Florida Lawmakers Ready for Another Shot at Litigation Funding Limits

Florida property/casualty insurance coverage leaders have stated they aren’t anticipating huge adjustments from the legislature’s 2026 common session that started this week, given the much-touted impression that 2022 reforms have already had on extreme litigation prices lately.

However one invoice that supporters stated would additional rein in litigation bills and losses has been given an opportunity of passing—fueled by rising considerations that third-party investments in lawsuits lengthen litigation and promote unwarranted class-actions.

Home Invoice 1157, sponsored by state Rep. Fabian Basabe, R-Miami Seaside, is much like a measures that didn’t move in 2024 and 2025. It and its companion, Senate Invoice 1396, by Sen. Colleen Burton, intention to put limits on the scope of affect that third-party litigation financiers can have on litigation. They’ve the help of the U.S. Chamber of Commerce.

“These payments will shut down a harmful loophole that enables hostile overseas entities to bankroll litigation designed to undermine Florida’s economic system and hurt its residents, a vital step towards reclaiming the state’s authorized system from overseas manipulation,” reads a submit from the U.S. Chamber’s Institute for Authorized Reform.

The measures would bar funders from directing the course of any civil motion, together with selecting the legal professionals concerned, skilled witnesses, and technique. The payments additionally would block financiers from receiving a bigger share of awards or settlements than the plaintiffs obtain.

Additional, the payments would:

• Bar funders from paying commissions or charges to anybody who refers somebody to the litigation financier.
• Require that each one agreements with overseas pursuits or individuals be disclosed inside 14 days of signing the agreements, and clearly determine the individuals concerned. The financing phrases wouldn’t have to be disclosed, and a courtroom could permit the agreements to be filed below seal.
• Permit courtroom fines and different sanctions towards events that don’t comply.

If permitted and signed by the governor, the legislation would take impact July 1, 2026.

Passage within the Florida Senate seems doubtless. However the Home, the place sentiments for much less—no more—tort reform run hotter, could also be much less inclined towards approval, stated George Feijoo, a lobbyist and marketing consultant representing the U.S. Chamber.

If litigation funding restrictions do make it to the end line, Florida would develop into not less than the ninth state to clamp some sort of limits on third-party lawsuit financiers.

GeorgiaKansas, Louisiana, Indiana, Montana, Oklahoma, Wisconsin, West Virginia and New York now have legal guidelines regulating third-party litigation funding, in line with information experiences. Washington State is contemplating a invoice this yr. And sources have instructed Insurance coverage Journal that some Alabama lawmakers and insurance coverage pursuits in current weeks have been huddling for a push within the session that begins right this moment, Jan. 13.

The complete textual content of Florida’s HB 1157 will be seen here.

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