*HB1160.1*
January 29, 2024
HOUSE BILL No. 1160
_____
DIGEST OF HB 1160 (Updated January 29, 2024 11:18 am - DI 151)
Citations Affected: IC 24-12.
Synopsis: Civil proceeding advance payment contracts and
commercial litigation financing. Prevents a CPAP provider from
making any decision, having any influence, or directing the consumer
claimant or the consumer claimant's attorney with respect to the
conduct of the underlying civil proceeding. Provides that a commercial
litigation financier may not provide funding to a commercial litigation
financing agreement that is financed by a foreign person. Prevents a
party from sharing certain privileged information with a commercial
litigation financier. Provides that a commercial litigation financier may
not make any decision, have any influence, or direct the plaintiff with
respect to the underlying civil proceeding. Specifies that a commercial
litigation financing agreement is subject to discovery.
Effective: July 1, 2024.
Lehman
January 8, 2024, read first time and referred to Committee on Judiciary.
January 29, 2024, amended, reported — Do Pass.
HB 1160—LS 6780/DI 149 January 29, 2024
Second Regular Session of the 123rd General Assembly (2024)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
Constitution) is being amended, the text of the existing provision will appear in this style type,
additions will appear in this style type, and deletions will appear in this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional
provision adopted), the text of the new provision will appear in this style type. Also, the
word NEW will appear in that style type in the introductory clause of each SECTION that adds
a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
between statutes enacted by the 2023 Regular Session of the General Assembly.
HOUSE BILL No. 1160
A BILL FOR AN ACT to amend the Indiana Code concerning trade
regulation.
Be it enacted by the General Assembly of the State of Indiana:
1 SECTION 1. IC 24-12-3-1, AS AMENDED BY P.L.85-2017,
2 SECTION 97, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
3 JULY 1, 2024]: Sec. 1. A CPAP provider may not do any of the
4 following:
5 (1) Pay or offer to pay a commission, referral fee, or other form of
6 consideration to any attorney, law firm, medical provider,
7 chiropractor, or physical therapist, or any of their employees for
8 referring a consumer claimant to the provider.
9 (2) Accept a commission, referral fee, rebate, or other form of
10 consideration from an attorney, law firm, medical provider,
11 chiropractor, or physical therapist, or any of their employees.
12 (3) Intentionally advertise materially false or misleading
13 information regarding the CPAP provider's products or services.
14 (4) Refer, in furtherance of an initial CPAP transaction, a
15 consumer claimant or potential consumer claimant to a specific
16 attorney, law firm, medical provider, chiropractor, or physical
17 therapist, or any of their employees. However, if a consumer
HB 1160—LS 6780/DI 149 2
1 claimant needs legal representation, the CPAP provider may refer
2 the person to a local or state bar association referral service.
3 (5) Knowingly provide funding to a consumer claimant who has
4 previously assigned or sold a part of the consumer claimant's right
5 to proceeds from the consumer claimant's civil proceeding
6 without first making payment to or purchasing a prior unsatisfied
7 CPAP provider's entire funded amount and contracted charges,
8 unless a lesser amount is otherwise agreed to in writing by the
9 prior CPAP provider. However, multiple CPAP providers may
10 agree to provide a CPAP transaction to a consumer claimant
11 simultaneously if the consumer claimant and the consumer
12 claimant's attorney consent to the arrangement in writing.
13 (6) Receive any right to Make any decision, have any influence,
14 or direct the consumer claimant or the consumer claimant's
15 attorney with respect to the conduct of the underlying civil
16 proceeding or any settlement or resolution of the civil proceeding,
17 or make any decision with respect to the conduct of the
18 underlying civil proceeding or any settlement or resolution of the
19 civil proceeding. The right to make these decisions remains solely
20 with the consumer claimant and the attorney in the civil
21 proceeding.
22 (7) Knowingly pay or offer to pay for court costs, filing fees, or
23 attorney's fees either during or after the resolution of the civil
24 proceeding, using funds from the CPAP transaction.
25 SECTION 2. IC 24-12-11 IS ADDED TO THE INDIANA CODE
26 AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
27 JULY 1, 2024]:
28 Chapter 11. Commercial Litigation Financing
29 Sec. 1. The following definitions apply throughout this chapter:
30 (1) "Commercial litigation financier" means a person that
31 enters into, or offers to enter into, a commercial litigation
32 financing agreement with a plaintiff in a civil proceeding.
33 (2) "Commercial litigation financing agreement" means a
34 nonrecourse agreement that a commercial litigation financier
35 enters into, or offers to enter into, to provide funding to
36 support a plaintiff or the plaintiff's attorney in prosecuting
37 the civil proceeding, if the repayment of the funded amount is:
38 (A) required only if the plaintiff prevails in the civil
39 proceeding; and
40 (B) sourced entirely from the proceeds of the civil
41 proceeding, whether the proceeds result from a judgment,
42 a settlement, or some other resolution.
HB 1160—LS 6780/DI 149 3
1 The term does not include a civil proceeding advance payment
2 transaction, an agreement between an attorney and a client
3 for the attorney to provide legal services on a contingency fee
4 basis or to advance the client's legal costs, a health insurance
5 plan or agreement, a repayment agreement of a financial
6 institution if repayment is not contingent upon the outcome of
7 the civil proceeding, or a funding agreement to a nonprofit
8 organization that seeks injunctive relief in a civil proceeding.
