http://www.sfgate.com/cgi-bin/article.cgi?f=/news/archive/2005/02/10/national/w123626S32.DTLSenate OKs Limit on Class Action Lawsuits
By JESSE J. HOLLAND, Associated Press Writer
Thursday, February 10, 2005
(02-10) 12:48 PST WASHINGTON, (AP) --
The Senate on Thursday gave President Bush the first legislative victory of his second term by approving legislation to help shield businesses from major class action lawsuits.
Under the legislation, long sought by big business, large multistate class action lawsuits like the ones that have been brought against tobacco companies could no longer be heard in small state courts. Such courts have handed out multimillion-dollar verdicts.
Instead, the cases would be heard by federal judges, who have not proven as open to those type of lawsuits.
The Senate passed the bill 72-26. The House is expected to take it up next week and send it to President Bush for his signature.
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concerning this legislation:
Public Citizen Press
Feb. 9, 2005
Senate on Track to Lock Consumers Out of Courthouse, Invite More Market
Deception
Statement of Public Citizen President Joan Claybrook
By defeating amendments that would make the class action bill fair to
consumers, the Senate made it exceedingly clear that its allegiance lies
with banks, credit card companies, drug manufacturers, big insurance
companies and other major corporations that fund campaigns and don’t
want to be held accountable for wrongdoing.
The result of this legislation, if enacted into law, will be more abuse and deception of consumers by unscrupulous businesses, because consumers will be locked out of the courthouse.
This bill creates a classic Catch-22 for consumers. Congress will be telling consumers that class actions based on state law must be heard in federal court, but the doors to the federal courthouse will be locked. Federal judges typically don’t allow such suits to go forward; they view them as unmanageable because they are based on a variety of different state consumer protection laws. The Feinstein- Bingaman amendment would have allowed federal judges to hear these cases, but its defeat ensures that corporate lobbyists will achieve their desired results: the elimination of virtually all class actions of significance. This will occur because there is no federal consumer protection law consumers can use to seek remedies.
If this bill is enacted, as it appears it will be, corporate wrongdoers will have a green light to lie, cheat and steal without fear of being held to account. The phrase “consumer beware” will once again be the law of the marketplace.
http://www.citizen.org/pressroom/release.cfm?ID=1874 .
For more information on class actions,
http://www.citizen.org/congress/civjus/class_action /