Barratry

Barratry refers to the practice of stirring up or inciting litigation, particularly the filing of groundless suits for profit. In the litigation finance context, barratry concerns arise when funders are accused of identifying and soliciting plaintiffs to pursue claims the plaintiffs would not otherwise have brought. While sophisticated commercial funders do not engage in claim origination of this type, the barratry doctrine informs regulatory discussions about funder conduct, particularly in mass tort and consumer litigation finance. Some critics of the industry invoke barratry-adjacent arguments when opposing mandatory disclosure of funding arrangements in class actions.

Sophisticated commercial funders structure their intake process to receive claims through counsel rather than soliciting plaintiffs directly, specifically to avoid any barratry-adjacent characterization that opponents of the industry invoke in legislative and regulatory debates over disclosure. This reputational risk management matters most in mass tort and consumer-facing segments, where critics are most likely to allege that funding incentivizes manufactured litigation rather than financing meritorious claims that already exist.