House Civil Law Committee advances package of tort, insurance and litigation-disclosure bills

The House Civil Law and Procedure Committee on April 22, 2025, advanced a set of bills targeting insurance costs, litigation financing, venue rules and how future medical awards are paid in personal-injury cases.

At a morning hearing in the State Capitol, committee members favorably reported seven bills after discussion with sponsors, industry representatives, insurance officials and affected small-business owners including tow and trucking firms. The measures include a ban on some damages for unauthorized immigrants in auto suits, a change to liability venue in uninsured/underinsured motorist cases, an optional reversionary medical trust for future medicals, new disclosure and consumer-protection rules for third-party litigation financing, a $5 million cap on general-damages awards in delictual actions as amended, and two bills aimed at transparency of fee arrangements and third-party interests in cases.

Why it matters: Lawmakers and business speakers tied the proposals to the state’s auto-insurance crisis and to high commercial auto premiums that many truckers and tow companies say threaten their ability to stay in business. Supporters said the package will bring predictability to insurers and reduce "nuclear verdicts" that they say drive up rates; opponents and some members raised consumer-protection and professional-regulation concerns.

HB 4 36 — Damages for unauthorized immigrants

Representative Richard Furman, sponsor, said House Bill 4 36 "prohibits awarding general damages like pain and suffering and past and future wages to unauthorized aliens in actions for damages from automobile accidents." He told the committee the bill is designed "to help address the state's auto insurance crisis and to encourage legal immigration." Committee member questions focused on whether unauthorized immigrants sometimes hold out‑of‑state licenses or insurance; Furman acknowledged such scenarios are possible but said the bill targets claimants who "have not followed the laws of our country and entered the country legally, and maintained legal status."

The committee moved HB 4 36 favorably by unanimous voice consent; no roll-call vote was recorded in committee. Representative Christian Carlson made the motion to report the bill favorable.

HB 3 36 — Venue in UM/UIM claims

Representative Wilder introduced HB 3 36, which he said is intended to close a venue‑shopping loophole in uninsured/underinsured motorist (UM/UIM) coverage claims. Wilder said plaintiffs sometimes add a UM/UIM claim to move the entire litigation to the plaintiff's home parish rather than where the accident or defendant is located. He told the committee the bill would restore the normal venue rule — suit where the accident occurred or where defendants reside — for suits that invoke UM/UIM coverage and thereby limit litigation costs and so‑called judge/jury shopping.

The committee reported HB 3 36 favorably on a roll-call vote: 10 yes, 2 no.

HB 4 27 — Reversionary medical trust (optional)

Representative Clay Bamberg described HB 4 27 as providing an option for insurers or liable parties to place a jury‑ or court‑awarded future‑medical amount into a reversionary trust administered by a trustee. Skip Phillips, chair of the Lobby Civil Justice Task Force, and Franco Pelka, Deputy Commissioner for Health, Life and Annuity at the Department of Insurance, both outlined parallels to existing programs: the state's Office of Risk Management fund for judgments against the state, the patients' compensation fund for medical‑malpractice future medicals, and Medicare set‑aside arrangements.

Phillips said the trusts would have a trustee with fiduciary duties under the Louisiana Trust Code, the trustee would pay bills as incurred, and any unspent funds would revert to the payor (the insurer or settling defendant) when future medical care is no longer needed or the claimant dies. Representative Bamberg and witnesses said administration costs would be paid by the payor, and they discussed notice, annual accounting and reimbursement procedures for providers that may bill or be paid out of the trust.

Committee discussion included questions about provider billing, annual trustee accounting and safeguards against bad actors; supporters pointed to trustee fiduciary duties, licensing of trust administrators and existing practice in Medicare and workers' comp as safeguards. The committee reported HB 4 27 favorably on a roll-call vote: 10 yes, 2 no.

HB 432 — Third‑party litigation financing (TPLF) cleanup and disclosures

Representative Chennavier presented HB 432 as a cleanup and consumer‑protection bill for third‑party litigation financing. She described provisions that would limit a financier’s recovery to the plaintiff’s net share after attorney fees and litigation costs, require attorneys to inform clients of financing arrangements and deliver copies of financing contracts within 30 days of retention, and preserve nonprofit legal‑aid exceptions.

Casey Rose Woolmer, representing the International Legal Finance Association, urged a narrower consumer focus to avoid chilling commercial financing for businesses that rely on capital; she also recommended tailored disclosure rules so clients receive understandable notice rather than large unredacted contracts. The committee reported HB 432 favorably by voice.

