Patrick Daugherty Assesses Fed Rate Cuts, Impact to Crypto Litigation
Foley & Lardner LLP partner Patrick Daugherty discussed the expected impact to crypto litigation from the U.S. Federal Reserve’s recent rate cut in The National Law Journal article, “Federal Reserve’s Half-Point Rate Cut Expected to Have an Impact on Crypto Litigation, Experts Say.”
Daugherty noted that the effects of the rate cuts on crypto litigation will vary depending upon the litigator’s practice.
“Big Law defense litigators will feel no change, as they are either self-financed or their firms have bank lines to draw upon,” Daugherty said. “Those bank lines finance the entire firm, of which litigation defense is only a part. Besides, their clients pay their bills monthly.”
However, Daugherty said, plaintiffs’ lawyers, in contrast to Big Law defense, could experience a better borrowing environment.
“As they need to borrow longer-term and usually don’t have partners in ‘other departments’ to pay the bills while they litigate,” Daugherty added. “There, the rate cuts will mean cheaper financing for them if cuts in the spot market rate find their way into longer-term loans. The Fed does not control long-term rates. It only controls the spot market rate.”
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