Litigation Finance Is Evolving: Here's What Every Attorney Should Know Before Seeking Funding

The Litigation Funding Landscape Has Shifted,  and Many Lawyers Are Being Left Behind

More than $15 billion in institutional capital is now deployed across the global litigation finance market, yet access to that capital has become increasingly unequal. As the largest funders raise minimum deal thresholds and concentrate resources on high-value commercial matters, a growing segment of law firms are finding that traditional litigation funding simply isn't built for the cases they actually handle.

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For senior partners managing firm cash flow alongside active dockets, this shift has real operational consequences. Cases that settle, sometimes for years before disbursement clears, create a timing mismatch that strains client relationships and firm liquidity alike.

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Understanding how litigation funding actually works, and more importantly, who it works for, is now a core competency for any attorney involved in contingency-based practices.

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What Makes a Case Eligible and Why the Answer Varies More Than You Think

Case Type and Minimum Value Thresholds

commercial litigation, intellectual property disputes, antitrust matters, or international arbitration. Others won't touch personal injury, family law, or regulatory proceedings, regardless of the potential recovery. Knowing a funder's case type criteria before initiating a conversation saves significant time on both sides.

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Value thresholds are equally consequential. Most large-scale institutional funders require at least $5 - 15 million in potential damages before they'll engage in due diligence, with some requiring substantially more. For practices handling smaller or mid-sized contingency matters, this creates a structural gap: your case may be meritorious, your settlement may be certain, and you may still be told the deal is too small to consider.

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Timing, Structure, and Merit Evaluation

Three additional variables determine whether a funding relationship is viable for your practice:‍

• Timing of engagement. Some funders commit capital pre-litigation; others only engage during or after discovery. A funder who enters only at the eve of trial offers little value to firms managing early-stage case costs.
• Portfolio vs. single-case arrangements. For firms with active contingency pipelines, portfolio funding can offer more favorable economics and greater capital certainty. Not every funder offers this structure, and it is worth asking directly.
• Merit framework. Every funder has its own underwriting model. What defendant profile do they require? What evidence of liability is necessary before they'll advance to formal diligence? Understanding their framework tells you whether your cases are likely to qualify before you invest time in a pitch.

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Post-Settlement/Judgment Funding: The Corner of Legal Finance Most Lawyers Overlook

Why Post-Settlement/Judgment Is Structurally Different

The overwhelming majority of litigation finance capital, estimated at more than 80% of deployed dollars, is committed at the pre-settlement/judgment stage, underwriting both legal merit, outcome risk and the possibility of earning a multiplier on their investment. This is what most people picture when they think of litigation funding: a funder betting alongside you on whether you'll win.

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Post-settlement and post-judgment funding operates on an entirely different premise, both in terms of how a transaction is underwritten and return expectations.

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By the time a post-settlement/judgment funder engages, the legal work is substantially finished. The parties have reached an agreement or a verdict has been won. What is being financed is the gap: the months, and sometimes years, between a settlement or judgment and the actual disbursement of funds through court approval processes, potential appeals, and claims administration.

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"We're not underwriting whether you'll win. That question has essentially already been answered. What we're financing is time. And for the attorneys and clients who've already done the hard work of reaching a settlement or winning a judgment, time is exactly what they don't want to lose." — Roni Dersovitz, Founder and CEO, RD Legal Funding

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What This Means for Attorneys in Practice

This distinction has two immediate implications for law firms considering their financing options:

1. First, the minimum value thresholds that govern traditional litigation funding often do not apply. Because post-settlement/judgment funders are not primarily underwriting outcome risk, the economics of smaller settled matters can still work. A case that was declined by an institutional funder for being too small may still qualify for post-settlement/judgment funding, and likely will.
2. Second, this segment of the market remains highly underserved. Less competition among funders means faster, more straightforward engagements for attorneys who qualify. Firms are not competing for attention the way they might with an oversubscribed institutional funder reviewing hundreds of pre-litigation submissions.

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Earned Receivables and Legal Cash Flow: A Framework for Thinking About Timing

The Real Cost of Waiting

For plaintiffs' attorneys, earned fees on contingency cases represent real economic value, but that value often remains locked for extended periods after a settlement/judgment is reached. Court-mandated approval timelines, administrative backlogs, and the administrative complexity of mass tort or class action disbursements can stretch this waiting period significantly.

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This creates a predictable cash flow problem that conventional lenders are poorly positioned to solve. Most banks and credit institutions do not recognize legal receivables or rights to future earned fees as acceptable collateral. That leaves attorneys with limited options: draw on firm credit lines, delay compensation distributions, or absorb the operational pressure of waiting.

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Post-settlement/judgment funding, structured around earned receivables rather than speculative outcomes, offers an alternative path designed specifically for the legal sector's unique timing dynamics.

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Questions Worth Asking a Potential Post-Settlement/Judgment Funder

If you have settled matters or won judgments where disbursement timing is creating pressure for your clients or your firm, the following questions will help you qualify a post-settlement/judgment funder quickly:

• Do you require a minimum settlement/judgment value, and if so, what is it?
• What documentation is required to initiate the funding process?
• How long does the diligence and approval process typically take?
• What is the fee structure, and how is it calculated relative to anticipated disbursement timing?
• Do you work directly with counsel, with plaintiffs, or both?

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RD Legal Funding: A Pioneer in Post-Settlement/Judgment Legal Finance

RD Legal Funding has been providing post-settlement and post-judgment funding to plaintiffs, their counsel, and litigation professionals since 1998. As one of the earliest entrants in this specialized segment of legal finance, the firm has built its practice specifically around the gap that institutional litigation funders do not address: financing earned receivables after settlement/judgment, not before.

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For law firms managing the dual pressure of client expectations and firm economics, that specialization matters. It means faster evaluations, broader eligibility, and a counterparty that understands the operational realities of contingency practice at a functional level, not just as a capital allocation exercise.

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Ready to Explore Your Options?

If your firm has settled matters won judgments where disbursement timing is creating cash flow pressure, or if you anticipate settlements/judgments where that pressure is likely, a conversation with a specialist in post-settlement/judgment funding is worth prioritizing.

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About RD Legal Funding

RD Legal Funding provides tailored capital solutions for law firms by accelerating access to post-settlement and earned fees. We understand that managing a successful legal practice requires more than just winning cases—it requires strategic financial planning and reliable capital partnerships.

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To learn more about strategic options for your practice:

Phone: (800) 565-5177

Email: info@legalfunding.com

Website: www.legalfunding.com

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Roni Dersovitz is the founder and CEO of RD Legal Funding, a pioneer in providing innovative liquidity solutions for contingency law firms, settlement claimants, and legal receivables. With over 25 years of experience in litigation finance, Roni has helped transform legal victories into immediate financial results for thousands of clients. To learn more, visit www.legalfunding.com or contact us at info@legalfunding.com or (800) 565-5177.

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