The news in July was that litigation funding companies were engaging in a “feeding frenzy” of agreements with former National Football League players who could be among the nearly 5,000 NFL veterans entitled to a share of the $1 billion concussion claims settlement.
The latest news reports two new twists: that the agreements are being challenged en masse, in ways that involve some unusual procedural means, and that a lead attorney in the concussion lawsuit – who has voiced criticisms of some litigation funding companies – has himself been the subject of criticism over his failure to disclose ties to another litigation funder.
The Legal Intelligencer has the latter story, here (behind a pay wall), saying that one of the lead attorneys “in the NFL concussion settlement has been very critical of numerous third-party litigation funding companies that have loaned money to retired players involved in the class action, but it is his alleged failure to publicly disclose his history with another litigation funding company that has raised some eyebrows recently.”
The former story is “one to watch” because it involves the “stunning disclosure” that between 900 and 1,000 ex-players (among there 4,800 who may be entitled to receive concussion settlement monies) had entered into deals with several litigation funders – and because “the NFL litigation will be the first to determine if [multi-district litigation] judges’ authority extends to third-party funders who’ve entered deals with individual plaintiffs.” These remarks are from commentary concerning the litigation by Alison Frankel, under the headline NFL Concussion Case: Can MDL Judges Police Plaintiffs’ Funding Deals? (available here). Wrote Frankel:
It’s entirely possible that just as many, or even more, plaintiffs in other big personal injury MDLs have entered funding arrangements. These deals don’t usually come to light. . . because they’re private contracts struck outside of the underlying litigation. What’s unusual about the NFL concussion case is that it’s a class action, which puts every member of the class under the aegis of class counsel, and that [the] Judge . . . ordered discovery on outside solicitations to class members.
Such a broad inquiry into the propriety of funding agreements could be a watershed for the litigation finance industry, prompting other MDL judges to require plaintiffs to disclose post-settlement funding agreements for their own protection. But that can occur only if MDL judges actually have jurisdiction to monitor these private contracts.
And for background, one source is The New York Times story in July(available here), headlined After N.F.L. Concussion Settlement, Feeding Frenzy of Lawyers and Lenders.