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Insurance and business groups back limited disclosure of third‑party litigation financing
Summary
Supporters including the insurance commissioner argued HB 13 84 would increase pricing predictability and help a hard liability insurance market; plaintiffs' lawyers and some advocates said forced disclosure could prejudice claimants and unequally advantage defendants.
CONCORD, N.H. — The House Judiciary Committee heard competitive testimony Thursday on legislation that would require disclosure of some third‑party litigation financing (TPLF) in commercial cases.
Representative Brian Cole introduced HB 13 84 as an effort to restore transparency where hedge funds and investment firms finance lawsuits. Cole said unknown funders can distort settlement incentives and drive up insurance costs for nonprofits and small businesses.
DJ Bettencourt, New Hampshire’s insurance commissioner, told lawmakers that a ‘‘hard’’ liability insurance market is partly driven by uncertainty about whether outside financiers are influencing litigation strategy. ‘‘Disclosure does not change the legal rights or outcomes. What it does do is improve predictability,’’ Bettencourt said.
Supporters from the business community, independent insurance agencies and trade associations said disclosure would allow carriers to price risk more accurately and could lower premiums and increase availability of coverage.
Opponents included plaintiffs’ attorneys and advocacy groups who said mandated disclosure would create an uneven playing field by revealing plaintiffs’ funding and strategy while insurers are not required to disclose reserves or settlement strategy. New Hampshire Association for Justice representatives warned disclosure could be used tactically by defense counsel to gain leverage.
Industry representatives and ILFA, a litigation funders’ association, said the bill as drafted is targeted to commercial financing and excludes consumer claims such as abuse or clergy cases. Several witnesses asked the committee to refine the bill’s lawyer‑funding provisions and to preserve in‑camera review when appropriate.
The committee recessed without a vote after multiple stakeholders asked for more drafting to balance transparency, confidentiality, and access to justice.
