Debate over third‑party litigation finance bill centers on transparency, access to justice and insurer concerns

The Senate Judiciary Committee heard an extended and sharply contested hearing on HB 733, which would require disclosure of certain commercial third‑party litigation finance (TPLF) agreements to courts and other parties and bar investment in commercial litigation by specified foreign entities. Supporters said the bill restores transparency and helps insurers and businesses assess litigation risk; opponents said mandatory, automatic disclosure would provide defendants with undue tactical advantage and drive financiers out of the New Hampshire market, reducing access to justice for smaller claimants.

Sponsor Representative Brian Cole described TPLF as an industry that “turns our civil justice system into another commodity for investors to make exorbitant profits,” and argued the bill’s disclosure and foreign‑investor limits would protect local defendants and insurance markets. He told the committee he based the draft on a National Conference of Insurance Legislators (NCOIL) model and noted 13–14 other states have enacted similar transparency measures.

Insurance and business groups strongly backed the bill. Nathan Fennessy of AIG described HB 733 as “a common sense reciprocal transparency bill” and State Farm’s representative said the amended House version is “a step in the right direction” to bring disclosure parity between plaintiffs and defendants. Insurance Commissioner DJ Bettencourt testified the bill would improve risk transparency, underwriting and claims management and could ease New Hampshire’s hard insurance market for nonprofits and child‑care providers.

Opponents included representatives of the International Legal Finance Association (ILFA) and commercial funders, who warned automatic pre‑discovery disclosure of financing agreements is highly prejudicial and would cause many commercial funders to refuse to operate in New Hampshire. Sean Thompson of ILFA said the Kansas compromise — which provides for in‑camera judicial review of funding agreements and other protections — is a preferable model because it gives judges access to agreements without exposing sensitive financing terms to opposing counsel.

Witnesses also debated the policy’s scope. Backers stressed the House amendment narrowed the bill to large‑scale commercial financing rather than consumer payday‑style funding, and included a provision to bar investments by foreign “entities of concern.” Opponents said the bill’s original language improperly swept in law‑firm side‑funding and could force financing arrangements underground.

Committee members heard suggestions for compromise from multiple sides: mandatory disclosure of a funding notice plus in‑camera review of full agreements, limits on funder control over litigation strategy, and prohibitions on funders accessing confidential discovery materials. The committee did not take a final vote on the measure during the hearing; parties said stakeholder negotiations were ongoing.