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Turn the new class action act to your clients' benefit: although the so-called Class Action Fairness Act can hardly be considered a boon for plaintiffs, some sections may help keep a class action going and limit the statute's harm.

Article Excerpt
Many consumer groups, organized labor, and ATLA rightly opposed legislation earlier this year that sought to "reform" class action litigation due to perceived abuses. (1) Nonetheless, Congress passed the so-called Class Action Fairness Act of 2005 (CAFA) in February, and the president signed it into law. (2) The act was hailed by business interests and other opponents of civil justice as a major step forward for litigation "reform."

However, close inspection of the final version of the law reveals that many of its provisions should prove useful to plaintiffs bringing class actions. Many other provisions are so poorly drafted that they probably will never affect litigation, especially so-called mass actions. Nevertheless, the act will make it easier to remove state class actions to federal courts, which is why ATLA and others opposed it.

The primary goal of the CAFA was to move state class actions to the federal system. The drafters, however, felt constrained to remodel the federal class action, presumably to make it more hospitable for class actions generally. In so doing, they inadvertently made it easier to maintain a class action in federal court.

Section 2 of the law, "Findings and Purposes," specifically acknowledges that "class action lawsuits are an important and valuable part of the legal system." One of the CAFA's purposes is to ensure "fair and prompt recoveries for class members with legitimate claims." (3) Another is to bring into the federal courts "interstate cases of national importance under diversity jurisdiction." (4) Counsel bringing a federal class action will gain, I believe, by asserting these broad declarations against opponents of the class.

The act also liberalizes who may sue. It no longer has a requirement that the named class representatives (or any class member) allege an injury that meets the general jurisdictional requirement of $75,000 minimum in damages. (5) Instead, it has two new requirements: that the class consist of 100 or more claimants and that the matter in controversy exceed "the sum or value" of $5 million. (6) The phrase "sum or value" indicates that the $5 million can...

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