From Niche to $67B: The Rise of Litigation Finance as a Global Asset Class

If you’ve been noticing more chatter about litigation finance lately, it’s not your imagination. What started as a niche way for plaintiffs to get some funding has blown up into a mainstream asset class that institutional investors can’t ignore. With legal bills soaring and cases growing ever more complex, third-party funding is shifting from a “nice to have” to a “must have” for many law firms and plaintiffs. And for firms like BroadRiver Capital, that presents a ripe opportunity to lead and expand provided they can navigate shifting regulations and embrace new funding structures.

Global Litigation Finance Market Size & Growth Projections

Globally, litigation funding was pegged at around $20.06 billion in 2024 by one source, with others ranging up to $23.57 billion or down to $17.5 billion. Forecasts show it climbing to somewhere between $22.8 billion and $25.8 billion in 2025, then on to nearly $37.3 billion by 2029, and potentially approaching $67.2 billion by 2037 implying compound annual growth rates of roughly 9.6–13.4% depending on which study you trust.

North America, and the U.S. in particular, dominates. In 2023 the U.S. market was about $4.5 billion, and it’s forecast to more than double to $9.7 billion by 2032 (an 8.9% CAGR). By 2037, North America could be generating $25.3 billion in litigation funding revenue, with just the commercial litigation segment adding $27.7 billion between 2025 and 2037.

Part of the challenge in pinning down exact figures is that litigation financing deals often happen privately, with no standard reporting requirements. That means anyone trying to size up the market has to lean heavily on proprietary data, deep industry relationships, and a critical eye toward differing methodologies.

Table 1: North American Litigation Finance Market Projections (2024–2037)

Key Drivers of Litigation Funding Expansion

1. Rising Legal Costs and Complex Disputes: The more expensive a lawsuit becomes, the more plaintiffs and law firms look to outside capital rather than tap into their own balance sheets.
2. Complex disputes: Commercial and IP cases, in particular, often involve multi-party claims, voluminous discovery, and specialized expertise pushes toward non-recourse funding.
3. Investor appetite for uncorrelated returns: Litigation finance has delivered in-sample returns north of 20% p.a., with very low correlation to stocks and bonds. That makes it a valuable diversification tool in a portfolio .
4. Regulatory shifts: As historical bans on champerty and maintenance ease, more jurisdictions are embracing third-party funding under clear rules, further legitimizing the asset class.

Bottom line: litigation finance is moving from discretionary to essential. It’s about ensuring access to justice when plaintiffs can’t or won’t front massive legal bills.

Risks and Returns in Litigation Funding

It’s tempting to focus on those 20%+ annual returns equity-style deals with performance kickers often outperform straight debt financings (especially in mass torts and personal injury) . But the flip side can be painful: if a funded case fails, the funder can lose 85–95% of their investment. In commercial portfolios, ~34% of cases produce negative returns; in big personal-injury claims, around 7% end in partial or full write‐offs.

Key takeaways:

• Single-case funding is risky you’re all in on one outcome.
• Diversity matters spreading capital across many uncorrelated claims smooths out volatility.
• Due diligence is critical sophisticated underwriting, expert legal input, and continuous monitoring are non-negotiable.

For institutional investors, the combination of high upside potential and high downside risk underscores the importance of a portfolio approach. Litigation funding can be a stellar diversifier, but only if deployed with discipline and expertise.

Case Types and Funding Models Gaining Traction

Over the past few years, we’ve seen clear winners in both case types and funding models:

• Commercial disputes (contracts, business torts): predictable damages and sophisticated parties make outcomes easier to model.
• Intellectual Property (patent litigation): high stakes, deep technical issues, and big-ticket awards.
• Mass torts: funders often bankroll claim intake and case management at scale.
• Antitrust, asset recovery, bankruptcy, employment: these have also picked up momentum as funders chase diversification.

