Can You Get Funding on a Mass Tort or Class Action Lawsuit?

By Michael Shemtoub, trial attorney, Beverly Law. Updated November 2026.

Class actions and mass torts are different

In a class action, one or more people sue on behalf of a whole group. Under the federal rule, a certified class’s claims “may be settled, voluntarily dismissed, or compromised only with the court’s approval,” and a settlement that binds class members may be approved only after a hearing and a finding that it is fair, reasonable and adequate (Fed. R. Civ. P. 23(e)). Class members usually receive a share set by the settlement’s formula.

In a mass tort, many people bring their own cases over the same product, drug or event. Each person keeps an individual claim with its own damages. In federal court, those cases are often gathered into multidistrict litigation (MDL): the Judicial Panel on Multidistrict Litigation can send cases sharing common questions of fact to one judge for coordinated pretrial proceedings, and any case not resolved by the end of that stage goes back to the court where it was filed (28 U.S.C. 1407).

The GAO has noted that funding for consumer class actions and mass tort litigation “could be considered a separate category” from other consumer funding (GAO-23-105210). The reasons are practical: the timeline, the payment process and the court’s control over the money.

Why these cases take so long

The NFL concussion litigation shows the stages. The MDL was formed in early 2012. The district court approved the class settlement and certified the class on May 8, 2015, and after appeals the settlement took effect on January 7, 2017. Even then, the Third Circuit noted, class members waited “at least two years, and often longer” for awards, and payment came only after any appeals of a claim decision were finished (In re NFL Players’ Concussion Injury Litigation). According to the same opinion, hundreds of class members took cash advances while they waited.

Time is what drives the price of most advances, because charges usually grow by interval. California’s funding law requires the amount owed to be set by time intervals and stops charges from running past 36 months from the funding date (Bus. & Prof. Code 6250(a), 6253). Other states differ; check the laws by state table.

Settlement programs, claims administrators and court-supervised funds

Large settlements often pay through a program with its own rules. In the NFL settlement, the claims administrator reviewed each claim, investigated where appropriate, and decided whether the class member qualified for an award. The money in many of these programs sits in a qualified settlement fund, which federal tax rules define as a fund set up under a court or government order, or approved by one, and kept under that authority’s continuing jurisdiction (26 C.F.R. 1.468B-1(c)). In plain terms, the money does not move until the program’s rules and the court allow it.

Fees come out before anyone is paid. The Supreme Court has long held that “a litigant or a lawyer who recovers a common fund for the benefit of persons other than himself or his client” is “entitled to a reasonable attorney’s fee from the fund as a whole” (Boeing Co. v. Van Gemert). In MDLs, judges may apply that idea through “common benefit” orders that set aside a share of recoveries for lawyers who did work used by everyone in the litigation. The percentage, if any, is in the orders for your MDL, so ask your lawyer for it along with your own fee. Medical liens, including Medicare’s, are resolved too; see funding and medical liens.

What courts have said about funders in these cases

The NFL ruling is the main federal appeals decision we found on this question. The settlement’s anti-assignment clause made any assignment of class claims “void, invalid, and of no force and effect,” and said the claims administrator “shall not recognize” one. In December 2017 the district judge ordered class members to disclose assignment agreements and declared any agreement assigning monetary claims void. The Third Circuit agreed that true assignments, which let a funder step into a player’s shoes and collect from the fund, were void. It held that the district court “went too far” by voiding the cash advance agreements in their entirety, including terms that only governed a lender’s right to be paid after the player received the money. Defenses such as usury or fraud were left to be decided case by case (In re NFL Players’ Concussion Injury Litigation).

The practical result: in a settlement with an anti-assignment clause, the funder may have to collect from you after you are paid, not from the fund. Your promise to repay can survive even when the assignment does not.

Some courts also ask who is funding a case. The Northern District of California requires parties in proposed class, collective or representative actions to disclose “any person or entity that is funding the prosecution of any claim or counterclaim” (N.D. Cal. Standing Order, para. 17). New Jersey’s federal rule targets funding of attorney’s fees and litigation expenses (D.N.J. L. Civ. R. 7.1.1.pdf)), so an advance for rent and bills may fall outside its text. Sharing case papers with a funder raises its own issues; see funding and attorney-client privilege.

What to ask before you sign

• Does the settlement or the program have an anti-assignment clause? Ask your lawyer to show you the language.
• If the funder cannot be paid from the fund, how and when does the contract expect you to pay it?
• What stage is the MDL in, and how long does your lawyer expect claims review and appeals to take?
• What common benefit assessment, fee and lien deductions will come out of your award?
• What does the contract say if your claim is denied by the administrator? Compare it with our page on what happens if you lose.

More on the payoff step is in how a lawsuit advance is paid back, and the full section starts at the lawsuit cash advance page.

Common questions

Related pages

Cash advance on a lawsuit · Laws by state · Injury law FAQs

Important: This page is general information, not legal or medical advice, and reading it does not create an attorney-client relationship. Every case is different; talk to a lawyer about yours. Texas cases are handled by the firm’s Texas-licensed attorneys, Joyce Ondich and John Efstathiou. Last reviewed: November 7, 2026.