Louisiana is moving forward with attempts to require the disclosure of litigation finance agreements. If enacted, SB196 would require that parties in litigation disclose litigation finance agreements where a funder has advanced capital to a litigant in exchange for a portion of the proceeds from the settlement or judgment. The proposed legislation would require disclosure of these non-recourse financing agreements within 60 days of entry of the agreement. The new law places an affirmative duty on the party to disclose—the proposed legislation requires the disclosure of the agreement without first receiving a discovery request. According to the bill, if the litigants fail to disclose the existence of the agreement, then the contract becomes unenforceable.
The bill, authored by Senator Peacock, continues to make its way through the Louisiana Legislature. Several weeks ago, the full state senate approved the bill. The bill then passed in the Louisiana House Civil Rules and Procedure Committee. The members of the House of Representatives will next debate the legislation and consider any further amendments. The legislation will then head to the Governor’s office if the Senate agrees with any changes made by the House of Representatives.