Session of 2025
SENATE BILL No. 54
By Committee on Judiciary
1-21
AN ACT concerning the code of civil procedure; relating to litigation
funding by third parties; limiting discovery and disclosure of third-
party agreements in certain circumstances; requiring reporting of such
agreements to the judicial council and a judicial council committee to
study third-party agreements; requiring the clerk of the supreme court
to develop a form for reports; exempting such reports from the open
records act; amending K.S.A. 2024 Supp. 60-226 and repealing the
existing section.
Be it enacted by the Legislature of the State of Kansas:
Section 1. K.S.A. 2024 Supp. 60-226 is hereby amended to read as
follows: 60-226. (a) Discovery methods. Parties may obtain discovery by
one or more of the following methods: Depositions on oral examination or
written questions; written interrogatories; production of documents or
things or permission to enter onto land or other property under K.S.A. 60-
234, K.S.A. 60-245(a)(1)(A)(iii) or K.S.A. 60-245a, and amendments
thereto; physical and mental examinations; and requests for admission.
(b) Discovery scope and limits. (1) Scope in general. Unless
otherwise limited by court order, the scope of discovery is as follows:
Parties may obtain discovery regarding any nonprivileged matter that is
relevant to any party's claim or defense and proportional to the needs of
the case, considering the importance of the issues at stake in the action, the
amount in controversy, the parties' relative access to relevant information,
the parties' resources, the importance of the discovery in resolving the
issues and whether the burden or expense of the proposed discovery
outweighs its likely benefit. Information within this scope of discovery
need not be admissible in evidence to be discoverable.
(2) Limitations on frequency and extent. (A) On motion, or on its
own, the court may limit the frequency or extent of discovery methods
otherwise allowed by the rules of civil procedure and must do so if it
determines that:
(i) The discovery sought is unreasonably cumulative or duplicative,
or can be obtained from some other source that is more convenient, less
burdensome or less expensive;
(ii) the party seeking discovery has had ample opportunity to obtain
the information by discovery in the action; or
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(iii) the proposed discovery is outside the scope permitted by
subsection (b)(1).
(B) A party need not provide discovery of electronically stored
information from sources that the party identifies as not reasonably
accessible because of undue burden or cost. On motion to compel
discovery or for a protective order, the party from whom discovery is
sought must show that the information is not reasonably accessible
because of undue burden or cost. If that showing is made, the court may
nonetheless order discovery from such sources if the requesting party
shows good cause, considering the limitations of subsection (b)(2)(A). The
court may specify conditions for the discovery.
(3) Agreements. (A) Insurance agreements. A party may obtain
discovery of the existence and contents of any insurance agreement under
which an insurance business may be liable to satisfy part or all of a
possible judgment in the action or to indemnify or reimburse for payments
made to satisfy the judgment. Information concerning the insurance
agreement is not by reason of disclosure admissible in evidence at trial.
For purposes of this paragraph, an application for insurance is not a part of
an insurance agreement.
(B) (i) Third-party agreements. A party may obtain discovery of the
existence and content of any third-party agreement.
(ii) Limitations on discovery of third-party agreements. (a) On
motion, a court must prohibit any inquiry into the existence or
nonexistence of a third-party agreement on a finding, by a preponderance
of the evidence, that such inquiry may cause undue prejudice to the party
objecting to such inquiry. When making such a finding, the court must
consider the political, ideological or social nature of the case, the likely
balance of litigation resources between the parties, whether such inquiry
would be proportional to the needs of the case and any other relevant
information presented by the parties.
(b) Information concerning the third-party agreement is not by
reason of disclosure admissible in evidence at trial.
(c) Subsection (b)(3)(B) shall not be construed to require a nonprofit
corporation or association to disclose its members or donors or require
disclosure of otherwise privileged information.
(d) Unless the court finds that a third-party agreement would be
admissible under the rules of evidence and necessary to prove an element
of a claim in the case, disclosure of the existence or content of such
agreement must not be required in any action brought:
(1) By or on behalf of the state or any political subdivision of the
state enforcing a law or seeking to protect against an imminent threat to
health or public safety; or
(2) solely in the public interest or on behalf of the general public if:
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(A) The plaintiff does not seek any relief that is different from the
relief sought for the general public or a class of which the plaintiff is a
member unless such relief is a claim for attorney fees, costs or penalties;
(B) the action, if successful, would enforce an important right
affecting the public interest and would confer a significant pecuniary or
nonpecuniary benefit on the general public or a large class of persons;
and
(C) private enforcement is necessary and places a disproportionate
financial burden on the plaintiff's state in the matter.
