ILR Comments on the Code of Conduct for Litigation Funders

The UK Civil Justice Council (“CJC”) has proposed a draft code of conduct to govern third-party litigation funding (“TPLF”) under the auspices of a proposed voluntary association, the Association of Litigation Funders.  The proposal for regulating Litigation Funders envisioned by the draft Code implicitly recognizes that third-party litigation funding threatens to undermine consumer interests and foster litigation abuse.  The Code, however, is inadequate.  As a threshold matter, it does not have the force of law. 

The U.S. Chamber Institute for Legal Reform states that the only way to adequately safeguard the rights of consumers and defendants – and promote the orderly administration of civil justice in England and Wales – is to enact a statute that is binding on all Litigation Funders.