Tensions between the litigation finance and insurance sectors escalated this week, as Burford Capital accused insurance giant Chubb of anti-competitive conduct for allegedly blacklisting entities affiliated with litigation funders. The clash centers on Chubb’s reported efforts to pressure law firms, brokers, and asset managers to distance themselves from litigation finance players, claiming such associations encourage excessive litigation.

An article in the Financial Times reports that Chubb, one of the world’s largest commercial insurers, has taken a hardline stance against third-party litigation funding (TPLF). The insurer allegedly warned that business relationships with firms connected to litigation funding could jeopardize access to its insurance services. In response, Burford Capital, the world’s largest litigation financier, has challenged Chubb’s actions as potentially violating antitrust laws by leveraging its dominant market position to suppress competition and restrict access to legal finance.

Burford argues that litigation funding serves a critical role in facilitating access to justice, especially for under-resourced claimants confronting well-capitalized defendants. The firm emphasized the legality of TPLF arrangements and framed Chubb’s actions as an overreach aimed at stifling a legitimate and growing financial sector. The dispute highlights deepening fault lines between two industries with starkly divergent views on the societal and economic impacts of litigation funding.

This confrontation arrives amid heightened scrutiny of TPLF, with insurers and some policymakers portraying it as a driver of “social inflation”—increased litigation costs and larger jury verdicts. Funders, on the other hand, maintain that these claims are overblown and self-serving.

The implications for legal finance are significant. If Chubb’s actions prompt regulatory review or litigation, it could shape the future of insurer-funder relations and the broader policy environment for litigation finance. The episode also raises the question: will other insurers adopt similarly aggressive stances, or will Burford’s challenge curb the momentum of this growing backlash?

A pivotal UK court case could reshape the future of litigation finance agreements, as Sony and Apple reignite legal challenges to widely used third-party funding models in large-scale commercial disputes.

An article in Law360 reports that the two tech giants are questioning the validity of litigation funding arrangements tied to multibillion-pound cartel claims brought against them. Their core argument: that certain litigation funding agreements may run afoul of UK laws governing damages-based agreements (DBAs), which restrict the share of damages a representative may take as remuneration. A previous Court of Appeal decision in PACCAR Inc. v. Competition Appeal Tribunal held that some funding models might qualify as DBAs, rendering them unenforceable if they fail to comply with statutory rules.

This resurrected dispute centers on claims brought by class representatives against Apple and Sony over alleged anti-competitive behavior. The companies argue that if the funding arrangements breach DBA regulations, the entire claims may be invalidated. For the litigation funding industry, the outcome could severely curtail access to justice mechanisms in the UK—especially for collective actions in competition law, where third-party financing is often essential.

The UK’s Competition Appeal Tribunal previously stayed the proceedings pending clarity on the legal standing of such funding arrangements. With the dispute now heading back to court, all eyes will be on whether the judiciary draws a clear line around the enforceability of funder agreements under current law.

The decision could force funders to rework deal structures or risk losing enforceability altogether. As UK courts revisit the DBA implications for litigation finance, the sector faces heightened uncertainty over regulatory compliance, enforceability, and long-term viability in complex group litigation. Will this lead to a redefinition of permissible funding models—or to a call for legislative reform to protect access to collective redress?

A Texas appeals court has ruled that a litigation funder cannot block attorneys from pursuing a fee dispute following a remand order, reinforcing the limited standing of funders in fee-shifting battles. In a 2-1 decision, the First Court of Appeals found that the funder’s interest in the outcome, while financial, did not confer the legal authority necessary to participate in the dispute or enforce a side agreement aimed at halting the proceedings.

An article in Law360 details the underlying case, which stems from a contentious attorney fee battle following a remand to state court. The litigation funder, asserting contractual rights tied to a funding agreement, attempted to intervene and stop the fee litigation between plaintiffs' and defense counsel. But the appellate court sided with the trial court’s decision to proceed, emphasizing that only parties directly involved in the underlying legal work—and not third-party financiers—are entitled to challenge or control post-remand fee determinations. The majority opinion concluded that the funder’s contract could not supersede procedural law governing who may participate in such disputes.

In dissent, one justice argued that the funder’s financial interest merited consideration, suggesting that a more expansive view of standing could be warranted. But the majority held firm, stating that expanding standing would invite unwanted complexity and undermine judicial efficiency.

This decision sends a strong signal to funders operating in Texas: fee rights must be contractually precise and procedurally valid. As more funders build fee recovery provisions into their agreements, questions linger about how far those rights can extend—especially in jurisdictions hesitant to allow funders a seat at the litigation table.

In a significant policy shift, Oklahoma has enacted legislation targeting foreign influence in its judicial system through third-party litigation funding. Signed into law by Governor Kevin Stitt, the two-pronged legislation not only prohibits foreign entities from funding lawsuits in the state but also imposes a $500,000 cap on non-economic damages in civil cases—excluding exceptions such as wrongful death. The new laws take effect November 1, 2025.

An article in The Journal Record notes that proponents of the legislation, including the Oklahoma Civil Justice Council and key Republican lawmakers, argue these measures are necessary to preserve the integrity of the state's courts and protect domestic businesses from what they view as undue interference. The foreign funding restriction applies to entities from countries identified as foreign adversaries by federal standards, including China and Russia.

