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Missouri House Bill HB2771

Missouri 2022 Regular Session

Missouri House Bill HB2771 Compare Versions

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11 SECONDREGULARSESSION
2-HOUSECOMMITTEESUBSTITUTEFOR
32 HOUSEBILLNO.2771
43 101STGENERALASSEMBLY
5-5551H.02C DANARADEMANMILLER,ChiefClerk
4+INTRODUCEDBYREPRESENTATIVECHRISTOFANELLI.
5+5551H.01I DANARADEMANMILLER,ChiefClerk
66 ANACT
7-Toamendchapter436,RSMo,byaddingtheretotwenty-twonewsectionsrelatingto
7+Toamendchapter436,RSMo,byaddingtheretotwenty-onenewsectionsrelatingto
88 litigation,withpenaltyprovisions.
99 BeitenactedbytheGeneralAssemblyofthestateofMissouri,asfollows:
10-SectionA.Chapter436,RSMo,isamendedbyaddingtheretotwenty-twonew
10+SectionA.Chapter436,RSMo,isamendedbyaddingtheretotwenty-onenew
1111 2sections,tobeknownassections436.550,436.552,436.554,436.556,436.558,436.560,
1212 3436.562,436.564,436.566,436.568,436.570,436.571,436.572,436.573,436.574,436.575,
13-4436.576,436.577,436.578,436.579,436.580,and1,toreadasfollows:
13+4436.576,436.577,436.578,436.579,and436.580,toreadasfollows:
1414 436.550.Sections436.550to436.570shallbeknownandmaybecitedasthe
1515 2"ConsumerLegalFundingModelAct".
1616 436.552.Asusedinsections436.550to436.570,thefollowingtermsmean:
1717 2 (1)"Advertise",publishingordisseminatinganywritten,electronic,orprinted
1818 3communicationoranycommunicationbymeansofrecordedtelephonemessagesor
1919 4transmittedonradio,television,theinternet,orsimilarcommunicationsmedia,
2020 5includingfilmstrips,motionpictures,andvideos,published,disseminated,circulated,
2121 6orplacedbeforethepublic,directlyorindirectly,forthepurposeofinducinga
2222 7consumertoenterintoaconsumerlegalfundingcontract;
2323 8 (2)"Charges",theamountofmoneystobepaidtotheconsumerlegalfunding
2424 9companybyoronbehalfoftheconsumerabovethefundedamountprovidedbyoron
2525 10behalfofthecompanytoaconsumerundersections436.550to436.570.Charges
2626 11includealladministrative,origination,underwriting,orotherfees,nomatterhow
2727 12denominated;
2828 13 (3)"Consumer",anaturalpersonwhohasapendinglegalclaimand:
29-14 (a)ResidesorisdomiciledinMissouri;and
3029 EXPLANATION—Matterenclosedinbold-facedbrackets[thus] intheabovebillisnotenactedandis
31-intendedtobeomittedfromthelaw.Matterinbold-facetypeintheabovebillisproposedlanguage. 15 (b)HasalegalclaiminMissouri;
30+intendedtobeomittedfromthelaw.Matterinbold-facetypeintheabovebillisproposedlanguage. 14 (a)ResidesorisdomiciledinMissouri;or
31+15 (b)HasalegalclaiminMissouri;
3232 16 (4)"Consumerlegalfundingcompany"or"company",apersonorentitythat
3333 17entersintoaconsumerlegalfundingcontractwithaconsumer.Thetermshallnot
3434 18include:
3535 19 (a)Animmediatefamilymemberoftheconsumer;
3636 20 (b)Abank,lender,financingentity,orotherspecialpurposeentity:
3737 21 a.Thatprovidesfinancingtoaconsumerlegalfundingcompany;or
3838 22 b.Towhichaconsumerlegalfundingcompanygrantsasecurityinterestor
3939 23transfersanyrightsorinterestinaconsumerlegalfunding;or
4040 24 (c)Anattorneyoraccountantwhoprovidesservicestoaconsumer;
4141 25 (5)"Consumerlegalfundingcontract",anonrecoursecontractualtransaction
4242 26inwhichaconsumerlegalfundingcompanypurchasesandaconsumerassignstothe
4343 27companyacontingentrighttoreceiveanamountofthepotentialproceedsofa
4444 28settlement,judgment,award,orverdictobtainedintheconsumer'slegalclaim;
4545 29 (6)"Fundedamount",theamountofmoneysprovidedtooronbehalfofthe
4646 30consumerintheconsumerlegalfundingcontract."Fundedamount"shallnotinclude
4747 31charges;
4848 32 (7)"Fundingdate",thedateonwhichthefundedamountistransferredtothe
4949 33consumerbytheconsumerlegalcompanyeitherbypersonaldelivery,viawire,
5050 34automatedclearinghousetransfer,orotherelectronicmeans,orbyinsured,certified,or
5151 35registeredUnitedStatesmail;
5252 36 (8)"Immediatefamilymember",aparent;sibling;childbyblood,adoption,or
5353 37marriage;spouse;grandparent;orgrandchild;
5454 38 (9)"Legalclaim",abonafidecivilclaimorcauseofaction,anyalternative
5555 39disputeresolutionproceeding,oranyadministrativeproceedingbeforeanyagencyor
5656 40instrumentalityofthisstate;
5757 41 (10)"Resolutiondate",thedatetheamountfundedtotheconsumer,plusthe
5858 42agreed-uponcharges,isdeliveredtotheconsumerlegalfundingcompany.
5959 436.554.1.Allconsumerlegalfundingcontractsshallmeetthefollowing
6060 2requirements:
6161 3 (1)Thecontractshallbecompletelyfilledinwhenpresentedtotheconsumerfor
6262 4signature;
6363 5 (2)Thecontractshallcontain,inboldandboxedtype,arightofrescission
6464 6allowingtheconsumertocancelthecontractwithoutpenaltyorfurtherobligationif,
6565 7withinfivebusinessdaysafterthefundingdate,theconsumereither:
66-HCSHB2771 2 8 (a)Returnsthefullamountofthedisbursedfundstotheconsumerlegalfunding
66+HB2771 2 8 (a)Returnsthefullamountofthedisbursedfundstotheconsumerlegalfunding
6767 9companybydeliveringthecompany'suncashedchecktothecompany'sofficeinperson;
6868 10or
6969 11 (b)Mailsanoticeofcancellationbyinsured,certified,orregisteredUnited
7070 12Statesmailtotheaddressspecifiedinthecontractandincludesareturnofthefull
7171 13amountofdisbursedfundsinsuchmailingintheformofthecompany'suncashedcheck
7272 14oraregisteredorcertifiedcheckormoneyorder;
7373 15 (3)Thecontractshallcontaintheinitialsoftheconsumeroneachpage;and
7474 16 (4)Thecontractshallrequiretheconsumertogivenonrevocablewritten
7575 17directiontotheconsumer'sattorneyrequiringtheattorneytonotifytheconsumerlegal
7676 18fundingcompanywhenthelegalclaimhasbeenresolved.Oncetheconsumerlegal
7777 19fundingcompanyconfirmsinwritingtheamountdueunderthecontract,the
7878 20consumer'sattorneyshallpay,fromtheproceedsoftheresolutionofthelegalclaim,
7979 21theconsumerlegalfundingcompanytheamountduewithintenbusinessdays.
