February 28, 2017

Class action reform bill clears House Judiciary Committee

The House Judiciary Committee approved class action reform legislation Feb. 15 by an 18-11 party-line vote without holding a hearing to examine the myriad provisions and complex considerations involved in changing the Federal Rules of Civil Procedure.

The ABA, in a Feb. 14 letter to the committee, had urged the committee to delay markup to hold a hearing on the bill, H.R. 985, which is more comprehensive than class action reform legislation that passed the House during the last Congress. The ABA opposed the previous legislation because it would have unnecessarily circumvented the Rules Enabling Act process developed by Congress to amend the federal rules, and made it more difficult for large numbers of injured parties to efficiently seek redress in court. In the letter, ABA Governmental Affairs Director Thomas M. Susman also pointed out that the Judicial Conference of the United States is considering changes to Rule 23, which governs class action certification, and recommended that Congress allow that process to continue.

H.R. 985 would amend Rule 23, which was adopted in 1966 and has been amended several times using the Rules Enabling Act. Currently, plaintiffs must meet rigorous threshold standards to proceed with a class action case, and the ABA maintains that current screening practices are working. The legislation, however, would mandate that no federal court shall certify any proposed class seeking monetary relief for personal injury or economic loss unless the party affirmatively demonstrates that each proposed class member suffered the same type and scope of injury as the named class representative(s).

“This requirement places a nearly insurmountable burden for people who have suffered personal injury or economic loss at the hands of large institutions with vast resources, effectively barring them from bringing class actions,” Susman wrote.

He explained that class actions have been an efficient means of resolving disputes and that many of the legitimate complaints about lawsuit abuses through class-action litigation have been addressed through the evolution of class-action standards by the courts and through consideration by the Judicial Conference.

H.R. 985 also contains several provisions to modify procedures governing multidistrict litigation proceedings.

Committee Chairman Bob Goodlatte (R-Va.) applauded approval of H.R. 985, maintaining that the action of the committee “addresses the abuses within our class action litigation system and keeps baseless class action suits away from innocent parties, while still keeping the doors to justice open for parties with real and legitimate claims.” 

 

Back to the February 2017 Washington Letter