(e) When requested by the disclosing party, the court must issue an
order to protect discovery of a third-party agreement from disclosure other
than to the parties, the parties' counsel, experts and others necessary to
the legal claim.
(C) Reporting of third-party agreements. (i) On and after July 1,
2025, any third-party agreement under which a person has a contractual
right to receive, directly or indirectly, compensation that is contingent in
any respect on the outcome of the claim must be reported to the judicial
council within 45 days after the commencement of an action in any Kansas
court in which such a third-party agreement exists or within 45 days after
such third-party agreement is entered into, whichever is later. The judicial
council must provide the person who reported such agreement
documentation showing that such report was made. Any third-party
agreement that is not reported pursuant to this subparagraph is void and
unenforceable unless such agreement relates to an action described in
subsection (b)(3)(B)(ii)(d).
(ii) The clerk of the supreme court shall prescribe a form for use
under this subparagraph. Such form shall include a method of reporting
whether the third-party agreement is a third-party agreement with a
foreign person and any other information the clerk determines is
necessary for the judicial council to complete the study required by
subsection (b)(3)(D).
(iii) Reports received pursuant to this subparagraph shall be
confidential and shall not be subject to the provisions of the open records
act, K.S.A. 45-215, et seq., and amendments thereto. The provisions of this
clause shall expire on July 1, 2030, unless the legislature reviews and
reenacts this provision pursuant to K.S.A. 45-229, and amendments
thereto.
(D) On or before July 1, 2028, the judicial council shall establish a
committee to study the issue of third-party agreements. Such committee
shall review all reports submitted pursuant to subsection (b)(3)(C) and
any other information related to such agreements the committee deems
necessary. Beginning on December 1, 2029, and each December 1
thereafter, the judicial council shall report to the chief justice of the
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supreme court, attorney general, house standing committee on judiciary
and senate standing committee on judiciary on the topic of third-party
agreements in Kansas and in other states and make recommendations on
the use of such third-party agreements in Kansas.
(4) Trial preparation; materials. (A) Documents and tangible things.
Ordinarily, a party may not discover documents and tangible things that
are prepared in anticipation of litigation or for trial by or for another party
or its representative, including the other party's attorney, consultant, surety,
indemnitor, insurer or agent. But, subject to subsection (b)(5), those
materials may be discovered if:
(i) They are otherwise discoverable under paragraph (1) subsection
(b)(1); and
(ii) the party shows that it has substantial need for the materials to
prepare its case and cannot, without undue hardship, obtain their
substantial equivalent by other means.
(B) Protection against disclosure. If the court orders discovery of
those materials, it must protect against disclosure of the mental
impressions, conclusions, opinions or legal theories of a party's attorney or
other representative concerning the litigation.
(C) Previous statement. Any party or other person may, on request
and without the required showing, obtain the person's own previous
statement about the action or its subject matter. If the request is refused,
the person may move for a court order, and K.S.A. 60-237, and
amendments thereto, applies to the award of expenses. A previous
statement is either:
(i) A written statement that the person has signed or otherwise
adopted or approved; or
(ii) a contemporaneous stenographic, mechanical, electrical or other
recording, or a transcription of it, that recites substantially verbatim the
person's oral statement.
(5) Trial preparation; experts.
(A) Deposition of an expert who may testify. A party may depose any
person who has been identified as an expert whose opinions may be
presented at trial. If a disclosure is required under subsection (b)(6), the
deposition may be conducted only after the disclosure is provided.
(B) Trial-preparation protection for draft disclosures. Subsections (b)
(4)(A) and (b)(4)(B) protect drafts of any disclosure required under
subsection (b)(6), and drafts of a disclosure by an expert witness provided
in lieu of the disclosure required by subsection (b)(6), regardless of the
form in which the draft is recorded.
(C) Trial-preparation protection for communications between a
party's attorney and expert witnesses. Subsections (b)(4)(A) and (b)(4)(B)
protect communications between the party's attorney and any witness
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about whom disclosure is required under subsection (b)(6), regardless of
the form of the communications, except to the extent that the
communications:
(i) Relate to compensation for the expert's study or testimony;
(ii) identify facts or data that the party's attorney provided and that
the expert considered in forming the opinions to be expressed; or
(iii) identify assumptions that the party's attorney provided and that
the expert relied on in forming the opinions to be expressed.