8080 22 2.Theconsumerlegalfundingcompanyshallprovidetheconsumer'sattorney
8181 23withawrittennotificationoftheconsumerlegalfundingcontractprovidedtothe
8282 24consumerwithinthreebusinessdaysofthefundingdatebywayofpostalmail,courier
8383 25service,facsimile,orothermeansofproofofdeliverymethod.
8484 26 3.Aconsumerlegalfundingcontractshallbeenteredintoonlyifthecontract
8585 27involves:
8686 28 (1)Anexistinglegalclaimmadebyoronbehalfoftheconsumer;or
8787 29 (2)Anexistingproceedingthatshallresolvetheconsumer'slegalclaiminwhich
8888 30theconsumerisrepresentedbyanattorney.
8989 436.556.Noconsumerlegalfundingcompanyshall:
9090 2 (1)Payoroffertopaycommissions,referralfees,orotherformsof
9191 3considerationtoanyattorney,lawfirm,medicalprovider,chiropractor,orphysical
9292 4therapistoranyoftheiremployeesforreferringaconsumertothecompany;
9393 5 (2)Acceptanycommissions,referralfees,rebates,orotherformsof
9494 6considerationfromanattorney,lawfirm,medicalprovider,chiropractor,orphysical
9595 7therapistoranyoftheiremployees;
9696 8 (3)Intentionallyadvertisemateriallyfalseormisleadinginformationregarding
9797 9itsproductsorservices;
9898 10 (4)Refer,infurtheranceofaninitiallegalfunding,acustomerorpotential
9999 11customertoaspecificattorney,lawfirm,medicalprovider,chiropractor,orphysical
100100 12therapistoranyoftheiremployees.However,thecompanymayreferthecustomertoa
101101 13localorstatebarassociationreferralserviceifacustomerneedslegalrepresentation;
102-HCSHB2771 3 14 (5)Failtopromptlysupplyacopyoftheexecutedcontracttotheconsumer's
102+HB2771 3 14 (5)Failtopromptlysupplyacopyoftheexecutedcontracttotheconsumer's
103103 15attorney;
104104 16 (6)Knowinglyprovidefundingtoaconsumerwhohaspreviouslyassignedor
105105 17soldaportionoftherighttoproceedsfromtheconsumer'slegalclaimunlessthe
106106 18consumerlegalfundingcompanypaysorpurchasestheentireunsatisfiedfunded
107107 19amountandcontractedchargesfromthepriorconsumerlegalfundingcompanyorthe
108108 20twocompaniesagreetoalesseramountinwriting.However,multiplecompaniesmay
109109 21agreetocontemporaneouslyprovidefundingtoaconsumer,providedthattheconsumer
110110 22andtheconsumer'sattorneyconsenttothearrangementinwriting;
111111 23 (7)Receiveanyrighttoormakeanydecisionswithrespecttotheconductofthe
112112 24underlyinglegalclaimoranysettlementorresolutionthereof.Therighttomakesuch
113113 25decisionsshallremainsolelywiththeconsumerandtheattorneyinthelegalclaim;or
114114 26 (8)Knowinglypayoroffertopayforcourtcosts,filingfees,orattorney'sfees
115115 27eitherduringoraftertheresolutionofthelegalclaimbyusingfundsfromtheconsumer
116116 28legalfundingcontract.Theconsumerlegalfundingcontractshallincludeaprovision
117117 29advisingtheconsumerthatthefundingshallnotbeusedforsuchcostsorfees.
118118 436.558.1.Thecontractedamounttobepaidtotheconsumerlegalfunding
119119 2companyshallbesetasapredeterminedamountbaseduponintervalsoftimefromthe
120120 3fundingdatetotheresolutiondateandshallnotbedeterminedasapercentageofthe
121121 4recoveryfromthelegalclaim.
122122 5 2.Noconsumerlegalfundingcontractshallbevalidifitstermsexceedaperiod
123123 6offorty-eightmonths.Noconsumerlegalfundingcontractshallbeautomatically
124124 7renewed.
125125 436.560.Allconsumerlegalfundingcontractsshallcontainthedisclosures
126126 2specifiedinthissection,whichshallconstitutematerialtermsofthecontract.Unless
127127 3otherwisespecified,thedisclosuresshallbetypedinatleasttwelve-pointbold-typefont
128128 4andbeplacedclearlyandconspicuouslywithinthecontract,asfollows:
129129 5 (1)Onthefrontpageunderappropriateheadings,languagespecifying:
130130 6 (a)Thefundedamounttobepaidtotheconsumerbytheconsumerlegal
131131 7fundingcompany;
132132 8 (b)Anitemizationofone-timecharges;
133133 9 (c)Thetotalamounttobeassignedbytheconsumertothecompany,including
134134 10thefundedamountandallcharges;and
135135 11 (d)Apaymentscheduletoincludethefundedamountandcharges,listingall
136136 12datesandtheamountdueattheendofeachone-hundred-eighty-dayperiodfromthe
137137 13fundingdateuntilthedatethemaximumamountduetothecompanybytheconsumer
138138 14tosatisfytheamountduepursuanttothecontract;
139-HCSHB2771 4 15 (2)Withinthebodyofthecontract,inaccordancewiththeprovisionsunder
139+HB2771 4 15 (2)Withinthebodyofthecontract,inaccordancewiththeprovisionsunder
140140 16subdivision(2)ofsubsection1ofsection436.554:"Consumer'sRighttoCancellation:
141141 17Youmaycancelthiscontractwithoutpenaltyorfurtherobligationwithinfivebusiness
142142 18daysafterthefundingdateifyoueither:
143143 19 (a)Returnthefullamountofthedisbursedfundstotheconsumerlegalfunding
144144 20companybydeliveringthecompany'suncashedchecktothecompany'sofficeinperson;
145145 21or
146146 22 (b)Mailanoticeofcancellationbyinsured,certified,orregisteredUnitedStates
147147 23mailtothecompanyattheaddressspecifiedinthecontractandincludeareturnofthe
148148 24fullamountofdisbursedfundsinsuchmailingintheformofthecompany'suncashed
149149 25checkoraregisteredorcertifiedcheckormoneyorder.";
150150 26 (3)Withinthebodyofthecontract,languagespecifyingthattheconsumerlegal
151151 27fundingcompanyshallhavenoroleindecidingwhether,when,orforhowmuchthe
