Goodlatte and Farenthold Applaud House Passage of Litigation Reform Legislation

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Washington, January 8, 2016 | Elizabeth Peace (202.225.7742) | comments

House Judiciary Committee Chairman Bob Goodlatte (R-Va.) and Regulatory Reform, Commercial and Antitrust Law Subcommittee Vice-Chairman Blake Farenthold (R-Texas) released the following statement upon the passage of the Fairness in Class Action Litigation Act of (H.R. 1927) by the House of Representatives by a vote of 211-188.

The legislation combines the Fairness in Class Action Litigation Act (H.R. 1927) and the Furthering Asbestos Claim Transparency (FACT) Act (H.R. 526) in order to bring necessary reforms to the class action litigation and asbestos bankruptcy trust systems. Chairman Goodlatte is the chief sponsor of the Fairness in Class Action Litigation Act, and Subcommittee Vice-Chairman Farenthold is the chief sponsor of the FACT Act.

Chairman Goodlatte: “This legislation closes a major loophole that allows aggressive trial lawyers to extort millions from companies, and then line their own pockets with those millions, while paying pennies and mere lip service to the actual victims. What’s worse, this scheme raises prices for all consumers because companies must raise prices to pay for these wasteful lawsuits. The bill the House passed today takes power away from the trial lawyers and gives it back to consumers who have actually been harmed.

“It also injects much-needed transparency into the asbestos bankruptcy trust system. By screening out dishonest claims and abuses of the system, we can ensure that deserving asbestos victims are not cheated.

“I was pleased to author the Class Action Fairness Act, which was signed into law ten years ago. Today, I am pleased the House has passed legislation to further reduce wasteful litigation, fraud and abuses in our legal systems, so that the truly injured can get the compensation they deserve.”

Congressman Farenthold: "The FACT Act helps ensure there are funds left for veterans and others exposed to asbestos that are not yet showing symptoms by curbing fraud and double dipping. The legislation is carefully crafted to protect victims privacy while making enough information available to combat fraud and abuse.

“Because asbestos trusts operate in secret, it’s impossible to tell how many abusive claims the trusts have received. Today, we’ve brought forth common sense legislation that will assist the asbestos compensation system in preventing fraud and abuse while protecting claimants’ private information.”

Details on the FACT Act: The FACT Act reduces fraud in the asbestos bankruptcy trust system through increased transparency measures. These measures ensure that asbestos bankruptcy trusts have the tools to combat fraud, which limits funds available for asbestos victims. The FACT Act is a measured approach that strikes the proper balance between achieving transparency and protecting victims’ privacy. Similar legislation passed the House of Representatives with a bipartisan vote last Congress.

Details on the Fairness in Class Action Litigation Act: The bill calls for reforms to the current federal class action lawsuit framework by requiring classes that consist of members with the same type and extent of injury. Under the proposed legislation, uninjured or non-comparably injured parties can still join class actions, but must do so separately from parties that experienced more extensive injury. 

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