Last month the Consumer Financial Protection Bureau released a ground-breaking 700 page study. They found that over 32 million cheated Americans are helped every year by class action lawsuits. More astonishing, they found that class actions helped consumers recover an average of $220 million a year and “for checking accounts alone, class action settlements over three years totaled over $600 million for at least 19 million consumers.”
In light of these extraordinary findings, you would think that Congress would be working hard to pave the path for greater access to class action litigation - but you’d be wrong. The House Judiciary committee had other plans.
Last week, Committee Chairman Bob Goodlatte (VA-R) introduced legislation that would end nearly all federal class action lawsuits. Yes, that’s right. H.R. 1927, the “Fairness in Class Action Lawsuits Act of 2015,” would effectively end federal class action lawsuits. (When a company practices a pattern of discrimination or receives a large windfall through small injuries to large numbers of people, a class action lawsuit allows harmed individuals to band together to challenge this wrongdoing in court.)
And this isn’t their usual “do-nothing” effort - the kind of effort evident in their inaction on immigration reform, police misconduct or systematic dismantling of voting rights. They are serious about this one. The bill, H.R. 1927, introduced just last week in the House, has already been scheduled for a hearing with the Judiciary Subcommittee on the Constitution and Civil Rights this week.
The bill will require that every victim in a class action suffer the same "type" and "extent" of injury and also limits the definition of injury to a victims' body or property. So while H.R. 1927 doesn’t come out and simply prohibit class action suits, it establishes criteria that is nearly impossible for plaintiffs' to meet.
Under H.R. 1927 no civil rights or discrimination class actions could ever be brought. Even the landmark case, Brown v. Board of Education couldn't proceed under this bill.
But it doesn't stop there. Slews of cases and victims would be disqualified from bringing a class suit. The requirement that every member of a class have the same type and extent of injury would preclude numerous class actions over predatory lending practices, anti-trust violations, employment law violations, unfair bank overdraft policies, denial of insurance benefits, and more - much more than I can mention. Even victims of the BP oil spill would be covered by this bill.
Class actions are an important tool to help victims get the justice they deserve when they are harmed or cheated. It is completely absurd that Congress is considering taking away this instrument.
H.R 1927 is as ridiculous as it sounds. The Committee tasked with ensuring access to the justice system is working to end one of the most important tools for justice that Americans have: federal class action rights.