Bloomberg Law
Aug. 7, 2018, 8:14 PM UTC

Common Litigation Funding Agreements Not Ethical, NYC Bar Says

Samson Habte
Samson Habte
Reporter

A recent opinion from the New York City bar’s ethics committee gives a thumbs down to litigation funding agreements of the sort that courts have routinely enforced in civil disputes between lawyers and funders.

The opinion centers on funding arrangements that are tied to specific future legal fees—either because the fees are security for the loan, or because the amount the lawyer has to repay depends on the amount of fees received. Those arrangements aren’t ethical, the city bar panel said, while acknowledging that “several New York courts” have enforced funding agreements similar to those analyzed in the July 30 ...

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