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NY A09442
Bill
Status
2/13/2026
Primary Sponsor
William Magnarelli
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AI Summary
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Requires litigation funding companies to register with the Department of Financial Services and pay a $500 registration fee, with annual reporting to the department beginning in 2027
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Caps charges to consumers at 25% of gross proceeds from their legal claim plus the funded amount, with a maximum funding limit of $500,000 per consumer
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Mandates contracts be written in plain language with 12-point bold font disclosures, including a 10-business-day right of rescission allowing consumers to cancel without penalty by returning the funded amount
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Prohibits litigation funding companies from paying referral fees to attorneys, law firms, or medical providers, and bars them from influencing decisions about the consumer's legal claim or settlement
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Imposes civil penalties of up to $5,000 per willful violation, enforced by the Attorney General, and voids contracts where companies willfully violate the law by waiving their right to recover charges in that case
Legislative Description
Amends the litigation funding act to promote consumer protections related to litigation funding contracts; provides for contract requirements for litigation funding including disclosures, prohibitions; provides for litigation funding company registration and reporting requirements.
Last Action
signed chap.11
2/13/2026