152152 28legalclaimissettledandthattheconsumerortheconsumer'sattorneyshallnotifythe
153153 29companyofwhethertheoutcomeofthelegalclaimwillbebysettlementorby
154154 30adjudicationpriortotheresolutiondate.Thecompanymayseekupdatedinformation
155155 31aboutthestatusofthelegalclaimbutinnoeventshallthecompanyinterferewiththe
156156 32independentprofessionaljudgmentoftheattorneyinthehandlingofthelegalclaimor
157157 33anysettlementthereof;
158158 34 (4)Withinthebodyofthecontract,inallcapitallettersandinatleasttwelve-
159159 35pointbold-typefontcontainedwithinabox:"THEFUNDEDAMOUNT AND
160160 36AGREED-UPON CHARGESSHALLBEPAIDONLYFROMTHEPROCEEDSOF
161161 37YOURLEGALCLAIMANDSHALLBEPAIDONLYTOTHEEXTENTTHAT
162162 38THEREAREAVAILABLEPROCEEDSFROMYOURLEGALCLAIM.IFTHERE
163163 39ISNORECOVERYOFANYDAMAGES FROMYOURLEGALCLAIMORIF
164164 40THEREISNOTENOUGHMONEYTOPAYBACKTHECONSUMER LEGAL
165165 41FUNDINGCOMPANYINFULL,YOUWILLNOTBEOBLIGATEDTOPAYTHE
166166 42CONSUMER LEGALFUNDINGCOMPANYANYTHINGINEXCESSOFYOUR
167167 43RECOVERYUNLESSYOUHAVEVIOLATEDTHISCONTRACT.YOUWILL
168168 44NOTOWE(INSERTNAMEOFTHECONSUMER LEGALFUNDINGCOMPANY)
169169 45ANYTHING IFTHEREARENOPROCEEDS FROMYOURLEGALCLAIM
170170 46UNLESSYOUORYOURATTORNEYHAVEVIOLATEDANYMATERIALTERM
171171 47OFTHISCONTRACT ORUNLESSYOUHAVECOMMITTED FRAUDAGAINST
172172 48THECONSUMER LEGALFUNDINGCOMPANY.";and
173173 49 (5)Locatedimmediatelyabovetheplaceonthecontractwheretheconsumer's
174174 50signatureisrequired,intwelve-pointfont:"Donotsignthiscontractbeforeyoureadit
175175 51completelyorifitcontainsanyblankspaces.Youareentitledtoacompletelyfilled-in
176-HCSHB2771 5 52copyofthecontract.Beforeyousignthiscontract,youshouldobtaintheadviceofan
176+HB2771 5 52copyofthecontract.Beforeyousignthiscontract,youshouldobtaintheadviceofan
177177 53attorney.Dependingonthecircumstances,youmaywanttoconsultatax,publicor
178178 54privatebenefitsplanning,orfinancialprofessional.Youacknowledgethatyour
179179 55attorneyinthelegalclaimhasprovidednotax,publicorprivatebenefitplanning,or
180180 56financialadviceregardingthistransaction."
181181 436.562.1.Nothinginsections436.550to436.570shallbeconstruedtorestrict
182182 2theexerciseofpowersortheperformanceofthedutiesofthestateattorneygeneralthat
183183 3heorsheisauthorizedtoexerciseorperformbylaw.
184184 4 2.Ifacourtofcompetentjurisdictiondeterminesthataconsumerlegalfunding
185185 5companyhasintentionallyviolatedtheprovisionsofsections436.550to436.570ina
186-6consumerlegalfundingcontract,theconsumerlegalfundingcontractshallbevoided.
186+6consumerlegalfundingcontract,theconsumerlegalfundingcompanyshallbeentitled
187+7torecoveronlythefundedamountitprovidedinthattransactionandshallnotbe
188+8entitledtoanyadditionalcharges.
187189 436.564.1.Thecontingentrighttoreceiveanamountofthepotentialproceeds
188-2ofalegalclaimisassignable.
190+2ofalegalclaimisassignablebyaconsumer.
189191 3 2.Nothingcontainedinsections436.550to436.570shallbeconstruedtocause
190192 4anyconsumerlegalfundingcontractconformingtosections436.550to436.570tobe
191193 5deemedaloanortobesubjecttoanyoftheprovisionsgoverningloans.Aconsumer
192194 6legalfundingcontractthatcomplieswithsections436.550to436.570isnotsubjectto
193195 7anyotherstatutoryorregulatoryprovisionsgoverningloansorinvestmentcontracts.
194196 8Totheextentthatsections436.550to436.570conflictwithanyotherlaw,suchsections
195197 9shallsupersedetheotherlawforthepurposesofregulatingconsumerlegalfundingin
196198 10thisstate.
197199 11 3.Onlyattorney'sliensrelatedtothelegalclaim,Medicare,orotherstatutory
198200 12liensrelatedtothelegalclaimshalltakepriorityoverclaimstoproceedsfromthe
199201 13consumerlegalfundingcompany.Allotherliensandclaimsshalltakepriorityby
200202 14normaloperationoflaw.
201203 15 4.Noconsumerlegalfundingcompany,regardlessoftheoutcomeofaclaimto
202204 16proceeds,shallattempttonegativelyimpactaconsumer'scredithistory,exceptinthe
203205 17casesofbreachofcontractandfraud.
204206 436.566.Anattorneyorlawfirmretainedbytheconsumerinthelegalclaim
205207 2shallnothaveafinancialinterestintheconsumerlegalfundingcompanyoffering
206-3consumerlegalfundingtothatconsumer.Additionally,anypracticingattorneywhohas
207-4referredtheconsumertohisorherretainedattorneyshallnothaveafinancialinterest
208-5intheconsumerlegalfundingcompanyofferingconsumerlegalfundingtothat
209-6consumer.
208+3consumerlegalfundingtothatconsumer.Additionally,anyattorneywhohasreferred
209+4theconsumertohisorherretainedattorneyshallnothaveafinancialinterestinthe
210+5consumerlegalfundingcompanyofferingconsumerlegalfundingtothatconsumer.
210211 436.568.Nocommunicationbetweentheconsumer'sattorneyinthelegalclaim
211212 2andtheconsumerlegalfundingcompanyasitpertainstotheconsumerlegalfunding
212-HCSHB2771 6 3contractshalllimit,waive,orabrogatethescopeornatureofanystatutoryorcommon-
213+HB2771 6 3contractshalllimit,waive,orabrogatethescopeornatureofanystatutoryorcommon-
213214 4lawprivilege,includingthework-productdoctrineandattorney-clientprivilege.
214215 436.570.1.Unlessaconsumerlegalfundingcompanyhasfirstregistered
215216 2pursuanttothissection,thecompanyshallnotengageinthebusinessofconsumerlegal
216217 3fundinginthisstate.
