HF3052 Summary

• Establishes the "Minnesota Nonrecourse Presettlement Funding Act" effective January 1, 2011, regulating nonrecourse presettlement funding transactions where companies purchase rights to potential proceeds from pending civil claims.

• Requires presettlement funding companies to register with the commissioner of commerce, with initial registration fee of $1,000 and $500 annually; registrants must provide contact information, executive officers, administrators, and proposed contracts.

• Mandates contracts include specific disclosures in 12-point bold type: total funding amount, itemized fees, repayment schedule over 36 months in six-month intervals, and annual percentage rate with compounding frequency.

• Requires five-day cancellation rights for consumers with full refund capability through uncashed check delivery or certified mail return; contracts must include prominent disclaimers that funding company makes no decisions regarding the underlying claim and that funds cannot be used for litigation costs.

• Prohibits presettlement funding companies from paying commissions or referral fees to attorneys, medical providers, or physical therapists; companies cannot advertise false information and must maintain accurate records for at least two years after contract completion.