Senate Ready To Move Class Action Bill

By Arthur D. Postal Washington Bureau Chief

NU Online News Service, Jan. 26, 3:35 p.m. EST, Washington?The Senate, which has consistently bottled up class action reform legislation, appeared today to have cleared such a measure for passage within 10 days.[@@]

That was the implication of the announcement by Sen. Arlen Specter, R-Pa. The senator said he would no longer link movement of class action to some difficult asbestos injury legislation and would report out the class action measure on Feb. 3. Introduction of the asbestos bill will be delayed until next week, he said.

The controversial asbestos bill would establish an alternative claims processing system for those injured by exposure to asbestos in the workplace. Sen. Specter's comments followed by one day remarks by Senate Majority Leader William Frist, R-Tenn., that he wants a vote on class action reform legislation on the Senate floor the week of Feb. 7.

David Winston, senior vice president, federal affairs, for the National Association of Mutual Insurance Companies, called Sen. Specter's comments after a closed session of the committee "interesting."

Mr. Winston explained that it means in effect that Sen. Specter's efforts to have his asbestos legislation move through his committee side-by-side with the class action bill had failed, clearly under pressure from the Senate Republican leadership. "The leadership really wants this [class action] bill to move," he said.

"We are pleased that the Senate has decided to establish passage of class action legislation as a priority," Mr. Winston said. "This bill will go a long way toward discouraging forum shopping by the plaintiff's bar and reduce efforts by them to ?game the system,' so to speak."

Joel Wood, senior vice president for governmental affairs at the Council of Insurance Agents and Brokers, added that "the industry, at long last, is going to see this bill enacted."

Hopefully, Mr. Wood said, "the vote will be sufficient to be a bellwether for legal reforms"?i.e., be strong enough to win support from Democrats for other legislation, like tort reform and curbs on medical malpractice litigation.

"Even the comments of Sen. Harry Reid, D-Nev., the minority leader, who was himself a trial lawyer, have been encouraging," Mr. Wood said. "He is resigned that several moderate members of the Democratic caucus will vote for this."

But Mr. Wood remained cautious, pointing out that compromise between the House and Senate "has always been elusive, and there are those on the House side who wish that this bill be much stronger. But we would rather have 80 percent of something than 100 percent of nothing."

Melissa Shelk, American Insurance Association vice president of federal affairs, said, "This year, as in the past, AIA is committed to working alongside class action reform supporters in the business community who have been harassed by frivolous class action suits to end this abuse of the civil justice system.

"The current system has been a losing proposition for everyone involved, except the trial attorneys who bring these lawsuits," Ms. Shelk said. "We feel the climate this year is particularly favorable for passage of this long-overdue fix for the badly broken class action system."

The legislation, introduced Monday as S. 5, would curb many current class action abuses by re-establishing federal authority over interstate cases in which plaintiffs' claims are over $5 million in the aggregate, while maintaining exclusive state authority over truly intrastate cases, so that the rights of consumers in all states are protected. S. 5 also limits "venue shopping" to prevent litigants from seeking out favorable court jurisdictions, requiring that claims be brought in a venue with a substantial connection to the injury.

The House of Representatives has previously passed class action reform on three separate occasions; the legislation fell one vote short the last time it was considered by the full Senate.

Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader

Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
  • Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.