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The Miller quick coupler comes in a few different sizes. The one I tried out has the proportions of a laundry bin and weighs nearly 700 pounds. It allows the operators of hydraulic digging machines to switch buckets without ever leaving the cab. Two flanges rise from its sides, supplying it with the Volks­wagen-like curves that inspired its nickname, the Bug. The flanges are drilled clean through with four holes set inside four bosses; beneath the front pair of holes are two upturned latches, like the open ends of two wrenches. Other than its poppy-red color, the device appears to be an ordinary specimen from the menagerie of heavy-duty construction equipment.

But in a Chicago courtroom on Oct. 26, the Bug will star in a multimillion-dollar dispute that represents a new frontier in the march of global capitalism. The nominal occasion is a paternity feud between two of the Bug’s corporate parents, Miller UK, the equipment manufacturer based in Cramlington, England, and Caterpillar, the American construction-equipment giant that was once Miller’s biggest customer. The themes of Miller UK v. Caterpillar are classics of the intellectual-property genre: greed, betrayal, bloodlines. But Miller’s method of funding its side of the production is something new. Rather than paying its lawyers out of pocket, Miller has turned to a private firm to front the money for its legal costs: the Illinois-based Arena Consulting, which is headed by two brothers, Herbert and Douglas Lichtman. If Miller loses, Arena gets nothing. If it wins, Arena will get a share of the proceeds, which could run well into the tens of millions of dollars.

This new form of lawsuit funding is called litigation finance. It lies at the crossroads of two Anglo-American tendencies. The first is our litigious side, in which we celebrate our equality before the law by dragging those who have wronged us before a judge. The second is our ingenious mercantilism, as demonstrated by our penchant for turning everything from church raffles to mortgages into marketable securities to be chopped up, bundled and resold. Like the celebrity bonds backed by royalties and popularized by David Bowie during the 1990s, litigation finance represents the expansion of securitization into hitherto virgin territory. Those involved in the practice argue that it allows smaller companies like Miller to afford a day in court. Detractors worry that it could give rise to a litigation arms race, with speculative money aggravating the already high costs of the American legal system.

While the amount of litigation funded by outside financiers is still relatively small, the industry — which barely existed outside personal-injury cases until the mid-2000s — is growing rapidly, driven by increasingly permissive laws, the promise of high returns and hourly billing rates that run $500 or more for the largest and most sophisticated law firms. Between 2013 and 2014, Burford Capital, a public company traded in Britain, increased its lawsuit investments from $150 million to $500 million. During the same period, its profits rose by 89 percent, with a 61 percent net profit margin. The two-year-old Gerchen Keller, one of the industry’s youngest funds, manages more than $840 million. With investor-backed war chests, plaintiffs are crossing borders to find the most favorable jurisdictions, and sometimes enlisting the help of foreign governments. Like equities and mortgages, lawsuits are making a transition from a private arrangement to a fully monetized asset class. The ‘‘portfolio’’ held by IMF Bentham, an Australia-based funder, consists of 39 cases, which the firm values at just over $2 billion. United States lawmakers are beginning to ask questions. In August, two senators from the Judiciary Committee sent letters to major funders asking them for the names of the cases they had invested in and many details of their business dealings. The letter called litigation finance a ‘‘burgeoning industry’’ that was ‘‘largely unregulated and operates with no licensing or oversight.’’

Larger companies, even those with their own in-house counsel, are selling off pieces of lawsuits to smooth out cash flow and offload risk. Juridica Investments, a Miami-based fund with $650 million under management, specializes in working with Fortune 500 companies, which make up 80 to 85 percent of its investments, according to Richard Fields, its chief executive, who says that outside funding helps align the interests of plaintiffs’ lawyers with those of their clients. ‘‘You want the largest recovery, in the shortest time, with the least uncertainty,’’ he says. Smaller companies can use litigation financing to finance growth, by using their future award as a credit line.

Over the last century, many have come to see lawsuits as a means of expression, a political weapon and a powerful deterrent against those who might do wrong. And yet creating lawsuits is not the same as creating something like the Bug. Litigation is a zero-sum industry — every dollar in damages taken home by the winner, minus fees, must be wrung out of the loser. Litigation also helps shape legal precedent, defining the terms under which civil justice may be sought. It’s hard to imagine how billions in outside capital won’t wind up changing the justice system. The only question is how.

