26 Rev. Litig. 707 (2007)
All That Glitters Isn't Gold: Analyzing the Costs and Benefits of Litigation Finance

handle is hein.journals/rol26 and id is 727 raw text is: All That Glitters Isn't Gold:
Analyzing the Costs and Benefits of Litigation Finance
Courtney R. Barksdale*
I.   INTRODUCTION   ........................................................................ 707
II.  THE  LENDING  PROCESS ........................................................... 710
I. THE LEGAL STATUS OF LITIGATION FUNDING ......................... 716
A.   Champerty & Maintenance ............................................. 716
B .  U sur , .............................................................................. 723
IV .  COST-BENEFIT  ANALYSIS   ....................................................... 725
A.   Costs Associated with PlaintiffLoans ............................. 725
B. Benefits of the Availability of Plaintiff Loans ................. 733
V. PROPOSED SOLUrTONS FOR BALANCING THE COSTS AND
B EN EFITS  ................................................................................. 735
V I.  C ONCLUSION  ........................................................................... 738
I.     INTRODUCTION
In December 1997, Sam DiSalvo suffered two broken
vertebrae and permanent neurological damage after the car he was
driving was hit by a woman who was driving while talking on a cell
phone.' As a result of his injuries, DiSalvo was unable to work to
support his family.2    While DiSalvo and his family awaited the
outcome of the lawsuit following the collision, mortgages, bills and
other financial obligations began to accrue.3 Desperate for money to
cover living expenses while awaiting a verdict or settlement, DiSalvo
considered getting money from a loan shark. Instead, DiSalvo
contacted Plaintiff Support Services, a company that makes high
interest cash advances to plaintiffs after evaluating their likelihood of
recovery.4   DiSalvo was sold immediately on the prospect of
*   B.A. Wake Forest University, cum laude, 2000; J.D., The University of
Texas School of Law, expected May 2007. The author would like to thank
Professor Lynn Baker for her substantive comments and criticism, Dr. Eric King
Watts for challenging her to do more than she thought possible, and her fianc6 for
his unending patience and support.
1. Daniel Brook, Litigation by Loan Shark, LEGAL AFFAIRS, October 2004,
at 42, available at http://www.legalaffairs.org/issues/September-October-2004/
feature brook_sepoct04.msp (last visited Feb. 3, 2007).
2. Id.
3. Id. at43.
4. Id.

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