Tag Archives: California

Financing Agreements Disclosure is required by Northern District of California in All Class Action Suits

Third-party litigation financing agreements are now required to be automatically disclosed in all proposed class actions in the Northern District of California. The automatic disclosure rule is the first of its kinds in the United States district courts.

The new rule, which states that “in any proposed class, collective or representative action, the required disclosure includes any person or entity that is funding the prosecution of any claim or counterclaim,” was adopted in a court-wide standing order for all judges in the Northern District of California. Although this is a huge step toward greater transparency in third party financing, the rule is unlikely to impact big players in litigation financing like Burford Capital and Bentham IMF, as they do not typically fund class action cases.

A Burford statement indicated that the new rule may even allow courts to see how common litigation financing in class action lawsuits has become.  The new rule is indeed limited—it was adopted after the court previously proposed an even broad requirement of automatic disclosure in all cases.

View full post at TheRecorder

Summarized by Meghan Hallinan

Proposed Northern District of California Rule Could Reveal Identity of Litigation Funders

Major players in the litigation funding industry are resisting a proposed amendment to the local civil rules of the Northern District
of California that would require plaintiffs who litigate in that forum
to disclose whether their suits are backed by third-party investors.
Promulgation of a rule requiring such disclosures could have a
nationwide effect, including opening doors to the possibility of
promulgation of a similar rule within the Federal Rules of Civil
Procedure, the rules that govern procedures in all federal trial
courts in the country.

See full article at TheRecorder

Summarized by Meghan Hallinan