Transparency has been a major focus of the Louisiana Association of Business and Industry's advocacy efforts for years, but more recently in the judiciary. We have worked to improve accountability and transparency in all aspects of the third branch of government, from the courtroom steps to the discovery deposition. Great strides have been made, but significant work remains.
Transparency is a fundamental tenet of democracy. Facilitating the public’s understanding of what goes into ensuring fair and equitable outcomes is critical to establishing public trust in the judicial process, and much of that begins with shining a light on certain litigation practices.
In this vein, the Legislature passed an important LABI-supported measure this session. Senate Bill 196 by Sen. Barrow Peacock, R-Bossier City, provides for the disclosure of litigation financing agreements, which come in many forms but at their core consist of an outside third party investing in a lawsuit in exchange for a stake in its financial outcome. There are concerns these arrangements can complicate the ability to fairly resolve a dispute and hide conflicts of interest or even unethical or illegal conduct. Since there is currently no obligation to disclose these arrangements in Louisiana courts, they are often unknown to the judge, the litigants and the public.
Hence the importance of SB 196, which would simply require the disclosure of any litigation financing agreement to all parties to the lawsuit, ensuring they are aware when a third party has a particular financial interest in the outcome of a case. As the utilization of these agreements has expanded — most recently calculated to be a $13 billion industry — so should the disclosure requirements. Any other result threatens the integrity of the civil justice system, and most importantly, erodes public trust in the judiciary.
The bill passed both chambers and now awaits the governor’s signature or veto. Whether the governor signs this legislation remains to be seen, but LABI will continue to advocate for a more transparent, fair and accountable judicial system.
LAUREN HADDEN
general counsel, LABI