Lawsuit loans are routinely offered for Brain Injury cases by legal funding companies. The underwriting of these cases however, is often much more complicated than the standard negligence case. This post will attempt to identify some things to remember when attempting to secure a lawsuit loan on a medical malpractice case.

The American legal system places a duty of care upon doctors as they interact with their patients. Medical Malpractice actions are based upon a breach of this duty. The breach must be of the standard of care for similar professionals in that specialty and in the geographic area in which the treatment occurred.

In order to sustain a cause of action for malpractice against a medical professional, the negligence must be causally related to the damages alleged. In other words, the malpractice must have cause an injury or other damages to the plaintiff. Plaintiffs routinely allege different types of damages. Most often, plaintiffs allege physical damage to their bodies. In other instances, lost wages or other economic damages are sought. In still others, emotional or mental damages are available to plaintiffs.

Malpractice  and Brain Injury Cases are Often Complicated.

Most states recognize malpractice cases for the following:

* Misdiagnosis and Failure to Diagnose a Treatable Medical Condition.
* Delay in Diagnosis of a Treatable Medical Condition.
* Misread or Improper Evaluation of Study.
* Pregnancy, Labor & Delivery Malpractice.
* Medication Errors.
* and others…

People can easily imagine a medical malpractice case where the doctor amputates the wrong leg. Clearly, the doctor should have known which leg to amputate and the resulting damages would be irreparable and not hard to quantify. Such a case would most likely be settled in short order.

But the vast majority of medical malpractice lawsuits are not so cut and dry.

When health care professionals (including doctors, nurses, and other practitioners) treat their patients, most are doing their very best to help. When something goes wrong, victims sometimes blame the health care worker for unexpected complications. However, just because a patient’s condition worsens does not necessarily mean the medical provider deviated from standard practice. After all, the patient is usually ill before he seeks medical attention.

Once a breach of the standard of care is proven, plaintiffs and their attorneys must then prove malpractice caused the plaintiffs damages. In other words, it is not enough to show the patient eventually suffered. The negligence must cause the suffering. In many lawsuits, this is not so easy to show.

For example, a physician may misdiagnose a patient’s Stage 4 pancreatic cancer. And the attorneys, through their skill and expertise can prove that the doctor’s diagnosis deviated from the acceptable standard of care. However, due to the terminal nature of this type of condition, damages would be very difficult to prove. The patient would most likely be facing a terminal diagnosis regardless of its timeliness. In this instance, any damages would certainly be minimized by defense attorneys.

Medical Malpractice Lawsuit Funding

When funding a malpractice case, lawsuit loan companies attempt to analyze the probability of success based upon much more complex factual and economic scenarios than a typical case loan involving negligence.

For example, malpractice cases usually involve multiple parties.  A lawsuit involving a surgery would require the examination of every individual in the Operation Room during the procedure.  This normally includes the serving and answering of interrogatories, depositions, and other discovery requests.  These steps are taken AFTER the following:

Drafting and filing of the Complaint, service of the Complaint, answering of the Complaint by defense counsel, motions to dismiss, designation of trial counsel, scheduling, logistical issues, document compilation, document production, etc.  This must be done for each and every defendant.  For these reasons it is not difficult to see why these case take years to litigate.

Litigation delays are compounded by the fact that many lawsuits involve very serious medical conditions which prevent plaintiffs from earning a wage. This combination frequently results in increased economic difficulty for plaintiffs.  Creditors do not usually care whether plaintiffs can work, they only care about getting paid.  That is their business.

Lawsuit loans are one way to mitigate against these economic hardships.  Essentially, the plaintiff assigns a portion of the proceeds of the case to the lawsuit funding company.  If the case settles, the “loan” is paid back according to the terms outlined in the funding agreement.  The use of the lawsuit loan is totally at the discretion of the plaintiff.  The money can be used for anything at all.  Which is great news for plaintiffs who find themselves behind on their expenses.

The bad news is that medical malpractice cases are very difficult to fund.  The reason is because they are so difficult to win.  Keep in mind, all of the discovery mentioned above costs money in the form of time, expert fees, court fees, stenographers, support staff, etc.  A lawsuit based on medical negligence is a commitment of time, money and energy.

