Federal Bill Targets Class Action Lawsuit, Undercuts Consumer Rights

Tort reform supporters in Congress are fired up, gaining significant traction in recent weeks with a number of proposed measures that could substantially undercut consumer rights. people

One of the most troubling bills takes aim at class action lawsuits.

Misleadingly dubbed the, “Fairness in Class Action Act,” H.R. 985 passed 220-201 (largely along party lines), the measure might be more aptly named the Class Action Elimination Act.

The reality is this bill creates procedural and evidentiary burdens that some opine are so high, it will be nearly impossible to pursue class action litigation. That would be a huge blow for consumer rights because it’s a key tool consumers have to level the playing field against large companies for unfair dealings. 

Say one individual suffers harm when a product fails to perform as intended. The harm may not be significant. It would not be cost effective for that individual to strike out on their own and file a lawsuit. However, if there are hundreds or thousands of individuals that suffered the exact same harm with this product, they can band together to file class action litigation that holds the company accountable.

Some plaintiffs might receive more substantial payouts than others, but as our Miami consumer rights lawyers know, the major victory is that companies start to think twice about engaging in underhanded actions that violate consumer rights.

In an opinion recently published in Product Safety & Liability Reporter, consumer rights lawyers argue that the measure would “stifle judicial discretion” and serve to override appellate court consensus on class action litigation.

Law professors writing for the publication conceded class action litigation isn’t perfect. In fact, their academic research has a prime focus of detailing various abuses within the class action system. However, the bill proposed by the GOP isn’t going to fix those problems, they say. The effect, if the measure passes, will be that consumers will be prevented from banding together the next time an auto company conceals an ignition switch error or emissions test failure. When businesses rip off consumers – just a little – it strips buyers of one of the most important legal remedies.

Not only that, the professors opine that this action hurts small businesses too. When big businesses get away with cutting corners, smaller companies can’t compete with that unfair advantage.

Of course, this isn’t the first time conservative lawmakers have launched a campaign for “tort reform.” However, it’s one of the first times they have had a real shot at passing it – so they are pressing full steam ahead with great vigor.

One of the biggest problems with the proposal would be the requirement that class actions could only proceed if claimants all suffered the exact same damages. That is almost never going to happen. In fact, courts have historically struggled with this point. The bipartisan consensus reached by federal courts has been to allow “issue classes.” This is where proceedings focus first on a defendant’s liability, and then is followed by individual damage proceedings. Requiring every class member to have suffered the exact same damages will foreclose on many cases before they ever get started.

Another element of the bill would require plaintiffs to submit medical records shortly after they file their lawsuit. The judge would then have just 30 days to ascertain whether that proof is sufficient. That is, quite simply, impossible. If you have thousands of plaintiffs suing a drug company, no judge in the country has enough staff to fairly review that many medical records in a month.

If you’re battling debt collection or need help with a consumer rights claim in Miami or the surrounding areas contact Jacobs|Keeley for a confidential appointment to discuss your rights. Call (305) 358-7991. Also, don’t miss Miami Foreclosure Attorney Bruce Jacobs on 880AM/the Biz, every Wednesday at 5 p.m. on “Debt Warriors with Bruce Jacobs and Court Keeley,” discussing foreclosure topics that matter to YOU.

Additional Resources:

Congress’s Judicial Mistrust, April 3, 2017, By Elizabeth Chamblee Burch and Myriam Gilles, Product Safety & Liability Reporter

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Citibank Ordered to Pay for Illegal Debt Sales and Collection, March 22, 2017, Consumer Rights Attorney Blog