Calls for Transparency Loom Over Increase in Litigation Funding

Wisconsin became the first state to pass legislation that requires the disclosure of third-party litigation funding—regardless of whether parties request the information in discovery.

Under Wisconsin Act 235, a party must disclose “any agreement under which any person … has a right to receive compensation that is contingent on and sourced from any proceeds of the civil action, by settlement, judgment or otherwise.” While the law does not apply to lawyer contingency fee arrangements, Wisconsin’s new legislation serves as a groundbreaking move towards disclosure of outside litigation funding arrangements.