On the funding side:

• Portfolio funding now makes up about two-thirds of all deals. Average portfolio investment: $16.5 million.
• Single-matter financings still exist average $6.6 million but they’re giving way to broader partnerships.
• Hybrid models blend debt, equity kicks, and bespoke structures.
• Large-scale investments: law firms see $50 million+ facilities, with some megadeals hitting $250 million.

Table 2: Key Litigation Types and Funding Models Gaining Traction

This shift toward portfolio and hybrid funding underscores a maturing market: funders want stable, long-term relationships with law firms and diversified pipelines of cases, rather than one-off wagers.

Navigating Litigation Finance Regulations

Historically, doctrines like champerty (profiting from another’s suit) and maintenance (backing litigants without direct interest) barred third-party funding. Today, most U.S. states and Canadian provinces have relaxed those rules, viewing funding as enhancing access to justice so long as funders don’t control litigation decisions.

In the U.S.:

• Disclosure regimes vary. Some federal courts require funders to disclose agreements; states like Colorado, Georgia, Kansas, and Oklahoma have explicit rules.
• Work-product protection often shields funding docs from discovery.
• Rule 5.4 (non-lawyer fee-sharing ban) generally doesn’t apply to law firm financing.

In Canada:

• Champerty and maintenance are civil, not criminal, issues.
• Court approval and prompt disclosure of funding deals are mandatory.
• Agreements must explicitly preserve attorney-client loyalty and confidentiality.

That regulatory diversity creates both hurdles and advantages. On one hand, funders need savvy compliance teams to tailor structures across jurisdictions. On the other, clearer rules especially in Canada lend legitimacy, attracting more institutional capital. Ethical transparency and preserving attorney independence aren’t just nice; they’re competitive advantages.

Beyond North America: global horizons and new frontiers

While North America is the heartland today, fast-growing markets are emerging worldwide:

• Asia-Pacific is expected to grow fastest, fueled by rising economic development and complex commercial disputes.
• London, Singapore, Hong Kong, Dubai (DIFC) are becoming arbitration funding hubs as rules liberalize.
• Latin America and Africa are still nascent but offer first-mover potential.

New segments are also opening up:

• International arbitration funding is on the rise, thanks to eased champerty norms in key jurisdictions.
• Defense-side financing helps defendants pool risk and free up balance-sheet capital a novel twist on the model.
• Middle-market deals avoid the scalability and competitive pressures of mega-fundings.
• Sector-focused strategies (AI, biotech, semiconductors, 5G/6G) target high-value IP litigation.

For a firm like BroadRiver, that means mapping a global footprint, building regional expertise, and experimenting with defense-side or sector-specific offerings to diversify risk and capture new revenue streams.

Technology’s Role in Modern Litigation Funding

Technology is reshaping every part of the value chain:

• AI/ML enable predictive models for case outcomes and optimal funding levels.
• Natural Language Processing sifts through filings and evidence to flag strengths and weaknesses.
• Big Data Analytics lets funders benchmark across thousands of cases.
• Blockchain/smart contracts promise transparent, automated payment triggers.
• Legal-tech platforms connect litigants with funders in more democratized marketplaces.

These tools turn litigation finance into a quantitative, scalable business. No longer purely a human-judgment game, underwriting can leverage terabytes of historical data to refine pricing, monitor case health in real time, and adjust capital allocations dynamically.

Strategic Roadmap for Litigation Funders

Putting it all together, the road map for a top-tier funder looks like this:

1. Invest in analytics and AI: Build or partner for advanced underwriting engines.
2. Double down on portfolio funding: Deepen law firm partnerships with multi-case facilities.
3. Expand globally: Target Asia-Pacific, arbitration hubs, and emerging markets.
4. Pursue new segments: Defense-side, middle-market deals, sector-focused IP strategies.
5. Champion ethics and compliance: Transparent disclosures, preserving attorney autonomy.

By marrying cutting-edge tech with thoughtful diversification and a global mindset while staying scrupulous about ethics funders can not only ride the growth wave but help shape the future of litigation finance itself.

That’s the story of North American litigation finance today big numbers, evolving deal structures, regulatory twists, and technology’s rapid ascent all woven together in a market that’s anything but static.