Private equity firms and litigation funders have flocked to Arizona to take advantage of its looser rules on law firm ownership and launch national operations.
The elimination of a rule that forbids non-lawyers from owning law firms in the state has invited a wave of outside capital to have a stake in law firms. Of the 76 applications that have been approved for so-called alternative business structures (ABS) since 2020, at least 15 have involvement from private equity or litigation finance.
A few established litigation funders that have created the structures include Pravati Capital, Virage Capital Management, ...