*EH1160.2*
Reprinted
March 1, 2024
ENGROSSED
HOUSE BILL No. 1160
_____
DIGEST OF HB 1160 (Updated February 29, 2024 3:08 pm - DI 149)
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 entity of concern.
Prevents a party from sharing 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. 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.
Requires the plaintiff or the plaintiff's attorney to provide written notice
of a commercial litigation financing agreement if the agreement is
directly or indirectly financed by a foreign person.
Effective: July 1, 2024.
Lehman, Jeter, Steuerwald
(SENATE SPONSORS — BROWN L, MESSMER, RANDOLPH LONNIE M)
January 8, 2024, read first time and referred to Committee on Judiciary.
January 29, 2024, amended, reported — Do Pass.
January 31, 2024, read second time, ordered engrossed. Engrossed.
February 1, 2024, read third time, passed. Yeas 96, nays 0.
SENATE ACTION
February 7, 2024, read first time and referred to Committee on Judiciary.
February 22, 2024, amended, reported favorably — Do Pass.
February 29, 2024, read second time, amended, ordered engrossed.
EH 1160—LS 6780/DI 149 Reprinted
March 1, 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.
ENGROSSED
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
EH 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. The
33 term does not include a nonprofit organization.
34 (2) "Commercial litigation financing agreement" means a
35 nonrecourse agreement that a commercial litigation financier
36 enters into, or offers to enter into, to provide funding to
37 support a plaintiff or the plaintiff's attorney in prosecuting
38 the civil proceeding, if the repayment of the funded amount is:
39 (A) required only if the plaintiff prevails in the civil
40 proceeding; and
41 (B) sourced entirely from the proceeds of the civil
42 proceeding, whether the proceeds result from a judgment,
EH 1160—LS 6780/DI 149 3
1 a settlement, or some other resolution.
2 The term does not include a civil proceeding advance payment
3 transaction, an agreement between an attorney and a client
4 for the attorney to provide legal services on a contingency fee
5 basis or to advance the client's legal costs, a health insurance
6 plan or agreement, a repayment agreement of a financial
7 institution if repayment is not contingent upon the outcome of
8 the civil proceeding, a funding agreement to a nonprofit
9 organization that represents a client on a pro bono basis, or
10 an agreement of an assigned claim to prosecute an
11 environmental contamination matter.
12 (3) "Foreign country of concern" includes the following:
13 (A) A foreign government listed in 15 CFR 7.4.
14 (B) A country designated as a threat to critical
15 infrastructure by the governor under IC 1-1-16-8.
16 (4) "Foreign entity of concern" means a partnership,
17 association, corporation, organization, or other combination
18 of persons:
19 (A) organized or incorporated in a foreign country of
20 concern;
21 (B) owned or controlled by the government, a political
22 subdivision, or a political party of a foreign country of
23 concern;
24 (C) that has a principal place of business in a foreign
25 country of concern; or
26 (D) that is owned, organized, or controlled by or affiliated
27 with a foreign organization that has been:
28 (i) placed on the federal Office of Foreign Assets Control
29 specially designated nationals and blocked persons list
30 ("SDN List"); or
31 (ii) designated by the United States Secretary of State as
32 a foreign terrorist organization.
33 (5) "Foreign person" means:
34 (A) an individual who is not a citizen of the United States
35 or an alien lawfully admitted for permanent residence in
36 the United States;
37 (B) an unincorporated association, of which a majority of
38 members are not citizens of the United States or aliens
39 lawfully admitted for permanent residence in the United
40 States;
41 (C) a corporation that is not incorporated in the United
42 States;
EH 1160—LS 6780/DI 149 4
1 (D) the government, a political subdivision, or a political
2 party of a country other than the United States;
3 (E) an entity that is organized under the laws of a country
4 other than the United States;
5 (F) an entity that has a principal place of business in a
6 country other than the United States and that has shares or
7 other ownership interest held by the government or a
8 government official of a country other than that of the
9 United States; and
10 (G) an employee, official, or member of any entity
11 described in clauses (B) through (F).
12 Sec. 2. A commercial litigation financier may not provide
13 funding to a commercial litigation financing agreement that is
14 directly or indirectly financed by a foreign entity of concern.
15 Sec. 3. A party may not disclose or share any documents or
16 information subject to a court order to seal or protect that is
17 received in the course of the civil proceeding with a commercial
18 litigation financier.
19 Sec. 4. A commercial litigation financier may not make any
20 decision, have any influence, or direct the plaintiff or the plaintiff's
21 attorney with respect to the conduct of the underlying civil
22 proceeding or any settlement or resolution of the civil proceeding,
23 or make any decision with respect to the conduct of the underlying
24 civil proceeding or any settlement or resolution of the civil
25 proceeding. The right to make these decisions remains solely with
26 the plaintiff and the plaintiff's attorney in the civil proceeding.
