New Economic Report Shows Third-Party Litigation Funding is Driving Up Costs for Consumers and Businesses

WASHINGTON - A new analysis by The Perryman Group finds that third-party litigation funding (TPLF) is imposing billions of dollars in costs on the U.S. economy and contributing to higher prices for households and businesses.

TPLF arrangements - where outside investors finance lawsuits in exchange for a portion of any award - are typically undisclosed to all parties in a case and the courts and are linked to prolonged litigation, larger verdicts, and significant inefficiencies across the civil justice system.

Key Findings

• $35.8 billion in direct annual economic losses tied to third-party litigation funding.

• Including broader economic effects, TPLF results in $54.2 billion in lost gross product and 454,450 fewer jobs each year.

• Consumers face $192.79 per person and $607.27 per household in annual losses due to lower earnings and higher prices.

• TPLF contributes to inflation across critical household expenses, including auto and home insurance.

"This new data makes clear that third-party litigation funding impacts affordability and is driving up costs for families and businesses across the country," said Sam Whitfield, senior vice president of federal government relations and political engagement at the American Property Casualty Insurance Association (APCIA). "Congress should pass the Protecting Third Party Litigation Funding from Abuse Act, the Protecting Our Courts from Foreign Manipulation Act, and the Tackling Predatory Litigation Funding Act to bring effective reform and meaningful savings to consumers."

The Perryman Group report, The Impact of Third-Party Litigation Funding on US Business Activity and Consumers , can be found here .