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Class-Action Bill Flies Through House

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The House voted 279-149 Thursday to send President Bush a bill that will move jurisdiction over large, multi-state class-action lawsuits into the federal courts.[@@]

The Senate passed the same bill last week by a 72-26 vote.

The bill passed more quickly than most supporters had hoped.

The American Council of Life Insurers, Washington, welcomed the S. 5 vote.

“It looks like we finally crossed the goal line,” ACLI spokesman Jack Dolan says. “It appears as if we will finally get sensible reform. Life insurers applaud the House, Senate and the Bush administration for finally getting this bill through the Congress.”

The bill would require class-action suits seeking $5 million or more in damages to be heard in state court if the primary defendant and more than one-third of the plaintiffs were from the same state. If fewer than one-third of the plaintiffs were from the same state as the primary defendant, the case would go to federal court.

The bill also would limit lawyers’ fees in so-called coupon settlements – when plaintiffs get discounts on products instead of financial settlements – by linking the fees to a coupon’s redemption rate or the actual number of hours the lawyers spent working on a case.

The House acted on the Senate bill out of concern that any amendments to make the bill stronger would expose it to a Democratic filibuster in the Senate.

The bill passed after a 2-hour debate. Democrats’ efforts to pass a substitute bill failed.

In supporting passage, Republicans said on the floor of the House that restricting most large class-action lawsuits to federal court will stop lawyers from reaping huge profits from the system and lead to lower prices for consumers.

Democrats have argued that Republicans passed the bill to hurt a big group of Democratic donors and help big businesses escape multimillion-dollar verdicts from state courts. Republicans won’t be satisfied with changing the class-action system, said Rep. John Conyers of Michigan, the top Democrat on the House Judiciary Committee.

“Today we will attempt to pre-empt state class action,” Conyers said on the House floor. “Next month we will take up a bankruptcy bill that massively tilts the playing field in favor of credit card companies and against ordinary consumers and workers alike. On deck are equally one-sided medical malpractice bills and asbestos bills that both cap damages and eliminate liability to protect some of the most egregious wrongdoing in America.”

Links to the text of the bill and other information about the bill are on the Web at


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