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S. 840: Litigation Funding Transparency Act of 2021


The text of the bill below is as of Mar 18, 2021 (Introduced).


II

117th CONGRESS

1st Session

S. 840

IN THE SENATE OF THE UNITED STATES

March 18, 2021

(for himself, Mr. Cornyn, Mr. Tillis, and Mr. Sasse) introduced the following bill; which was read twice and referred to the Committee on the Judiciary

A BILL

To amend title 28, United States Code, to increase transparency and oversight of third-party litigation funding in certain actions, and for other purposes.

1.

Short title

This Act may be cited as the Litigation Funding Transparency Act of 2021.

2.

Transparency and oversight of third-party litigation funding in class actions

(a)

In general

Chapter 114 of title 28, United States Code, is amended by adding at the end the following:

1716.

Third-party litigation funding disclosure

(a)

In general

In any class action, class counsel shall—

(1)

disclose in writing to the court and all other named parties to the class action the identity of any commercial enterprise, other than a class member or class counsel of record, that has a right to receive payment that is contingent on the receipt of monetary relief in the class action by settlement, judgment, or otherwise; and

(2)

produce for inspection and copying, except as otherwise stipulated or ordered by the court, any agreement creating the contingent right.

(b)

Timing

The disclosure required by subsection (a) shall be made not later than the later of—

(1)

10 days after execution of any agreement described in subsection (a)(2); or

(2)

the time of service of the action.

.

(b)

Technical and conforming amendment

The table of sections for chapter 114 of title 28, United States Code, is amended by adding at the end the following:

1716. Third-party litigation funding disclosure.

.

3.

Transparency and oversight of third-party litigation funding in multidistrict litigation

Section 1407 of title 28, United States Code, is amended—

(1)

by redesignating subsections (g) and (h) as subsections (h) and (i), respectively; and

(2)

by inserting after subsection (f) the following:

(g)
(1)

In any coordinated or consolidated pretrial proceedings conducted pursuant to this section, counsel for a party asserting a claim whose civil action is assigned to or directly filed in the proceedings shall—

(A)

disclose in writing to the court and all other parties the identity of any commercial enterprise, other than the named parties or counsel, that has a right to receive payment that is contingent on the receipt of monetary relief in the civil action by settlement, judgment, or otherwise; and

(B)

produce for inspection and copying, except as otherwise stipulated or ordered by the court, any agreement creating the contingent right.

(2)

The disclosure required by paragraph (1) shall be made not later than the later of—

(A)

10 days after execution of any agreement described in paragraph (1)(B); or

(B)

the time the civil action becomes subject to this section.

.

4.

Applicability

The amendments made by this Act shall apply to any case pending on or commenced after the date of the enactment of this Act.