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June 02, 2004

It's on... no, it's off

The saga of tort reform bills in the U.S. Senate continued Monday and Tuesday, as Majority Leader Bill Frist took a U-turn, first intending to bring the Class Action Fairness Act to the floor for a vote, then backing off as Democrat supporters of the bill balked at Frist's intention to move the bill forward. The Act is intended to address the phenomenon of large national class action cases being shopped to the most permissive jurisdiction in the country -- inevitably a "magnet court" favorable to plaintiffs -- by allowing for such cases' removal to federal court.

The "magnet court" phenomenon is certainly real, as admitted by plaintiffs' lawyer extraordinaire Dickie Scruggs: "[W]hat I call the 'magic jurisdiction,' . . . [is] where the judiciary is elected with verdict money. The trial lawyers have established relationships with the judges that are elected; they’re State Court judges; they’re popul[ists]. They’ve got large populations of voters who are in on the deal, they’re getting their [piece] in many cases. And so, it’s a political force in their jurisdiction, and it’s almost impossible to get a fair trial if you’re a defendant in some of these places. The plaintiff lawyer walks in there and writes the number on the blackboard, and the first juror meets the last one coming out the door with that amount of money. . . . The cases are not won in the courtroom. They’re won on the back roads long before the case goes to trial. Any lawyer fresh out of law school can walk in there and win the case, so it doesn’t matter what the evidence or the law is."

See also my take on the Class Action Fairness Act in a Wall Street Journal column last year; and John Beisner and Jessica Davidson Miller's excellent new study "There Will Be No Exodus: An Empirical Study Of S. 2062’s Effects On Class Actions," which collects empirical data which suggest it is unlikely that most non-magnet-court class actions will leave state courts under the new law.

Posted by James R. Copland at 02:16 PM | TrackBack (0)

Class Actions
Statistics/Empirical Work



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