217218 4 2.Anapplicant'sregistrationshallbefiledinthemannerprescribedbythe
218-5divisionoffinanceandshallcontaintheinformationthedivisionrequirestomakean
219-6evaluationofthecharacterandfitnessoftheapplicantcompany.Theinitialapplication
220-7shallbeaccompaniedbyafive-hundred-dollarfee.Arenewalregistrationshallinclude
221-8atwo-hundred-dollarfee.Aregistrationshallberenewedeverytwoyearsandexpireon
222-9Septemberthirtieth.
223-10 3.Acertificateofregistrationshallnotbeissuedunlessthedivisionoffinance,
224-11uponinvestigation,findsthatthecharacterandfitnessoftheapplicantcompany,andof
225-12theofficersanddirectorsthereof,aresuchastowarrantbeliefthatthebusinessshall
226-13operatehonestlyandfairlywithinthepurposesofsections436.550to436.570.
227-14 4.Everyregistrantshallalso,atthetimeoffilingsuchapplication,filewiththe
228-15divisionoffinance,ifthedivisionoffinancesorequires,abondsatisfactorytothe
229-16divisionoffinanceinanamountnottoexceedfiftythousanddollars.Inlieuofthebond
230-17attheoptionoftheregistrant,theregistrantmaypostanirrevocableletterofcredit.
231-18Thetermsofthebondshallrunconcurrentlywiththeperiodoftimeduringwhichthe
232-19registrationshallbeineffect.Thebondshallprovidethattheregistrantshallfaithfully
233-20conformtoandabidebytheprovisionsofsections436.550to436.570,toallrules
234-21lawfullymadebytheadministratorundersections436.550to436.570,andtoanysuch
235-22personorpersonsanyandallamountsofmoneysthatmaybecomedueorowingtothe
236-23stateortosuchpersonorpersonsfromtheregistrantunderandbyvirtueofsections
237-24436.550to436.570duringtheperiodforwhichthebondisgiven.
238-25 5.Uponwrittenrequest,theapplicantisentitledtoahearingonthequestionof
239-26theapplicant'squalificationsforregistrationif:
240-27 (1)Thedivisionoffinancenotifiestheapplicantinwritingthattheapplicationis
241-28denied;or
242-29 (2)Thedivisionoffinancehasnotissuedaregistrationwithinsixtydaysofthe
243-30datetheapplicationfortheregistrationwasfiled.
244-31
245-32Arequestforahearingshallnotbemademorethanfifteendaysafterthedivisionof
246-33financemailsawrittennoticetotheapplicantstatingthattheapplicationisdeniedand
247-34disclosingfindingsinsupportofdenialoftheapplication.
248-HCSHB2771 7 35 6.Notwithstandingthepriorapprovalrequirementofsubsection1ofthis
249-36section,aconsumerlegalfundingcompanythatregisteredwiththedivisionoffinance
250-37betweentheeffectivedateofsections436.550to436.570andsixmonthsthereaftermay
251-38engageinconsumerlegalfundingwhilethecompany'sregistrationisawaitingapproval
252-39bythedivisionoffinance.Allfundingcontractsineffectpriortotheeffectivedateof
253-40sections436.550to436.570arenotsubjecttothetermsofsections436.550to436.570.
254-41 7.Noconsumerlegalfundingcompanyshalluseanyconsumerlegalfunding
255-42contractforminthisstateunlessithasbeenfiledwiththedivisionoffinancein
256-43accordancewiththefilingproceduressetforthbythedivisionoffinance.
257-44 8.Thedivisionoffinancemay,afternoticeandhearingunderchapter536,
258-45imposeanadministrativefinenottoexceedonethousanddollarsperviolationagainsta
259-46consumerlegalfundingcompanythatisfoundtohaveknowinglyandwillfullyviolated
260-47sections436.550to436.570.
261-48 9.Thedivisionoffinanceshallhavetheauthoritytopromulgaterulestocarry
262-49outtheprovisionsofsections436.550to436.570.Anyruleorportionofarule,asthat
263-50termisdefinedinsection536.010,thatiscreatedundertheauthoritydelegatedinthis
264-51sectionshallbecomeeffectiveonlyifitcomplieswithandissubjecttoallofthe
265-52provisionsofchapter536and,ifapplicable,section536.028.Thissectionandchapter
266-53536arenonseverable,andifanyofthepowersvestedwiththegeneralassembly
267-54pursuanttochapter536toreview,todelaytheeffectivedate,ortodisapproveandannul
268-55arulearesubsequentlyheldunconstitutional,thenthegrantofrulemakingauthority
269-56andanyruleproposedoradoptedafterAugust28,2022,shallbeinvalidandvoid.
219+5departmentofcommerceandinsuranceandshallcontaintheinformationthe
220+6departmentrequirestomakeanevaluationofthecharacterandfitnessofthe
221+7applicantcompany.Theinitialapplicationshallbeaccompaniedbyafive-hundred-
222+8dollarfee.Arenewalregistrationshallincludeatwo-hundred-dollarfee.Aregistration
223+9shallberenewedeverytwoyearsandexpireonSeptemberthirtieth.
224+10 3.Acertificateofregistrationshallnotbeissuedunlessthedepartmentof
225+11commerceandinsurance,uponinvestigation,findsthatthecharacterandfitnessofthe
226+12applicantcompany,andoftheofficersanddirectorsthereof,aresuchastowarrant
227+13beliefthatthebusinessshalloperatehonestlyandfairlywithinthepurposesofsections
228+14436.550to436.570.
229+15 4.Everyregistrantshallalso,atthetimeoffilingsuchapplication,filewiththe
230+16departmentofcommerceandinsurance,ifthedepartmentsorequires,abond
231+17satisfactorytothedepartmentinanamountnottoexceedfiftythousanddollars.Inlieu
232+18ofthebondattheoptionoftheregistrant,theregistrantmaypostanirrevocableletter
233+19ofcredit.Thetermsofthebondshallrunconcurrentlywiththeperiodoftimeduring
234+20whichtheregistrationshallbeineffect.Thebondshallprovidethattheregistrantshall
235+21faithfullyconformtoandabidebytheprovisionsofsections436.550to436.570,toall
236+22ruleslawfullymadebytheadministratorundersections436.550to436.570,andtoany
237+23suchpersonorpersonsanyandallamountsofmoneysthatmaybecomedueorowingto
238+24thestateortosuchpersonorpersonsfromtheregistrantunderandbyvirtueofsections
239+25436.550to436.570duringtheperiodforwhichthebondisgiven.
240+26 5.Uponwrittenrequest,theapplicantisentitledtoahearingonthequestionof
241+27theapplicant'squalificationsforregistrationif:
242+28 (1)Thedepartmentofcommerceandinsurancenotifiestheapplicantinwriting
243+29thattheapplicationisdenied;or
244+30 (2)Thedepartmentofcommerceandinsurancehasnotissuedaregistration
245+31withinsixtydaysofthedatetheapplicationfortheregistrationwasfiled.
