GA Tort Reform Legislation: Third-Party Litigation Financing

After Governor Brian Kemp proposed a tort reform package in late January, it was divided for purposes of legislation.  Senate Bill 69 focuses on third-party litigation financing and Senate Bill 68 contains a miscellaneous package of initiatives.  

As to SB 69 on litigation funding, the bill provides:

• Litigation financiers must register with the state.  Financiers must not have connections to entities affiliated with foreign adversaries, as designated by the U.S. Secretary of Commerce. 
• The existence of the financing agreement is subject to disclosure, though is not necessarily admissible into evidence. 
• Financiers are prohibited from exerting direct influence over the legal proceedings, including decisions regarding trial strategy.  
• Financiers are jointly and severally liable for any award issued against the funded party.
• Violations of the law carry significant criminal penalties, including felony charges with potential prison sentences.

Some of these provisions seem reasonable to me, and others do not.  Registration, disclosure, and the prohibition of influence in litigation decisions seem reasonable.  These measures are similar to the arguably analogous third-party liability insurance system with which we are familiar.  On the other hand, the provisions for joint and several liability and felony enforcement appear punitive and calculated to deter financiers from operating in Georgia.  Third-party litigation financing is not my wheelhouse, however, and I defer to others who understand it better than I do.  (Tony Sebok and Bryon Stier come to mind.)