The federal judge serving as a top adviser to Chief Justice John Roberts, Judge Robert M. Dow Jr., has expressed his view that courts should not require the public disclosure of outside funding for lawsuits. According to Dow, the real concern for courts should be if litigation funders are essentially usurping control of the cases they invest in, which can be addressed by disclosing the litigation finance agreements privately to judges and other parties involved in the lawsuits. Noting, as Bloomberg Law reports, “As long as the funder doesn’t have control, I don’t think it’s gonna be a major issue for judges.” Dow voiced his concerns at a conference in New York, following his 2022 appointment as counselor to US Supreme Court Chief Justice John Roberts, a position he held after leaving his seat on the federal district court in Chicago.
The $15.2 billion litigation finance industry, where investors fund lawsuits in return for a portion of settlements and verdicts, has attracted the attention of some judges, legislators, and the US Chamber of Commerce. While some states and federal courts require parties to disclose outside funding, efforts to enforce such disclosure across the federal judiciary have, so far, hit a standstill.
Dow weighed into this topic during his stint at a committee reviewing federal court rules. He suggested that disclosures could disadvantage parties not utilizing outside funding by unfairly revealing their opponents’ strategies. He mentioned, “The concern I had when we were looking at this at the rules committee was public disclosure of too much really gets into litigation strategy. That’s really not fair to give one side the other side’s litigation strategy unless it’s mutual.”
He shared his thoughts at a conference organized by the International Legal Finance Association, a leading litigation funding industry group. He was joined by ex-Miami federal judge Ursula Ungaro and former magistrate Sam Sheldon in a federal court in Texas. Ungaro is now a partner at Boies Schiller Flexner and Sheldon at Robbins Geller Rudman & Dow, notable litigation firms that occasionally use outside funding in some cases.
Ungaro also voiced her concerns about the impact of disclosure. She said, “I’m still struggling with the idea that any of this should be disclosed. There are all kinds of things that go on in the world that have some influences on lawyers and clients and judge’s cases; to think that disclosure is going to solve that problem is nonsense.”