Case funders would disclose agreements and stay out of case decisions

Lawyers and parties would have to share case-funding agreements and related information. The rules cover funded civil cases, administrative proceedings, claims, class actions, and multi-district cases in New Mexico. A court order or agreement among the parties may change the general disclosure requirement. Disclosures about foreign people or organizations apply only when they meet the bill's definitions and have one of the listed connections to the funding or case information. The bill excludes certain arrangements, including contingency-fee legal services, some loans and insurance payments, and funding for medical receivables. Clients must receive a copy within 30 days after the earlier of the lawyer being hired or entering the agreement. Other disclosures are due within 30 days after the case begins and must be updated when an agreement is entered or changed.

A case funder would be barred from controlling case decisions, paying for referrals, or transferring the funding agreement or case rights. The funded person and their lawyer would keep control over the case, including the choice of lawyer, experts, and strategy.

A case funder would have to cover certain costs and penalties, and violations could void agreements or lead to enforcement under the Unfair Practices Act. The cost protection would apply to funded people in cases financed by the funder. The funder would not have to cover costs or penalties resulting from the funded person's intentionally wrongful conduct. Only a funding agreement entered into in violation of the act would be void.