Litigation is a calculated gamble – you place your bets, you take your cards, and you try to play the best hand you can. But what happens when an uninvolved bystander decides to back one of the players, putting a big pile of brightly colored chips right in front of them?

That’s literally what happened in one high-profile international case involving Chevron and alleged pollution to the Ecuadorian jungle; and it is indicative of a new financing jackpot that needs to stop, according to speakers at the U.S. Chamber Institute for Legal Reform's (ILR) 13th annual summit on October 24.

With third-party litigation financing, the practice in which outside investors purchasing a stake in the outcome of litigation, litigants end up spending more time and money in court trying to maximize the investor's return on investment instead of seeking justice.

In the Chevron case, Russell DeLeon, the British founder of an online poker firm, invested $1.6 million with lawyers suing Chevron in exchange for as much as 6% of the anticipated fee, which would be 25%-30% of any settlement. “What could be a better argument against this notion than litigation in U.S. courts being funded by a poker magnate in London?” said Bob Weber, IBM’s senior vice president for legal and regulatory affairs and general counsel.

The practice is growing and isn’t likely to go away soon, said Daniel Fisher, senior editor at Forbes. “In theory, it’s a great investment class – the returns are spectacular,” he said. Fisher recently profiled the head of one of the investment firms at the center of this type of funding, Juridica, a London-listed firm with approximately $157 million invested in 23 cases, and claims an internal rate of return on completed investments of 85%.

The speakers discussed several legal and ethical problems with third-party litigation financing, including the fact that it may compromise the relationship between the plaintiffs and their attorneys and the disclosure of privileged company information to the financing company. “There’s absolutely no question in my mind, when you have a third-party funder investing, cases that are on their death bed, barely surviving, tend to last longer in the system,” Weber said.

ILR has released a white paper titled Stopping the Sale on Lawsuits: A Proposal to Regulate Third-Party Investments in Litigation which calls for legislation that appoints a federal agency to regulate third-party investments in litigation – an agency empowered to make rules and regulations in pursuit of its mandate and to enforce any laws, rules, or regulations governing this type of financing.

No one, not even a poker magnate, should be able to treat the U.S. court systems like an ATM.