Hedge Funds Aim To Win Big By Funding Lawsuits

Law360, New York (September 5, 2006, 12:00 AM EDT) -- The $1 trillion hedge fund industry has a new moneymaking trick up its sleeve: funding lawsuits. But while the risky strategy may be profitable for the funds, this new trend in litigation has some experts questioning the legality of the practice.

Hedge funds have begun speculating in litigation by either offering funding to companies involved in litigation, or purchasing claims outright from financially strapped plaintiffs.

Although as an investment strategy the practice seems risky, hedge funds are no strangers to weighing the pros and cons of...
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