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Missouri Governor Mike Parson signs comprehensive legislation regulating Consumer Legal Funding

July 10, 2023

Missouri Governor Mike Parson signs comprehensive legislation regulating Consumer Legal Funding

Missouri Governor Michael Parson signed an omnibus bill, SB 103, containing sweeping new regulations for the growing industry of consumer legal funding—bringing meaningful oversight of provider companies for the first time in the state’s history. Missouri now joins several states, like Oklahoma, Nebraska, Ohio, Utah, Nevada, Vermont, Tennessee, Indiana, and Maine, who have acted to enact consumer protections while preserving consumer choice. Consumer legal funding—also known as pre-settlement funding—is a specialty financial service that allows plaintiffs pursuing a legal claim to sell part of the potential proceeds of the claim for cash now. Unlike a loan, there is no obligation to the funding company if the consumer does not have a successful outcome in their claim. And because it’s the sale of an asset, it can’t affect a person’s credit or put them into collections. This legislation ensured that it will be treated as a consumer asset. “Consumer legal funding is a financial lifeline to those engaged in civil litigation who lack savings. Governor Parson giving his approval to this legislation is a win for robust consumer protections and protecting access to legal funding in Missouri.” Stated Missouri State Representative Phil Christofanelli Missouri State Senator Sandy Crawford stated “I am pleased that we were finally able to take the Consumer Legal Funding legislation across the finish line. Although this process has taken several years, I am confident the finished product was worth the time it took. I was happy to play a role in passing this important legislation.” “Consumer legal funding is different from a lot of other financial products. It allows a consumer to get the financial assistance they need while their claim is making its way through the legal system.” said Eric Schuller, President Alliance for Responsible Consumer Legal Funding, the Trade Association that represents the companies that offer Consumer Legal Funding. Missouri State Senator Curtis Trent stated: “I appreciate the Governor’s support. This measure will ensure that Missourians have better access to the financial resources they need to protect their rights in Court.” Schuller said, “this is some of the most well-researched legislation we’ve seen come out in the last few years. It’s sure to serve as a model for other states in the years to come. This is good lawmaking in action—a trend which should continue.”

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Consumer

North Carolina Becomes First State to Ban Third-Party Litigation Funding

North Carolina has become the first state in the nation to enact an outright ban on third-party litigation funding, after Governor Josh Stein signed House Bill 315 into law. The measure makes it unlawful for outside investors to finance civil lawsuits in exchange for a financial interest tied to the outcome of the case, marking a significant departure from the disclosure-and-transparency approach adopted by other states.

As reported by WWAY-TV3, the law defines litigation investment as providing money for the fees, costs, or expenses of pending or potential civil proceedings in return for compensation contingent on the result. The statute authorizes the state attorney general to seek injunctions and civil penalties against violators, though certain activities are carved out from the prohibition.

The bill drew broad legislative support, passing the House unanimously and clearing the Senate by a 45-1 margin. Business groups, including the North Carolina Chamber and the U.S. Chamber of Commerce's Institute for Legal Reform, backed the measure, arguing it strengthens the state's legal and business climate. Critics counter that third-party funding can expand access to the courts for parties who otherwise lack the resources to pursue meritorious claims.

The development represents a notable escalation in the regulatory debate over litigation finance in the United States. While states such as Ohio and others have advanced transparency requirements, North Carolina's outright prohibition sets a new precedent that funders, defense interests, and legislators in other jurisdictions are likely to watch closely.

Consumer

“Take Care of Maya” Family Battles Former Lawyers Over $42M Litigation Loan

The family at the heart of the Netflix documentary "Take Care of Maya" is now locked in a dispute with its former attorneys over the proceeds of a litigation loan, in a case that puts the mechanics of litigation finance in an unusually public spotlight. Jack Kowalski and his daughter Maya, whose ordeal with a rare chronic illness and a Florida hospital drew national attention, are challenging the fees claimed by the lawyers who once represented them.

As reported by Bloomberg Law, the dispute centers on a $42 million litigation funding loan and nearly $10 million in attorneys' fees now in contention. The family's current counsel alleges that the prior firm, AndersonGlynn LLP of Jacksonville, "committed flagrant, serious, and repeated violations of their professional, ethical, and fiduciary duties" during the representation. The matter is being heard in Florida's Twelfth Judicial Circuit.

The fight illustrates a recurring tension in funded litigation: when sizable awards meet layered financing arrangements and contingency fees, the division of proceeds can become its own battleground. Disputes over how loan repayments, interest, and legal fees are calculated against a recovery are increasingly common as litigation finance scales.

For an industry often criticized for operating out of public view, the high profile of the Kowalski case offers a rare, concrete look at how litigation loans intersect with attorney compensation — and what can go wrong when the relationship between client, counsel, and funder breaks down.

Consumer

Peter Thiel-Backed “Objection” Turns the Gawker Playbook Into an AI Tribunal for Journalists

By John Freund |

A decade after he secretly bankrolled Hulk Hogan's lawsuit that bankrupted Gawker, billionaire Peter Thiel is again funding an effort aimed at the press — this time through a startup that lets the wealthy pay to put reporters on trial before an artificial-intelligence "jury." The venture, called Objection, was founded by Aron D'Souza, the lawyer who orchestrated the Thiel-financed campaign against Gawker, and launched in April 2026 with seed money from Thiel, Balaji Srinivasan, and venture firms Social Impact Capital and Off Piste Capital.

As reported by The Hollywood Reporter, Objection works as a private arbitration service. For a starting fee of roughly $2,000, a client can challenge a published article. Human investigators — ranging from recent graduates to former CIA and FBI agents — gather evidence, which is then assessed claim-by-claim by multiple large language models acting as jurors. The system issues an "Honor Index" score grading a journalist's accuracy and integrity, and clients can pay extra to amplify favorable findings on social media.

The company's first target is a Hollywood Reporter investigation, brought by a Purdue Pharma heir disputing 2021 coverage of his image as an ethical investor. Media lawyers and First Amendment scholars warn the model could chill reporting that relies on confidential sources, with one attorney describing it as "a high-tech protection racket for the rich and powerful." The case underscores how litigation — and the money behind it — has become a tool to shape, and sometimes silence, coverage of the powerful.