A new opinion piece argues that legal system abuse, including the rapid expansion of third-party litigation funding, is an overlooked driver of household costs, and calls for federal transparency measures targeting outside investors in litigation.

As reported by the Washington Reporter, Jenn Pellegrino, founder of Defend Forgotten America Action, writes that staged crashes, billboard advertising that omits how attorneys' fees, litigation funders and medical liens consume settlements, and unnecessary medical treatment combine to push costs onto businesses, insurers and ultimately consumers through higher prices and suppressed wages. She argues small businesses absorb the effects most acutely.

Pellegrino singles out third-party litigation funding as "one particularly troubling trend," pointing to the involvement of outside investors, including foreign governments and sovereign wealth funds, and the limited visibility courts and defendants have into who is financing a suit, what influence investors hold, and how recoveries are divided. The civil justice system, she writes, "should not become another financial marketplace where investors place bets on the outcome of lawsuits."

The piece points to state-level disclosure reforms already enacted and to two federal proposals. The Protecting Our Courts from Foreign Manipulation Act would require disclosure of foreign litigation funding and bar foreign governments and sovereign wealth funds from investing in U.S. litigation. The Tackling Predatory Litigation Funding Act would impose a higher tax rate on profits earned by outside investors in litigation.

The op-ed reflects a broader effort by funding critics to recast disclosure legislation as consumer economics rather than a narrow procedural debate.

Third-party litigation funding in India remains small but is attracting institutional capital, with domestic and foreign funders building portfolios in a market that still has no central statute, regulator or disclosure requirement.

As reported by Business Standard, active participants include Five Rivers, LegalPay and Singapore-based ELF Partners, while the government examines whether litigation funding can be deployed for insolvency-related claims. The economics are familiar: a claimant with a ₹100 crore claim that would cost ₹5 crore to pursue can transfer that cost to a funder on a non-recourse basis, repaying only from recoveries.

The legal foundation rests on case law rather than legislation. Sameer Jain, managing partner at PSL Advocates & Solicitors, noted that the Supreme Court's 2018 ruling in Bar Council of India v A.K. Balaji held that lawyers cannot fund their own clients but did not bar anyone else, while Maharashtra, Gujarat and Uttar Pradesh amended the Code of Civil Procedure to recognise financiers. In Tomorrow Sales Agency v SBS Holdings, the Delhi High Court declined to treat a funder as a party to arbitration and held that an award could not be enforced against a non-party funder, while stressing that funding should be transparent and not exploitative.

The Ministry of Corporate Affairs' Insolvency Law Committee likewise found no legal bar. Neeha Nagpal, founding partner at NM Law Chambers, described the market as unregulated by statute but governed by contract and precedent, and pointed to voluntary self-regulation through industry bodies as an interim step toward a balanced regime.