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The Class Action Fairness Act of 2005
Calling it “a model of effective, bipartisan legislation,” President Bush signed the Class Action Fairness Act of 2005 on Feb. 18, 2005. The Act was designed with two primary purposes:
- To reduce “forum-shopping” by plaintiffs and their attorneys searching for sympathetic state courts when deciding where to file suit; and
- To enhance fairness to class members of class action settlements.
To achieve these goals, the Act significantly expands federal jurisdiction over multi-state class actions while imposing new requirements on class action settlements in federal court, such as restricting attorney fee awards when class members receive coupons instead of cash in a settlement, and requiring defendants to notify federal and state officials of any proposed class action settlement. Parties involved in class actions initiated on or after Feb. 18, 2005 should fashion their legal strategies with the Act's sweeping changes in mind.
Expanded Federal Jurisdiction
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