Class Actions Improvements Act Exposed

The Class Actions Improvement Act was Originally approved by the American Legislative Exchange Council (ALEC) Board of Directors September 13, 2000. Amended version approved by the ALEC Board of Directors January 14, 2009. Re-approved by ALEC Board of Directors on January 28, 2013.

CMD's Bill Summary

This bill greatly limits class action lawsuits, a major vehicle for confronting a large corporation's widespread practices that cause injury or are discriminatory. In particular, this bill specifies that class actions can only be maintained if the plaintiffs are not seeking any money (see Sect 2(b)(2)). It also makes it much more difficult to maintain a class action if it involves plaintiffs from multiple states, and adds a series of other presumptions against the maintenance of the class. This bill would have the effect of protecting large manufacturers of goods and large service providers from liability.


This "model" bill seeks to replace state statutes and judicial decisions to make it more difficult for Americans to file and maintain class action lawsuits in state court. The ability to file a class action can help individual Americans aggregate and strengthen their case and leverage in claims against corporations whose products or actions have injured multiple people. Through this legislation, corporations are trying to consolidate gains they have made in the federal court system under judges that are often selected from law firms that have primarily represented corporate defendants and not injured plaintiffs. In so doing, this proposed legislation seeks to supplant state procedures and rulings that may be more sympathetic to injured Americans than the federal system. Among other things, the proposed bill attempts to limit the ability of a state court to handle a class action that involves citizens of its own state along with citizens of other states who have been injured or killed by products sold nationally. This aids companies and limits injured Americans' rights.

ALEC Bill Text

Summary

This Act adopts a modified comparative fault system which bars a plaintiff's recovery whose fault exceeds that of the defendants and nonparties. This ensures that only deserving plaintiffs are compensated. A key part of this Act is the assessment of the fault of nonparties, which guarantees that named parties are not assigned artificially high percentages of responsibility. To apply comparative fault, the jury must allocate fault or responsibility to each party. This allocation also provides the information necessary to allocate responsibility for damages if the state has eliminated or modified joint and several liability. If the state has a statute governing joint and several liability, legislators should ensure that the provisions of the comparative fault statute are consistent with that statute.

Model Legislation

{Title, enacting clause, etc.}

Section 1. {Title.}

This Act shall be known and may be cited as the Comparative Fault Act.

Section 2. {Definitions.}

The following words, as used in this Act, shall have the meaning set forth below, unless the context clearly requires otherwise:

(A) "Fault" means an act or omission of a person that is a proximate cause of injury or death to another person or persons, damage to property, tangible or intangible, or economic injury, including but not limited to negligence, malpractice, strict liability, absolute liability, or failure to warn. Fault shall not include any tort that results from an act or omission committed with a specific wrongful intent.

(B) "Comparative fault" means the degree to which the fault of each person was the proximate cause of the alleged injury or death or damage to property, tangible or intangible.

(C) "Person" means any individual, corporation, company, association, firm, partnership, society, joint stock company, or any other entity, including any governmental entity or unincorporated association of persons.

Section 3. {Comparative fault standard.}

In any action for personal injury, property damage, or wrongful death, recovery shall be predicated upon principles of comparative fault and the liability of each person who caused the injury shall be allocated to each person in direct proportion to that person's percentage of fault. Where the percentage of fault chargeable to the plaintiff is less than the aggregate fault of all defendants and nonparties, the plaintiff may recover damages, but the plaintiff's recovery of damages will be diminished in proportion to the percentage of fault chargeable to the plaintiff. Where the plaintiff's percentage of fault is equal to or exceeds the aggregate fault of all defendants and nonparties, the plaintiff shall be barred from any recovery.

Section 4. {Fault of nonparties}

(A) In assessing percentages of fault, the trier of fact shall consider the fault of all persons who contributed to the alleged injury, death, or damage to property, tangible or intangible, regardless of whether said person was, or could have been, named as a party to the suit. Negligence or fault of a nonparty may be considered if the plaintiff entered into a settlement agreement with the nonparty or if the defending party gives notice within 120 days of the date of trial that a nonparty was wholly or partially at fault. The notice shall be given by filing a pleading in the action designating such nonparty and setting forth such nonparty's name and last-known address, or the best identification of such nonparty that is possible under the circumstances, together with a brief statement of the basis for believing such nonparty to be at fault.

(B) Nothing in this Act is meant to eliminate or diminish any defenses or immunities that currently exist, except as expressly noted herein. Assessments of percentages of fault for nonparties are used only as a vehicle for accurately determining the fault of named parties. Where fault is assessed against nonparties, findings of such fault shall not subject any nonparty to liability in this or any other action, or be introduced as evidence of liability in any action.

Section 5. {Assumption of the risk.}

(A) In any tort action, a defendant shall not be liable if the injured person assumed the risk of injury or harm to property. Assumption of the risk shall mean that the injured person:

(1) knew of and appreciated the risk; and

(2) voluntarily exposed himself or herself to the danger which proximately caused the injury or damage.

(B) The elements of assumption of the risk may be inferred, as a matter of either fact or law, from circumstantial evidence that the injured person must have known and appreciated the risk and voluntarily encountered it.

Section 6. {Imputed fault.}

Nothing in this Act is intended to, in any way, disturb the doctrine of imputed negligence, or fault currently followed in this jurisdiction.

Section 7. {Effect of contributory fault.}

Contributory fault shall not bar recovery in any action for personal injury, property damage, or wrongful death, except as otherwise provided in Section 5.

Section 8. {Burden of proof.}

The burden of alleging and proving fault shall be upon the person who seeks to establish such fault.

Section 9. {Limitations.}

Nothing in this Act shall be construed to create a cause of action. Nothing in this Act shall be construed in any way to alter the immunity of any person.

Section 10. {Severability clause.}

Section 11. {Repealer clause.}

Section 12. {Effective date.}

Added to 2013 version: "[i] There is substantial uniformity among the state statutes and state court rules that govern class certification. Forty states have adopted (sometimes with minor modifications) the current (1966) version of Fed. R. Civ. P. 23. Two states (Mississippi and Virginia) have no formal class action statutes or rules at all."