Less Than 12% of Federal and State Case Filings Present Strong Opportunities for Litigation Funding, According to First-of-Its-Kind Market Intelligence Study

LexShares report uses proprietary case analysis software to dissect funding potential of more than 30,000 federal and state case filings to produce first-ever analysis of litigation funding investment criteria

BOSTON and NEW YORK, Sept. 20, 2022 /PRNewswire/ -- Though the U.S. litigation finance market continues to expand, less than 12% of federal and state cases filed in 2021 met the minimum threshold to be considered for investment, according to a new report issued today by tech-enabled litigation funder LexShares. This finding, detailed in the inaugural edition of LexShares' special report, "The Litigation Funding Barometer: A Data-Driven Analysis of What Litigation Funders Want," illustrates the high bar that law firms and plaintiffs must reach to attract valuable funding dollars for their cases. 

The report analyzes more than 30,000 federal and state case filings from 2021, graded by LexShares' proprietary Diamond Mine origination software, to provide lawyers with a unique window into how attractive their matters might be to litigation funders. The Diamond Mine algorithm assesses each case based on numerous factors, such as damages alleged and the track record of plaintiff's counsel, before assigning a raw score ranging from 1-25. 

In an industry first, "The Litigation Funding Barometer" breaks down cases across several claim types and dozens of jurisdictions, while also revealing which law firms filed the greatest number of cases with strong funding potential. Among the study's high-level findings, in 2021:

• Trade secrets, antitrust, and contract disputes filed in federal court represented some of the strongest funding opportunities across all jurisdictions. 
• Federal cases presented a higher percentage of strong funding opportunities than state cases. 
• Law firms appearing in the NLJ500, which we categorize as "Big Law," filed the cases with the strongest investment potential.

In addition to this and other detailed insights, the report's findings are accompanied by insider commentary from members of the LexShares investments team, offering lawyers and law firms key context around the characteristics of claims that typically lend themselves to third-party funding arrangements, and why.

"Critics of litigation funding have long pointed to the industry's lack of transparency," said Cayse Llorens, CEO of LexShares. "By publishing this groundbreaking report, we address a critical, unmet market need for closure of the knowledge gap that still exists between lawyers, clients, and third-party funders. Providing the market with more meaningful information not only equips users of litigation finance to make better business decisions, but also supports LexShares' mission of increasing access to justice for parties with meritorious claims."

About LexShares

LexShares is the leading tech-enabled litigation finance firm, with an innovative approach to originating and financing high-value commercial claims. LexShares funds litigation-related matters, primarily originated by its proprietary Diamond Mine software, through both its online marketplace and dedicated litigation finance funds. LexShares finances a mix of single-case commercial deals and a growing contingent of portfolio arrangements within its pipeline of "middle market" investment opportunities. Founded in 2014, the company is privately owned with principal offices in Boston and New York. For more information, visit lexshares.com. 

This release may contain "forward looking statements" which are not guaranteed. Investment opportunities posted on LexShares are offered by WealthForge Securities, LLC, a registered broker-dealer and member FINRA / SIPC. LexShares and WealthForge are separate entities. Investment opportunities offered by LexShares are "private placements'' of securities that are not publicly traded, are not able to be voluntarily redeemed or sold, and are intended for investors who do not need a liquid investment. Investments in legal claims are speculative, carry a high degree of risk and may result in loss of entire investment.

Media Contact: 
Alec Shirkey, Director of Marketing
[email protected] 

SOURCE LexShares