Making Litigation Funding Agreements Discoverable Is Good Public Policy

The U.S. District Court for the District of New Jersey is considering a local rule requiring discoverability of third-party litigation funding (TPLF) agreements—but allows the plaintiff to self-describe the agreements.

It would require disclosure of information about ‘funding for some or all of the attorneys’ fees and expenses for the litigation on a non-recourse basis in exchange for (1) a contingent financial interest based upon the results of the litigation or (2) a non-monetary result that is not in the nature of a personal or bank loan, or insurance.’

While laudable, the proposed rule does not go far enough. However, DNJ should still adopt discoverability of third-party litigation funding agreements, as should all other jurisdictions.