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Threats to Class Action Litigation

Coming soon in Congress, four bills with conveniently misleading titles that would limit plaintiffs' access to the courts by restricting class action litigation.

CLASS ACTION LITIGATION is a type of legal action where one plaintiff -- or party bringing the legal claim -- represents a group of people ("class") similarly affected. 

Class actions are BENEFICIAL to individuals because it allows for power in numbers. Think of this: one person with one claim of $1,000 doesn't hold much weight in court, especially with the cost of legal fees. However, if 100 individuals join a class action lawsuit, it allows the class to receive just compensation, even if their individual claims are small. 

Because of class actions, individuals can hold corporations responsible for malfeasance. 

SUMMARY OF THE CURRENT BILLS

1. "Fairness in Class Action Litigation Act of 2017," H.R. 985, would critically hobble class actions by making them much more difficult to certify and reducing the compensation to plaintiffs’ class action lawyers. This bill is far-reaching and the most problematic of all four. Perhaps the most concerning provision is that law would require plaintiffs seeking class certification in a federal court to affirmatively demonstrate that each class member had the same type and scope of injury. Not only would this slow the entire system down, but it is incredibly difficult and nearly impossible to find identical class members.

2.  "Lawsuit Abuse Reduction Act of 2017,"  (S.237 and H.R. 720) would amend Rule 11 of the Federal Rules of Civil Procedure to eliminate the 21-day "safe harbor" and to make sanctions mandatory instead of discretionary if a violation is found. 

3. "Innocent Party Protection Act," H.R. 725, imposes criteria to apply on a motion to remand a case that was removed to federal court on the basis of diversity, where one of the defendants is a citizen of the forum state and where the defendants claim that the joinder of that defendant is "fraudulent." 

4. "Stop Settlement Slush Funds Act of 2017," H.R. 732, would prohibit the federal government from negotiating settlements that include “payments to third parties to advance programs that assist with recovery, benefits, and relief for communities harmed by lawbreakers.”  

Follow the news on the Civil Procedure & Federal Courts Blog here.

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