Litigation finance disclosure in the United States remains governed by an uneven mix of state laws and court rules, with no uniform federal requirement as of mid-2026. Several states have moved quickly: New York's Consumer Litigation Funding Act (effective June 17, 2026) caps consumer funder recoveries at 25% of gross recovery; Georgia's Courts Access and Consumer Protection Act (2025) makes the existence and terms of funding agreements of $25,000 or more discoverable in civil actions; Kansas (2025) requires disclosure of high-level funding information and delivery of the funding agreement to the court; and Colorado's HB25-1329 requires foreign third-party funders to disclose and submit information to the state attorney general.
At the federal level, Senators Grassley, Tillis, Kennedy, and Cornyn introduced the Litigation Funding Transparency Act of 2026 (S. 3826) in February 2026, which would require disclosure of any third-party funder's identity in class actions, MDLs, and large coordinated federal proceedings involving 100 or more cases, including whether the funder is a foreign state, foreign person, sovereign wealth fund, or commercial enterprise, and would bar funders from directing litigation strategy or settlement.
The throughline across nearly all of these proposals is a distinction between commercial litigation funding (still largely unregulated at the disclosure level in most states) and consumer/mass tort funding (increasingly subject to direct rate caps and mandatory disclosure), a divide the Institute expects to sharpen rather than resolve over the next several years.