To help me understand what a quick coupler does, David Ridley, a straw-haired Miller mechanic in a jumpsuit, arranged a demonstration. Beside a chain-link fence near the Miller UK factory, he had set up a yellow Komatsu digging machine, of the scale favored by demolition crews and construction-minded toddlers. Attached to the end of its hydraulic arm was a digging bucket. Ridley picked up a sledgehammer and tapped a wrist-like joint, then slid out one of the two cylindrical pins holding the bucket in place. The pin’s chrome surface was coated with grease. He hoisted it onto his shoulder. It weighed about 100 pounds.

‘‘How many people want to be changing that all day?’’ Ridley asked.

Ridley then tapped out the other pin, climbed up into the Komatsu’s cab and revved the diesel engine up to a gentle hum. He swung the yellow arm over to the Bug and positioned it within the flanges so the four holes aligned. He connected some hydraulic hoses to deliver power to the Bug’s innards and tapped the two pins back in. Then, using the Bug-enhanced Komatsu, Ridley picked the bucket back up. Thanks to the Bug, it was an idiotproof process. A bright yellow safety latch tightened neatly over one of the pins. It took less than 10 seconds.

Before quick couplers, operators would waste 30 minutes or more each time they wanted to switch out a bucket or other tool. Miller’s first quick coupler, nicknamed the Magnificent Seven, came to market in the early 1990s, reducing that time to seven seconds. They also solved another problem. Previously, a construction company with three kinds of machines would need to buy three lines of buckets to match. Quick couplers soon created universal compatibility among product lines: A Komatsu bucket, for example, could now be slapped onto a Volvo machine.

Caterpillar soon took notice. Compared with Miller, Cat is a leviathan: It’s one of the 200 largest corporations in the world, with more than 100,000 employees. In 1997, according to legal filings from Miller, Cat approached a Miller executive at a trade show in Germany. The two companies began to talk about having Miller contract to supply Cat with a fully automatic coupler that the companies ultimately brought to market as the Pin Grabber Plus. Over the years, Cat (by Miller’s count) bought about 27,000 of these units for resale to its own customers, generating upward of $100 million in revenue. Each generation of couplers had to mesh perfectly with the specifications of Cat’s machines, so the companies’ engineers exchanged technical drawings, and their executives hobnobbed over dinners in North­umberland and Illinois. By 2006, Caterpillar was ordering about 10,000 Miller couplers a year. According to Miller, Caterpillar orders accounted for as much as 28 percent of its business and a larger share of its profits.

Then, in the midst of the 2008 downturn, Cat, according to Miller’s version of events, abruptly told Miller that its couplers would no longer be needed. Cat had designed its own coupler in-house. (Cat’s filings deny that its coupler used Miller’s proprietary technology and say that it was allowed to terminate its contract with Miller at any time.) Keith Miller, the company’s founder, was gutted. With the loss of his largest customer, Miller earnings swung from an eight-million-pound profit to a million-pound loss. Miller took on debt and dismissed more than half of its employees.

A year after Cat broke the news, Keith Miller saw its competing coupler for the first time. ‘‘It wasn’t just similar,’’ he told me. ‘‘It was a replica of ours.’’ Miller felt certain that the new Cat couplers made use of his company’s know-how. He sued Caterpillar for breach of contract, fraud and misappropriating trade secrets. But he quickly learned what it means to sue a company as large as Cat. Caterpillar’s lawyers made dozens of preliminary filings. They claimed that Miller had delivered ‘‘substandard’’ couplers and failed to address ‘‘continuity of supply’’ issues that it had repeatedly raised.

Miller’s lawyers quickly went through millions of pounds. To make it through the discovery phase of the suit would require millions more. Keith and his two siblings, who own the com­pany together, mortgaged their houses and signed personal guarantees on the company’s debt. But still they didn’t have enough money to see their case through to court. So a contact in London introduced them to Reed Oslan, a Chicago lawyer who specializes in litigation finance.

