Sean Coffey, a lawyer who last year ran unsuccessfully for New York’s Attorney General in the Democratic Primary, has co-founded a firm that will fund lawsuits. This is further proof that relationship between financing firms and lawyers must end.
The LRANY has taken a strong stand against this practice, often called “Non-recourse civil litigation financing”, or more commonly, lawsuit lending.
Such financing companies essentially engage in payday lending for litigation. They seek out consumers who have filed lawsuits and offer to pay them up-front money in exchange for a percentage of whatever award they may later receive in their lawsuit – a percentage which increases over time. Litigation companies prey on vulnerable consumers – people who are often injured and unable to work, with no financial support, and desperate for cash. These companies force the consumer to agree to unfair terms that ultimately result in the consumers giving up a big piece, if not all, of any award they may receive for their injuries.