Litigation finance refers to investments in litigation by a third person not originally a party to the suit. Whether the country should embrace this new practice has sparked debate among the bar, on the Hill, in the press, and between scholars. We disagree with the premise of this debate;...

This lecture for the Foundation for Law, Justice and Society, at Wolfson College, University of Oxford, addresses the cost to society of pharmaceutical mass tort litigation, nearly 15 years after the withdrawal by Merck & Co., Inc. of Vioxx® (rofecoxib) from markets worldwide.When Merck...

Many physicians and tort reform advocates believe that most medical malpractice (“med mal”) claims are “frivolous”; they often rely on reports that only about 20% of claims result in a payout. Many physicians and reform advocates also believe that plaintiffs lawyers often sue every...

Basic economic analysis of litigation funding shows that risk neutral plaintiffs without budget constraints will not accept funding unless they are pessimistic relative to the funder. Risk aversion makes a plaintiff who shares probabilistic beliefs with the funder act observationally equivalent...

This paper aims to investigate whether (inEurope) the Favoring Plaintifffee-shifting Rule can be an alternative to legal aid for assisting wealth-constrained Plaintiffs in pursuing cases, that would otherwise be dropped. According to the Favoring Plaintiff fee-shifting Rule, in litigation a...

How should legal disputes be allocated between litigation and arbitration? Given strong incentives for many actors to arbitrate everything, the question turns fundamentally on the scope of arbitration under the applicable law. In "Re-Inventing Arbitration: How Expanding the Scope of Arbitration...

This paper looks at the decision to settle patent litigation in Germany from a new angle by focusing on detailed data on within-trial actions and motivations by plaintiff, defendant and the courts. Using a new dataset covering about 80% of all patent litigation cases in Germany between 2000 and...

A settlement is an agreement between parties to a dispute. In everyday parlance and in academic scholarship, settlement is juxtaposed to trial or some other method of dispute resolution in which a third-party factfinder ultimately picks a winner and announces a score. The “trial versus...

Two risk-averse litigants with different subjective beliefs negotiate in the shadow of a pending trial. Through contingent contracts, the litigants can mitigate risk and/or speculate on the trial outcome. The opportunity for contingent contracting decreases the settlement rate and increases the...