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February 15, 2016 Practice Points

H.R. 1927 Passes House and Heads to Senate

The Fairness in Class Action Litigation and Furthering Asbestos Claim Transparency Act of 2016 makes it through

by Ben V. Seessel

On January 8, 2016, the U.S. House of Representatives passed, by a vote of 211–188 along party lines, H.R. 1927—the Fairness in Class Action Litigation and Furthering Asbestos Claim Transparency Act of 2016. The bill would amend U.S. Code, title 28, to preclude federal courts from certifying “any proposed class seeking monetary relief for personal injury or economic loss unless the party seeking to maintain such a class action affirmatively demonstrates that each proposed class member suffered the same type and scope of injury as the named class representative or representatives.” It would also require that class certification orders “include a determination, based on a rigorous analysis of the evidence presented” that such a demonstration had been made.

The proposed legislation was sponsored by Representative Rob Goodlatte or Virginia, Chair of the House Judiciary Committee. The House Judiciary Committee’s report makes clear that the bill’s purpose is to counteract recent federal court decisions certifying class actions in which putative class members sustained no injury. Among other decisions, the report cites the Sixth Circuit’s decision in In re Whirlpool Corp. Front Loading Washer Products Liability Litigation, 722 F.3d 838, 849 (6th Cir. 2013), in which the court affirmed an order certifying a class of washing machine owners who alleged that their machines produced a moldy smell, notwithstanding that a majority of absent class members did not experience a similar problem with their machines. It also noted the Seventh Circuit’s decision in In re IKO Roofing Shingle Products Liability Litigation, 757 F.3d 599, 603 (7th Cir. 2014), in which it held that the district court had abused its discretion in denying certification on the basis that certain putative class members’ roofing shingles did not manifest the alleged defect. And the House Judiciary Committee Report also cited a recent decision from the Ninth Circuit, Wolin v. Jaguar Land Rover North America, LLC, 617 F.3d 1168, 1173 (9th Cir. 2010), in which the court held that “proof of the manifestation of a defect is not a prerequisite to class certification,” in a case brought on behalf of a putative class alleging that defects in their Jaguar automobiles caused premature tire wear.

The bill would also amend section 524(g) of the Bankruptcy Code to require asbestos trusts to file quarterly reports with the bankruptcy court, detailing claimants’ names, claimants’ exposure history, and the basis for any payments made to claimants.

H.R. 1927 has been read twice in the Senate and referred to the Senate Committee for the Judiciary.

Ben V. Seessel is a shareholder with Carlton Fields in Hartford, Connecticut.

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