Ohio Checked the Passports: HB 105 Reads Foreign Capital Out of the Courthouse

On July 7, 2026, in Columbus, Governor Mike DeWine signed House Bill 105 and made Ohio the first state to check a litigation funder's passport at the courthouse door. The sentence that does the work now sits in Section 1357.07 of the Revised Code: "No commercial litigation financier shall knowingly enter into a commercial litigation financing agreement with a person or entity that is not domiciled in the United States or respecting a legal claim that is financed, directly or indirectly, by a person or entity not domiciled in the United States." Bloomberg Law's read of the statute names Burford Capital and Parabellum Capital as the two funders the test would bar. Burford reports a $7.5 billion legal finance portfolio in its own annual results. Neither firm has said what it will do about a state that just made its money contraband.

Twenty days redrew the map. On June 17, New York's 25 percent cap on a funder's take took effect. On June 22, North Carolina made the trade itself unlawful, at $50,000 per violation. On July 7, Ohio went after the capital. New York capped the take. North Carolina banned the trade. Ohio banned the money. Three statutes, three theories, one summer, and no funder's compliance memo from May survives any of them.

The mechanism is a three-way lockout. Under the enrolled text of HB 105, a commercial litigation financier cannot knowingly fund a foreign-domiciled party or a claim financed, directly or indirectly, by one. A consumer legal funding company is barred the same way. And the third clause turns the gun around: "No consumer or entity shall enter into a consumer legal financing agreement or a commercial litigation financing agreement with a person or entity that is not domiciled in the United States." The litigant who takes the money violates the chapter too. The phrase "directly or indirectly" is the long arm. A fund domiciled in Delaware does not clear the test if the capital behind it is not American. North Carolina priced its violation at $50,000 a hit. Ohio skipped the price tag. Section 1357.10 hands the attorney general "any equitable remedy," including an order barring the company from doing business in the state at all.

Bloomberg Law's coverage of the signing reads the test onto two names: Burford Capital and Parabellum Capital, the two funders its analysis identifies as headquartered abroad or backed by investors who are. Burford Capital, last seen in the Sysco settlement veto episode using its funding contract to block its own funded party's antitrust settlements, now faces a statute that outlaws both halves of that story in Ohio. The control clause, Section 1357.09, orders that a financier "shall not make any decision, have any influence, or direct any decisions" on a claim, naming settlement outright. The passport clause takes care of the rest. Parabellum Capital had never drawn a statute with its name in the coverage before this one. Its first appearance on this scoreboard is a ban.

The tactical map has clean edges. Contingency-fee lawyers are exempt. Banks whose repayment does not ride on the outcome are exempt. Insurers and preexisting indemnitors are exempt, along with 501(c) nonprofits funding pro bono cases. Everyone else gets a registration window: beginning ninety days after the sections take effect, no financier does business in Ohio without registering with the attorney general, listing its name, domiciliary address, chief executive, and corporate family. Then comes the part the industry will hate most. When a funded claim resolves, the lawyers must file the existence and contents of the funding agreement with the attorney general within fourteen days, and the statute orders the attorney general to "promptly publish the contents" on a public website. Any contract clause that tries to wall the agreement off from discovery is "void and unenforceable." The confidential funding agreement, the industry's load-bearing wall since Rancman v. Interim Settlement Funding Corp. put champerty back in Ohio's vocabulary in 2003, becomes a public record with a URL.

The next fight is already drafted into the statute. The general assembly wrote Section 1357.07(D) as a declaration of intent: the ban serves "the legitimate state interest of protecting due process rights for all litigants in the courts of this state by addressing the grave risk posed by foreign actors that seek to interfere with those courts." A legislature does not write that sentence for its own reading. It writes it for a judge, in the constitutional challenge it expects the funders to file. The ABA Journal reports the litigation finance industry responded to the signing with outrage while the U.S. Chamber praised it. Outrage is not a pleading. The funders' real options are three: sue Ohio, restructure into capital that can show an American passport, or write the state off.

Ohio's ledger now runs ahead of everyone's. The registration clock starts ninety days after the chapter takes effect. The first funded Ohio claim to resolve after that puts a funding agreement on the attorney general's website for anyone to read. And somewhere a funder's litigation team is pricing the suit against the state that banned its money. The map is drawn. The next move is theirs.