In the legal world, the Miller lawsuit is what is known as a ‘‘David and Goliath’’ case, in which a plaintiff is so outgunned financially that it wouldn’t be able to have its day in court without a lawyer willing to work on contingency or an infusion of investor cash. The Davids come in a variety of guises. Patricia Cohen, ex-wife of the billionaire hedge fund manager Steven A. Cohen, got a reported $1.2 million war chest from a firm called Balance Point, which specializes in funding divorce cases like hers. In 2006, 16 years after their divorce, Patricia saw a ‘‘60 Minutes’’ report on her ex-husband’s business, which led her to file a lawsuit accusing Cohen of racketeering and fraud, claiming that he concealed $5.5 million during their legal proceedings. In 2014, after a string of findings and appeals, a federal judge dismissed the racketeering portion of Patricia’s claim, noting that the only difference between it and other family disputes was ‘‘the seemingly inexhaustible resources that each side has brought to bear,’’ but he allowed Patricia to continue her case against Steven for fraud and other claims. The litigious aftermath of the Cohen divorce, he noted, had persisted for twice as long as the Cohen marriage. Gerald Lefcourt, Patricia Cohen’s lawyer, said that outside financing was necessary for Patricia to challenge someone with the resources of her ex-husband. ‘‘The average person who has a good job making $100,000 a year is middle class, but totally shut out of the legal system,’’ he said. ‘‘You can’t fight a big case. How do you do it?’’

Terms of the deal between Miller UK and its funders have not been disclosed, but funders typically acquire the rights to 20 to 60 percent of all damages in hopes of recouping two or three times their original investment, sometimes more. This month, when Miller UK Ltd. v. Caterpillar Inc. is scheduled to reach trial in a federal court in Chicago, Miller’s lawyers will ask a jury to award Miller more than $100 million. ‘‘As the boss, I have to find a way forward,’’ Keith Miller said. ‘‘We’re just a little business from the northeast of England. Without litigation finance, we couldn’t take them on.’’

Despite the hypercapitalist spirit of its rise, litigation finance actually has its roots in antiquity. According to Max Radin, a historian of ancient city-states, members of Athenian political clubs would back each other in lawsuits against their rivals. Apollodorus, a wealthy banker’s son, bought shares of lawsuits and hired professional orators — some of the earliest lawyers in Western history — to write his court speeches. The Romans tolerated the practice in some cases until the sixth century, when it was banned by Emperor Anastasius. The Roman taboo on litigation finance, Radin writes, sprang from the idea that ‘‘a controversy properly concerned only the persons actually involved in the original transaction,’’ not self-interested meddlers. In medieval England, litigants could hire ‘‘champions’’ to represent them in ‘‘trial by battle.’’ By the late 13th century, these strongmen were being compared to prostitutes, and their prevalence hastened the movement of dispute resolution to the courtroom. During the Middle Ages, this concept of ‘‘champerty’’ — assisting another person’s lawsuit in exchange for a share of the proceeds — emerged as part of the larger ecclesiastical taboo against usury. Though the word was associated with feudal land grabs, Radin notes that in practice, champerty was used by rich lawyers ‘‘on behalf of propertied defendants.’’ In 1787, Jeremy Bentham, the political philosopher, mocked prohibitions on champerty as a holdover from feudal days, where courts were beholden to ‘‘the sword of a baron, stalking into court with a rabble of retainers at his heels.’’

Nevertheless, a vestigial squeamishness about investing in lawsuits made its way across the Atlantic. The first such disputes, early in the 20th century, were over contingency fees, the practice, now common, of lawyers taking on a case in exchange for a percentage of future damages. Unlike England, which still caps fees for winning solicitors, America was open to this kind of payment structure, in keeping with its frontier ethic toward credit and speculation. Twenty-eight states now explicitly permit champerty, as long as funders do not act out of malice, back frivolous lawsuits or exert too much control over trial strategy.

Hedge funds, banks and insurance companies have long been quietly funding the occasional lawsuit, but no major United States investment outfit in the commercial arena specialized in the practice until Juridica was founded in 2007. The industry’s early growth was driven in part by the recession, which made lawyers at big companies eager to hand off risk and also increased the demand among investors for opportunities that could pay off no matter what was happening in the world’s markets. Today the industry seems to have become a permanent part of the financial landscape, with shares of prominent funders trading every day on stock exchanges in London and Sydney.

Anthony Sebok, a professor at Cardozo Law who advises Burford, says he sees the practice as part of a broader trend toward the financialization of the law. ‘‘Why can’t I promise a stranger some piece of the game?’’ he asked me, paraphrasing Bentham’s writings. ‘‘Is there something icky about it, like I’m commodifying my rights? Bentham says these legal rights are our property. Why shouldn’t we be able to sell them?’’ Jonathan Molot, a professor at Georgetown Law who serves as Burford’s chief investment officer, has written that stock offerings by law firms could improve morale, lower rates and help lawyers focus on maximizing long-term profits. Like lawsuits, the firm itself should evolve into an asset. ‘‘It’s a mistake for lawyers to hunker down and say we’re different, we’re excluded, we’re not part of the economy,’’ he said.

