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Bill

AB 743

California Financing Law: lawsuit financiers.

2025-2026 Regular Session Introduced by Stephanie Nguyen and 1 co-sponsor

California advances AB 743 to regulate third-party lawsuit financing companies, establishing oversight for an industry funding plaintiffs' legal costs in exchange for settlement shares.

In committee: Set, first hearing. Hearing canceled at the request of author.
#californiafinancinglaw #lawsuitfinanciers
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Bill Summary · AB 743

Legislative bill overview

AB 743 addresses the regulation of lawsuit financiers (also called litigation funding companies or third-party litigation funders) in California. The bill passed the Assembly unanimously and is currently in the Senate committee process. The specific provisions regulating these financiers have not been publicly detailed in the available action history.

Why is this important

Lawsuit financing has grown significantly, with companies providing capital to plaintiffs in exchange for a percentage of settlements or judgments. This practice affects access to justice for individuals who cannot afford litigation costs, but raises concerns about conflicts of interest, increased litigation volume, and whether funders may influence case strategy. California's regulatory approach could set a national precedent for an industry with minimal current oversight.

Potential points of contention

  • Disclosure requirements vs. attorney-client privilege: Balancing transparency about funder involvement against confidentiality protections
  • Interest rate caps: Whether legislation should limit the percentage of awards funders can claim, affecting both plaintiff access and funder viability
  • Influence over litigation: Concerns that funders with financial stakes may pressure attorneys or plaintiffs toward particular settlement strategies rather than client interests

Compiled from official sources — confirm details with the bill’s official record.

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