Triple-I: Saturation of legal advertising increasing the number of plaintiffs in mass litigation

By Isha Marathe

June 2 - (The Insurer) - The growing influence of third-party litigation funding and rising attorney advertising across the U.S. are increasing the number of plaintiffs in mass litigation and driving up legal system abuse, said the Insurance Information Institute in a recent report.

As with many factors of legal system abuse, the impact of excessive and aggressive attorney advertising has been challenging to quantify, Triple-I said. However, the report found a relationship between the proliferation of attorney advertising and escalating litigation and insurance claims.

The report's researchers created probability models using proprietary data on mass tort TV advertisements, matching it to Federal Judicial Center data on all filings that were transferred to multidistrict litigation.

They concluded that legal advertising increases the number of plaintiffs in a multidistrict litigation case and theorised that the increase in filings “is not merely a result of competition between lawyers for cases but, rather, a genuine growth in the number of claimants".

IMPACT OF ATTORNEY ADVERTISING

Problematic attorney advertising can create a false sense of urgency, pressuring the target audience to take legal action, possibly without even considering other options. It overpromises results when implying guaranteed windfalls, creating unrealistic expectations and potentially impacting time to settle. And, it can influence a potential jury, allowing attorneys to communicate plaintiff-biased information, which can impact the way jurors process facts about the case, Triple-I said.

In the 10 years up to and including 2022, the number of consolidated multidistrict litigation cases pending in federal courts has steadily declined. However, during the same period, the single largest group of pending multidistrict litigation has involved product liability cases, Triple-I said.

More than $106 million was spent by the 10 biggest digital legal advertisers in 2023. Triple-I cited a 2024 Wall Street Journal article that reported a 24% increase in federal civil cases filed in 2023.

Since the potential to optimise profits can motivate the increase in advertising for these cases, it is fair to presume the advertising boom played some role in the increase in mass litigation, Triple-I said.

As attorney advertising increases, so has consumer awareness around it, the report said.

While 89% of consumers reported seeing attorney advertising in 2024 (up 8 percentage points from 2021), the most frequently reported type of legal ad, by a large margin, targeted injuries from auto accidents, with 63% saying they encountered advertisements of this type, Triple-I found.

Triple-I said 52% of respondents said they feel attorney advertising increases the cost of their auto insurance (up from 45% in 2021).

Third-party litigation funding may further bolster this trend because investors may be especially attracted to mass litigation by the chance to optimise their financial returns, the report said.

As of March 2025, Arizona, Ohio, New Hampshire and at least five other states were considering third-party litigation funding disclosure legislation.

"While several factors may impact insurer costs, unnecessary and excessive litigation can drive higher loss ratios while being more challenging to predict and mitigate," Triple-I said. "Coverage affordability is a growing concern for many policyholders nationwide."