Extends TPLF litigation safeguards and disclosure requirements enacted in 2019 for consumer lawsuit lending to apply to all TPLF by: extending the current law’s application from funds provided to a “natural person” to any person who claims an entitlement to recovery from a legal claim (aside from a plaintiff’s attorney); applying the law to any financing in which the funder has a right to receive payment is contingent on the outcome of the claim; eliminating an exemption in current law for commercial tort claims; exempting loans to law firms when they do not give the lender an interest in the litigation; exempting funding provided to or by nonprofit organizations so long as they are not repaid more than they the amount they funded plus interest; applying current prohibitions on lender conduct to all TPLF, such as the bars on paying referral fees, referring plaintiffs to a particular lawyer or healthcare provider, attempting to influence the litigation or its resolution, or providing legal advice; requiring automatic disclosure of any TPLF agreement, including funding provided to an attorney or law firm where repayment is contingent in any respect on the outcome; limiting an existing prohibition on funders charging more than an annual fee of 18% to funding provided to a natural person, retaining its use only for consumer lawsuit loans.
