Lawsuit Lending Facts

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Measure to cap litigation finance interest moves on after hot debate

April 4, 2014

The Knoxville News-Sentinel reports:

The litigation finance business, also known as "lawsuit lending," advances money to people who are seeking damages for injuries in court, typically for living expenses during a long wait for a case to come to trial or be otherwise resolved. They are repaid only if the lawsuit is successful.

The bill (SB1360), sponsored by House Speaker Pro Tempore Curtis Johnson, R-Clarksville, would subject the industry to state government regulation for the first time and put a cap of 46 percent on the amount of interest that can be charged.

"What I care about most of all is that there is nothing in the law in our state right now that prevents poor people in my district, at their most vulnerable time, from being taken advantage of by these companies," said Johnson.

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