enforcing ethical and sustainable funding practices. As the UK has such a body already, it is not unthinkable that the future association will look to the Association of Litigation Funders, which is in its eighth year of operations, for guidance on issues regarding client protection, control of case strategy, withdrawal from cases, and approval of settlements, among other issues.

Mandatory Disclosure of Funding

This particular issue may be the most relevant to attorneys and their clients. As of now, there is no rule that states that attorneys or their clients must disclose their intention to use pre-settlement funding at the start of the case. The lack of a rule benefits plaintiffs, as many plaintiffs do not anticipate needing a settlement advance loan. Rather, the need arises as a case drags on. If the amendment to Rule 26 of the Federal Rules of Civil Procedure proposed by the U.S. Chamber Institute for Legal Reform, which would require the early disclosure of on party’s plan to use litigation funding, passes, it would make disclosure of funding mandatory. The theory behind this proposed amendment is that legal funding is relevant to the merits of a case.

Regardless of what is to come in 2019, our goal at Capital Financing remains the same – to provide injured parties and their families with the pre-settlement funding they need to get back on their feet after a bad accident. For more information on how we can help you, submit an application today.