Grand Canyon Times

Arizona's leading small business association has urged the House Judiciary Committee to promptly pass Senate Bill 1215. The bill, which addresses transparency in the litigation-financing industry, will be discussed in a hearing scheduled for tomorrow.

Chad Heinrich, state director for NFIB in Arizona, emphasized the importance of knowing who is involved in lawsuits. "At issue is whether the litigation-financing industry can remain hidden from public and private scrutiny forever," Heinrich stated. "It should be an outrage to everyone that you’re not allowed to know all the people suing you."

Litigation finance involves third parties investing in lawsuits for a share of potential profits. Bloomberg Law reports that this industry has grown significantly, with approximately 40 funders holding around $10 billion in capital and spending nearly $2.5 billion on cases last year alone. University of Iowa professor Maya Steinitz noted that there are currently no regulations directly overseeing litigation funding.

Senate Bill 1215 includes provisions preventing litigation financiers from influencing decisions related to legal proceedings or settlements. The bill passed the Senate with a 27-1 vote on March 13 and will first be reviewed by the House Judiciary Committee.

The NFIB highlighted concerns over predatory lawsuits financed by third-party lenders targeting small businesses. In an Action Alert to its members, NFIB stated, "SB1215 will bring critical transparency and accountability to litigation financing and ensure that when a small business is sued, it’s clear who is funding the litigation, and who stands to benefit from its outcome."

For over 80 years, NFIB has represented small and independent business owners across America. As a nonprofit association dedicated exclusively to these businesses since its founding in 1943, NFIB continues its advocacy efforts at both national and state levels.