(D) Expert employed only for trial preparation. Ordinarily, a party
may not, by interrogatories or deposition, discover facts known or
opinions held by an expert who has been retained or specially employed
by another party in anticipation of litigation or to prepare for trial and who
is not expected to be called as a witness at trial. But a party may do so
only:
(i) As provided in K.S.A. 60-235(b), and amendments thereto; or
(ii) on showing exceptional circumstances under which it is
impracticable for the party to obtain facts or opinions on the same subject
by other means.
(E) Payment. Unless manifest injustice would result, the court must
require that the party seeking discovery:
(i) Pay the expert a reasonable fee for time spent in responding to
discovery under subsection (b)(5)(A) or (b)(5)(D); and
(ii) for discovery under subsection (b)(5)(D), also pay the other party
a fair portion of the fees and expenses it reasonably incurred in obtaining
the expert's facts and opinions.
(6) Disclosure of expert testimony. (A) Required disclosures. A party
must disclose to other parties the identity of any witness it may use at trial
to present expert testimony. The disclosure must state:
(i) The subject matter on which the expert is expected to testify; and
(ii) the substance of the facts and opinions to which the expert is
expected to testify.
(B) Witness who is retained or specially employed. Unless otherwise
stipulated or ordered by the court, if the witness is retained or specially
employed to provide expert testimony in the case, or is one whose duties
as the party's employee regularly involve giving expert testimony, the
disclosure under subsection (b)(6)(A) must also state a summary of the
grounds for each opinion.
(C) Time to disclose expert testimony. A party must make these
disclosures at the times and in the sequence that the court orders. Absent a
stipulation or court order, the disclosures must be made:
(i) At least 90 days before the date set for trial or for the case to be
ready for trial; or
(ii) if the evidence is intended solely to contradict or rebut evidence
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on the same subject matter identified by another party under subsection (b)
(6)(B), within 30 days after the other party's disclosure.
(D) Supplementing the disclosure. The parties must supplement these
disclosures when required under subsection (e).
(E) Form of disclosures. Unless otherwise ordered by the court, all
disclosures under this subsection must be:
(i) In writing, signed and served; and
(ii) filed with the court in accordance with K.S.A. 60-205(d), and
amendments thereto.
(7) Claiming privilege or protecting trial preparation materials. (A)
Information withheld. When a party withholds information otherwise
discoverable by claiming that the information is privileged or subject to
protection as trial preparation material, the party must:
(i) Expressly make the claim; and
(ii) describe the nature of the documents, communications or things
not produced or disclosed, and do so in a manner that, without revealing
information itself privileged or protected, will enable other parties to
assess the claim.
(B) Information produced. If information produced in discovery is
subject to a claim of privilege or of protection as trial preparation material,
the party making the claim may notify any party that received the
information of the claim and the basis for it such claim. After being
notified, a party must promptly return, sequester or destroy the specified
information and any copies it has; in possession, must not use or disclose
the information until the claim is resolved;, must take reasonable steps to
retrieve the information if the party disclosed it before being notified; and
may promptly present the information to the court under seal for a
determination of the claim. The producing party must preserve the
information until the claim is resolved.
(c) Protective orders. (1) In general. A party or any person from
whom discovery is sought may move for a protective order in the court
where the action is pending, as an alternative on matters relating to a
deposition, in the district court where the deposition will be taken. The
motion must include a certification that the movant has in good faith
conferred or attempted to confer with other affected parties in an effort to
resolve the dispute without court action and must describe the steps taken
by all attorneys or unrepresented parties to resolve the issues in dispute.
The court may, for good cause, issue an order to protect a party or person
from annoyance, embarrassment, oppression or undue burden or expense,
including one or more of the following:
(A) Forbidding the disclosure or discovery;
(B) specifying terms, including time and place or the allocation of
expenses, for the disclosure or discovery;
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(C) prescribing a discovery method other than the one selected by the
party seeking discovery;
(D) forbidding inquiry into certain matters, or limiting the scope of
disclosure or discovery to certain matters;
(E) designating the persons who may be present while the discovery
is conducted;
(F) requiring that a deposition be sealed and opened only on court
order;
(G) requiring that a trade secret or other confidential research,
development or commercial information not be revealed or be revealed
only in a specified way; and
(H) requiring that the parties simultaneously file specified documents
or information in sealed envelopes, to be opened as the court orders.
