Legal asset financing includes the financial and organizational support through the coordination of the best legal and financial professionals, the acquisition of legal assets, the monetization of litigation, the financing of legal costs, the coverage of potential adverse costs, the recourse financing, or the guarantee on legal assets, among other products.
Litigation or arbitration funding
Companies and law firms use funds from a third party/investor to pay for litigation or arbitration costs
We finance any type of litigation that aims to obtain an economic amount or a liquid asset (e.g. shares, real estate assets) from sufficiently solvent counterparties.
The case must be “economically viable” in order to be subject to financing. This entails that the ratio of total costs to be financed over the total amount claimed should generally not exceed 25%. This is to ensure that the claimant will receive a reasonable amount after paying all the costs of the legal process and Claimbnb’s fees.
We finance multiple types of cases and we are always open to analyze new types of cases and complex situations.
We do not finance criminal matters that are not strictly economic matters.
We have no minimum investment size criteria. Our focus is local and we aim to build long-term relationships with companies and lawyers. tOur goal is to put our capital at the service of Justice. It is very common that viable cases or unfair situations are neglected by other investors due to the minimum investment size criteria.
We do not require the claimant to bear any costs. In some cases, we offer the claimant the option to contribute financially to retain a greater proportion of the eventual recovery, but this is entirely optional.
We are aware that some costs may have been incurred prior to the approval of our investment. That is not a problem, as we can also cover expenses already incurred in the past.
Claimbnb will be in touch with the lawyer throughout the whole process and will require to be notified of all milestones as they occur. Claimbnb also has reputable legal advisors who can assist and support during the lawsuit, and will provide expert support to increase, whenever possible, the client’s economic position in the lawsuit.
The lawyer will periodically communicate any developments and share copies of the relevant documents and communications. The lawyer will also send Claimbnb copies of invoices relating to the costs of the process.
The lawyer and Claimbnb will agree on a budget at the beginning of the case. Although we always expect to meet agreed budgets, we are aware that in some situations there can be a deviation. In the event of relevant deviations that entail a significant increase in costs, we are flexible and prefer to tackle the situation as soon as possible in order to obtain a revised quote and terms that reflect the new economic situation.
In the event of unfavorable ruling and provided that the agreed conditions have been met, the client would not need to pay back any amount.
The investment is non-recourse, which means that there is no requirement to pay back any amount. Neither the client nor the lawyer has any kind of repayment obligation for losing the case.
When the case is won either by favorable ruling or by extra-judicial agreement, the amounts obtained will be distributed in the manner and with the priority agreed in the credit rights purchase agreement executed with Claimbnb. In general, Claimbnb will have the priority to recover the costs funded and the corresponding fees, to compensate for the risk born, but leaving the bulk of the amount recovered for the client.
Normally there are no cases or situations that are the same and therefore we analyze each situation on a case-by-case basis. In the same manner, we set the cost of our services taking into account the individual risk of each case and the merits of each matter.
The cost normally depends on the following factors: i) the estimated lawsuit success rate, ii) the estimated time elapsing from the first cash out up to the recovery of the amounts, iii) the complexity of the matter, and iv) the percentage of the economic amount advanced or acquired from the client (if any), among other factors.
Our cost depends on the abovementioned factors, but at the same time we are completely flexible and can adapt to the needs and preferences of the lawyer and the client.
We usually set the cost of our fees as the greater of the following amounts: a percentage of the amount recovered or a multiple of our investment.
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