Class Action Fairness Act of 2003-Motion to Proceed

CLASS ACTION FAIRNESS ACT OF 2003—MOTION TO PROCEED

Mr. GRASSLEY. Mr. President, I rise to ask my colleagues to vote in support of the motion to proceed to S. 1751, the Class Action Fairness Act of 2003. This bill is a fair and balanced solution to the growing problem of class action abuses, and it has solid bipartisan support. The process that was used to get to the floor was open and fair. The bill deserves to be debated, and my colleagues should support cloture on the motion to proceed so that we can get on the bill and consider amendments.

This modest bill will preserve class action lawsuits as an important tool that brings representation to the unrepresented.
But it will also go a long way toward ending class action lawsuit abuses where the plaintiffs receive coupons of little or no value, while their lawyers receive millions. It makes you wonder who benefits from these class actions: the consumers or their lawyers? Given the trial lawyers' opposition to this bill, I think we know the answer to that question.

Both forum-shopping plaintiffs' lawyers and corporate defense lawyers are abusing the system. Lawyers are choosing plaintiff-friendly county courts to hear national class action cases, and defendants are shopping around for the best settlement deal regardless of whether it is the right thing to do. The lawyers file competing class actions, and enter into collusive settlements.

Some class action lawyers manipulate pleadings to avoid the removal of cases to the Federal courts, even if it hurts their clients. Some even name an innocent local defendant just to beat Federal jurisdiction. In the end, it is the consumer that is the big loser. This just isn't right.

The Class Action Fairness Act of 2003 tries to fix the more egregious abuses. The bill includes a number of provisions to help protect class members. It requires that notice of proposed settlements in all class actions, as well as all class notices, must be in clear, easily understood English. It requires that State attorneys general be notified of any proposed class settlement that would affect residents of their States so that they can act as watchdogs for fairness.

The bill includes provisions to help ensure that there are fair settlements. For example, it disallows cash bounty payments to lead plaintiffs so lawyers looking for victims can't promise them unwarranted payoffs to be their excuses for filing suit.
It requires that judges to carefully scrutinize settlements where the plaintiffs get only coupons or noncash awards, and the lawyers get money. The bill requires a court to make a written finding that the settlement is fair and reasonable for class members.

Finally, the bill injects some rationality in terms of where large, nationwide class actions can be heard. It allows more class action lawsuits to be removed from State court to Federal court, either by a defendant or an unnamed class member. A class action would qualify for Federal jurisdiction if the total damages exceed $5,000,000 and parties included citizens from multiple states. But if a case really belongs in State court because it is a local problem or the class members and defendants are in-State, the case won't be decided in Federal court.

This is a good bill. It is fair and balanced. We have been working with Senators on both sides of the aisle to try to get it right. There is no question that there are serious problems with the current class action system and we need to deal with these abuses. So I urge all my colleagues to join me in supporting cloture on the motion to proceed so that we can finally get to the bill and debate this legislation.