TEXAS LAWYER, Feb. 12, 2001
Tort Reformers Pushing for Limits on Class Actions — Again


Armed with a new poll that says Texans are concerned about abuses of class-action suits, civil justice reformers are making another attempt to convince the Legislature to place limits on that type of legal action. "Today, these lawsuits don’t seem to be about justice," Tina Bruno, a spokeswoman for Central Texans Against Lawsuit Abuse, said at a Feb. 2 news conference at the Capitol. "They seem to be about greed, pure and simple," she added.

But Richard Hile, speaking on behalf of the Texas Trial Lawyers Association, says opinions handed down last year by the Texas Supreme Court in Intratex Gas Co. v. Richard Beeson, et al. , Ford Motor Co. v. Barry Sheldon, et al. and Southwestern Refining Co., et al. v. Julia Bernal have made it tougher to win class actions in the state.

"It’s our opinion that existing law is sufficient protection for defendants in a suit," says Hile, a partner in Dies & Hile in Austin.

Bruno cited a poll paid for by the American Tort Reform Association that found 68 percent of the 800 Texans surveyed believe that class-action suits benefit lawyers more than the people who have been injured. The survey, conducted Sept. 27 through Oct. 19 by the Center for Survey Research and Analysis at the University of Connecticut, has a margin of error of plus or minus 3 percentage points.

The Findings
The poll shows that Texans have conflicting attitudes about class-action suits, which allow a lawyer to represent many people in one legal action if they have suffered a similar injury.

Among the findings are that seven out of 10 Texans, or 72 percent of those polled, believe class-action suits are an effective way for people to be compensated for harm. But 62 percent of the respondents believe that class actions lead to higher prices for goods and services without providing real benefits, according to the survey results.

The survey also shows that 67 percent believe that regulation or legislation is a better way to protect individuals from injuries than class actions. The business-backed groups touting the survey have not suggested tougher regulations or legislation to restrain businesses, however.

Instead, the Texas Civil Justice League has been working with key lawmakers to draft a bill that would allow the state Supreme Court, through an interlocutory appeal, to determine whether a class should be certified. Similar legislation has been filed in the previous two sessions.

George Scott Christian, a spokesman for the league, said at the news conference that courts of appeals have the final word on standards for class certification because once a class is certified, the case is unlikely to go to trial. This had led to conflicting standards statewide, he said.

"We would like the Supreme Court to be able to resolve those conflicts," Christian said.

Sen. Teel Bivins, an Amarillo Republican who plans to introduce the bill in the Senate, says in an interview that the certification of a class often determines what is going to happen with a suit. "It forces defendants in many cases to enter into unreasonable settlements because they can’t afford for some jury to decide that they’ve lost the whole ranch," he says.

Provisions Proposed
Bivins says the bill also will include provisions staying court proceedings while an appeal is in progress and requiring that a class action go through the administrative process if a state agency has exclusive jurisdiction over the issue involved in the suit. Another provision, he says, would allow settlement classes so that cases involving plaintiffs with widely varying degrees of injury could be aggregated for settlement purposes.

Christian said at the news conference that the league is asking the Legislature to address the venue law, which was last reformed in 1995, to prevent lawyers from shopping around for the most sympathetic courts. Under the proposal, a class-action suit would have to be filed where a defendant resides or in a place that can be clearly identified as the site where the cause of action arose, he said.

"The problem is we’re getting class actions in remote counties of the state with no direct connection to the case," Christian said.

The venue issue is in the bill draft that the league is working on with the lawmakers, he said.

In 1999, a bill that would have allowed challenges to class-action certifications to be appealed directly to the state Supreme Court won Senate approval but died in the House.

Hile, who was involved in negotiations with the civil justice league in 1999, says the TTLA is concerned about the time factor if interlocutory appeals on class certification can go to the state’s highest civil court. If the certification issue goes from a court of appeals to the Supreme Court, the benefits of the class action could be destroyed by the time there’s an opinion, he says.

If the issue raised in a suit must go through a state agency review, as proposed by the bill, that’s "a black hole that a substantial number of cases will go into and never come out," Hile says.

Allowing settlement classes, Hile says, creates the potential for abuse and collusive efforts. He says such classes do not have to meet the traditional requirements for certification and, while benefiting a defendant and some plaintiffs, could hurt other plaintiffs’ claims.

Mary Alice Robbins’ e-mail address is mrobbins@amlaw.com .

Copyright 2001, Texas Lawyer. All rights reserved.

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