Litigation funding—also known as litigation financing or third-party litigation funding (TPLF)—provides a person or entity with the money to pay attorney fees, expert witnesses, and other costs necessary for litigation. Litigation funding is essentially a loan, secured by the proceeds of the expected settlement or collection of judgment in a lawsuit, and is designed to allow persons or entities without the necessary resources to pursue valid claims in litigation.

In North Carolina, litigation funding, also known as third-party litigation funding (TPLF), is a practice where a third party provides financial assistance to a litigant to cover legal expenses such as attorney fees and expert witness costs. This funding is typically non-recourse, meaning that the funder will only be repaid from the proceeds of a settlement or judgment if the litigation is successful. North Carolina does not have specific statutes directly regulating litigation funding for general civil litigation. However, the practice must comply with general state laws on contracts, lending, and professional conduct for attorneys. Attorneys in North Carolina are bound by the North Carolina Rules of Professional Conduct, which impose certain duties regarding client confidentiality and conflicts of interest that must be considered when engaging with litigation funders. Additionally, while not specific to litigation funding, North Carolina's usury laws cap the interest rates that can be charged on loans, which could potentially apply to the funding agreements if they are deemed to be loans. It is important for parties involved in litigation funding agreements in North Carolina to ensure that their arrangements are structured in compliance with relevant laws and ethical rules.