Though third party litigation funding has just started to grab headlines in the U.S., the funding method has been used in Europe for some time.

According to Jonathan Molot, chief investment officer and co-founder of Burford Capital, people in the U.S. didn’t see a need for litigation financing because lawyers can get contingent fees, whereas in England it was a necessity because up until recently lawyers weren’t allowed to work for a share of the recovery.

Also, while personal injury and class action lawyers work for a contingent fee – they don’t get paid unless they win – commercial litigators generally don’t work that way, said Molot, a former practicing attorney and current Georgetown University Law School professor.

The third party funding vehicle was reconsidered in the U.S. in order to enable commercial disputes to be brought by businesses, he said.

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