Class Action Fairness Act Places Multistate Class Actions Before Federal Courts

Article by Perry A. Napolitano and Robert D. “Bo” Phillips, Jr.

Recently, 53 Senate Republicans teamed with 18 Democrats and one Independent to pass what is considered a key component of President Bush’s litigation reform agenda. On February 18, 2005, the president signed into law the Class Action Fairness Act of 2005. Supported by the U.S. Chamber of Commerce and other business interests, the Act is intended to enhance federal court jurisdiction over multistate class actions-actions that are filed in state courts based on the residency of a few class members, but in which the class consists of consumers or employees from around the nation. Accordingly, the Act grants federal district courts original jurisdiction over civil actions in which the total matter in controversy exceeds $5 million, and at least one class member and one defendant are citizens of different states. This aggregation of the amount in controversy and "minimal diversity" jurisdiction will apply to actions