R Street Testimony in Support of SB 69, “Georgia Courts Access and Consumer Protection Act”

Testimony from:
Marc Hyden, Director, State Government Affairs, R Street Institute

In SUPPORT of SB 69, “Georgia Courts Access and Consumer Protection Act”

March 25, 2025

House Subcommittee of Rules on Lawsuit Reform

Chairman and members of the committee:

My name is Marc Hyden. I am a Georgia resident and the director of state government affairs for the R Street Institute, which is a nonprofit, nonpartisan public policy research organization. Our mission is to engage in policy research and outreach to promote free markets and limited, effective government in many areas, including in finance, insurance and trade. This is why SB 69 is of special interest to us.

Lawmakers are well-aware of Georgia’s broken tort system. The American Tort Reform Foundation (ATRF) ranked Georgia as the number one “judicial hellhole” in 2022 and number four in 2024, thanks to the increasing number of nuclear verdicts and expansive liability laws. The results have been inescapable. “Lawsuit abuse and excessive tort costs wipe out billions of dollars of economic activity annually. Georgia residents pay a ‘tort tax’ of $1,213.80 and 123,900 jobs are lost each year,” reports ATRF.

Georgia’s Office of the Commissioner of Insurance and Safety Fire also conducted an in-depth study on the matter, and its findings confirmed what we already knew: the tort system is broken. The Insurance Commissioner noted that claims, claim payouts and legal involvement have been surging in Georgia. Insurers often bear the brunt of this, and in order to remain solvent, they must pass on some of the increased expenses on to consumers. Ultimately, individual insureds and businesses pay the price of lawsuit abuse.

While there are a host of variables driving this phenomenon, third party litigation funding (TPLF) is one of them. TPLF is a quickly growing industry in which financiers—often hedge funds and even foreign interests—secretly invest in lawsuits in exchange for a large cut of the judgement. As of 2023, there was an estimated $15.2 billion invested in commercial litigation in the United States. Federal law does not regulate this, and TPLF has run amok in Georgia. This arrangement encourages more lawsuits, drives up payouts and bogs down the judicial system, and since the investing agreements are frequently conducted in secret, funders’ interests can be prioritized over the plaintiffs’.

SB 69 does not seek to end the practice of TPLF, but rather enact some common sense reforms. If passed, it would forbid foreign adversaries from investing in such suits, require disclosures of TPLF agreements and safeguard consumers from predatory lending practices under the guise of TPLF. Put simply, SB 69 aims to protect the United States from hostile enemies and consumers from unscrupulous financiers. For these reasons, we appreciate Sen. Kennedy’s leadership on this issue and urge your support for SB 69.

Thank you,

Marc Hyden
Director, State Government Affairs
R Street Institute
(404) 918-2731
mhyden@rstreet.org