David Williams, president of the Taxpayers Protection Alliance (TPA), said that the current legal system incentivizes lawsuits, which extract money from the economy and burden taxpayers. He made this statement in a January 3 op-ed.
"The current system incentivizes lawsuits," said Williams. "Every dollar spent on such a suit is one that could not be used towards supporting economic growth."
On June 21, 2021, the U.S. District Court for the District of New Jersey became the first federal district court to require routine disclosure of third-party litigation funding. Local Rule 7.1.1 mandates that parties identify funders within 30 days of filing, including their name, address, and corporate incorporation details if applicable. The rule also requires disclosure of any conditions tied to litigation decisions or settlements. Additional discovery into funding arrangements may be sought upon demonstrating good cause, such as conflicts of interest or material influence over litigation outcomes, according to Lexology.
According to the U.S. Chamber of Commerce, third-party litigation funding (TPLF) is a multibillion-dollar global industry allowing investors, including hedge funds and foreign entities, to finance lawsuits in exchange for a share of settlements or awards. A study by the U.S. Chamber of Commerce titled "Grim Realities: Debunking Myths in Third-Party Litigation Funding" highlights negative effects of TPLF, such as prolonged litigation and increased settlement costs. The report notes growing efforts by courts, regulators, and legislators worldwide to address challenges posed by this secretive industry.
Third-party litigation funding (TPLF), identified as a rapidly growing alternative asset class, provided over $17 billion globally in 2020 with more than half deployed in the United States, according to Swiss Re. The Insurance Information Institute (Triple-I) expresses concerns that TPLF drives social inflation by increasing litigation costs and outsized jury awards while prolonging legal proceedings. This situation raises insurance premiums and threatens affordability. Swiss Re projects that the global TPLF market could reach $30 billion by 2028, further impacting insurers and policyholders.
Insurify reports that the average annual cost of full coverage insurance rose to $2,329 in June 2024—a 15% increase from $2,018 at the end of 2023—with projections reaching $2,469 by year-end. This reflects a total increase of 22% for 2024 according to Insurify's data. Comprehensive, collision, and liability coverage constitute a full-coverage policy offering financial protection for drivers and their vehicles. In New Jersey specifically, Insurify projects a 9% increase in automobile insurance prices for 2024.
According to HuffPost, David Williams is an expert on government waste and budget processes as President of TPA since its founding in 2011. He has worked globally advising taxpayer and free-market groups while helping establish similar organizations worldwide. Williams holds a Master of Arts in Political Science from Villanova University and a Bachelor of Science in Telecommunications from Kutztown University.