Further, in many jurisdictions, plaintiffs only win 1 out of 3 lawsuits filed.  Plaintiff attorneys make money because the cases which are won, are very large.  But for purposes of lawsuit loans, where any loss is a total loss, 33.33% is just not the ideal scenario.

Despite these obvious pitfalls, lawsuit funding companies offer pre-settlement loans on malpractice cases every single day.  They are not the easiest cases to get approved, but the plaintiff’s need still exists.  The legal funding business is there to help plaintiffs lessen their financial burdens while they wait for a favorable recovery on their case.

In most instances, Avandia is commonly used as an anti-diabetic drug. It works to reduce fatty acid, glucose, and concentrations of insulin in the blood. Recently, Avandia has become quite controversial for its many potential side effects. It continues to be used in the United States, however there are strict usage restrictions associated to this drug. Attempts have been made to ban this drug in the country.



Other Uses



Although Avandia is intended for use as an anti-diabetic drug, it has been linked to potentially treating other diseases. First of all, the drug may be able to help treat Alzheimer’s in certain patients. Malaria might even be treated in some ways by this drug. Also, it might be able to treat mild ulcerative colitis. Therefore, Avandia has plenty of other potential uses that have nothing to do with diabetes. Various research projects are being done on the affects of Avandia on other diseases, but no conclusive results or findings have been published yet.



Goldberg & Osborne, a personal injury law firm, has provided this article for informational purposes only, written by an independent author, and has not reviewed or edited this article and is not responsible for its content or accuracy.

Like many successful businesses, lawsuit funding is often misunderstood. The industry arose out of the need for plaintiffs to remain solvent while their litigation is pending. Because many venues lack the resources to competently adjudicate disputes in a rapid manner, persons involved in lawsuits often are required to endure a long, drawn out litigation process usually lasting many months if not years. Most would agree the lawsuit funding business has met this need effectively.

Because litigation loan companies technically purchase a portion of the case, pre-settlement funding is offered to all plaintiffs who have a need for immediate cash. There is no requirement the plaintiff be on the verge of bankruptcy. Below is a list of reasons why a settlement loan or cash advance may be a viable option for these individuals.

1. No Credit Checks – Since lawsuit loans are not technically “loans”, the creditworthiness of the applicant is really a non issue. This is good news for applicants because many suffer from inadequate credit scores. Otherwise, other sources of funds might be available to them at a lower cost. Not having your credit probed is usually a good thing.

2. No Repayment if the Case is Unsuccessful – Likewise, because lawsuit funding is a purchase of proceeds, the cash advance is considered “non-recourse”. This means that if the applicant is not successful in the case, the advance does not need to be paid back. This is good news for clients since the lawsuit funding company shoulders the risk of loss. If the case loses, the advance is simply a “gift” from the funder to the client

3. No Monthly Payments - Unlike many other types of financing, such as credit card cash advances or other loans, lawsuit funding does NOT require monthly payments be made. In fact, only after the case is over do the funding agreement terms need be satisfied.

4. No Cost to Apply – Almost all lawsuit funding outfits offer free application. If the case is approved and funded, then and only then is the client required to repay the advance under certain conditions. The industry standard is that the applicant does not have to come “out of pocket” to apply for funding. After all, they are strapped for cash to begin with.

4. Very Competitive Rates for Preferred Cases – Costs associated with lawsuit funding are often misunderstood. The payback on most advances is calculated with interest. But in the lawsuit funding business, costs vary greatly. Some companies have more expenses and must pass those costs along to the plaintiff. Other companies have more “reasonable” charges. If the applicant is diligent, he can locate a rate of interest that he can live with.

Ultimately, it is very difficult to compare liquidity solutions for those persons in a financial bind. Most funding options have pros and cons. Since every situation is different, every individual must decide what is in his best interests.

Thank you for your interest in the pre-settlement loan business.

A lawsuit funding transaction is the selling of part of the future proceeds expected from a pending litigation.  The plaintiff  in the lawsuit effectively transfers by contract a portion of the case once it is successful.  Part of the transaction is the agreement that the contract will be placed in the file as a “lien” against the future settlement.  In other words, the property must be repaid, with costs, to the rightful owner BEFORE the plaintiff receives any of the settlement.

A lawsuit loan is only one potential lien which may exist in any given file.  Below we discuss some common examples of liens contained in litigation files.

