Abstract
The escalating cost of civil litigation is leaving many defendants and plaintiffs unable to meet legal expenses such as attorney fees, court charges and others. This significantly impacts their ability to sue or defend themselves effectively. Related to this phenomenon is the ethics discussion around access to justice and crowdfunding. This article explores the dimensions that explain the phenomenon of litigation crowdfunding. Using data from CrowdJustice, a popular Internet fundraising platform used to assist in turning legal cases into publicly funded social cases, we study litigation crowdfunding through the lenses of the number of pledges, goal achievement, target amount, length of description, country, case category, and others. Overall, we see a higher number of cases seeking funding in the categories of human rights, environment, and judicial review. Meanwhile, the platform offers access to funding for other less prominent categories, such as voting rights, personal injury, intellectual property, and data & privacy. At the same time, donors are willing to donate more to cases related to health, politics, and public services. Also noteworthy is that while donors are willing to donate to education, animal welfare, data & privacy, and inquest-related cases, they are not willing to donate large sums to these causes. In terms of lawyer/law firm status, donors are more willing to donate to cases assisted by experienced lawyers. Furthermore, we also note that the higher the number of successful cases an attorney presents, the greater the amount raised. We analyzed valence, arousal, and dominance in case description and found they have a positive relationship with funds raised. Also, when a case description is updated on a crowdsourcing site, it ends up being more successful in funding—at least in the categories of health, immigration, and judicial review. This is not the case, however, for categories such as public service, human rights, and environment. Our research addresses whether litigation crowdfunding, in particular, levels the playing field in terms of opening up financing opportunities for those individuals who cannot afford the costs of litigation. While it may support social justice, ethical concerns with regards to the kinds of campaigns must also be addressed. Most of the ethical concerns center around issues relating to both the fundraisers and donors. Our findings have ethical and social justice implications for crowdfunding platform design.
Highlights
Technological advancement has a marked impact on all categories of financing as well as funding sources
It would appear that individuals who are involved in litigation regarding human rights, judicial review, environment, immigration, and public interest are more likely to seek crowdfunding
Considering the platform expanded to the U.S only in 2017, and these are early days. we are likely to see more cases in the U.S going forward., Overall, we see a higher number of cases seeking funding in the arenas of human right, environment, and judicial review
Summary
Technological advancement has a marked impact on all categories of financing as well as funding sources. Online platforms (such as Kickstarter, GoFundMe, Crunchbase, Indiegogo and Rockethub) [1,2,3] have given rise to a novel method of funding called crowdfunding This phenomenon impacts funding at both the industry as well as individual level. In investment-based models, the person who contributes expects financial return which can take the form of a share in the claimant’s future gain (as in equity-based crowdfunding) or repayment with interest (as in debt-based crowdfunding) In these models, funders support cases that they expect to be successful and that can bring them profits. Litigants can choose from a variety of dedicated crowdfunding platforms to finance their legal proceedings Some platforms such as LexShares in the U.S, and AxiaFunder in the U.K, are both investment-based platforms that select cases that have strong merit and high likelihood of success. CrowdJustice, on the other hand, is a donation-based platform where people support cases without any expectation of monetary or nonmonetary reward [4, 5]
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