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What's the ROI on the Medical Malpractice Claim Pending Against You? Print E-mail
Written by Michael Sacopulos, JD   
Thursday, 26 May 2011 16:49


Medical Justice Medico-Legal Q&A

Q: I have recently been told there are a number of organizations investing in medical malpractice suits in the State of Florida. As I understand it, these organizations invest large sums of money with plaintiff's attorneys in hopes of a big return. Is this true? If so, is it legal?

A: I am sorry to be the one to tell you, that in fact there are firms putting money into lawsuits against physicians. For a variety of legal reasons, the investment is typically in terms of a loan. A quick Google search will turn up a number of firms willing to loan money to plaintiff's attorneys engaged in medical malpractice litigation. These loans are not for an insignificant amount. For example, LawCash sets its lending parameters of a minimum Ten Thousand Dollars ($10,000) maximum One Million Dollars ($1,000,000.00) per case. LawCash promises to decide whether or not to fund a particular case within forty-eight hours.

Organizations investing in litigation or organizations extending loans to attorneys typically charge two to four percent interest per month, compounded annually. This can result in effective annual interest rate in excess of fifty percent. Often this interest rate is justified on the basis that the loans are "non-recourse loans." This means that if the plaintiff's litigation is unsuccessful, there is no obligation to repay the loan. We will leave it to you to speculate as to the impact of high dollar non-recourse loans upon medical malpractice claims.

As to the second part of your question regarding the legality of these types of loans, there is not a universal answer. It appears that there is a basis under Florida to believe these types of loans are in fact permissible. Certainly firms engaging in making these loans believe that there actions are permissible under Florida law. Other states prohibit this practice. Finally, there are some states, such as Kentucky that currently have legislation pending which would address the issue head on. I am unaware of any legislative efforts in Florida to prohibit the trafficking in medical malpractice litigation, at the present time.

Michael J. Sacopulos is a Partner with Sacopulos, Johnson & Sacopulos, in Terre Haute, Indiana. His core expertise is in medical malpractice defense and third party payment disputes. Sacopulos may be reached at

Last Updated on Thursday, 09 June 2011 09:01

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