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 New York, litigation funding, also known as third-party litigation financing, is a practice where a third party provides financial assistance to a litigant to cover legal fees and other expenses associated with a lawsuit. 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. New York does not have specific statutes that comprehensively regulate litigation funding, but the practice is generally allowed and governed by case law, contracts law, and professional conduct rules that apply to attorneys. The New York State Bar Association has issued ethics opinions providing guidance on the involvement of attorneys in litigation funding arrangements. Attorneys must ensure that such arrangements do not compromise their professional responsibilities, including maintaining client confidentiality and avoiding conflicts of interest. Additionally, disclosure of litigation funding arrangements may be required under certain circumstances during the litigation process.