Friday, February 18, 2005

Mediating Class Actions in 2005 and Forward – It’s Not the Same Now!

In his own words, President Bush seeks to “end the lawsuit culture in our country” by signing the Class Action Fairness Act of 2005 today. What’s the impact on mediation? Well, for one thing it sets the venue of class action suits seeking $5 million or more in state court only if the primary defendant and more than 1/3 of the plaintiffs are from the same state. However, if less that 1/3 of the plaintiffs are from the same state as the primary defendant, and more than $5 million is the amount in controversy, the case will be heard in Federal court.

Next, the Act limits attorneys’ fees in settlements where plaintiffs get discounts or coupons on products instead of a financial settlement. The attorneys’ fees are linked to the coupon’s redemption rate or the actual hours spent working on a particular case.

There’s more!

After you read this Act, do you think it will have other effects on mediation?

To email me, click Perry S. Itkin