27 Sec. 5. (a) In a civil proceeding in which a plaintiff enters into a
28 commercial litigation financing agreement, the contents of the
29 commercial litigation financing agreement are subject to discovery
30 under the Indiana Rules of Trial Procedure by:
31 (1) a party other than the plaintiff; or
32 (2) an insurer that has a duty to defend another party in the
33 civil proceeding.
34 (b) In a civil proceeding in which a plaintiff enters into a
35 commercial litigation financing agreement that is directly or
36 indirectly financed by a foreign person, the plaintiff or the
37 plaintiff's attorney shall provide to:
38 (1) each of the other parties in the civil proceeding; and
39 (2) each insurer that has a duty to defend another party in the
40 civil proceeding;
41 written notice that the plaintiff has entered into a commercial
42 litigation financing agreement.
EH 1160—LS 6780/DI 149 5
1 (c) A plaintiff or the plaintiff's attorney shall provide the
2 written notice required by subsection (b) within a reasonable time
3 after the date on which the commercial litigation financing
4 agreement was executed.
EH 1160—LS 6780/DI 149 6
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
EH 1160—LS 6780/DI 149 7
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.
EH 1160—LS 6780/DI 149 8
(Reference is to HB 1160 as introduced.)
JETER
Committee Vote: yeas 10, nays 0.
_____
COMMITTEE REPORT
Madam President: The Senate Committee on Judiciary, to which
was referred House Bill No. 1160, has had the same under
consideration and begs leave to report the same back to the Senate with
the recommendation that said bill be AMENDED as follows:
Page 2, line 32, after "proceeding." insert "The term does not
include a nonprofit organization.".
Page 3, line 7, delete "or".
Page 3, line 8, delete "seeks injunctive relief in a civil proceeding."
and insert "represents a client on a pro bono basis, or an agreement
of an assigned claim to prosecute an environmental contamination
matter.".
Page 3, delete lines 9 through 29, begin a new line block indented
and insert:
"(3) "Foreign country of concern" includes the following:
(A) A foreign government listed in 15 CFR 7.4.
(B) A country designated as a threat to critical
infrastructure by the governor under IC 1-1-16-8.
(4) "Foreign entity of concern" means a partnership,
association, corporation, organization, or other combination
of persons:
(A) organized or incorporated in a foreign country of
concern;
(B) owned or controlled by the government, a political
subdivision, or a political party of a foreign country of
concern;
(C) that has a principal place of business in a foreign
country of concern; or
(D) that is owned, organized, or controlled by or affiliated
with a foreign organization that has been:
(i) placed on the federal Office of Foreign Assets Control
specially designated nationals and blocked persons list
("SDN List"); or
EH 1160—LS 6780/DI 149 9
(ii) designated by the United States Secretary of State as
a foreign terrorist organization.".
Page 3, line 32, delete "person." and insert "entity of concern.".
Page 3, delete lines 33 through 40, begin a new paragraph and
insert:
"Sec. 3. A party may not disclose or share any 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.".
and when so amended that said bill do pass.
(Reference is to HB 1160 as printed January 29, 2024.)
BROWN L, Chairperson
Committee Vote: Yeas 11, Nays 0.
_____
SENATE MOTION
Madam President: I move that Engrossed House Bill 1160 be
amended to read as follows:
Page 3, between lines 32 and 33, begin a new line block indented
and insert:
"(5) "Foreign person" means:
(A) an individual who is not a citizen of the United States
or an alien lawfully admitted for permanent residence in
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
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
EH 1160—LS 6780/DI 149 10
United States; and
(G) an employee, official, or member of any entity
described in clauses (B) through (F).".
Page 4, line 6, after "5." insert "(a)".
Page 4, line 7, delete "existence and".
Page 4, after line 13, begin a new paragraph and insert:
"(b) In a civil proceeding in which a plaintiff enters into a
commercial litigation financing agreement that is directly or
indirectly financed by a foreign person, the plaintiff or the
plaintiff's attorney shall provide to:
(1) each of the other parties in the civil proceeding; and
(2) each insurer that has a duty to defend another party in the
civil proceeding;
written notice that the plaintiff has entered into a commercial
litigation financing agreement.
(c) A plaintiff or the plaintiff's attorney shall provide the
written notice required by subsection (b) within a reasonable time
after the date on which the commercial litigation financing
agreement was executed.".
(Reference is to EHB 1160 as printed February 23, 2024.)
BROWN L
EH 1160—LS 6780/DI 149