Justice for Profit: A Comparative Analysis of Australian, Canadian and US, Third Party Litigation Funding

Third party litigation funding (TPLF) has emerged as one of the most important developments in civil litigation. Courts and policymakers in several countries are looking to each other as they debate the costs and benefits of this growing industry and the need for regulatory oversight. Such cross-pollination in the public and jurisprudential debates on TPLF can be enormously helpful, but must be approached with caution. The TPLF industry operates in very different procedural environments, and any comparative analysis must take into account the various jurisdictions' unique litigation culture and architecture. In this paper, the authors explore TPLF in the United States, Australia and Canada, with a focus on class action litigation in the latter two jurisdictions. They examine the historical development of TPLF, current practices, the legal and procedural context within which such funding takes place, and how each jurisdiction is addressing regulation of this form of finance. In the final part of the paper, they engage in a comparative analysis of TPLF in the three countries, and highlight important differences that may ultimately result in unique approaches to regulatory oversight of the industry. "For us to have access to fairly priced funding would enormously improve access to justice."(1) "Third-party funding undermines the civil justice system. [ ... ] Do we really want [funders] in our civil justice systems to commercialise the practice of law? We are moving from being a profession into being an investment entity."(2)