INDIANAPOLIS (Legal Newsline) -- An Indiana state senator has introduced a bill that would make lawsuit lending loans subject to the same regulations as traditional loans.
Sen. Doug Eckerty (R-Yorktown) introduced Senate Bill 378 on Tuesday.
The bill would have a consumer lawsuit loan fall under the definition of a loan in the state code, and it would require a plaintiff who has received a non-recourse loan "secured by the proceeds of a lawsuit to file a copy of the lending agreement with the court and provide a copy to the opposing party."
It also defines "consumer lawsuit lending" or "consumer lawsuit loan" as providing money to a consumer for any purpose other than prosecuting the consumer's proceeding, where the repayment of the money is required only if the consumer prevails in the proceeding; and sourced from the proceeds of the proceeding, by judgment, settlement, or otherwise; or purchasing from a consumer a contingent right to receive a share of the potential proceeds of the consumer's proceeding, by judgment, settlement, or otherwise.
It says that if a consumer lawsuit lending agreement is executed before the consumer files a complaint or similar pleading, the consumer must file a copy of the agreement with the court when the complaint or similar pleading is filed and serve a copy of the agreement on the opposing party. If it is filed after the complaint is filed, the consumer must file a copy of the agreement with the court and serve it to the opposing party within 10 days of its execution.
If passed, the law would become effective July 1.
Lawsuit lending bill introduced in Indiana