246+32
247+33Arequestforahearingshallnotbemademorethanfifteendaysafterthedepartment
248+34mailsawrittennoticetotheapplicantstatingthattheapplicationisdeniedand
249+35disclosingfindingsinsupportofdenialoftheapplication.
250+HB2771 7 36 6.Notwithstandingthepriorapprovalrequirementofsubsection1ofthis
251+37section,aconsumerlegalfundingcompanythatregisteredwiththedepartmentof
252+38commerceandinsurancebetweentheeffectivedateofsections436.550to436.570and
253+39sixmonthsthereaftermayengageinconsumerlegalfundingwhilethecompany's
254+40registrationisawaitingapprovalbythedepartment.Allfundingcontractsineffect
255+41priortotheeffectivedateofsections436.550to436.570arenotsubjecttothetermsof
256+42sections436.550to436.570.
257+43 7.Noconsumerlegalfundingcompanyshalluseanyconsumerlegalfunding
258+44contractforminthisstateunlessithasbeenfiledwiththedepartmentofcommerceand
259+45insuranceinaccordancewiththefilingproceduressetforthbythedepartment.
260+46 8.Thedepartmentofcommerceandinsurancemay,afternoticeandhearing
261+47underchapter536,imposeanadministrativefinenottoexceedonethousanddollarsper
262+48violationagainstaconsumerlegalfundingcompanythatisfoundtohaveknowinglyand
263+49willfullyviolatedsections436.550to436.570.
264+50 9.Thedepartmentofcommerceandinsuranceshallhavetheauthorityto
265+51promulgaterulestocarryouttheprovisionsofsections436.550to436.570.Anyruleor
266+52portionofarule,asthattermisdefinedinsection536.010,thatiscreatedunderthe
267+53authoritydelegatedinthissectionshallbecomeeffectiveonlyifitcomplieswithandis
268+54subjecttoalloftheprovisionsofchapter536and,ifapplicable,section536.028.This
269+55sectionandchapter536arenonseverable,andifanyofthepowersvestedwiththe
270+56generalassemblypursuanttochapter536toreview,todelaytheeffectivedate,orto
271+57disapproveandannularulearesubsequentlyheldunconstitutional,thenthegrantof
272+58rulemakingauthorityandanyruleproposedoradoptedafterAugust28,2022,shallbe
273+59invalidandvoid.
270274 436.571.Asusedinsections436.571to436.580,thefollowingtermsmean:
271275 2 (1)"Consumer",anynaturalpersonwhoresides,ispresent,orisdomiciledin
272276 3thisstateorwhoisormaybecomeaplaintifforcomplainantinalawsuitorotherlegal
273277 4disputeinthisstate;
274278 5 (2)"Legalrepresentative",anattorney,groupofattorneys,lawfirm,orother
275279 6partywhomayrepresentapersonorpersonsinalegaldisputeinthisstate;
276-7 (3)"Litigationactivities",anylegalworkandadvicedirectlyrelatedtothe
277-8prosecutionofalegalclaimasdefinedundersubdivision(9)ofsection436.552,
278-9includingfilings,legaldocumentpreparationanddrafting,appeals,creationofa
279-10litigationstrategy,draftingtestimony,andrelatedlitigation.Fundsprovidedtoa
280-11consumerforhisorherpersonalneedsandusearenotlitigationactivities;
281-12 (4)"Litigationfinancer",aperson,groupofpersons,orlegalentityengagedin
282-13thebusinessoflitigationfinancingoranyothermechanismcreatedwiththeintentofso
283-14doing;
284-HCSHB2771 8 15 (5)"Litigationfinancing",thefundingoflitigationactivitiesbyentitiesother
285-16thanthepartiesthemselves,theircounsel,orotherentitieswithapreexisting
286-17contractualrelationshipwithoneoftheparties,suchasanindemnitororaliability
287-18insurer;
288-19 (6)"Litigationfinancingtransaction",anonrecoursetransactioninwhich
289-20financingisprovidedtoaconsumerinreturnforaconsumerassigningtothelitigation
290-21financeracontingentrighttoreceiveanamountofthepotentialproceedsofthe
291-22consumer'sjudgment,award,settlement,orverdictobtainedwithrespecttothe
292-23consumer'slegalclaimoragreeingtopaythelitigationfinancerinterestorotherfeesfor
293-24thefinancingprovided."Litigationfinancing"shallnotincludelegalrepresentation
294-25servicesprovidedtoaconsumeronacontingencyfeebasis,orlegalcostsadvancedbya
295-26legalrepresentative,ifsuchservicesorcostsareprovidedtooronbehalfofaconsumer
296-27byanattorneyrepresentingtheconsumerinthedisputeandinaccordancewithrule4
297-28oftherulesofthesupremecourt;
298-29 (7)"Medicalprovider",anypersonorbusinessprovidingmedicalservicesof
299-30anykindtoaconsumerincluding,butnotlimitedto,physicians,nursepractitioners,
300-31hospitals,physicaltherapists,chiropractors,orradiologistsaswellasanyoftheir
301-32employeesorcontractorsoranypracticegroups,partnerships,orincorporationsofthe
302-33same.
280+7 (3)"Litigationfinancer",aperson,groupofpersons,orlegalentityengagedin
281+8thebusinessoflitigationfinancingoranyothermechanismcreatedwiththeintentofso
282+9doing;
283+10 (4)"Litigationfinancing",thefundingoflitigationactivitiesbyentitiesother
284+11thanthepartiesthemselves,theircounsel,orotherentitieswithapreexisting
285+12contractualrelationshipwithoneoftheparties,suchasanindemnitororaliability
286+13insurer;
287+HB2771 8 14 (5)"Litigationfinancingtransaction",anonrecoursetransactioninwhich
288+15financingisprovidedtoaconsumerinreturnforaconsumerassigningtothelitigation
289+16financeracontingentrighttoreceiveanamountofthepotentialproceedsofthe
290+17consumer'sjudgment,award,settlement,orverdictobtainedwithrespecttothe
291+18consumer'slegalclaimoragreeingtopaythelitigationfinancerinterestorotherfeesfor
292+19thefinancingprovided."Litigationfinancing"shallnotincludelegalrepresentation
293+20servicesprovidedtoaconsumeronacontingencyfeebasis,orlegalcostsadvancedbya
294+21legalrepresentative,ifsuchservicesorcostsareprovidedtooronbehalfofaconsumer
295+22byanattorneyrepresentingtheconsumerinthedisputeandinaccordancewithrule4
296+23oftherulesofthesupremecourt;
297+24 (6)"Medicalprovider",anypersonorbusinessprovidingmedicalservicesof
298+25anykindtoaconsumerincluding,butnotlimitedto,physicians,nursepractitioners,
299+26hospitals,physicaltherapists,chiropractors,orradiologistsaswellasanyoftheir
300+27employeesorcontractorsoranypracticegroups,partnerships,orincorporationsofthe
301+28same.