(2) Ordering discovery. If a motion for a protective order is wholly or
partly denied the court may, on just terms, order that any party or person
provide or permit discovery.
(3) Awarding expenses. The provisions of K.S.A. 60-237, and
amendments thereto, apply to the award of expenses.
(d) Sequence of discovery. Unless the parties stipulate or the court
orders otherwise for the parties' and witnesses' convenience and in the
interests of justice:
(1) Methods of discovery may be used in any sequence; and
(2) discovery by one party does not require any other party to delay
its discovery.
(e) Supplementing disclosures and responses. (1) In general. A party
who has made a disclosure under subsection (b)(6), or who has responded
to an interrogatory, request for production or request for admission, must
supplement or correct its disclosure or response:
(A) In a timely manner if the party learns that in some material
respect the disclosure or response is incomplete or incorrect, and if the
additional or corrective information has not otherwise been made known
to the other parties during the discovery process or in writing; or
(B) as ordered by the court.
(2) Expert witness. For an expert to whom the disclosure requirement
in subsection (b)(6) applies, the party's duty to supplement extends both to
information included in the disclosure and to information given during the
expert's deposition. Any additions or changes to this information must be
disclosed at least 30 days before trial, unless the court orders otherwise.
(f) Signing disclosures and discovery requests, responses and
objections. (1) Signature required; effect of signature. Every disclosure
under subsection (b)(6) and every discovery request, response or objection
must be signed by at least one attorney of record in the attorney's own
name, or by the party personally, if unrepresented, and must state the
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signor's address, e-mail address and telephone number. By signing, an
attorney or party certifies that to the best of the person's knowledge,
information and belief formed after a reasonable inquiry:
(A) With respect to a disclosure, it is complete and correct as of the
time it is made;
(B) with respect to a discovery request, response or objection, it is:
(i) Consistent with the rules of civil procedure and warranted by
existing law or by a nonfrivolous argument for extending, modifying or
reversing existing law or for establishing new law;
(ii) not interposed for any improper purpose, such as to harass, cause
unnecessary delay or needlessly increase the cost of litigation; and
(iii) neither unreasonable nor unduly burdensome or expensive
considering the needs of the case, prior discovery in the case, the amount
in controversy and the importance of the issues at stake in the action.
(2) Failure to sign. Other parties have no duty to act on an unsigned
disclosure, request, response or objection until it is signed, and the court
must strike it unless a signature is promptly supplied after the omission is
called to the attorney's or party's attention.
(3) Sanction for improper certification. If a certification violates this
section without substantial justification, the court, on motion, or on its
own, must impose an appropriate sanction on the signer, the party on
whose behalf the signer was acting, or both. The sanction may include an
order to pay the reasonable expenses, including attorney's fees, caused by
the violation.
(g) As used in this section:
(1) "Foreign person" means:
(A) An individual that is not a citizen of the United States or an alien
lawfully admitted for permanent residence in the United States;
(B) an unincorporated association when a majority of the 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) a government, political subdivision or political party of a county
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 has shares or other ownership interest held by
the government or a government official of a country other than the
United States; or
(G) an organization in which any person or entity described in
subsections (g)(1)(A) through (g)(1)(F) holds a controlling or majority
interest or in which the holdings of any such persons or entities,
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considered together, would constitute a controlling or majority interest.
(2) "Reasonable interest" means a total interest not greater than
11.1% of the principal.
(3) "Third-party agreement" means any agreement under which any
person, other than a party, an attorney representing the party, such
attorney's firm or a member of the family or household of a party has
agreed to pay expenses directly related to prosecuting the legal claim and
has a contractual right to receive compensation that is contingent in any
respect on the outcome of the claim. "Third-party agreement" does not
include an agreement that does not afford the nonparty agreeing to pay
legal expenses any profit from the legal claim beyond repayment of the
amount such nonparty has contractually agreed to provide plus
reasonable interest.
(h) The provisions of subsections (b)(3)(B), (b)(3)(C) and (b)(3)(D)
are severable. If any portion of such subsections is held by a court to be
unconstitutional or invalid, or the application of any portion of such
subsections to any person or circumstance is held by a court to be
unconstitutional or invalid, the invalidity shall not affect the other
portions of such subsections that can be given effect without the invalid
portion or application, and the applicability of such other portions of such
subsection to any person or circumstance remains valid and enforceable.
Sec. 2. K.S.A. 2024 Supp. 60-226 is hereby repealed.
Sec. 3. This act shall take effect and be in force from and after its
publication in the statute book.
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