Tennessee Small Business Owners and Insurance Companies Crosshairs under Tennessee Senate Plan

by ARC Legal Funding

Two weeks ago the Tennessee Senate passed SB-1360, a bill that would implement suffocating price control regulations onto the consumer legal funding industry, hurting both small businesses and consumers in Tennessee. 

Dan Cleary, the founder of Provident Litigation Funding, Inc., a small business owner based in Nashville, Tennessee has been helping Tennessean for years by providing the important services of consumer legal funding.  But due to the recent events in the Tennessee Senate, Dan is very concerned about SB-1360 and its potential impact to the business he has built over the years.

“If this statute is enacted, my employees will lose their jobs, and the people of Tennessee will lose access to consumer legal funding altogether,” Dan said.

Dan’s company is designed to serve citizens, like those in Tennessee who are suddenly unable to work, often due to an automobile accident, and left without a paycheck.  These consumers usually have no other option to access funds to pay for essential daily expenses such as rent, transportation, utilities or food while their legal claims are being settled.  Dan’s agreements with these consumers are non-recourse, meaning that unless there is a settlement, the consumer has no obligation for repayment.

 So, why among its very first items of business in the New Year, would the Tennessee Senate abruptly schedule a vote on legislation to put Dan’s industry out of business? Or why is Senator Jack Johnson (R-Franklin) speaking on the senate floor about consumer legal funding as a “valuable service to people in need” one minute and passing a bill that sends the industry to its grave the next minute? And even more perplexing is why the Tennessee Chamber of Commerce, an organization normally an advocate of free enterprise and small business, is leading such a charge at the statehouse?

The answer is simple, as it all leads back to major pressure being applied from the Washington, DC-based U.S. Chamber of Commerce and the billion-dollar national insurance company interests who are calling the shots from outside the Volunteer state.

While we all hope a citizen never finds themselves injured or in the financial constraints that require consumer legal funding, the truth is, it happens.  Unfortunately, these services and Dan’s business are on the brink of extinction in Tennessee leaving future citizens without the services so many have found to be so helpful.