(Article reproduced with permission from Daily Report for Executives, 179 DER (Sept. 16, 2015). Copyright 2015 by The Bureau of National Affairs, Inc. (800-372-1033) http://www.bna.com)
Adams and Reese Partner Lucian Pera was interviewed in a Bloomberg BNA article, "Senators Take Aim at Litigation Finance: Could Letter Lead to Legislation?" as the controversial business of alternative (or third party) litigation financing (ALF) is drawing attention from two federal lawmakers who are concerned that the industry is largely unregulated and operating without licensing or oversight.
This expression of concern about a growth industry with little federal supervision came from Sens. Charles E. Grassley (R-Iowa) and John Cornyn (R-Texas) as the issues surrounding alternative litigation financing seem to pit one traditional Republican cause — allowing industry to flourish in the absence of burdensome regulation — against another concern that consumer litigation is bad for business.
"‘I can’t think of any reason that the lawyer’s loyalty would be to the client’s funder," said Pera. "The only situation that comes close would be if the funder was funding lots of cases for the lawyer," but even then Pera said a conflict is unlikely. "That’s just not how plaintiffs lawyers are wired in my experience," he said. As a part of its Ethics 20/20 project, the American Bar Association sought comments in 2011 about ALF, but determined "there was really no need for any changes in the ABA Model Rules of Professional Conduct to address any issues with litigation funding," Pera said.