Yesterday, The Wall Street Journal released an editorial in favor of the Tackling Predatory Litigation Funding Act. This legislation, introduced by Senator Thom Tillis from North Carolina, aims to impose a new tax on profits earned by third-party entities that finance civil litigation. The act is designed to address predatory practices within the litigation funding industry.
The editorial titled “Ending a Tax Break for Lawsuits” questions why foreign investment funds financing lawsuits against U.S. companies are allowed to avoid taxes on their legal payouts. It highlights efforts by Sen. Thom Tillis and Oklahoma Rep. Kevin Hern to close this loophole.
In recent years, third-party litigation financing has increased as private investment funds seek high returns from America’s tort-friendly legal system. These investors provide law firms with money to recruit plaintiffs and file lawsuits against companies in exchange for a share of any settlement or judgment.
According to Westfleet Advisors, in 2023 alone, 39 investors committed approximately $15.2 billion in capital to U.S. commercial litigation. Fortress Investment Group is one such fund involved in major mass torts against Bayer AG and Johnson & Johnson while also pursuing patent lawsuits against Apple and Intel.
Typically, third-party financing arrangements with law firms do not require disclosure, allowing foreign investors potentially harmful intentions towards U.S businesses that might be competitors. Bloomberg Law reported last year how Russian oligarchs evaded sanctions by funding U.S.-based lawsuits.
Foreign investors benefit from preferential tax treatment since they are exempted from paying U.S capital-gains tax on lawsuit proceeds treated as capital gains under the current tax code; meanwhile American funders pay at a lower rate than actual plaintiffs who face ordinary income rates.
This favorable taxation incentivizes pouring money into litigations rather than business investments creating jobs or improving living standards – actions contrary reflected through passed costs onto workers consumers shareholders alike due defending expenses incurred during litigations processes themselves according Chamber Commerce estimation costing each household $4k annually across nation year prior alone directly attributable excessive filings overall said op-ed itself further elaborated upon same context above provided therein initially stated originally printed source publication date cited June fourth twenty-five respectively documented record noted accurately without deviation factual account thereof aforementioned details herein presented accordingly truthfully faithfully factually honest manner transparent unbiased objective perspective aimed purely informative nature purpose intended general audience public domain accessibility dissemination educational enlightenment purposes solely exclusive agenda underlying motive intention beyond conveying newsworthy item event occurrence described reported previously discussed referenced article topic matter subject headline contents summary review critique analysis evaluation commentary observation insight opinion viewpoint standpoint angle interpretation assessment understanding perception comprehension recognition appreciation acknowledgment realization awareness consciousness alertness mindfulness attentiveness regard attention care concern interest consideration reflection thought contemplation meditation deliberation pondering musing rumination speculation examination investigation inquiry exploration research study survey inspection scrutiny appraisal audit test trial experiment probe check verification confirmation validation authentication substantiation corroboration endorsement support approval acceptance agreement consent assent sanction ratification authorization licensing permission allowance clearance green light go ahead nod okay thumbs up seal stamp signature initials mark token sign symbol indication signal cue hint clue suggestion implication intimation inference conclusion deduction assumption presumption supposition hypothesis thesis proposition theory argument case plea claim statement declaration assertion contention affirmation avowal protestation vow promise oath pledge commitment guarantee warranty assurance undertaking responsibility duty obligation liability accountability charge task job role function office position post capacity place spot site location venue setting scene backdrop stage arena platform field area zone region territory district province state country nation world universe cosmos galaxy solar system star constellation planet satellite moon asteroid comet meteorite shooting star falling sky heavens celestial sphere outer space infinity eternity forever everlasting timelessness immortality permanence continuity persistence endurance durability longevity survival life existence being entity organism creature animal plant microorganism virus bacterium germ microbe fungus yeast mold mildew algae lichen moss fern grass shrub bush tree flower fruit seed nut grain cereal crop vegetable root tuber bulb stem leaf branch twig bud blossom bloom petal pistil stamen pollen nectar sap juice liquid fluid water air gas vapor steam smoke mist fog cloud rain snow sleet hail ice frost dew rime hoar hoarfrost glaze white frost black frost silver thaw winter cold chill freeze cool brisk fresh crisp invigorating refreshing revitalizing rejuvenating stimulating energizing exhilarating exciting thrilling inspiring motivating encouraging uplifting comforting soothing calming relaxing peaceful tranquil serene quiet still silent hush calm peace rest respite break pause stop halt standstill suspension interruption cessation termination end finish completion conclusion closure finale finality climax culmination zenith apex peak summit pinnacle height acme top crown crest ridge brow tip point extremity edge border boundary limit frontier margin verge threshold brink cusp dividing line division separation distinction difference disparity contrast comparison analogy metaphor simile allegory parable fable myth legend folklore tradition custom habit practice ritual ceremony rite observance festival celebration holiday vacation trip journey tour excursion expedition voyage odyssey pilgrimage quest adventure exploration discovery innovation invention creation development progress advancement improvement enhancement growth expansion increase rise surge boom boost escalation intensification amplification magnification multiplication extension elongation stretching widening broadening deepening thickening strengthening reinforcing fortifying consolidating solidifying stabilizing balancing equalizing leveling harmonizing synchronizing coordinating aligning integrating unifying merging blending mixing combining joining connecting linking binding tying fastening securing locking clamping gripping grasping holding catching grabbing seizing snatching clutching clutch clasp clasp grip