The Financial Times (FT), a top global business publication, recently published a major piece examining the future of the multi-billion dollar litigation funding industry. The article focused on the challenges and criticisms facing the sector, including regulatory scrutiny and the complexities of capital management, especially as it relates to foreign investment in U.S. and international disputes.

New rules allow nonlawyers to practice law and own law firms in Arizona. This welcomed revolution in access to justice will have profound effects on the justice system and legal profession.

And like all broad reforms, it has possible unintended consequences.

The new rules allow nonlawyers to invest in and manage Arizona law firms structured as “Alternative Business Structures” — business entities that provide legal services and include nonlawyers with economic interests or decision-making authority.

Litigation financing allows third-party funders like Burford Capital to invest in other people's lawsuits, but it's long been considered unethical, and is illegal in many places.

But justice can often hinge more on how much money each side has than on what's actually right or wrong. So Burford argues that allowing investments in lawsuits will give more people access to better justice. And it's been a good business for them. But others worry it might warp the justice system.

The highly publicized lawsuit brought by Hulk Hogan against Gawker Media, which was secretly funded by venture capitalist Peter Thiel, thrust the world of third-party litigation funding into the national spotlight. The case amplified public concerns about transparency and the potential for wealthy interests to wield significant influence in the civil justice system.

The article, 'Litigation Financing Attracts New Set of Investors,' examined how hedge funds and other institutional investors are increasingly funding lawsuits in exchange for a portion of the recovery, a trend that is rapidly transforming the civil justice system.

As a leading expert in the field, Maya Steinitz was featured for her commentary on the ethical and regulatory challenges posed by the industry's growth.