Class Action Fairness Act of 2005

CLASS ACTION FAIRNESS ACT OF 2005 -- (Senate - February 10, 2005)

Mr. SCHUMER. Mr. President, I rise today to express my support for S. 5, the Class Action Fairness Act, and to explain why I supported the amendment proposed by my friend from California, Senator Feinstein, for herself and on behalf of my friend from New Mexico, Senator Bingaman.

I support the class action legislation before us today. Certain lawsuits have become a concern to many Americans. Many lawsuits have been filed in local State courts that have no connection to the plaintiff, the defendant, or the conduct at issue. This allows forum shopping, which undercuts the basic fairness of our justice system.

Having said that, I am not one of those who think access to the courts should be unduly blocked. Our citizens' use of the courts has led to many reforms in the protection of civil rights and the environment, and has held corporate malefactors accountable for improper conduct that has cost victims billions of dollars. Often for those without power, a lawsuit is the only avenue for redress. We need lawsuits, but the rules governing them should be fair.

As we have heard yesterday and today, courts in some places have become magnets for all kinds of lawsuits. Some of these lawsuits are meritorious; some are not. In either scenario, if the case affects the Nation as a whole, it should be heard in Federal court. Judges in small counties should not make law for all of America. Although those judges might make good law, there is a real risk that parochial concerns would dominate in that type of decision. That is not to say that there are not judges in the Federal courts who do not have extreme views on both sides of the issues, much as we try not to confirm judges who fall out of the mainstream.

Consequently, we need to rein in forum shopping. When consumers allege that a product sold nationwide to consumers in all 50 States is defective, a Federal court should decide that case.

It is for these reasons that I joined with my colleagues, the Senator from Connecticut, Mr. Dodd, and the Senator from Louisiana, Ms. Landrieu, to help craft the compromise that led to the bill before us.

The spirit of the compromise we reached would not create a new mechanism to dismiss class actions, but instead would remove the large and national class actions to the Federal courts.

But when Senators Dodd, Landrieu, Carper, Kohl, and I, all of whom have worked so long and hard on this bill, met with the majority leader and others 2 years ago, we made perfectly clear the right of the minority to offer amendments. That right remains an essential part of my participation in the compromIse.

Although we worked hard to improve the bill, we wanted to make sure that our colleagues had the opportunity to offer amendments because no bill is perfect.

One area where the bill could be improved stems from a real concern that many of the consumer class actions removed to Federal court might not be certified on the grounds that there would be too many non-common issues due to differences among State laws that would apply to different members of the national class. To date, at least 26 Federal district courts have refused to certify class actions on those grounds.

Some of us believed that not certifying could have resulted in a problem because it would effectively mean the weakening, if not the disappearance, of the class members' ability to get remedies, particularly with the changes made to current law by this bill. Not certifying could also create a practical problem for lawyers, who have the opportunity to try their class action before one court, and post-decertification might have to re-plead and try several class actions in several courts, thereby destroying the sought-after efficiency of class actions and creating the risk that the results would not be uniform.

This was not the desired outcome of our compromise: We intended to send national class actions to Federal court, not to their graves.

The amendment that my friend from California, Senator Feinstein, and my friend from New Mexico, Senator Bingaman, introduced would not only have improved the bill, but would have also furthered the spirit of the compromise by clarifying our intention that the bill remove, but preserve class actions, even when Federal judges face choice of law issues.

Importantly, this amendment would not have aided forum-shopping plaintiffs' lawyers. Instead, it would have clarified options for a Federal judge facing a choice of law question. That clarification would have helped to grind to a halt the class action merry-go-round between the State and Federal courts. I hope that Federal judges view this bill, even without the amendment, as a vehicle that was intended to bring national class actions to the Nation's courts and not as a vehicle to balk at certification. The use of subclasses to protect people's rights under their State laws is now in the hands of Federal judges. They have the tools to protect those rights. This bill was not intended to destroy them.

That view will protect an important instrument of deterrence against future wrongdoing and an important adjunct to regulators in the enforcement of laws protecting our citizens.

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