Judiciary Vote First Step in Fixing Class Action System

WASHINGTON, DC, April 11, 2003 - The Senate Judiciary Committee's vote today to reform the state court class action lawsuit system is the beginning of a process to make class action lawsuits simpler, fairer and faster for everyone. The bill will curb rampant venue shopping in state courts and abusive settlements in which class members receive coupons or something else of little value while their lawyers receive huge legal fees, according to the U.S. Chamber of Commerce.

"This is a win for consumers and business," said Stanton D. Anderson, the Chamber's executive vice president and chief legal officer. "Those who benefit the most from the current system are class action lawyers; those who benefit the least are consumers and class members. This bill changes all that."

The Class Action Fairness Act of 2003 (S. 274) expands the jurisdiction of federal courts, allowing them to more easily hear large class action lawsuits in which plaintiffs and defendants are from different states. This will ensure that national class action lawsuits, involving plaintiffs from around the country, can be heard in federal courts.

"The fact that this bill has won bipartisan support is a significant milestone that puts us one very large step closer to making class action reform a reality," Anderson said. "We have nothing but praise for the spirit of cooperation shown by Democratic Senators Feinstein, Kohl and Carper and Republican Senators Hatch and Grassley. We are grateful that they have been working so well together."

Class action lawsuit reform has been endorsed by newspapers across the country. In addition, the American Bar Association recently endorsed the concept of expanding the jurisdiction of federal courts to hear more of these cases.

A recent poll conducted for the Chamber's Institute for Legal Reform, which appeared in USA Today, found that 67 percent of those questioned thought the class action lawsuit system needed to be reformed. Forty percent of those questioned, or the equivalent of about 60 million people, said they had received a notice telling them they were members of a class action lawsuit. Of that number, only 30 percent said they took steps to share in any possible reward, and more than half didn't think they received anything of any value.