IVCA Provides Updates for State Legislative Issues – 04/01/2026 – IVCA Cautions Against Anti PE Measures In The Legislature

IVCA Illinois Legislative Report
David Stricklin, IVCA Legislative Liaison, Stricklin & Associates

IVCA CAUTIONS AGAINST ANTI PE MEASURES IN THE LEGISLATURE

Private Equity is under scrutiny by legislatures across the country including Illinois. Critics are using the term “private equity” into something they think should give policy makers pause. Here in Illinois legislation has been introduced on a wide range of matters potentially affecting PE firms and their investment strategies.

The bill of greatest concern:

 HB 5487 / Gong Gershowitz / Private Equity in Law Firms Pushback.

As introduced the bill specifically referenced Private Equity and Hedge funds would be prohibited from investing the in the back-office functions of a law firm. IVCA opposes the bill and advised the committee members of our opposition. The bill was amended to take out “private equity” and “hedge fund” but the intent is the same:

HB 5487 ( HCA 0001) Gong-Gershowitz Replaces everything after the enacting clause. Reinserts provisions in the bill as introduced with these changes. Deletes references to “hedge fund” and “private equity group” and makes the Act applicable to “an entity owned, operated, or controlled in whole or in part by persons not licensed as attorneys”. Prohibits such an entity from accessing, owning, or determining the content of client records or accessing any attorney-client communications. Makes conforming changes. Effective immediately.

The bill passed the House Judiciary Committee unanimously. It is the brainchild of the Illinois Trial Lawyers Association, which has a long history in the Capitol and with this committee. The Illinois State Bar Association is also on record in support. The bill is now poised for action on the House floor in April. California is one state which has taken similar action and other states have it under consideration. Our opposition is not only to the bill itself but the broader precedent of imposing bans on PE investments in health care, housing, or other sectors of the economy.

At the same time, IVCA and other opponents including some major law firms were able to keep the Senate version of the bill from being heard in committee. SB 3812. This leaves open the question of what the ultimate result will be, but rest assured this is a high priority for ITLA and for the House sponsor. If you would like our help reaching out to your legislator, please advise IVCA Executive Director Christie Pruyn! The Illinois General Assembly is currently on Spring Break. The session picks up momentum the week of April 13.

The second measure IVCA has worked against is being driven by the Illinois Attorney General. The bill would expand the scope of health care transactions which are required to report to the Attorney General. While described by the AG as a simple clarification, IVCA is recommending caution as these types of regulatory expansions often lead to more specific and burdensome requirements: McDermott Will & Schulte Analysis.

HB 5000 also passed the House Judiciary Committee – Civil on a unanimous vote. IVCA is in touch with legislators and with the AG’s office to ensure they are aware of our concerns.