But the interests of financiers and plaintiffs are not always so well aligned. Depending on the structure of the deal and the ultimate payout, plaintiffs sometimes walk away with a few crumbs after the funders and lawyers take their share. One such outcome happened in 2007, when Altitude Capital, a funder, invested $8 million in an intellectual-property suit filed by DeepNines, a small network security company, against McAfee, a much larger competitor. The case was settled for $25 million, but after expenses ($2.1 million), lawyers’ fees (roughly $11 million) and Altitude’s cut ($10 million), DeepNines took home $800,000, a little over 3 percent of its settlement. Then, Altitude questioned DeepNines’ math, arguing that the company shouldn’t have deducted its own expenses before calculating contingency fees. It sued its former partner for $5 million more, eventually dropping the suit in 2011.

This kind of falling out is unusual, but it shows the fundamental conflict that can occur. When it’s time to divvy up the prizes, allies can turn into competitors, and smaller, inexperienced plaintiffs can find themselves facing down a second Goliath — their former champion.

The Institute for Legal Reform, a Washington-based lobby affiliated with the Chamber of Commerce, argues that litigation finance will prompt courts to award damages so large that they hurt American businesses. Executives from Johnson & Johnson, FedEx, Dow Chemical and many other large companies have sat on its board. ‘‘We support the position taken by the Institute for Legal Reform,’’ said a spokeswoman for Caterpillar, who said she could not comment further on the Miller case because of the pending lawsuit.

Lisa Rickard, the institute’s president, calls litigation finance ‘‘the biggest single threat to the integrity of our justice system.’’ As evidence, she put me in touch with Howard Schrader, a lawyer for Ace Limited, a $35 billion insurance company engaged in a multifront legal battle over a grievance dating back to the Liberian Civil War of 1991. At its root was the question of whether a Liberian company run by Lebanese nationals was due an insurance settlement over a looted supermarket, or whether the damage fell under a war-risk exclusion in its insurance policy that ruled out ‘‘insurrection.’’ The plaintiff was a Liberian official, represented by a lawyer from the British Virgin Islands, who had found outside investors and sued in a Cayman Islands court to enforce a Liberian judgment. Schrader spent more than an hour speaking with me by phone, dutifully walking me through the case and peeling back mind-numbing layers of acquisitions, indemnity agreements, receiverships and jurisdictional disputes. To Rickard, the Ace Limited case was an example of buccaneering funders tracking down far-flung plaintiffs to pick at old wounds. I wasn’t so sure. On one hand, a giant Swiss insurance company felt it was being shaken down. On the other, a small business felt it was due something for paying years of premiums. I had trouble feeling too sorry for either.

In another long-running legal battle, which began in Ecuador and has since spread to several other jurisdictions, Steven Donziger, a Harvard Law School-educated lawyer, has pursued Chevron with an Ahab-like single-mindedness. He has donned the hats of advocate, adviser and ad hoc fund-raiser for some 30,000 indigenous Ecuadorians who live around the Lago Agrio area and claim that Texaco, which Chevron acquired, left contaminated waste pits around old oil-drilling sites on their land. In 2010, after the case had gone on for 19 years and Donziger’s team had gone through $7 million, Burford bought in. They invested $4 million, with another $11 million planned. In exchange for its support, Burford would receive 5.5 percent of the settlement, which could work out to a 100-to-1 jackpot should Chevron pay $27 billion in damages, an ambitious sum calculated by a court-appointed expert.

Chevron went on offense, digging up outtakes from a documentary in which Donziger extols the suit as an act of ‘‘brute force’’ and the purpose of plaintiffs’ law as ‘‘to make [expletive] money.’’ (Donziger has said that these excerpts are ‘‘grossly misleading or lacking in context.’’)