9 (3) "Foreign person" means:
10 (A) an individual that is not a citizen of the United States
11 or an alien lawfully admitted for permanent residence of
12 the United States;
13 (B) an unincorporated association, of which a majority of
14 members are not citizens of the United States or aliens
15 lawfully admitted for permanent residence in the United
16 States;
17 (C) a corporation that is not incorporated in the United
18 States;
19 (D) the government, a political subdivision, or a political
20 party of a country other than the United States;
21 (E) an entity that is organized under the laws of a country
22 other than the United States;
23 (F) an entity that has a principal place of business in a
24 country other than the United States and that has shares or
25 other ownership interest held by the government or a
26 government official of a country other than that of the
27 United States; and
28 (G) an employee, official, or member of any entity
29 described in clauses (B) through (F).
30 Sec. 2. A commercial litigation financier may not provide
31 funding to a commercial litigation financing agreement that is
32 directly or indirectly financed by a foreign person.
33 Sec. 3. A party may not disclose or share:
34 (1) privileged or confidential materials;
35 (2) proprietary information;
36 (3) trade secrets; or
37 (4) any other documents or information subject to a court
38 order to seal or protect;
39 that is received in the course of the civil proceeding with a
40 commercial litigation financier.
41 Sec. 4. A commercial litigation financier may not make any
42 decision, have any influence, or direct the plaintiff or the plaintiff's
HB 1160—LS 6780/DI 149 4
1 attorney with respect to the conduct of the underlying civil
2 proceeding or any settlement or resolution of the civil proceeding,
3 or make any decision with respect to the conduct of the underlying
4 civil proceeding or any settlement or resolution of the civil
5 proceeding. The right to make these decisions remains solely with
6 the plaintiff and the plaintiff's attorney in the civil proceeding.
7 Sec. 5. In a civil proceeding in which a plaintiff enters into a
8 commercial litigation financing agreement, the existence and
9 contents of the commercial litigation financing agreement are
10 subject to discovery under the Indiana Rules of Trial Procedure
11 by:
12 (1) a party other than the plaintiff; or
13 (2) an insurer that has a duty to defend another party in the
14 civil proceeding.
HB 1160—LS 6780/DI 149 5
COMMITTEE REPORT
Mr. Speaker: Your Committee on Judiciary, to which was referred
House Bill 1160, has had the same under consideration and begs leave
to report the same back to the House with the recommendation that said
bill be amended as follows:
Page 2, delete lines 25 through 42, begin a new paragraph and
insert:
"SECTION 2. IC 24-12-11 IS ADDED TO THE INDIANA CODE
AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2024]:
Chapter 11. Commercial Litigation Financing
Sec. 1. The following definitions apply throughout this chapter:
(1) "Commercial litigation financier" means a person that
enters into, or offers to enter into, a commercial litigation
financing agreement with a plaintiff in a civil proceeding.
(2) "Commercial litigation financing agreement" means a
nonrecourse agreement that a commercial litigation financier
enters into, or offers to enter into, to provide funding to
support a plaintiff or the plaintiff's attorney in prosecuting
the civil proceeding, if the repayment of the funded amount is:
(A) required only if the plaintiff prevails in the civil
proceeding; and
(B) sourced entirely from the proceeds of the civil
proceeding, whether the proceeds result from a judgment,
a settlement, or some other resolution.
The term does not include a civil proceeding advance payment
transaction, an agreement between an attorney and a client
for the attorney to provide legal services on a contingency fee
basis or to advance the client's legal costs, a health insurance
plan or agreement, a repayment agreement of a financial
institution if repayment is not contingent upon the outcome of
the civil proceeding, or a funding agreement to a nonprofit
organization that seeks injunctive relief in a civil proceeding.
(3) "Foreign person" means:
(A) an individual that is not a citizen of the United States
or an alien lawfully admitted for permanent residence of
the United States;
(B) an unincorporated association, of which a majority of
members are not citizens of the United States or aliens
lawfully admitted for permanent residence in the United
States;
(C) a corporation that is not incorporated in the United
HB 1160—LS 6780/DI 149 6
States;
(D) the government, a political subdivision, or a political
party of a country other than the United States;
(E) an entity that is organized under the laws of a country
other than the United States;
(F) an entity that has a principal place of business in a
country other than the United States and that has shares or
other ownership interest held by the government or a
government official of a country other than that of the
United States; and
(G) an employee, official, or member of any entity
described in clauses (B) through (F).
Sec. 2. A commercial litigation financier may not provide
funding to a commercial litigation financing agreement that is
directly or indirectly financed by a foreign person.
Sec. 3. A party may not disclose or share:
(1) privileged or confidential materials;
(2) proprietary information;
(3) trade secrets; or
(4) any other documents or information subject to a court
order to seal or protect;
that is received in the course of the civil proceeding with a
commercial litigation financier.
Sec. 4. A commercial litigation financier may not make any
decision, have any influence, or direct the plaintiff or the plaintiff's
attorney with respect to the conduct of the underlying civil
proceeding or any settlement or resolution of the civil proceeding,
or make any decision with respect to the conduct of the underlying
civil proceeding or any settlement or resolution of the civil
proceeding. The right to make these decisions remains solely with
the plaintiff and the plaintiff's attorney in the civil proceeding.
Sec. 5. In a civil proceeding in which a plaintiff enters into a
commercial litigation financing agreement, the existence and
contents of the commercial litigation financing agreement are
subject to discovery under the Indiana Rules of Trial Procedure
by:
(1) a party other than the plaintiff; or
(2) an insurer that has a duty to defend another party in the
civil proceeding.".
Delete page 3.
Renumber all SECTIONS consecutively.
and when so amended that said bill do pass.
HB 1160—LS 6780/DI 149 7
(Reference is to HB 1160 as introduced.)
JETER
Committee Vote: yeas 10, nays 0.
HB 1160—LS 6780/DI 149