Ethics/Professional Responsibility
Sep. 22, 2026
Newsom signs law limiting litigation funders' control over cases
AB 2305 bars private equity firms and other litigation funders from influencing case strategy or settlements and gives the State Bar authority to pursue violations.
Gov. Gavin Newsom has signed legislation restricting the influence private equity firms, hedge funds and other outside investors can exercise over California lawsuits.
AB 2305 bars litigation funders from directing or influencing substantive decisions in cases they finance, including settlement decisions. The measure responds to concerns that some outside funders have required plaintiffs to obtain approval before settling or rejected settlements they considered insufficiently prof...
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