By Tariq Naeem

Third party litigation funding (“TPLF”) refers to the involvement of non-parties, typically sophisticated financial companies, that invest in lawsuits by paying money to plaintiffs or their counsel in exchange for a contingent interest in the proceeds from the litigation. TPLF is big business, with an estimated $15 billion in capital having been invested in U.S. civil litigation seeking to profit on the outcome of someone else’s claim. With no consistent national policy governing these agreements, states like Ohio are stepping in to address concerns about the potential for negative impacts on the justice system. Among other reasons, TPLF agreements have come under increased scrutiny due to concerns that they can increase the filing of frivolous lawsuits, obscure potential conflict-of-interest issues, elevate the profit motive of investors over claimants’ litigation interests, and subject the U.S. legal system to manipulation by malign foreign interests.

Currently, Ohio law permits only “non-recourse civil litigation advance contracts,” which involve cash payments to consumers with a pending civil case in exchange for an amount of the proceeds received in the case. Read the full article in the Spring 2025 Edition of Inter Alia below.