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Congressional Bill Would Cripple Class Actions With New Requirements

January 26, 2016 @ 9:47 am

The National Employment Lawyers Association (NELA), to which Mr. Gaudet belongs as a member, recently issued a letter to Speaker Paul Ryan in opposition to a Congressional bill that would cripple class actions by requiring an early showing, at the start, that all class members suffered a similar injury.  Click here to read NELA’s letter.  The bill would require an enormous expenditure of time and money to investigate each and every class member in a class action, some of which contain 9 million class members. This would have to be done without the benefit of discovery from the defendant.

NELA’s letter identifies the particular language in the bill that would be onerous:

The House may soon consider H.R. 1927, the “Fairness in Class Action Litigation and Furthering Asbestos Claim Transparency Act of 2015.” Section 2 of this bill would effectively eviscerate consumer, antitrust, employment and civil rights class actions. The undersigned groups write in strong opposition to Sec. 2 of this bill. While a few modifications have been made to the bill since it was first introduced, what has not changed is the requirement that every person in a class have “an injury of the same type and scope” before the case can proceed. (The word “scope” replaced the word “extent” found in the bill’s earlier version, but this is a distinction without a difference.) Class members must already meet common requirements spelled out in F.R.C.P. 23, which requires that the class as a whole have the same type of injury stemming from the same unlawful conduct. However, a new requirement that every individual in a class have an injury of the same “scope,” proof of which must be established before the case can even proceed as a class, will sound the death knell for most class actions.
Many class actions would fail to meet these new requirements including the obligation to prove that class members sustained injuries of the same “scope” as well as the “same type.”  Currently, class members are not required to have the same “scope” of injuries and it would take decades for the meaning of this new requirement to be teased out.  The current rules only provide the class to show, at the start, that they have similar questions of law or fact.

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