303302 436.572.1.(1)Nolitigationfinancershallengageinalitigationfinancing
304303 2transactioninthisstateunlessitisregisteredasalitigationfinancerinthisstate.
305304 3 (2)Alitigationfinancerthatisabusinessentityorpartnershipisregisteredin
306305 4thisstateif:
307306 5 (a)Ithasastatusofactiveandingoodstandingasreflectedintherecordsofthe
308307 6secretaryofstate;and
309308 7 (b)Itscharter,articlesoforganization,certificateoflimitedpartnership,or
310309 8otherorganizationaldocument,or,ifaforeignentity,itsMissouriapplicationfora
311310 9certificateofauthority,containsastatementthatitshallbedesignatedasalitigation
312311 10financerpursuanttosections436.571to436.580.
313312 11 (3)Alitigationfinancerthatisnotabusinessentityorpartnershipisregistered
314313 12inthisstateifitfilesanapplicationforregistrationasalitigationfinanceronaform
315314 13prescribedbythesecretaryofstate,alongwithafilingfeeofonehundreddollars,that
316315 14contains:
317316 15 (a)Theapplicant'sfulllegalname;
318317 16 (b)Thebusinessnameoftheapplicant,ifany;
319318 17 (c)Thephysicalstreetaddressandmailingaddressoftheapplicant;
320319 18 (d)Atelephonenumberthroughwhichtheapplicantcanbereached;
321-HCSHB2771 9 19 (e)Thename,physicalstreetaddress,mailingaddress,andtelephonenumber
320+19 (e)Thename,physicalstreetaddress,mailingaddress,andtelephonenumber
322321 20foraMissouriregisteredagentappointedtoacceptserviceofprocessonbehalfofthe
323322 21applicant;
324-22 (f)Astatementthattheapplicantshallbedesignatedasalitigationfinancer
323+HB2771 9 22 (f)Astatementthattheapplicantshallbedesignatedasalitigationfinancer
325324 23pursuanttosections436.571to436.580;and
326325 24 (g)Anyotherinformationthesecretaryofstatedeemsnecessary.
327326 25 2.Eachlitigationfinancershallfilewiththesecretaryofstateasuretybondof
328327 26notlessthanfiftythousanddollars.Thebondshallbepayabletothisstatefortheuseof
329328 27theattorneygeneralandanypersonwhomayhaveacauseofactionagainsttheobliger
330329 28ofthebondforanyviolationofsections436.571to436.580.Thebondshallcontinuein
331330 29effectsolongasalitigationfinancerisdesignatedasalitigationfinancerintherecords
332331 30ofthesecretaryofstate.
333332 31 3.Alitigationfinancershallamenditsregistrationwiththesecretaryofstate
334333 32undersubsection1ofthissectionwithinthirtydayswhenevertheinformationcontained
335334 33insuchrecordchangesorbecomesinaccurateorincompleteinanyrespect.Alitigation
336335 34financerthatisnotabusinessentityorpartnershipmayamenditsregistrationwiththe
337336 35secretaryofstatebyfilinganamendmentonaformprescribedbythesecretaryofstate,
338337 36alongwithafilingfeeoftwentydollars.
339338 37 4.Alldocumentsfiledpursuanttothissectionarepublicrecord.
340339 436.573.1.Alitigationfinancershallnot:
341340 2 (1)Payoroffercommissions,referralfees,orotherformsofconsiderationto
342341 3anylegalrepresentative,medicalprovider,oranyoftheiremployeesforreferringa
343342 4consumertoalitigationfinancer;
344343 5 (2)Acceptanycommissions,referralfees,rebates,orotherformsof
345344 6considerationfromalegalrepresentative,medicalprovider,oranyoftheiremployees;
346-7 (3)Knowinglyadvertisefalseormisleadinginformationregardingitsproducts
347-8orservices;
348-9 (4)Referaconsumerorpotentialconsumertoaspecificlegalrepresentative,
349-10medicalprovider,oranyoftheiremployees;
350-11 (5)Failtopromptlysupplycopiesofanycompletelitigationfinancingcontracts
351-12totheconsumerandtheconsumer'slegalrepresentative;
352-13 (6)Attempttosecurearemedyorobtainawaiverofanyremedyincluding,but
353-14notlimitedto,compensatory,statutory,orpunitivedamages,thattheconsumermight
354-15otherwisebeornotbeentitledtopursue;
355-16 (7)Attempttoeffectarbitrationorotherwiseeffectthewaiverofaconsumer's
356-17righttotrialbyjury;
357-HCSHB2771 10 18 (8)Offerorprovidelegaladvicetotheconsumerregardingthelitigation
358-19financingortheunderlyingdispute;
359-20 (9)Assign,whichincludessecuritizing,alitigationfinancingcontractinwholeor
360-21part;
361-22 (10)Reportaconsumertoacreditreportingagencyifinsufficientfundsremain
362-23fromthenetproceedstorepaythelitigationfinancer;or
363-24 (11)Receiveorexerciseanyrighttodirect,normakeanydecisionswithrespect
364-25to,theconductoftheconsumer'slegalclaimoranysettlementorresolutionthereof.
365-26Therighttomakesuchdecisionsshallremainsolelywiththeconsumerandhisorher
366-27legalrepresentative.
367-28 2.Alegalrepresentativeretainedbyaconsumer,amedicalproviderforsuch
368-29consumer,oranyemployeethereofshallnothaveafinancialinterestinlitigation
369-30financingandshallnotreceiveareferralfeeorotherconsiderationfromanylitigation
370-31financer,itsemployees,itsowners,oritsaffiliates.
345+7 (3)Advertisefalseormisleadinginformationregardingitsproductsorservices;
346+8 (4)Referaconsumerorpotentialconsumertoaspecificlegalrepresentative,
347+9medicalprovider,oranyoftheiremployees;
348+10 (5)Failtopromptlysupplycopiesofanycompletelitigationfinancingcontracts
349+11totheconsumerandtheconsumer'slegalrepresentative;
350+12 (6)Attempttosecurearemedyorobtainawaiverofanyremedyincluding,but
351+13notlimitedto,compensatory,statutory,orpunitivedamages,thattheconsumermight
352+14otherwisebeornotbeentitledtopursue;
353+15 (7)Attempttoeffectarbitrationorotherwiseeffectthewaiverofaconsumer's
354+16righttotrialbyjury;
355+17 (8)Offerorprovidelegaladvicetotheconsumerregardingthelitigation
356+18financingortheunderlyingdispute;
357+19 (9)Assign,whichincludessecuritizing,alitigationfinancingcontractinwholeor
358+20part;
359+HB2771 10 21 (10)Reportaconsumertoacreditreportingagencyifinsufficientfundsremain
360+22fromthenetproceedstorepaythelitigationfinancer;or
361+23 (11)Receiveorexerciseanyrighttodirect,normakeanydecisionswithrespect
362+24to,theconductoftheconsumer'slegalclaimoranysettlementorresolutionthereof.