HB 4 35 (as amended) — Cap on general damages in delictual actions

Representative Egan introduced the measure as an amendment‑passed bill that limits general damages awards to $5,000,000 for a single claimant in a delictual action (the bill language was later amended to reference delictual actions). Egan and several business witnesses, including Mark Younger (Younger Wholesale) and Greg Stewart (Safeway Transportation), argued the cap would reduce "nuclear verdicts," help stabilize commercial auto insurance pricing, and keep trucking and towing businesses operating in Louisiana.

Opponents and some committee members questioned: why $5 million (larger than caps in other states), how the cap affects victims with catastrophic injuries, and whether caps protect businesses when many commercial policies already have high limits. The committee adopted an amendment that narrowed the bill’s initial wording to explicitly reference delictual actions and then reported the bill favorably on a roll‑call vote: 10 yes, 2 no.

HB 4 39 — Cap on contingency fees for small recoveries

Representative J. Abare proposed a cap that would limit an attorney’s contingency fee to 10% for the first $15,000 recovered in delictual actions and make the contingency percentage discoverable. Abare said the change targets a high frequency of small claims in Louisiana and aims to keep more small recoveries with claimants rather than enabling ‘‘mill’’ practices. Members questioned whether the statutory cap is appropriate regulation of attorney fees (which are governed by the Rules of Professional Conduct) and whether reporting alleged violations to the disciplinary board is necessary or redundant. The committee reported HB 4 39 favorably on a roll‑call vote: 10 yes, 2 no.

HB 4 49 — Disclosure of third‑party interests in cases

Representative Carlson brought an amendment and the underlying bill requiring attorneys or other parties with a reasonable expectation of earning $1,000 or more from a case (other than the attorney of record’s legal‑service fee) to disclose that interest to the court; the disclosure would be discoverable and non‑disclosure agreements that bar such disclosure would be unenforceable to the extent they prohibit it. Carlson said the intent is transparency where an attorney or participant has a separate financial interest — for example, an attorney who has equity in or refers patients to a medical provider. Members asked about practical mechanics (disclosure when no lawsuit is filed), HIPAA concerns and whether the rule should apply symmetrically to both plaintiff and defense sides. The committee reported HB 4 49 as amended on a roll‑call vote: 8 yes, 2 no.

Votes at a glance (committee outcomes)

- HB 4 36 (prohibit general damages for unauthorized aliens in auto claims): reported favorably (moved by Rep. Carlson; voice consent; no recorded roll‑call). - HB 3 36 (venue limits for UM/UIM claims): reported favorably; roll call 10 yes, 2 no. - HB 4 27 (optional reversionary medical trust): reported favorably; roll call 10 yes, 2 no. - HB 432 (TPLF cleanup/disclosure): reported favorably (voice). - HB 4 35 (cap general damages in delictual actions as amended): reported favorably; roll call 10 yes, 2 no. - HB 4 39 (limit contingency fee on first $15,000): reported favorably; roll call 10 yes, 2 no. - HB 4 49 (disclosure of non‑attorney‑of‑record financial interests ≥ $1,000): reported favorably as amended; roll call 8 yes, 2 no.

Perspectives from the room

Jessica Herring, representing tow companies in Vernon Parish, described sharp premium increases for tow operators and said rising costs threaten closures. "Last year, I wrote a check for nearly $14,000 for insurance coverage," Herring said, listing year‑by‑year increases and warning that closures would lengthen traffic delays. Several trucking representatives, including Mark Younger and Greg Stewart, described similar pressures and told the committee that high commercial auto premiums are forcing businesses out of state.

Skip Phillips and Franco Pelka from the insurance community emphasized existing analogues to the proposed reversionary trust: "We do that for tort claims against the state" and "that's essentially what this bill does," Pelka said, comparing the proposal to Medicare set‑aside arrangements.

What’s next

Each bill will go to the House floor if called by the Rules or Speaker’s Office. Sponsors and committee staff indicated several items may be further amended on the floor, and some members asked for additional drafting changes (for example, clarifying scope to delictual actions or adding notice procedures for medical trustees). Several speakers said they will work with authors on language to address disclosure mechanics, provider billing and HIPAA concerns.

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Ending note: The committee hearing included multiple public witnesses and dozens of written cards from industry groups, insurers, small businesses and advocacy organizations. Several measures—especially the reversionary trust and the damages‑cap bill—drew the most extended debate and are likely to be contested on the floor and in subsequent committee stages.