Unlimited Lawyer and Funder Fees

The proposal does not prevent excessive amounts of the rewards or settlement payouts of collective actions from going to lawyers and third-party litigation investors.

Third-party litigation funders with no direct ties to the claim will be allowed to invest in the outcome of a case. While the Directive does include safeguards relating to transparency and limiting control of funders over litigation, these safeguards are not sufficient, and funders may find ways around these limitations.

The Directive also allows lawyers to charge “contingency fees” (where they act for a percentage of the value of any final award).

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