On March 24, 2025, the Minnesota State Legislature introduced Senate Bill 2929, a significant piece of legislation aimed at regulating consumer and commercial litigation funding in the state. This bill seeks to address growing concerns about the transparency and ethical practices within the litigation funding industry, which has seen rapid growth in recent years.

The primary purpose of Senate Bill 2929 is to establish a regulatory framework for consumer litigation funding companies and commercial litigation financiers. Key provisions include a requirement for these entities to register with the state’s Department of Commerce, ensuring that they adhere to specific operational standards. Notably, the bill mandates that if a registration application is not processed within 60 days, the applicant may proceed with funding activities while awaiting approval. This provision aims to prevent unnecessary delays that could hinder access to justice for individuals seeking funding for legal claims.

Additionally, the bill introduces annual reporting requirements for litigation funding companies, compelling them to disclose the number of lawsuits funded, the total amounts disbursed, and the annual percentage rates charged to consumers. This data will be made publicly available, albeit with protections in place to maintain the confidentiality of individual consumers and companies. Such transparency is intended to empower consumers and foster accountability within the industry.

However, the bill has not been without controversy. Critics argue that while regulation is necessary, the provisions may inadvertently limit access to funding for those who need it most. Some stakeholders have raised concerns about the potential for increased costs associated with compliance, which could be passed on to consumers. Furthermore, the prohibition against entering into agreements with foreign entities of concern has sparked debate regarding its implications for international business relationships and the potential for reduced competition in the market.

The implications of Senate Bill 2929 extend beyond regulatory compliance; they touch on broader economic and social issues. By enhancing transparency in litigation funding, the bill aims to protect vulnerable consumers from predatory practices while ensuring that legitimate funding avenues remain accessible. Experts suggest that if enacted, the bill could set a precedent for similar regulations in other states, potentially reshaping the landscape of litigation funding nationwide.

As the legislative process unfolds, stakeholders will be closely monitoring amendments and debates surrounding the bill. The outcome of Senate Bill 2929 could significantly influence the future of litigation funding in Minnesota, impacting both consumers seeking justice and the companies that provide financial support for legal claims.