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An Open Letter to the U.S. House of Representatives: Vote "YES" on the Class Action Fairness Act of 2005
February 15, 2005
On behalf of the 350,000 members of the National Taxpayers Union (NTU), I write to offer our views concerning the Class Action Fairness Act of 2005 (S. 5) recently passed by the Senate and scheduled for a vote in the House on Thursday. Specifically, we urge you to vote YES on S. 5.
America's legal system is already the most expensive in the history of the world. As the American Tort Reform Foundation observes, the U.S. tort system imposed costs of $152 billion on the American economy in 1994 -- in subsequent years these costs have risen by 125 percent. In fact, tort costs already represent 2.2 percent of America's Gross Domestic Product.
For taxpayers and consumers these statistics are very bad news, since they are the ones who largely end up footing the bill for the trial lawyers' exploits. This is true in private actions, because when a company has to pay millions for a claim, those costs are generally passed on to consumers in the form of higher prices (although employees and shareholders also take a hit).
Therefore, Thursday's passage of legislation in the Senate that would move most class-action suits with aggregate claims of $5 million or more from state courts to federal courts is a win for taxpayers, consumers, and the economy. The Senate's bipartisan vote in favor of legislation that had failed in the three previous Congresses is a welcome sign that the stranglehold trial lawyers have on Washington is beginning to slip.
NTU and its members applaud the persistence of those in Congress who have fought for this opportunity to finally put a crimp in the ability of trial lawyers to "forum shop" class-action lawsuits for the purpose of achieving excessive personal financial gain. Thus, we strongly encourage you to maintain your position in suport of S. 5 as this crucial vote approaches.
We need to stop the frivolous and abusive tactics of the trial lawyers in many areas, including medical malpractice and asbestos. NTU hopes that House passage of S. 5 will provide Congress with the necessary momentum to tackle these other issues this year. Accordingly, a YES vote on S. 5 will be weighted favorably in NTU's 2005 Rating of Congress.
John Berthoud, Ph.D