363+25Therighttomakesuchdecisionsshallremainsolelywiththeconsumerandhisorher
364+26legalrepresentative.
365+27 2.Alegalrepresentativeretainedbyaconsumer,amedicalproviderforsuch
366+28consumer,oranyemployeethereofshallnothaveafinancialinterestinlitigation
367+29financingandshallnotreceiveareferralfeeorotherconsiderationfromanylitigation
368+30financer,itsemployees,itsowners,oritsaffiliates.
371369 436.574.1.Thetermsofthelitigationfinancingagreementshallbesetforthina
372370 2writtencontractthatiscompletelyfilledin.Thereshallbenoincompletesectionswhen
373371 3thecontractisofferedorpresentedtotheconsumer.
374372 4 2.Litigationfinancingcontractsshallcontainthedisclosuresspecifiedinthis
375373 5section,whichshallconstitutematerialtermsofthelitigationfinancingcontract.
376374 6 3.Thedisclosuresshallbetypedinatleastfourteen-pointboldfontandbe
377375 7placedclearlyandconspicuouslyimmediatelyabovetheconsumer'ssignaturelineinthe
378376 8litigationfinancingcontractandshallbeinsubstantiallythefollowingform:
379377 9 Consumer'sRighttoCancellation:Youmaycancelthiscontract
380378 10 withoutpenaltyorfurtherobligationwithinfive(5)businessdays
381379 11 fromthedateyousignedthiscontractorreceivedfinancingfrom
382380 12 [insertnameofthelitigationfinancer]byeitherreturningthe
383381 13 fundsto[insertname,officeaddressandofficehoursofthe
384382 14 litigationfinancer]orbyU.S.mail,[insertnameandmailing
385383 15 addressoflitigationfinancer].ForreturnbyU.S.mail,the
386384 16 postmarkdateonthereturnedfundsor,ifmailedbyregistered
387385 17 orcertifiedmail,thedateofthereturnreceiptrequestedshallbe
388386 18 thedateofreturn.
389387 19 Thefeeschargedpursuanttothisagreementshallnotexceed
390388 20 [litigationfinancertoinsertannualinterestpercentagerate,
391389 21 percentageofawardorsettlementproceeds,ordollaramount].
392-HCSHB2771 11 22 Thelitigationfinanceragreesthatithasnorighttoandwillnot
390+22 Thelitigationfinanceragreesthatithasnorighttoandwillnot
393391 23 makeanydecisionsabouttheconductofyourlawsuitordispute
394392 24 andthattherighttomakethosedecisionsremainssolelywithyou
395393 25 andyourlegalrepresentative.
396-26 Ifthereisnorecoveryofanymoneyfromyourlegalclaimorif
394+HB2771 11 26 Ifthereisnorecoveryofanymoneyfromyourlegalclaimorif
397395 27 thereisnotenoughmoneytosatisfytheportionassignedto
398396 28 [insertnameofthelitigationfinancer]infull,youwillnotowe
399397 29 anythinginexcessofyourrecovery.
400398 30 Donotsignthiscontractbeforeyoureaditcompletely.Ifthis
401399 31 contractcontainsanyincompletesections,youareentitledtoa
402400 32 completelyfilled-incopyofthecontractpriortosigningit.
403401 33 Beforeyousignthiscontract,youshouldobtaintheadviceofan
404402 34 attorney.Dependingonthecircumstancesyoumaywantto
405403 35 consultataxadvisor,afinancialprofessional,oranaccountant.
406404 36 4.Iftheconsumerisrepresentedbyalegalrepresentativeinthedisputethatis
407405 37thesubjectofthelitigationfinancingcontract,thelegalrepresentativeshall
408406 38acknowledgeinthecontractthatthelegalrepresentativeoritsemployeror
409407 39employeeshaveneitherreceivednorpaidareferralfeeoranyotherconsideration
410408 40fromortothelitigationfinancer,norwillinthefuturedoso.
411409 41 5.Iftheconsumer'slegalrepresentativeisapartytoalitigationfinancing
412410 42agreementrelatedtotheconsumer'slegalproceeding,thelegalrepresentativeshall
413411 43sharewiththeconsumertheagreementbetweenthelegalrepresentativeandthe
414412 44litigationfinancer.Theagreementshallbeaccompaniedbythedisclosurerequiredby
415413 45thissection,andtheconsumershallsignbothanacknowledgmentthattheagreement
416414 46hasbeenreadandtherequireddisclosure.
417415 436.575.1.Exceptasotherwisestipulatedororderedbythecourt,aconsumer
418416 2ortheconsumer'slegalrepresentativeshall,withoutawaitingadiscoveryrequest,
419417 3providetoallpartiestothelitigation,includingtheconsumer'sinsurerifpriorto
420418 4litigation,anylitigationfinancingcontractoragreementunderwhichanyone,other
421419 5thanalegalrepresentativepermittedtochargeacontingentfeerepresentingaparty,
422420 6hasarighttoreceivecompensationorproceedsfromtheconsumerthatarecontingent
423421 7onandsourcedfromanyproceedsofthecivilaction,bysettlement,judgment,or
424422 8otherwise.
425-HCSHB2771 12 9 2.Theexistenceoflitigationfinancingandallparticipantsinsuchfinancing
423+9 2.Theexistenceoflitigationfinancingandallparticipantsinsuchfinancing
426424 10arrangementsarepermissiblesubjectsofdiscoveryinallpersonalinjurylitigationor
427425 11mattersarisingoutofpersonalinjuries.
