Foreign Money Paying for Litigation: What Could Possibly Go Wrong?
If James Landis were alive today, he would roll over in his grave. Landis, a Harvard Law School dean and advisor to Franklin D. Roosevelt, would have recognized the practice of “maintenance” in today’s third-party litigation funding (TPLF). Landis’ definition of the word was published in Encyclopedia Britannica’s 14th edition as “assisting a party, with money or otherwise, to prosecute or defend an action in which the maintainer has no legitimate interest.”
TPLF is big business. Funders hold $15 billion in assets deployable to finance litigation. R Street has written on TPLF and has testified on how TPLF investments by well-heeled but unfriendly foreign actors could weaken U.S. national security. A plausible scenario includes sovereign wealth funds of adversary nations damaging U.S. national interests by tying up courts in vexatious litigation against makers of weapons or other critical products.
In 2023, the Senate Judiciary Committee’s John Kennedy (R-La.) sent a letter to then-Attorney General Merrick Garland and Chief Justice John Roberts out of “grave concern about the growing threat to national security from foreign entities funding litigation in our nation’s courts.” This led to the introduction of the Protecting Our Courts from Foreign Manipulation Act of 2023 (S.2805).
Another bill, the Litigation Transparency Act of 2025 (H.R. 1109) takes aim at TPLF activity more broadly. While several iterations of this bill were introduced in the past, the version currently under consideration is sponsored by Darrell Issa (R-Calif.), Chairman of the House Judiciary Subcommittee on Courts, Intellectual Property, Artificial Intelligence and the Internet. Reps. Scott Fitzgerald (R-Wis.) and Mike Collins (R-Ga.) are co-sponsors. Last year’s chairs of the House Energy and Commerce, Science, and Natural Resources committees declared they were “alarmed by reports of China-affiliated organizations attempting to influence United States energy policy” and opened an investigation into foreign influence operations targeting U.S. energy and environmental policies.
Between 2015 and 2021, as lawmakers and others became more aware of issues surrounding TPLF— including through a Government Accountability Office study—there were no known cases of foreign-sourced capital funding litigation that could erode U.S. national security. Importantly, examples have finally come to light. These include foreign actors funding litigation targeting ExxonMobil and a sophisticated China-backed campaign to weaken America’s energy industry by promoting renewables and attacking fossil fuel energy production. Other revelations include financing the activity of non-practicing entities in patent litigation.
Examples of TPLF are playing out in real time today: Litigation brought by four U.S. environmental groups against ExxonMobil alleges that the energy giant willfully misled the public about the environmental dangers of single-use plastics. ExxonMobil asserts that the litigation, financed by Australian mining magnate and environmentalist Andrew Forrest, aims to damage the oil behemoth with smear techniques and lawfare “for politics, publicity, and private gain.”
Meanwhile, the largest TPLF firm is Fortress Investment Group, an alternative investment manager with close to $50 billion in assets under management, rendering it 10 times larger than publicly traded Burford. Intellectual property business includes VLSI, which brought numerous patent-infringement suits against Intel and other targets. Softbank Group acquired Fortress in 2017, and in 2023, Abu Dhabi sovereign wealth fund Mubadala Investment Company acquired a 68 percent stake in SoftBank. In January of this year, Fortress announced it was raising capital for a new $1 billion fund: the Fortress Legal Assets Fund II.
It would hardly be surprising to discover a Russian connection to TPLF activity. For example, A1—a subsidiary of Russian conglomerate Alfa Group—was found bankrolling litigation in New York. There have been reports of Russian TPLF activity in unseemly asset recovery cases, such as Tatiana Akhmedova seeking to realize a $625 million settlement from her ex-husband, Farkhad Akhmedov. Such cases are often litigated in the United Kingdom, where courts in England and Wales typically award the world’s most generous divorce settlements. The most recently reported Russian TPLF connection concerns phosphorus magnate Andrey Guriev pursuing discovery from Florida-based litigation funder 777 Partners, with other funders in the United States and elsewhere allegedly naming him in lawsuits.
TPLF should be discoverable in litigation, and conflicts of interest between funders and attorneys whose cases they fund should become known. Plaintiff attorneys are bound by duty of loyalty and independence, zealously representing clients’ interests over and against the interests of others. By contrast, the mission of funders—such as other public and private asset managers—is, as articulated by Burford, “to deliver superior risk-adjusted returns for our investors.” Military theorist Carl von Clausewitz maintained that “war is the continuation of politics by other means.” To paraphrase this, our courts should not be weaponized as battlefields on which hostile nations pursue advantage to the detriment of U.S. national security.