Matt Levine’s Money Stuff: There’s a Stock Exchange for Lawsuits

Litigation trading

Two things that Americans, and Money Stuff, love are financial capitalism and litigation. An important mechanism of American life is that, if someone does something bad to you, that automatically creates an asset: If I punch you in the face, or post mean things about you on the internet, or poison your town’s drinking water, you become the owner of a financial asset, and I incur an offsetting liability. Because you can sue me, you probably will, and your lawsuit might result in you getting money from me.

How much is the asset worth? There are two approaches to answering that ...