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Florida Senate Committee Adopts Litigation Funding Guidelines; Expands Wrongful Dying



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Litigation financing might quickly develop into extra clear and fewer influential in Florida, however a 34-year-old restriction on who can file medical malpractice wrongful dying claims could be expanded underneath payments authorised Monday by a key Florida legislative panel.


The Senate Judiciary Committee, by a vote of 10-0, endorsed Senate Bill 1276, which supporters mentioned would require full disclosure on who could also be funding lawsuits and would bar these lenders from directing or influencing the litigation.

“This can give management again to Floridians by guaranteeing that each one rights to make selections in a lawsuit stay with the one who was harmed,” mentioned Sen. Jay Collins, R-Tampa, who sponsored the invoice.


Third-party financing of main lawsuits has develop into a prime situation for insurers and firms across the nation, and a variety of states have handed comparable laws designed to shine a lightweight on who’s footing the invoice. Bloomberg information service reported final fall that the funding efforts have grown quickly lately. One funding group, Fortress, has plowed $6 billion into litigation funding.

Underneath present Florida legislation, lenders and mortgage phrases in Florida lawsuits will be discovered to a restricted diploma by way of the Florida Secured Transaction Registry. However that requires the names of events concerned and different info that could be tough to acquire. Plaintiffs in some instances additionally should speak in confidence to defendant insurance coverage firms details about funding, as a part of the invention course of in lawsuits.

The nation’s largest property insurance coverage commerce group mentioned that SB 1276 would deliver transparency to extra instances.


“Third-party litigation financing is a particularly regarding development in litigation that’s turning courts into money-making machines for buyers,” Logan McFaddin, with the American Property Casualty Insurance coverage Affiliation, mentioned in a press release. “APCIA applauds the Florida Senate Judiciary Committee for supporting SB 1276 as a strategy to defend shoppers and produce transparency to this extremely predatory trade.”

She mentioned that litigation funders usually are giant hedge funds or international actors that cost excessive rates of interest, which might depart plaintiffs with little payout on the finish of litigation.


Plaintiffs’ lawyer Rebecca Timmons, representing the Florida Justice Affiliation, argued on the committee listening to that the invoice ought to be revised to require disclosure solely to authorities companies that may police international affect. The disclosure shouldn’t be made to opposing counsel, nor to insurance coverage firms, she mentioned.

Timmons mentioned limiting litigation financing might harm common Floridians, who don’t usually have the means to attend out years-long courtroom instances. “These folks can’t go toe to toe when the opposite aspect has tens of millions to spend on legal professionals,” she mentioned.


Particularly, in accordance with a legislative evaluation, the invoice would prohibit litigation financiers from:

  • Directing the course of authorized proceedings
  • Contracting for a bigger share of the proceeds of a authorized continuing than is collectively recovered by the plaintiffs
  • Paying or providing to pay a referral charge or fee to any individual
  • Assigning or securitizing litigation financing agreements.

The invoice additionally would require:

  • Attorneys and their purchasers to make disclosures on financing agreements or relationships they’ve with international or home litigation financiers.
  • Litigation financiers to indemnify plaintiffs and their counsel for any antagonistic prices, lawyer charges, damages, or sanctions awarded in opposition to them.
  • Authorizes courts to take financing agreements under consideration when figuring out whether or not a category consultant or counsel can pretty signify class pursuits.

Payments that will have required litigation funders to register with the Florida Division of State and to file surety bonds died within the Legislature final yr.

On the medical malpractice situation, SB 248 would as soon as once more enable dad and mom of grown kids who died attributable to medical negligence, to sue the caregivers. The Senate Judiciary Committee authorised the invoice by a vote of 8-0 on Monday.


State lawmakers in 1990, as a part of a transfer to restrict expensive med mal insurance coverage charges, barred dad and mom of adults, who had no kids of their very own and no partner, from recovering damages in medical malpractice wrongful dying instances. SB 248, sponsored by Committee Chair Clay Yarborough, R-Jacksonville, would reopen that class of plaintiffs.

“Decreasing medical malpractice premiums in 1990 was worthy purpose, however placing a ban on sure people, in order that they can’t entry the judicial system is an injustice,” Yarborough mentioned on the committee assembly.

He acknowledged that increasing the category of plaintiffs might result in increased malpractice premiums within the years forward, and Florida medical suppliers already face a few of the highest insurance coverage prices within the nation. So, to counter that, the invoice supplies caps on non-economic injury awards – $500,000 for medical practitioners and $750,000 for non-practitioners.


An modification by Sen. Lauren E-book, D-Davie, would have eliminated these caps. Her modification failed.

The payments come virtually a yr after Florida lawmakers authorised a sweeping tort-reform measure that restricted multipliers and one-way charges for plaintiffs attorneys; lowered the timeframe for bringing negligence fits; apportioned fault in fits; and made it tougher to show bad-faith actions by insurers.


Advocates of Monday’s actions mentioned additional reforms are wanted to curb pointless litigation.

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