Senate Approves Class-Action Lawsuit Reform Bill; House Likely To Pass Legislation Next Week
The Senate on Thursday voted 72-26 to pass a class-action lawsuit reform bill (S 5), with approval from the House and President Bush likely as early as next week, the New York Times reports (Labaton, New York Times, 2/11).
The legislation seeks to prevent "forum shopping," a practice under which attorneys file lawsuits in jurisdictions that often favor plaintiffs. The bill also would shift class-action lawsuits from state to federal courts in cases in which more than $5 million is in dispute or in which plaintiffs and defendants reside in different states. In addition, the legislation includes several provisions that would protect plaintiffs from settlements where they receive coupons for discounts on goods and services while their lawyers receive large payouts (California Healthline, 2/10).
Fifty-three Republicans, 18 Democrats and Sen. Jim Jeffords (I-Vt.) voted in favor of the bill. Twenty-six Democrats voted against the legislation, and Sens. Rick Santorum (R-Pa.) and John Sununu (R-N.H.) abstained (New York Times, 2/11). Some "unexpected" Democrats voted in favor of the bill, such as Sens. Barack Obama (D-Ill.), Jeff Bingaman (D-N.M.) and Ken Salazar (D-Colo.), CQ Today reports (Stern, CQ Today, 2/10).
"The class-action bill is a strong step forward in our efforts to reform the litigation system and keep America the best place in the world to do business," President Bush said in a statement. He added, "I applaud the strong bipartisan majority in the Senate for passing this bill, and I call on the House to act promptly so that I can sign it into law" (Reynolds, Los Angeles Times, 2/11).
Senate Majority Leader Bill Frist (R-Tenn.) called the passage of the legislation "a victory for the American people," adding, "The bill protects plaintiffs' rights while reining in rampant abuse of America's courts" (Hurt, Washington Times, 2/11).
However, Senate Minority Leader Harry Reid (D-Nev.) said that the bill "slams the courthouse doors on a wide range of injured plaintiffs," adding, "It turns federalism upside down by preventing state courts from hearing state law claims, and it limits responsibility at a time of rampant corporate scandals. Instead of turning up the heat on corporate shenanigans, this bill lets corporate wrongdoers off the hook" (Los Angeles Times, 2/11).
Reid said that the Senate "should crack down" on "bad lawyers that bring meritless cases," but he added that "this bill is not about punishing bad lawyers. It is about hurting consumers and helping corporations avoid liability for misconduct" (Holland, AP/Houston Chronicle, 2/11).
The House likely will pass the bill as early as next week, as House members have approved similar legislation in previous sessions, according to the Washington Times.
House Majority Leader Tom Delay (R-Texas) and other Republican House members said in a statement, "The House passed this important legal reform in the 106th, 107th and 108th Congresses. Those efforts died variously at the hands of a minority of Democratic senators and former President Clinton. This time, with a solid bipartisan majority of senators and a reform-minded president, the outcome will be different" (Washington Times, 2/11).
Delay added, "We look forward to this legislation coming to the House floor next week so we can send it to President Bush" (Harris, Washington Post, 2/11).