Verdict for women raped in prison will go primarily to lawsuit lender due to 88% return
The Detroit Free Press reported on a travesty of justice this week. Eight women sued the State of Michigan and won a 5 million dollar verdict arising out of having endured prison rapes. The State appealed. While the case was on appeal, the women borrowed $635,000.00 from MONEY FOR LAWSUITS, a company that makes loans at outrageous rates to individuals who are likely to achieve verdicts or settlements from a wrongdoer. Eventually, the State agreed to compromise the judgment and agreed to pay the women $3.5 million dollars. This week, a judge ruled that the company is owed $3.1 million dollars of the settlement. The contract Money For Loans prepared calls for 4.25% interest compounded monthly, according to the Free Press, resulting in an 88% return. Even competitors in the lawsuit funding industry objected to the terms of the contract demanded by Money For Lawsuits. Mark Bello of Lawsuit Financial claims his company will never demand more than fifty percent of an injury victim's recovery.
One former Feiger attorney explained that in two recent cases where he had achieved substantial verdicts, his clients owed "four or five times" what they had been loaned because of unethical--but perhaps legal--interest demands. To date, our firm has been successful in persuading our clients to avoid these "litigation funding" firms. Unfortunately, many injury victims face extensive medical billings (often in the hundreds of thousands of dollars) and are unable to work: they are ripe for abuse at the hands of someone with money and the ability to "invest" it for a few months or years.