1.  Attorney’s Fee – In cases where the attorney’s fee is only paid if the case is successful (otherwise known as contingency fees), the attorney’s fee is essentially a lien on the proceeds of the case.  These terms are sometimes negotiated and memorialized in a retainer agreement signed by the attorney and the client.  And are most commonly seen in personal injury cases.  The fee usually ranges from 33% to 40% of the total recovery.  Of importance for purposes of lawsuit funding is that the attorney’s fee is superior to all other liens in the file.

2.  Letters of Protection – Similar to the above, letters of protection are usually found in personal injury actions where there is extensive medical treatment.  Basically, a letter of protection is a written acknowledgment, by an attorney, that his office will “protect” the medical provider’s lien for medical treatment rendered.  It is unclear whether these acknowledgments take priority over lawsuit funding transactions, but nonetheless, pre-settlement funding companies pay special attention to outstanding medical bills when underwriting a case.  Sometimes the amount of the LOP is negotiated at the time of settlement, particularly if the attorney and medical provider routinely represent/treat the same individuals.

3.  Federal Tax Liens – By law, the presence of Federal Tax Liens take priority over other liens in the file.  And this should come to no surprise to anyone since Uncle Sam wants his money first.  These liens will typically attach to the proceeds and may have to be directly deposited with the IRS or other Federal Agency as full or partial payment of these obligations.  In some instances, these amount can be negotiated down in an effort to settle a case.

4.  Child Support – Most state laws require the presence of child support liens be superior to lawsuit loans.  The public policy argument is obviously to protect the welfare of children.  Yet the presence of these and all other liens sometimes hinder settlement negotiations as the plaintiff suddenly realizes that he is pursuing his case to pay off his creditors.  Under these circumstances, what is the plaintiff’s incentive to settle?

The litigation cash advance business is only really concerned with liens which take priority over the lawsuit loan as a matter of law.  This is truly jurisdiction specific but the liens mentioned above are commonly seen in the day to day business dealings of lawsuit funding companies.

Much is spoken/written about the “costs” associated with obtaining a cash advance against the future proceeds of a pending lawsuit. Otherwise known as a lawsuit loan or pre-settlement funding, many companies offer cash now against the future resolution of a case. The costs associated with these transactions vary greatly. This post attempts a broad discussion of the history of pricing in the lawsuit funding industry.

The lawsuit funding industry was born to address the liquidity concerns of those individuals who were encountering financial difficulties while waiting for their lawsuit to be resolved. Because many jurisdictions were simply bogged down with thousands of cases, plaintiffs often had to wait months if not, years for their cases to be settled. Lawsuit funding companies offered clients immediate cash against the future proceeds of the case. The catch was that the “costs” associated with these transactions were very expensive, at least when comparing costs with other sources of funds.

So what is “expensive?”

Historically, lawsuit funding has been deemed a “last resort” source of money for those in financial need. I write “historically” because this business is relatively new and only in the mid 2000′s to the present have larger amounts of risk capital been deployed investing in pending lawsuit claims. When the business first started, near the end of the 20th century, lawsuit loan companies offered rates as high as 10% per month! Now that’s expensive. Clearly, in the majority of instances, persons who obtained funding at those rates were in desperate need of funds.

But it was not the investor’s greed that set the pricing. In any new business, mistakes are made but corrected and the business evolves through competition as others clearly see the potential of a return on their investment. Because of this history, more and more investors recognize the potential for a return on capital. Competition then takes hold of this potential profitability as investors analyze what is an acceptable rate of return for putting their money at risk. In most instances, this competition “trims the fat” off of the return and results in better pricing for the applicant.

We have witnessed this first hand in this business. And what this means is that the lawsuit funding business is becoming more and more efficient.

The days of 10% per month interest are dwindling fast. Currently, an applicant can expect to pay anywhere from 1.5% to 4.5% per month for lawsuit cash advance funding. This is a far cry from the original rates. Competition and better business efficiency has made this reduction in costs a reality. The trend is likely to continue. Which will undoubtedly make lawsuit funding more “reasonable” than ever.

Moreover, investors also benefit. As past mistakes are corrected and business models refined, investors are able to more accurately assess the risks to their capital. The understanding of risk is of primary importance to investors and they seek the preservation of capital first, and the return on capital second. As the business evolves, more and more “conservative” investors are likely to place their capital in these investments.