Critics, however, contend that the laws may undermine access to justice, especially in complex or high-cost litigation where third-party funding can serve as a vital resource. The cap on non-economic damages, in particular, has drawn concern from trial lawyers who argue it may disproportionately impact vulnerable plaintiffs without sufficient financial means.

Oklahoma’s move aligns with a broader national trend of state-level scrutiny over third-party litigation funding. Lawmakers in several states have introduced or passed legislation to increase transparency, impose registration requirements, or limit funding sources.

For the legal funding industry, the Oklahoma law raises pressing questions about how funders will adapt to an increasingly fragmented regulatory landscape. It also underscores the growing political sensitivity around foreign capital in civil litigation—a trend that could prompt further regulatory action across other jurisdictions.

A new opinion piece pushes back against recent cultural and political rhetoric characterizing third-party litigation funding as a partisan instrument, arguing instead that it remains a neutral financial tool in the legal system.

An article in the Consumer Choice Center emphasizes that while some political actors and commentators have portrayed litigation funding as a means to challenge so-called “woke” corporations, such framing misconstrues the role and function of funders. According to the piece, litigation funding serves a straightforward purpose: to provide capital to litigants—be they individuals or entities—who lack the resources to pursue claims. The authors argue that this mechanism is neither inherently ideological nor driven by political outcomes.

The article calls for clearer regulatory standards and heightened transparency to avoid potential abuses and maintain public trust. It warns against allowing litigation finance to be co-opted by political narratives, which could derail substantive policy debates around disclosure, ethical boundaries, and market oversight.

In a landscape increasingly shaped by culture wars, this intervention underscores a foundational point: litigation finance is not a proxy battlefield for partisan interests, but a tool with the potential to improve access to justice—provided it is governed with clarity and care.

A recent opinion piece in The Wall Street Journal advocates for closing tax loopholes that allow foreign investment funds to avoid U.S. taxes on profits earned from financing lawsuits against American companies. The editorial argues that the current tax code inadvertently incentivizes predatory litigation funding practices by exempting foreign investors from taxation on lawsuit proceeds, thereby disadvantaging domestic businesses.

The article contends that this exemption creates an uneven playing field, enabling foreign entities to profit from U.S. legal actions without contributing to the tax base. It suggests that such practices not only strain the judicial system but also impose additional burdens on American companies, which must defend against potentially frivolous or opportunistic lawsuits financed by these untaxed foreign investments.

The editorial calls on Congress to reevaluate and amend the tax code to eliminate these exemptions. By doing so, it aims to deter exploitative litigation funding and ensure that all investors, regardless of nationality, are subject to the same tax obligations when profiting from the U.S. legal system.

The piece emphasizes that such reforms would promote fairness and protect domestic businesses from undue legal and financial pressures.

Backlit Capital Solutions has announced the launch of its full-service legal finance consultancy. The firm aims to provide comprehensive funding solutions for legal claims, offering services that include litigation finance, arbitration funding, and judgment enforcement strategies.

An article in PR Newswire states that Backlit Capital Solutions is positioning itself as a comprehensive provider in the legal finance sector, aiming to serve a diverse clientele that includes claimants, law firms, lenders, and investors. The firm's service offerings encompass litigation finance, arbitration funding, and judgment enforcement strategies, indicating a broad approach to legal funding solutions.

The launch of Backlit Capital Solutions reflects a growing trend in the legal finance industry, where firms are expanding their services to address the multifaceted needs of legal claimants and their representatives. By offering a suite of services under one roof, Backlit Capital Solutions aims to streamline the funding process and provide tailored solutions to its clients.

As the legal finance landscape continues to evolve, the entry of firms like Backlit Capital Solutions underscores the increasing demand for specialized financial services in the legal sector. Their comprehensive approach may set a new standard for how legal finance consultancies operate, potentially influencing the strategies of existing and emerging players in the market.

In a significant decision reinforcing the enforceability of international arbitration awards, the U.S. Supreme Court has reinstated a $500 million award in a dispute between two Indian companies.

An article in Bloomberg Law states that the case, CC/Devas (Mauritius) Ltd. v. Antrix Corp. Ltd., involved Antrix Corporation, a company owned by the Indian government, and CC/Devas, a Mauritius-based entity. The dispute centered on a failed satellite agreement, leading to an arbitration award in favor of CC/Devas. The U.S. Court of Appeals for the Ninth Circuit had previously vacated the award, asserting that additional connections to the U.S. were necessary to establish jurisdiction.

However, the Supreme Court, in an opinion authored by Justice Samuel Alito, rejected this view, stating that once the FSIA's explicit requirements—subject matter jurisdiction and proper service—are met, personal jurisdiction over a foreign sovereign is automatic. The unanimous ruling emphasized that the FSIA was designed to clarify governing standards, not to introduce hidden requirements.

This decision has significant implications for the legal funding industry, particularly in the context of international arbitration. By affirming the enforceability of foreign arbitration awards under the FSIA, the ruling provides greater certainty for funders investing in cross-border disputes involving sovereign entities. It underscores the U.S. commitment to upholding international arbitration agreements, thereby enhancing the attractiveness of the U.S. as a venue for enforcing such awards.

The Court did not address potential constitutional questions related to due process, leaving that issue open for future litigation. Nonetheless, the ruling is a clear affirmation of the FSIA's provisions and their role in facilitating the enforcement of international arbitration awards in U.S. courts.