In February, Representative Bob Goodlatte (R-Va.) introduced a new bill (H.R. 985) designed to “assure fairer, more efficient outcomes for claimants and defendants” in class-action and multi-district litigation. Dubbed the “Fairness in Class Action Litigation Act of 2017,” the proposed legislation would add a number of new hurdles and disclosure requirements that must be satisfied in connection with any case seeking class certification in federal court.
Among other things, the proposed law would: (i) provide for mandatory disclosures designed to prevent the approval of class actions in which the lawyer representing the class is a relative of a party in the class action suit; (ii) require that “any third-party funding agreement be disclosed to the district court”; and (iii) require federal circuit courts to accept any appeals of district court orders granting or denying class certification. In addition, for plaintiffs seeking “monetary relief,” the law would add an express requirement that the plaintiff “affirmatively demonstrate that each proposed class member suffered the same type and scope of injury as the named class representative.” Moreover, the bill also seeks to address disproportionately large attorney’s fee awards by, among other things, limiting class counsel’s fees to a “reasonable percentage” of the total amount of payments both “distributed to and received by class members,” and, similarly capping the total fee award to no more than that “received by all class members.”
Rep. Goodlatte—who is currently serving as Chairman of the House Judiciary Committee—also authored the Class Action Fairness Act of 2005 and was also behind another class action reform bill introduced in 2015 that failed to clear the Senate. As explained by the Chairman, the proposed legislation “seeks to maximize recoveries by deserving victims, and weed out unmeritorious claims that would otherwise siphon resources away from innocent parties.”