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Why is There an Assault on the Poorest Amongst Us?

June 12, 2019

Why is There an Assault on the Poorest Amongst Us?

This article was contributed by Eric Schuller, President of the Alliance for Responsible Consumer Legal Funding (ARC). “Millions of Americans Are Just 1 Paycheck Away From ‘Financial Disaster’” was the title in a recent story in Barron’s. The article stated that 51% of working adults in the US would need to access savings to cover necessities if they missed more than one paycheck. That is the equivalent of over 78.2 million Americans. The story went on to state that “roughly two-thirds of households earning less than $30,000 annually and Hispanic households would not be able to cover basic living expenses.” That is the equivalent of over 101.2 million Americans. Consumer Legal Funding is a vital resource for those very Americans. Funding allows the 101.2 million Americans who cannot cover basic living expenses to bridge that gap while their legal claims make their way through the system. With some cases taking several months – if not years – to settle, these Americans need help today. Consumer Legal Funding allows them to pay their mortgages, put food on their tables and keep a roof over their heads while the Insurance industry slow-walks their legal claims. Perhaps the most chilling revelation here is that the Insurance industry, led by the US Chamber of Commerce, supported legislation to eliminate Consumer Legal Funding in two of the top-10 poorest states in the country: first in Arkansas, where 15.4% of the population lives in poverty, and just last week in West Virginia, where the poverty rate is 17.7%. What is even more striking, is that those are two of the top-10 hungriest states in the US. In West Virginia, 14.9% of the population goes hungry, and in Arkansas the rate is 17.4%. The elimination of Consumer Legal Funding in these two states was implemented merely to increase Insurance industry profits, and force consumers to accept lowball offers (as an aside: State Farm ended 2018 with a net worth of over $100 Billion). Thanks to the latest legislation that went into effect on June 5, 2019 in West Virginia, residents who need Consumer Legal Funding assistance will no longer be able to access it. Take for example, Patressa from Barboursville, WV, who said: “I am completely broke financially due to a car accident. I have medical needs and doctor appointments that I need to go to.” Now Patressa is among the 1.8 million residents of West Virginia who no longer have access to alternative funds while their cases are pending in the legal system. As a result, Patressa will be forced to accept an offer for less than what she deserves. One of the most heartbreaking responses to the recent legislation comes from Victoria of Clarksburg, WV, who stated quite candidly that she “needed the money so I could have a place to live.” Who can the 4.8 million Patressa’s and Victoria’s of West Virginia and Arkansas turn to for help? How will they meet their medical needs? How will they find a place to live? Eric Schuller President Alliance for Responsible Consumer Legal Funding (ARC)

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Legal-Bay Extends Non-Recourse Funding to AFFF PFAS Firefighting Foam Cancer Plaintiffs

By John Freund |

Consumer legal funder Legal-Bay has announced that it is providing pre-settlement funding to plaintiffs in the AFFF firefighting foam mass tort, as nationwide litigation tied to PFAS-related cancers and other diseases continues to advance toward bellwether trials.

According to PR Newswire, the AFFF multidistrict litigation has become one of the largest toxic tort proceedings in the United States, with thousands of personal injury claims consolidated in federal court alongside the municipal water contamination cases that have already produced multi-billion-dollar settlements with several chemical manufacturers.

Legal-Bay's funding is non-recourse, meaning plaintiffs repay advances only on a recovery, with no obligation if a case is unsuccessful. Eligible applicants include firefighters, military veterans, airport workers, industrial workers, and civilians diagnosed with cancers of the kidney, testicle, pancreas, prostate, liver, bladder, or thyroid, as well as thyroid disease, ulcerative colitis, and immune system disorders linked to PFAS exposure. The funder said applications are typically approved within 24 to 48 hours of receipt of case documentation.

"Toxic exposure litigation involving PFAS and firefighting foam can take years to fully resolve," said Legal-Bay chief executive Chris Janish. The announcement follows a similar Legal-Bay outreach to Depo-Provera plaintiffs earlier this week, reflecting a pattern of consumer funders positioning around large mass tort dockets ahead of bellwether outcomes that may define settlement values.

Consumer

Legal-Bay Extends Non-Recourse Funding to Depo-Provera Mass Tort Plaintiffs

By John Freund |

Consumer legal funder Legal-Bay has announced that it is actively providing pre-settlement funding to plaintiffs in the Depo-Provera product liability litigation, offering non-recourse advances as the coordinated proceedings move through early discovery.

According to PR Newswire, lawsuits involving Pfizer's injectable contraceptive Depo-Provera are in mid-stage litigation across U.S. courts, with plaintiffs alleging the product caused serious health complications including decreased bone density and meningioma brain tumors, as well as inadequate warnings about long-term risks. Cases are being organized through coordinated proceedings, with bellwether trials expected to shape future settlement values; no global settlement has been finalized.

Legal-Bay's funding is non-recourse, meaning plaintiffs repay advances only if they prevail or settle, with no repayment obligation absent a recovery. The funder said applications from lawyers and plaintiffs in active Depo-Provera matters are typically approved within 24 to 48 hours of receiving case documentation. "We are very active in this litigation and are a preferred funder to many of the top Depo Provera firms in the country," said Legal-Bay chief executive Chris Janish.

The announcement illustrates the continued role of consumer legal funding in large mass tort dockets, where plaintiffs often face extended timelines before resolution. It also reflects funders' practice of positioning early in emerging product liability litigation as bellwether outcomes begin to define potential settlement frameworks.

Consumer

Counsel Financial Closes $30 Million+ Succession Financing for Plaintiff Firm

By John Freund |

Counsel Financial has originated a financing transaction worth more than $30 million to support an internal succession plan at a plaintiff-side law firm. The capital is structured to enable the orderly transfer of ownership from the firm's existing partners to the next generation, with the deal collateralized by a portfolio of single-event personal injury matters.

According to Newswire, the transaction was funded by a large alternative asset manager and represents a specialized application of litigation finance to law firm continuity planning. Rather than financing a single case or open caseload, the deal monetizes the firm's existing inventory of personal injury claims to generate liquidity for a planned ownership transition.

Succession financing has emerged as a quieter but increasingly active corner of the litigation finance market. Plaintiff firms with mature partnerships and substantial pending dockets often face significant friction when senior partners look to retire or reduce their stakes — particularly where state ethics rules limit the use of outside capital. Specialty lenders such as Counsel Financial have responded by structuring transactions that draw on case portfolios as collateral, allowing firms to fund partner buyouts without ceding control to non-lawyer investors.

For plaintiff-side practices grappling with generational turnover, deals of this scale offer a model for preserving firm independence while accessing institutional capital. The transaction also underscores the deepening role of alternative asset managers in funding the operational and ownership structures of plaintiff law firms, well beyond traditional case-by-case funding.