Houston Daily

Buzz Patterson, a columnist for RedState, said that third-party litigation funding contributes to lawsuit abuse, leading to increased premiums and negatively impacting small businesses and consumers in Texas. He added that Senate Bill 30 (SB 30), which failed to pass, would have addressed some of these issues. The statement was made on the social media platform X.

"The cost of living in the US is out of control, and one hidden driver is lawsuit abuse," said Patterson. "Lawfare, funded by outsiders, needs to be addressed and stopped! Predatory third-party litigation funding allows outside investors, including foreign entities, to secretly bankroll lawsuits and collect a cut of the winnings. It's driving up costs for everyday Americans, delaying justice, and undermining the already struggling integrity of our courts."

In the 2025 legislative session in Texas, SB 30, supported by Texans for Lawsuit Reform, aimed to tighten regulations around medical damages. However, it failed after the House and Senate could not reconcile their differing versions before adjournment. Business groups viewed this outcome as a missed opportunity to curb abusive litigation practices that drive up costs for consumers and small businesses, including higher liability premiums. The bill's failure underscored intraparty divisions even as employers expressed concerns about increasing legal exposures across the state.

According to the U.S. Chamber’s Institute for Legal Reform, total U.S. tort costs amounted to more than $529 billion in 2022—approximately 2.1% of GDP—equating to "over $4,200 per U.S. household." Analysts indicate that these costs impact insurance rates, prices, and investment decisions. For Texas families and small businesses, aggressive litigation and opaque funding arrangements contribute to premium pressure in auto, commercial liability, and umbrella lines.

Insurer testimony has linked third-party litigation funding to prolonged cases and larger payouts that increase premiums. The American Property Casualty Insurance Association informed Congress in 2024 that profit-driven funders raise defense and settlement costs and worsen loss ratios in excess liability, commercial auto, and general liability—costs ultimately borne by policyholders, including Texas small employers and consumers. Swiss Re research similarly associates such funding with higher awards and total liability costs.

Patterson is a conservative columnist and commentator who served 20 years in the U.S. Air Force as the senior military aide to President Bill Clinton. He was responsible for the "nuclear football." A bestselling author and national speaker, he writes at RedState on policy, national security, and culture.

RedState is an American conservative political blog owned by Salem Media Group that publishes commentary and reporting on politics and culture. Founded in 2004, it has hosted activist gatherings and features a roster of conservative writers and editors. The site remains an influential hub for right-of-center grassroots perspectives and analysis on national and state issues.