Class-Action Reform

With enough votes to pass but perhaps not to overcome a filibuster, the long-debated Class Action Fairness Act finally is expected to get a hearing from the full Senate this week after Senate Majority Leader Bill Frist struck a deal with Democrats. It has been a long wait for the act, but time has treated it well: The Judiciary Committee has reviewed several versions of it and finally come up with one both sides of the debate should be content to support.

The act would amend the judicial code to direct civil actions to federal court when the value of the issue being debated exceeds $5 million and the dispute crosses state boundaries. It more clearly sets attorneys’ fees in these cases and reduces the incentive for lawyers to reap large profits while their many clients get a coupon. Without lawyer-bashing, this bill removes the incentive for huge lawsuits over specious injuries without surrendering protections for the public. It promotes a uniform measure of justice nationwide, rather than making letting some spots be much friendlier to plaintiffs or defendants.

The congressional debate over class-action lawsuits sometimes leaves the impression that the entire idea of bringing suit on behalf of hundreds or thousands of clients is a means of extortion. It isn’t. The class-action suit is an efficient way of hearing many similar cases, gives access to those who might not be able to obtain a representation on their own and counters corporate legal muscle with top lawyers on the side of consumers. But when lawyers get rich off cases while their clients, if they know they even are clients in these massive cases, get virtually nothing, it is hard to believe that justice is served.

Sen. Jeff Bingaman is expected to improve the act further with an amendment that would give judges discretion of whether to apply consumer protections from a group of states’ laws or pick one state law to stand for all states when considering a case. This ability should keep companies from moving to states with lax protection laws. It’s a welcome companion to the bill’s intention to reduce court shopping by plaintiffs’ attorneys, who look nationwide for sympathetic judges.

It is important to note that the legislation does not bar anyone from bringing a suit – it directs national suits to the federal courts and gives judges more discretion in deciding awards. These are reasonable rules and ones the Senate should support when the vote on the class-action act finally arrives.