In Part II of an article for the Professional Liability Defense Quarterly, Andrew P. Carroll, an associate in the firm’s Management and Professional Liability group, discusses how litigation finance will affect professional liability underwriting and claims in the future, as well as methods for combatting these changes.
Throughout the article, Andrew explains the importance of properly calculating risk and negotiating settlements with so few cases going to trial, and how attorneys and carriers alike need to be prepared for how third-party financing will result in higher demands and an increase in overall value in the next few years.
“One method of understanding how and why this trend is expected is through the exploration of expected utility theory, which originated in economics but is now being applied to settlement negotiations,” Andrew writes. “An exploration of this theory not only provides insight into why third-party financing will increase claim values, but also a glimpse of what can be done to bring claim values down in the future.”
In Part I of the article, Andrew talked about the business model of third-party litigation financing and compared its explosion in growth to a historical example of an investment fund with a similarly exponential growth in funding levels.
“Part I―Litigation Funding: Will This Glittering Investment Bring on a Malpractice Gold Rush?” Professional Liability Defense Quarterly, Volume 12 Issue 2, 2020
“Part II―Litigation Funding: Will This Glittering Investment Bring on a Malpractice Gold Rush?” Professional Liability Defense Quarterly, Volume 12, Issue 3, 2020
Andrew focuses on handling matters relating to professional liability, real property, and commercial litigation. His professional liability practice includes representing attorneys, accountants, brokers, and directors and officers in civil litigation and investigative matters. His experience spans through trial and appeal, including multiple forms of alternative dispute resolution. Additionally, Andrew handles complex commercial litigation matters stemming from various claims of statutory violations, contractual disputes, and alleged breaches of fiduciary duty.