American Property Casualty Insurance Association: Commonsense Reforms are Needed in Third Party Litigation Financing

WASHINGTON, Sept. 14 -- The American Property Casualty Insurance Association issued the following news release on Sept. 13, 2023:

The American Property Casualty Insurance Association (APCIA) released the following statement in support of today's House Committee on Oversight and Accountability hearing entitled, "Unsuitable Litigation: Oversight of Third-Party Litigation Funding." The statement may be attributed to Nat Wienecke, APCIA's senior vice president of federal government relations.

"APCIA appreciates and supports the House Committee on Oversight and Accountability's examination of third-party litigation funding.

"Legal system abuse is rampant across the country. Plaintiff lawyers use a host of abusive tactics, including third party litigation funding, that turn civil justice into a commodities market supporting investor interests rather than the victim's.

"Third party litigation funding is a dark money lending practice that allows unknown investors with no ties to the injured person to invest in lawsuits, and in some cases falsely inflate medical costs, for their own profit.

"Several states and courts have begun to take steps to require disclosure of third party litigation funding in litigation. We encourage the committee to consider transparency and disclosure in third party litigation financing as well. These common-sense reforms are necessary to restore balance to the civil justice system."

According to the U.S. Chamber Institute for Legal Reform, the average American household pays more than a $3,600 "tort tax" due to unnecessary and abusive litigation across the country that raises the costs of products and services like groceries and gas.

Westfleet Advisors, a litigation finance advisory firm, found investments in U.S. litigation financing now rising to $13.5 billion in 2022, which new capital commitments growing by nearly 16% year over year.

APCIA's letter to the committee is attached.

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Original text here: https://www.apci.org/media/news-releases/release/77449/