| Home > 107th Congressional Bills > S. 275 (is) To amend the Internal Revenue Code of 1986 to repeal the Federal estate and gift taxes and the tax on generation-skipping transfers, to preserve a step up in basis of certain property acquired from a decedent, and for other purposes. [Introduc...
S. 275 (is) To amend the Internal Revenue Code of 1986 to repeal the Federal estate and gift taxes and the tax on generation-skipping transfers, to preserve a step up in basis of certain property acquired from a decedent, and for other purposes. [Introduc...
108th CONGRESS 1st Session S. 274 To amend the procedures that apply to consideration of interstate class actions to assure fairer outcomes for class members and defendants, and for other purposes. _______________________________________________________________________ IN THE SENATE OF THE UNITED STATES February 4, 2003 Mr. Grassley (for himself, Mr. Kohl, Mr. Hatch, Mr. Carper, Mr. Specter, Mr. Miller, Mr. Chafee, and Mr. Lugar) introduced the following bill; which was read twice and referred to the Committee on the Judiciary _______________________________________________________________________ A BILL To amend the procedures that apply to consideration of interstate class actions to assure fairer outcomes for class members and defendants, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE; REFERENCE; TABLE OF CONTENTS. (a) Short Title.--This Act may be cited as the ``Class Action Fairness Act of 2003''. (b) Reference.--Whenever in this Act reference is made to an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of title 28, United States Code. (c) Table of Contents.--The table of contents for this Act is as follows: Sec. 1. Short title; reference; table of contents. Sec. 2. Findings and purposes. Sec. 3. Consumer class action bill of rights and improved procedures for interstate class actions. Sec. 4. Federal district court jurisdiction for interstate class actions. Sec. 5. Removal of interstate class actions to Federal district court. Sec. 6. Report on class action settlements. Sec. 7. Effective date. SEC. 2. FINDINGS AND PURPOSES. (a) Findings.--Congress finds the following: (1) Class action lawsuits are an important and valuable part of the legal system when they permit the fair and efficient resolution of legitimate claims of numerous parties by allowing the claims to be aggregated into a single action against a defendant that has allegedly caused harm. (2) Over the past decade, there have been abuses of the class action device that have-- (A) harmed class members with legitimate claims and defendants that have acted responsibly; (B) adversely affected interstate commerce; and (C) undermined public respect for our judicial system. (3) Class members often receive little or no benefit from class actions, and are sometimes harmed, such as where-- (A) counsel are awarded large fees, while leaving class members with coupons or other awards of little or no value; (B) unjustified awards are made to certain plaintiffs at the expense of other class members; and (C) confusing notices are published that prevent class members from being able to fully understand and effectively exercise their rights. (4) Abuses in class actions undermine the national judicial system, the free flow of interstate commerce, and the concept of diversity jurisdiction as intended by the framers of the United States Constitution, in that State and local courts are-- (A) keeping cases of national importance out of Federal court; (B) sometimes acting in ways that demonstrate bias against out-of-State defendants; and (C) making judgments that impose their view of the law on other States and bind the rights of the residents of those States. (b) Purposes.--The purposes of this Act are to-- (1) assure fair and prompt recoveries for class members with legitimate claims; (2) restore the intent of the framers of the United States Constitution by providing for Federal court consideration of interstate cases of national importance under diversity jurisdiction; and (3) benefit society by encouraging innovation and lowering consumer prices. SEC. 3. CONSUMER CLASS ACTION BILL OF RIGHTS AND IMPROVED PROCEDURES FOR INTERSTATE CLASS ACTIONS. (a) In General.--Part V is amended by inserting after chapter 113 the following: ``CHAPTER 114--CLASS ACTIONS ``Sec. ``1711. Definitions. ``1712. Judicial scrutiny of coupon and other noncash settlements. ``1713. Protection against loss by class members. ``1714. Protection against discrimination based on geographic location. ``1715. Prohibition on the payment of bounties. ``1716. Clearer and simpler settlement information. ``1717. Notifications to appropriate Federal and State officials. ``Sec. 1711. Definitions ``In this chapter: ``(1) Class.--The term `class' means all of the class members in a class action. ``(2) Class action.--The term `class action' means any civil action filed in a district court of the United States under rule 23 of the Federal Rules of Civil Procedure or any civil action that is removed to a district court of the United States that was originally filed under a State statute or rule of judicial procedure authorizing an action to be brought by 1 or more representatives as a class action. ``(3) Class counsel.--The term `class counsel' means the persons who serve as the attorneys for the class members in a proposed or certified class action. ``(4) Class members.--The term `class members' means the persons (named or unnamed) who fall within the definition of the proposed or certified class in a class action. ``(5) Plaintiff class action.--The term `plaintiff class action' means a class action in which class members are plaintiffs. ``(6) Proposed settlement.--The term `proposed settlement' means an agreement regarding a class action that is subject to court approval and that, if approved, would be binding on some or all class members. ``Sec. 1712. Judicial scrutiny of coupon and other noncash settlements ``The court may approve a proposed settlement under which the class members would receive noncash benefits or would otherwise be required to expend funds in order to obtain part or all of the proposed benefits only after a hearing to determine whether, and making a written finding that, the settlement is fair, reasonable, and adequate for class members. ``Sec. 1713. Protection against loss by class members ``The court may approve a proposed settlement under which any class member is obligated to pay sums to class counsel that would result in a net loss to the class member only if the court makes a written finding that nonmonetary benefits to the class member substantially outweigh the monetary loss. ``Sec. 1714. Protection against discrimination based on geographic location ``The court may not approve a proposed settlement that provides for the payment of greater sums to some class members than to others solely on the basis that the class members to whom the greater sums are to be paid are located in closer geographic proximity to the court. ``Sec. 1715. Prohibition on the payment of bounties ``(a) In General.