Comer: Left-Wing Activists are Funneling Millions into America’s Legal System to Cement Radical Agenda

WASHINGTON – Today, House Committee on Oversight and Accountability Chairman James Comer (R-Ky.) delivered opening remarks at a full committee hearing titled “Unsuitable Litigation: Oversight of Third-Party Litigation Funding.” In his opening statement, Chairman Comer emphasized that many lawsuits are being funded by left-wing activists aiming to hijack America’s legal system to influence policy decisions and determine outcomes. He highlighted how these progressive funded lawsuits are currently impacting the mining of critical minerals, development of new medications, energy production, and U.S. national security. He stressed that this detrimental form of political activism is not only implementing a radical agenda, but taxpayers are also being forced to cover attorney’s fees, settlement payouts, and economic impacts to the affected American industries. Chairman Comer concluded that activist groups shouldn’t be legislating via litigation and will work to identify ways Congress can address third-party litigation funding to ensure fairness in our legal system.

Below are Chairman Comer’s remarks as prepared for delivery.

Today we examine a growing concern in our nation’s legal system.

Millions of lawsuits are filed each year.

These suits range from simple disputes between neighbors to complex multi-district litigation spanning the entire country.

Many of these lawsuits have significant merit requiring serious analysis by courts, but some are frivolous as well.

With the millions of cases being brought each year, our courts have become overburdened, creating delays, and making it difficult and expensive for many litigants to prosecute their cases.

The complexity and expense of some of these cases makes litigation funding important.

In fact, for some, litigation funding necessary to enable them to pursue justice through the legal system. 

But there are some concerning trends in how litigation is funded.

The spread of untraceable and undisclosed funding of lawsuits across the country raising significant ethical and legal questions.

For example, many lawsuits are funded by progressive activists or private equity seeking to hijack America’s legal system to implement their policy desires or make a quick buck.

Lawsuits that impact the mining of critical minerals, development of new medications, energy production, and our national security.

These lawsuits raise concerns about attorneys’ ethical duties, whether the proper parties are at the negotiating table, and whether litigants are being hurt by limitations on the funding they receive.

They raise concerns about whether attorneys are acting in the best interests of their clients or those they receive funding from.

They raise concerns about whether the funders should be included at the negotiating table during settlement talks.

They raise concerns that some litigation financers are not acting in the best interests of the litigants.

We know that activist groups use this funding to push policies that they could not enact through the legislative process.

Some left-wing groups funnels millions to law firms to sue companies across the country on questionable legal grounds.

They are trying to use the courts to put these companies out of business or limit their ability to bring new products to market.

These activist groups will find plaintiffs and pour millions into claims against energy, mining, and manufacturing companies to the detriment of consumers, innovation, national security, the workforce, and even to plaintiffs themselves.

All in the name of political activism.

These groups know that their tactics and goals are too extreme for the American people to support.

So rather than use the electoral process, they are implementing their agenda through litigation against both the public and private sectors.

Other groups are entering into funding agreements with plaintiffs’ attorneys, where they pay to support litigation in exchange for a significant portion of the money awarded should the plaintiffs win.

In some cases, these outside groups can effectively override a settlement agreement if they don’t like the payoff amount.

In fact, a recent study by the Institute for Legal Reform found that for every dollar paid in damages through tort litigation, a meager 53 cents actually found its way into the rightful pockets of the claimants.

When American companies are under threat of frivolous litigation, those companies must set aside hundreds of millions of dollars to fight against claims from these groups.

And the American people are then affected when companies are forced to offset the cost of litigation by raising prices.

The mass torts litigation sector raked in an astonishing $443 billion in 2020 alone, the equivalent of 2.1 percent of the entire GDP of the United States.

Today, we’re going to hear from American industry to see how unnecessary litigation can freeze essential sectors of the economy and hurt consumers.

We will also hear how activist groups use “sue-and-settle” tactics to encourage government agencies to regulate well beyond the laws Congress passed for them to administer.

These suits cost taxpayers’ unknown sums in attorney’s fees, settlement payouts, and economic impacts to the affected industries.

Let me be clear, agencies should not be conducting rulemaking via litigation.

And activist groups certainly shouldn’t be legislating via litigation.

Today is a first step to identifying how pervasive third-party litigation funding is and how deep the abuses go.

I look forward to hearing the testimony of our witnesses and to discussing how we can ensure fairness in our legal system.

With that, I now yield to the Ranking Member Mr. Raskin.

###