N.Y. FIS Law § 1005 — New York Code / Act FIS / Article 10 / Section 1005
Disclosures
Status: in_force

§ 1005. Disclosures. All litigation funding contracts shall contain\nthe disclosures specified in this section, which shall constitute\nmaterial terms of the contract. Unless otherwise specified, such\ndisclosures shall be typed in at least twelve point bold type font and\nbe placed clearly and conspicuously within the contract, as follows:\n  (a) On the front page under appropriate headings, language specifying:\n  (i) the funded amount;\n  (ii) an itemization of all charges;\n  (iii) a payment schedule to help consumers understand how much they\nwill have to pay in charges based on different hypothetical resolutions\nof the consumer's legal claim; and\n  (iv) the following statement in at least twelve point type font: "The\nmaximum amount you may be required to pay cannot exceed 25% of the gross\nrecovered amount received for your claim plus the amount paid to you by\nthe litigation funding company, but only to the extent that there are\nproceeds available from your legal claim."\n  (b) Within the body of the contract in at least twelve point type\nfont:  "Consumer's right to cancellation: you may cancel this contract\nwithout penalty or further obligation within ten business days after the\ndate you receive the payment from the litigation funding company if you\nreturn to the litigation funding company the full amount of the\ndisbursed funds."\n  (c) Within the body of the contract, an explanation that the\nlitigation funding company shall have no role in deciding whether, when\nand how much the legal claim is settled for, however, the consumer and\nconsumer's attorney must notify the company of the outcome of the legal\nclaim by settlement or adjudication prior to paying the company from the\nproceeds of any settlement, judgment, award or verdict that may be paid\nto resolve that consumer's legal claim. The company may seek updated\ninformation about the status of the legal claim but in no event shall\nthe company interfere with the independent professional judgment of the\nattorney in the handling of the legal claim or any settlement thereof.\n  (d) Within the body of the contract, in all capital letters in at\nleast twelve point bold type font contained within a box: "THE AGREED\nUPON CHARGES SHALL BE PAID ONLY FROM ANY PROCEEDS OF YOUR LEGAL CLAIM,\nAND SHALL BE PAID ONLY TO THE EXTENT THAT THERE ARE AVAILABLE PROCEEDS\nFROM YOUR LEGAL CLAIM. YOU WILL NOT OWE (INSERT NAME OF THE LITIGATION\nFUNDING COMPANY) ANYTHING IF THERE ARE NO PROCEEDS FROM YOUR LEGAL\nCLAIM, UNLESS YOU HAVE VIOLATED ANY MATERIAL TERM OF THIS CONTRACT OR\nYOU HAVE COMMITTED FRAUD AGAINST (INSERT NAME OF LITIGATION FUNDING\nCOMPANY)."\n  (e) Located immediately above the place on the contract where the\nconsumer's signature is required, in twelve point bold type font: "Do\nnot sign this contract before you read it completely. Do not sign this\ncontract if it contains any blank spaces. You are entitled to a\ncompletely filled-in copy of the contract before you sign this contract.\nDepending on the circumstances, you may want to consult a tax, public or\nprivate benefits planning, or financial professional. You acknowledge\nthat your attorney in the legal claim has provided no tax, public or\nprivate benefit planning, or financial advice regarding this contract.\nYou further acknowledge that your attorney has explained the terms and\nconditions of the litigation funding contract."\n  (f) A copy of the executed contract shall promptly be delivered to the\nattorney for the consumer.\n  (g) The following shall be printed within the body of the contract in\nall capital letters in at least twelve point bold type font: "PURSUANT\nTO THE LAWS OF THE STATE OF NEW YORK, THE MAXIMUM AMOUNT YOU MAY BE\nREQUIRED TO PAY CANNOT EXCEED 25% OF THE GROSS RECOVERED AMOUNT RECEIVED\nFOR YOUR CLAIM PLUS THE AMOUNT PAID TO YOU BY THE LITIGATION FUNDING\nCOMPANY."\n