--The court may not approve a proposed settlement that provides for the payment of a greater share of the award to a class representative serving on behalf of a class, on the basis of the formula for distribution to all other class members, than that awarded to the other class members. ``(b) Rule of Construction.--The limitation in subsection (a) shall not be construed to prohibit a payment approved by the court for reasonable time or costs that a person was required to expend in fulfilling the obligations of that person as a class representative. ``Sec. 1716. Clearer and simpler settlement information ``(a) Plain English Requirements.--Any court with jurisdiction over a plaintiff class action shall require that any written notice concerning a proposed settlement of the class action provided to the class through the mail or publication in printed media contain-- ``(1) at the beginning of such notice, a statement in 18- point or greater bold type, stating `LEGAL NOTICE: YOU ARE A PLAINTIFF IN A CLASS ACTION LAWSUIT AND YOUR LEGAL RIGHTS ARE AFFECTED BY THE SETTLEMENT DESCRIBED IN THIS NOTICE.'; ``(2) a short summary written in plain, easily understood language, describing-- ``(A) the subject matter of the class action; ``(B) the members of the class; ``(C) the legal consequences of being a member of the class action; ``(D) if the notice is informing class members of a proposed settlement agreement-- ``(i) the benefits that will accrue to the class due to the settlement; ``(ii) the rights that class members will lose or waive through the settlement; ``(iii) obligations that will be imposed on the defendants by the settlement; ``(iv) the dollar amount of any attorney's fee class counsel will be seeking, or if not possible, a good faith estimate of the dollar amount of any attorney's fee class counsel will be seeking; and ``(v) an explanation of how any attorney's fee will be calculated and funded; and ``(E) any other material matter. ``(b) Tabular Format.--Any court with jurisdiction over a plaintiff class action shall require that the information described in subsection (a)-- ``(1) be placed in a conspicuous and prominent location on the notice; ``(2) contain clear and concise headings for each item of information; and ``(3) provide a clear and concise form for stating each item of information required to be disclosed under each heading. ``(c) Television or Radio Notice.--Any notice provided through television or radio (including transmissions by cable or satellite) to inform the class members in a class action of the right of each member to be excluded from a class action or a proposed settlement, if such right exists, shall, in plain, easily understood language-- ``(1) describe the persons who may potentially become class members in the class action; and ``(2) explain that the failure of a class member to exercise his or her right to be excluded from a class action will result in the person's inclusion in the class action. ``Sec. 1717. Notifications to appropriate Federal and State officials ``(a) Definitions.-- ``(1) Appropriate federal official.--In this section, the term `appropriate Federal official' means-- ``(A) the Attorney General of the United States; or ``(B) in any case in which the defendant is a Federal depository institution, a State depository institution, a depository institution holding company, a foreign bank, or a nondepository institution subsidiary of the foregoing (as such terms are defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813)), the person who has the primary Federal regulatory or supervisory responsibility with respect to the defendant, if some or all of the matters alleged in the class action are subject to regulation or supervision by that person. ``(2) Appropriate state official.--In this section, the term `appropriate State official' means the person in the State who has the primary regulatory or supervisory responsibility with respect to the defendant, or who licenses or otherwise authorizes the defendant to conduct business in the State, if some or all of the matters alleged in the class action are subject to regulation by that person. If there is no primary regulator, supervisor, or licensing authority, or the matters alleged in the class action are not subject to regulation or supervision by that person, then the appropriate State official shall be the State attorney general. ``(b) In General.--Not later than 10 days after a proposed settlement of a class action is filed in court, each defendant that is participating in the proposed settlement shall serve upon the appropriate State official of each State in which a class member resides and the appropriate Federal official, a notice of the proposed settlement consisting of-- ``(1) a copy of the complaint and any materials filed with the complaint and any amended complaints (except such materials shall not be required to be served if such materials are made electronically available through the Internet and such service includes notice of how to electronically access such material); ``(2) notice of any scheduled judicial hearing in the class action; ``(3) any proposed or final notification to class members of-- ``(A)(i) the members' rights to request exclusion from the class action; or ``(ii) if no right to request exclusion exists, a statement that no such right exists; and ``(B) a proposed settlement of a class action; ``(4) any proposed or final class action settlement; ``(5) any settlement or other agreement contemporaneously made between class counsel and counsel for the defendants; ``(6) any final judgment or notice of dismissal; ``(7)(A) if feasible, the names of class members who reside in each State and the estimated proportionate share of the claims of such members to the entire settlement to that State's appropriate State official; or ``(B) if the provision of information under subparagraph (A) is not feasible, a reasonable estimate of the number of class members residing in each State and the estimated proportionate share of the claims of such members to the entire settlement; and ``(8) any written judicial opinion relating to the materials described under subparagraphs (3) through (6). ``(c) Depository Institutions Notification.-- ``(1) Federal and other depository institutions.--In any case in which the defendant is a Federal depository institution, a depository institution holding company, a foreign bank, or a non-depository institution subsidiary of the foregoing, the notice requirements of this section are satisfied by serving the notice required under subsection (b) upon the person who has the primary Federal regulatory or supervisory responsibility with respect to the defendant, if
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