428426 436.576.1.Eachlitigationfinancershallfileareportannuallywiththesecretary
429427 2ofstateinaccordancewithsuchproceduresasthesecretarymayrequire.Thereport
430428 3shallcontainatleastthefollowing:
431-4 (1)Foreachpersonthat,directlyorindirectly,owns,controls,holdswiththe
429+HB2771 12 4 (1)Foreachpersonthat,directlyorindirectly,owns,controls,holdswiththe
432430 5powertovote,orholdsproxiesrepresentingatleastfivepercentofthevotingsecurities
433431 6ofthelitigationfinancer:
434432 7 (a)Thelegalnameandaddressofeachperson;
435433 8 (b)Ifthepersonisanindividual,hisorherprincipaloccupation,offices,and
436434 9positionsheldduringthepastfiveyearsandanyconvictionofcriminaloffensesother
437435 10thanminortrafficviolationsduringthepasttenyears;
438436 11 (c)Ifthepersonisnotanindividual,areportofthenatureofitsbusiness
439437 12operationsduringthepastfiveyearsortheentiretyofthepersonandanypredecessor's
440438 13existence,whicheverisshorter,anarrativedescriptionofthebusinessintendedtobe
441439 14donebythepersonandtheperson'ssubsidiariesandalistofallindividualswhoareor
442440 15whohavebeenselectedtobecomedirectorsorexecutiveofficersoftheperson.Thelist
443441 16shallincludeforeachindividualtheinformationrequiredundersubdivision(2)ofthis
444442 17subsection;and
445443 18 (2)Foreachlitigationfinancingtransactionenteredinthisstateorinvolvinga
446444 19claimtobelitigatedinthisstate,thelitigationfinancershallidentify:
447445 20 (a)Theamount,datesofpayment,andnameandaddressofeachpersonthat
448446 21receivedanyamountoffinancingfromalitigationfinancerduringtheprevious
449447 22calendaryear;
450448 23 (b)Theamount,dateofpayment,andsourceofpaymentforallproceeds
451449 24obtainedbythelitigationfinancerduringthepreviouscalendaryearfromany
452450 25judgment,award,settlement,orverdictinalitigationfinancingtransaction;and
453451 26 (c)Anyotherinformationthesecretaryofstatedeemsnecessarytothe
454452 27administrationofjustice.
455453 28 2.(1)Thesecretaryofstateshallprovidetothecommissionerofinsurancean
456454 29annualreportwithinsixmonthsofthereceiptoftheinformationinsubsection1ofthis
457455 30sectioncontainingalloftheinformationthereinandasummary.Thisreportasfiled
458456 31shallnotbemadeavailabletothepublicandshallbeconfidentialbylawandprivileged,
459457 32shallnotbesubjecttotheprovisionsofchapter610,shallnotbesubjecttosubpoena,
460458 33andshallnotbesubjecttodiscoveryoradmissibleinevidenceinanyprivatecivilaction.
461-HCSHB2771 13 34 (2)Thesecretaryofstateshallreleasethereportandsummarydescribedunder
459+34 (2)Thesecretaryofstateshallreleasethereportandsummarydescribedunder
462460 35subdivision(l)ofthissubsectiontothepublicafterremovingallpersonallyidentifiable
463461 36informationofanyconsumer.Nothinginthissubsectionshallaffecttheobligationto
464462 37discloselitigationfinancingcontractsorotheragreementsundersection436.575.
465463 436.577.Sections436.571to436.580shallapplytoanyclassaction.Putative
466464 2classmembersandthecourtshallbeadvisedthattheproposedclassattorneyhasalegal
467465 3orfinancialrelationshipwithalitigationfinancer.
468-436.578.Sections436.571to436.580shallnotapplytolitigationfinancing
466+HB2771 13 436.578.Sections436.571to436.580shallnotapplytolitigationfinancing
469467 2providedtocommercialenterprisesinsupportoflitigationstrictlybetweencommercial
470468 3enterprises.Thisexemptiondoesnotapplytoanypersonalinjuryclaim,situations
471469 4arisingfromapersonalinjuryclaim,oranaggregationofpersonalinjuryclaims,
472470 5whetherbysubrogation,assignment,oranyotherbasis.
473-436.579.Thepracticeoflitigationfinancingshallberegulatedbythedivisionof
474-2finance.Thecommissionerofthedivisionoffinancemaypromulgateallnecessaryrules
475-3andregulationsfortheadministrationofthissection.Anyruleorportionofarule,as
476-4thattermisdefinedinsection536.010,thatiscreatedundertheauthoritydelegatedin
477-5thissectionshallbecomeeffectiveonlyifitcomplieswithandissubjecttoallofthe
478-6provisionsofchapter536and,ifapplicable,section536.028.Thissectionandchapter
479-7536arenonseverable,andifanyofthepowersvestedwiththegeneralassembly
480-8pursuanttochapter536toreview,todelaytheeffectivedate,ortodisapproveandannul
481-9arulearesubsequentlyheldunconstitutional,thenthegrantofrulemakingauthority
482-10andanyruleproposedoradoptedafterAugust28,2022,shallbeinvalidandvoid.
471+436.579.Thepracticeoflitigationfinancingshallberegulatedbythe
472+2departmentofcommerceandinsurance.Thecommissionerofinsurancemay
473+3promulgateallnecessaryrulesandregulationsfortheadministrationofthissection.
474+4Anyruleorportionofarule,asthattermisdefinedinsection536.010,thatiscreated
475+5undertheauthoritydelegatedinthissectionshallbecomeeffectiveonlyifitcomplies
476+6withandissubjecttoalloftheprovisionsofchapter536and,ifapplicable,section
477+7536.028.Thissectionandchapter536arenonseverable,andifanyofthepowersvested
478+8withthegeneralassemblypursuanttochapter536toreview,todelaytheeffectivedate,
479+9ortodisapproveandannularulearesubsequentlyheldunconstitutional,thenthegrant
480+10ofrulemakingauthorityandanyruleproposedoradoptedafterAugust28,2022,shall
481+11beinvalidandvoid.
483482 436.580.Anyviolationoftheprovisionsofsections436.571to436.580shallmake
484483 2thelitigationfinancingcontractunenforceablebythelitigationfinancer,theconsumer,
485484 3oranysuccessor-in-interesttothelitigationfinancingcontract.
486-Section1.Itshallbeunlawfulforanypersonorentitytooperateasaconsumer
487-2legalfundingproviderinthisstateexceptasauthorizedbytheconsumerlegalfunding
488-3modelactandwithoutfirsthavingobtainedalicenseinaccordancewiththeconsumer
489-4legalfundingmodelact.Nopersonorentitymayengageinanydevise,subterfuge,or
490-5pretensetoevadetherequirementsoftheconsumerlegalfundingmodelact.However,
491-6anycompanythathasalicenseingoodstandingundersection436.550to436.570onthe
492-7effectivedateoftheconsumerlegalfundingmodelactshallbeentitledtomake
493-8consumerlegalfundingsunderthetermsoftheconsumerlegalfundingmodelactupon
494-9theeffectivedateoftheconsumerlegalfundingmodelact,ifthatcompanyfilesan
495-10applicationforaconsumerlegalfundinglicense,forsixtydaysoruntilthedivision
496-11approvesordeniestheapplicationforafundinglicense,whicheverissooner.Any
497-12consumerlegalfundingcontractbyanypersonorentityinviolationofthissubsection
498-HCSHB2771 14 13shallbenullandvoidandthepersonorentitythatenteredintotheconsumerlegal
499-14fundingtransactionsshallhavenorighttocollect,attempttocollect,receive,orretain
500-15anyprincipal,interestorchargesrelatedtotheconsumerlegalfundingtransaction.
501485 âś”
502-HCSHB2771 15
486+HB2771 14