On October 4, 2024, US Representatives Darrell Issa (R-CA) and Scott Fitzgerald (R-WI) introduced HR 9922, the Litigation Transparency Act of 2024. If enacted, the act would require the disclosure of third parties receiving payment in civil lawsuits. The bill is intended to shed light on civil litigation funded by undisclosed third-party interests.
In a press release on his website, Representative Issa stated that the legislation is intended to increase transparency and target “serious and continuing abuses in our litigation system.” The National Association of Mutual Insurance Companies, The U.S. Chamber of Commerce, and the American Property Casualty Insurance Association, among other organizations, submitted statements of support for the bill. However, opponents of similar measures have argued that third-party money for litigation expenses can promote access to justice and level the playing field.
The text of the legislation can be found here. If enacted, the bill would require that each party disclose in writing to the court the names of any persons having a “right to receive any payment or thing of value that is contingent on the outcome of the civil action,” as well as any agreement creating such a right. The bill includes an exception where the right to receive payment is due to the repayment of a loan.
The bill has been referred to the US House of Representatives Judiciary Committee.
Practice Note: Significant legislative action on the bill during the short remainder of the current Congress is unlikely. IP Update will track the progress of the bill if it is introduced in the next Congress.
