A Louisiana federal court has introduced new disclosure requirements for parties using third-party litigation financing, adding another layer to the growing push for greater transparency over who is financially backing lawsuits in U.S. courts.
The U.S. District Court for the Western District of Louisiana said parties must identify litigation funders involved in their cases and provide basic information about those financial arrangements.
Under a new standing order, litigants must disclose the name and address of each third-party funder supporting their case. They are not required to hand over the full financing agreements, but must provide a short explanation of the arrangement.
The disclosures must also indicate whether a funder has any authority to approve or influence important decisions in the litigation, including whether to settle a case.
Parties generally have 14 days to make the required disclosure after entering a case or signing a litigation funding agreement.
Litigation finance companies provide money to plaintiffs or other parties to cover the costs of pursuing lawsuits. In return, funders typically receive an agreed share of a settlement or court award if the case succeeds.
The International Legal Finance Association welcomed the limited nature of Louisiana’s requirement. Dai Wai Chin Feman, the organization’s U.S. chapter chair, said the rule does not compel litigants to disclose sensitive material that could potentially be used against them.
Louisiana’s move adds to a developing mix of federal court orders and state-level measures aimed at bringing litigation financing arrangements into the open. Courts and lawmakers across the country have increasingly focused on whether outside financial interests can affect litigation strategy or settlement decisions.
Efforts to establish a nationwide disclosure requirement, however, have made little headway in Congress. Republican lawmakers have introduced proposals in both the House and Senate that would require broader disclosure of litigation financing agreements, but the measures have encountered opposition from Democrats as well as conservative organizations.
The federal judiciary is also examining the issue. A judicial rules-making panel began studying in 2024 whether a nationwide requirement for disclosure of third-party litigation funding should be adopted.
For now, Louisiana’s federal court joins a growing number of jurisdictions taking their own approach, leaving the United States with a developing patchwork of rules rather than a single national standard.
