A troubling trend is on the rise as our courts are flooded with more and more lawsuits that are funded by financial firms, according to a report in Transport Topics.
Litigation funding has the potential to “turn the courthouse into a casino,” according to Page Faulk, a senior vice president at the U.S. Chamber Institute for Legal Reform.
The article looks at funding agreements, their impact on settlements, and the lack of transparency in the industry.
“The only way to know whether a particular litigation funding arrangement is violating core legal and ethical precepts or impeding settlement is to make the practice more transparent,” Faulk said.
ILR’s research paper, Selling More Lawsuits, Buying More Trouble: Third Party Litigation Funding A Decade Later, looks at how this explosive growth has happened, how the industry is fueling abusive litigation, how the few TPLF agreements that have been made public reveal deep ethical issues with the practice, and how lawmakers and rule makers can approach TPLF reform.