Litigation Funding Transparency Act of 2026
Sponsored By: Senator Grassley, Chuck [R-IA]
Introduced
Summary
Transparency into third-party litigation funding: This bill would require parties in class actions, multidistrict litigation, and coordinated proceedings with at least 100 related suits to disclose and track outside funders.
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- Parties and counsel would have to file written disclosures naming any third-party funder, state if a funder is a foreign state, foreign person, or sovereign wealth fund, and produce funding agreements to the court and named parties unless the court orders otherwise. Disclosures must be made no later than the later of 10 days after a funding agreement is executed or when the action is served.
- Third-party funders and foreign-linked funders would face public reporting. The Administrative Office of the U.S. Courts would post and report every 120 days, starting within 180 days, lists tied to dockets, courts, and monetary support amounts.
- The bill would bar funders from controlling litigation strategy or accessing discovery protected by court orders without permission. Courts could treat disclosures as discovery subject to Rule 26 and Rule 37 sanctions and may hold violators in contempt.
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Bill Overview
Analyzed Economic Effects
4 provisions identified: 2 benefits, 0 costs, 2 mixed.
Ban funder control and discovery access
If enacted, the bill would bar third-party funders from controlling litigation strategy, settlement talks, or other case decisions by contract or otherwise. It would also bar funders and their agents from seeing or copying discovery that is under a protective order unless the court allows it. Courts could hold violators in contempt and use district-court contempt powers to enforce the rules.
Mandatory disclosures and public reports
If enacted, parties or their lawyers in covered actions would have to tell the court and all named parties who is funding the case and say whether the funder is a foreign state, foreign person, sovereign wealth fund, or a company they control. They would have to give funding agreements to the court and other parties unless the court orders otherwise. Disclosures would be due by the later of 10 days after the funding agreement is signed or when the case is served, and must be corrected if they become materially wrong. The Administrative Office of the U.S. Courts would post and send public reports starting within 180 days of enactment and then every 120 days listing identified funders, case captions and docket numbers, the court, and amounts given in the prior 120 days.
Which lawsuits and funders count
If enacted, the bill would cover class actions, MDLs under 28 U.S.C. 1407, and any coordinated federal docket with 100 or more civil cases. It would apply to cases pending when the law takes effect and to cases filed later. The bill would define a "third-party funder" to include companies, foreign states or persons, and sovereign wealth funds that pay to fund a case or have a right to more back than they put in. Counsel of record would not count as third-party funders, and some pro bono nonprofit-funded suits would be excluded.
Repayment-only funders get exemption
If enacted, the bill would not treat a lender or similar provider as a covered "commercial enterprise" if its expected return is only repayment of principal, repayment plus limited interest, or reimbursement of fees paid to counsel. The interest limit would be the greater of 10% or three times the prior calendar year's average 30-year Treasury yield. Funders meeting these limits would be excluded from some of the bill's commercial-funder rules.
Sponsors & CoSponsors
Sponsor
Grassley, Chuck [R-IA]
IA • R
Cosponsors
Sen. Tillis, Thomas [R-NC]
NC • R
Sponsored 2/11/2026
Sen. Kennedy, John [R-LA]
LA • R
Sponsored 2/11/2026
Sen. Cornyn, John [R-TX]
TX • R
Sponsored 2/11/2026
Roll Call Votes
No roll call votes available for this bill.
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