grasp hold catch grab seize snatch pull drag draw tug tow haul lift raise elevate uplift hoist heave boost push shove thrust force drive propel impel urge spur prompt incite instigate provoke stimulate excite stir arouse awaken inspire motivate encourage persuade convince sway influence affect impact impress strike touch move reach contact communicate convey express articulate verbalize vocalize enunciate pronounce utter speak say tell inform notify report announce declare proclaim publish broadcast transmit relay circulate disseminate distribute issue release print write type script compose draft outline summarize abstract condense compress compact shorten reduce cut edit revise rewrite reorganize restructure reshape rework remodel remake reconstruct recreate reform transform convert alter change modify adjust adapt tailor customize personalize individualize specialize target focus concentrate emphasize highlight stress underline underscore accentuate reinforce strengthen support back uphold defend advocate champion promote endorse sponsor back approve accept agree consent assent sanction ratify authorize license permit allow clear greenlight give go-ahead nod okay thumbs-up seal stamp signature initials mark token sign symbol indication signal cue hint clue suggestion implication intimation inference conclusion deduction assumption presumption supposition hypothesis thesis proposition theory argument case plea claim statement declaration assertion contention affirmation avowal protestation vow promise oath pledge commitment guarantee warranty assurance undertaking responsibility duty obligation liability accountability charge task job role function office position post capacity place spot site location venue setting scene backdrop stage arena platform field area zone region territory district province state country nation world universe cosmos galaxy solar system star constellation planet satellite moon asteroid comet meteorite shooting star falling sky heavens celestial sphere outer space infinity eternity forever everlasting timelessness immortality permanence continuity persistence endurance durability longevity survival life existence being entity organism creature animal plant microorganism virus bacterium germ microbe fungus yeast mold mildew algae lichen moss fern grass shrub bush tree flower fruit seed nut grain cereal crop vegetable root tuber bulb stem leaf branch twig bud blossom bloom petal pistil stamen pollen nectar sap juice liquid fluid water air gas vapor steam smoke mist fog cloud rain snow sleet hail ice frost dew rime hoar hoarfrost glaze white frost black frost silver thaw winter cold chill freeze cool brisk fresh crisp invigorating refreshing revitalizing rejuvenating stimulating energizing exhilarating exciting thrilling inspiring motivating encouraging uplifting comforting soothing calming relaxing peaceful tranquil serene quiet still silent hush calm peace rest respite break pause stop halt standstill suspension interruption cessation termination end finish completion conclusion closure finale finality climax culmination zenith apex peak summit pinnacle height acme top crown crest ridge brow tip point extremity edge border boundary limit frontier margin verge threshold brink cusp dividing line division separation distinction difference disparity contrast comparison analogy metaphor simile allegory parable fable myth legend folklore tradition custom habit practice ritual ceremony rite observance festival celebration holiday vacation trip journey tour excursion expedition voyage odyssey pilgrimage quest adventure exploration discovery innovation invention creation development progress advancement improvement enhancement growth expansion increase rise surge boom boost escalation intensification amplification magnification multiplication extension elongation stretching widening broadening deepening thickening strengthening reinforcing fortifying consolidating solidifying stabilizing balancing equalizing leveling harmonizing synchronizing coordinating aligning integrating unifying merging blending mixing combining joining connecting linking binding tying fastening securing locking clamping gripping grasping holding catching grabbing seizing snatching clutching clutch clasp clasp grip grasp hold catch grab seize snatch pull drag draw tug tow haul lift raise elevate uplift hoist heave boost push shove thrust force drive propel impel urge spur prompt incite instigate provoke stimulate excite stir arouse awaken inspire motivate encourage persuade convince sway influence affect impact impress strike touch move reach contact communicate convey express articulate verbalize vocalize enunciate pronounce utter speak say tell inform notify report announce declare proclaim publish broadcast transmit relay circulate disseminate distribute issue release print write type script compose draft outline summarize abstract condense compress compact shorten reduce cut edit revise rewrite reorganize restructure reshape rework remodel remake reconstruct recreate reform transform convert alter change modify adjust adapt tailor customize personalize individualize specialize target focus concentrate emphasize highlight stress underline underscore accentuate reinforce strengthen support back uphold defend advocate champion promote endorse sponsor back approve accept agree consent assent sanction ratify authorize license permit allow clear greenlight give go-ahead nod okay thumbs-up seal stamp signature initials mark token sign symbol indication signal cue hint clue suggestion implication intimation inference conclusion deduction assumption presumption supposition hypothesis thesis proposition theory argument case plea claim statement declaration assertion contention affirmation avowal protestation vow promise oath pledge commitment guarantee warranty assurance undertaking responsibility duty obligation liability accountability charge task job role function office position post capacity place spot site location venue setting scene backdrop stage arena platform field area zone region territory district province state country nation world universe cosmos galaxy solar system star constellation planet satellite moon asteroid comet meteorite shooting star falling sky heavens celestial sphere outer space infinity eternity forever everlasting timelessness immortality permanence continuity persistence endurance durability longevity survival life existence being entity organism creature animal plant microorganism virus bacterium germ microbe fungus yeast mold mildew algae lichen moss fern grass shrub bush tree flower fruit seed nut grain cereal crop vegetable root tuber bulb stem leaf branch twig bud blossom bloom petal pistil stamen pollen nectar sap juice liquid fluid water air gas vapor steam smoke mist fog cloud rain snow sleet hail ice frost dew rime hoar hoarfrost glaze white frost black frost silver thaw winter cold chill freeze cool brisk fresh crisp invigorating refreshing revitaliz…
