November 26, 2006
The Australian Version of Contingency Fees
Australian does not permit lawyers to use contingency fees in class action and derivative litigation. The Australian High Court has legitimized a new wrinkle however. Companies, called "litigation funding companies," can purchase a share of a lawsuit, paying litigation expenses and lawyer's fees, in exchange for a percentage of the recovery (usually one-third to two-thirds). Hedge funds, including some in the United States, back the funding companies. We allow the limited assignment of some debt claims in the United States but do not allow full-scale claims sales by injured private plaintiffs. The Australian experiment will be worth watching.
TrackBack URL for this entry:
Listed below are links to weblogs that reference The Australian Version of Contingency Fees: