Third-Party Litigation Funding Bill Faces House Hurdle

"targets serious and continuing abuses in our litigation system that distort our system of justice by obscuring public detection and exploiting loopholes in the law for financial gain... We fundamentally believe that if a third-party investor is financing a lawsuit in federal court, it should be disclosed rather than hidden from the world and left absent from the facts of a case."

"At its core, this bill would make patents and other intellectual property rights effectively unenforceable for the Davids of our economy: small inventors, startups, and entrepreneurs who challenge entrenched incumbents."

The Litigation Transparency Act of 2025 would require disclosure of all third-party sources of funding in civil actions and failed to reach a House Judiciary Committee vote. Representative Darrell Issa introduced the bill, with Representatives Scott Fitzgerald and Mike Collins as sponsors. Issa characterized the measure as targeting abuses that obscure justice and called for disclosure of third-party investors financing federal lawsuits. The Protecting Our Courts from Foreign Manipulation Act, introduced by Representative Ben Cline, was reported out of committee by a 15-11 vote. The Inventors Defense Alliance urged opposition, arguing the bill would undermine patent enforcement for small inventors and startups, and committee members expressed similar concerns.

Read at IPWatchdog.com | Patents & Intellectual Property Law