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They're Making a Federal Case Out of It . . . In State Court

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They're Making a Federal Case Out of It . . . In State Court

By Jessica Davidson Miller, John H. Beisner September 1, 2001
Energy & EnvironmentRegulations
EconomicsRegulations
Legal ReformOther

Increasingly, academics and policy makers are concerned that a handful of state courts, through their certification and settlement of interstate class action lawsuits, are effectively making law for 49 other states in addition to their own, or applying their own state law to citizens of other states.  Interstate class actions, often brought by a relatively small number of very skilled plaintiff's firms, can dictate regulatory policy for national industries and affect the rights of millions of consumers. This study examined class actions from 1998-2000 in 3 counties (Palm Beach County, Fl; Jefferson County, Tx; Madison County, Il) to discern whether the problems being discussed are an anomaly or a genuine threat that warrants congressional action.

In the last Congress, both houses carefully examined a key judicial policy question—should interstate class actions (that is, large-scale lawsuits with significant interstate commerce implications involving the residents and laws of multiple states) normally be heard by local county courts (that is, by judges typically elected by the residents of the court’s locality) or by federal courts (that is, by judges nominated by the President of the United States and confirmed by the duly elected Senators of all 50 states)? These discussions were prompted by introduction of legislation intended to widen the scope of federal diversity jurisdiction over interstate class actions.[2] After several detailed hearings,[3] that legislation passed the House.[4] Senate hearings were also held on the subject,[5] and the Senate Judiciary Committee ultimately endorsed enactment of a bill parallel to that passed by the House.[6] However, the full Senate never considered the measure, and the jurisdiction expansion proposals did not become law. The legislation has been reintroduced in the current session of Congress.[7]

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