In September 2011, Burford sent Donziger a letter ending their relationship. They accused his team of ‘‘fraudulent conduct’’ and ‘‘deception,’’ citing Donziger’s communications with the supposedly impartial expert who had come up with the $27 billion settlement figure. Burford said that consultants working with Donziger’s team had ‘‘ghost written’’ the expert’s report and ‘‘worked very hard to cover that up.’’ Donziger, meanwhile, has continued his crusade against Chevron in Canada, Argentina and Brazil. ‘‘You cannot sustain this kind of case without money, and a lot of money,’’ Donziger said in 2010. You can imagine Chevron’s being more inclined to settle had Donziger taken a less ambitious approach. Considering that scenario, it’s arguable that Burford’s investment could have been part of what has kept those 30,000 Ecuadorians — Donziger’s clients — from receiving one penny in damages, more than 20 years after Texaco left their area. In 2014, a federal judge ruled that Donziger could not continue to pursue Chevron in the United States. Donziger has appealed and continues his foreign lawsuits. Chevron calls the case against the company ‘‘the legal fraud of the century.’’

Not long ago I had breakfast with Christopher Bogart, Burford’s C.E.O. He is in early middle age, and his well-tended appearance and subtly asymmetric eyeglasses signal prosperity. ‘‘We’ve done more than 100 deals,’’ he said, speaking of the Chevron case. ‘‘We haven’t had another one that’s gone that way.’’ Burford, Bogart told me, never anticipated a $27 billion payout. ‘‘We believed that Chevron would settle for much less than that,’’ he said, perhaps $1 billion, a more modest 3-to-1 or 4-to-1 win.

‘‘The case illustrates something that I think all lawyers know,’’ he continued. ‘‘You don’t always get all of the facts from your client.’’ His tone was somewhere between resignation and remorse, like a banker who had made a bad bet.

Of course, the transformation of legal disputes into deals didn’t begin with litigation finance. For years, observers of the legal profession have criticized how the market economy erodes its ethical obligations, pushing private advantage over public good and billable hours above all. Only the truly rich can afford to hire a professional who will zealously and exhaustively defend their interests. When litigation financiers talk about expanding access to justice and standing up for the little guy, they generally mean helping millionaires pursue claims against billionaires. In some ways, the rise of litigation finance is a symptom of what the American civil-justice system has become — a slow, expensive and complicated system for mediating corporate breakups. The judges in this system might talk like referees, but their function is moving toward that of accountants.

Keith Miller sometimes imagines his lawsuit as a movie, the heavy-equipment version of ‘‘Erin Brockovich.’’ For years, he claims, Caterpillar denied rumors that it was building its own version of the Bug, reassuring Miller of the prospects for their ongoing relationship up to the moment that Cat terminated the contract. Emails turned up during discovery by Miller’s legal team show Caterpillar employees’ strategizing about what to do if the information somehow leaked. To Keith Miller, the dispute over the quick coupler’s origin is about more than money.

‘‘All we want to do is set the record straight about what happened and why,’’ he told me.

An initial skirmish in Miller v. Caterpillar involved a major question for litigation finance as a whole — should plaintiffs be forced to disclose their funding arrangements, or are they entitled to keep these deals confidential? Lisa Rickard, from the Institute for Legal Reform, argues in favor of disclosure. ‘‘That helps the judge and the defendant understand who’s pulling the strings,’’ she told me.

Judge Jeffrey Cole, who is presiding over the Miller case, disagreed. He called champerty ‘‘a hoary doctrine’’ that time had ‘‘narrowed to a filament.’’ Many of the particulars of Miller’s financial dealings with its backers, Cole found, are irrelevant, as they ‘‘have nothing to do with the claims or defenses in the case.’’ Miller could keep the specifics of how it was financing its lawsuit confidential.

If Cole’s ruling is any indication, the day is approaching when lawsuits are something like the Bug itself — complicated, expensive and eminently transferable commodities. More and more lawyers will find themselves being paid by people whose interest in the outcome is speculative, not personal. Somewhat like mortgage banking, lawyering will involve serving as a buffer between the people who care and the people who manage the probabilities.

Like most entrepreneurs, Keith Miller is a bit of both. His feelings about Caterpillar’s treatment of the Bug haven’t stopped him from continuing to sell the company some of Miller’s smaller products. ‘‘We’re hand-to-mouth each month,’’ he says. ‘‘Quite frankly, we’re not in a position to turn anything down.’’ Could he ever imagine repairing Miller’s relationship with Cat? ‘‘I’d be delighted to do that,’’ he said. ‘‘So long as we’re reimbursed for our losses.’’

Correction: October 23, 2015
An earlier version of this article misstated the amount of money managed by the firm Gerchen Keller. It has more than $840 million under management, not $475 million in private capital.