[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[S. 1501 Introduced in Senate (IS)]







104th CONGRESS
  1st Session
                                S. 1501

 To amend part V of title 28, United States Code, to require that the 
 Department of Justice and State attorneys general are provided notice 
 of a class action certification or settlement, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           December 22, 1995

  Mr. Cohen (for himself and Mr. Nunn) introduced the following bill; 
  which was read twice and referred to the Committee on the Judiciary

_______________________________________________________________________

                                 A BILL


 
 To amend part V of title 28, United States Code, to require that the 
 Department of Justice and State attorneys general are provided notice 
 of a class action certification or settlement, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Protecting Class Action Plaintiffs 
Act of 1995''.

SEC. 2. NOTIFICATION REQUIREMENT OF CLASS ACTION CERTIFICATION OR 
              SETTLEMENT.

    (a) In General.--Part V of title 28, United States Code, is amended 
by inserting after chapter 113 the following new chapter:

                      ``CHAPTER 114--CLASS ACTIONS

``Sec.
``1711. Notification of class action certifications and settlements.
``Sec. 1711. Notification of class action certifications and 
              settlements
    ``(a) For purposes of this section, the term--
            ``(1) `class' means a group of similarly situated 
        individuals, defined by a class certification order, that 
        comprise a party in a class action lawsuit;
            ``(2) `class action' means a lawsuit filed pursuant to rule 
        23 of the Federal Rules of Civil Procedure or similar State 
        rules of procedure authorizing a lawsuit to be brought by 1 or 
        more representative individuals on behalf of a class;
            ``(3) `class certification order' means an order issued by 
        a court approving the treatment of a lawsuit as a class action;
            ``(4) `class member' means a person that falls within the 
        definition of the class;
            ``(5) `class counsel' means the attorneys representing the 
        class in a class action;
            ``(6) `electronic legal databases' means computer services 
        available to subscribers containing text of judicial opinions 
        and other legal materials, such as LEXIS or WESTLAW;
            ``(7) `official court reporter' means a publicly available 
        compilation of published judicial opinions;
            ``(8) `plaintiff class action' means a class action in 
        which the plaintiff is a class; and
            ``(9) `proposed settlement' means a settlement agreement 
        between the parties in a class action that is subject to court 
        approval before it becomes binding on the parties.
    ``(b) This section shall apply to--
            ``(1) all plaintiff class actions filed in Federal court; 
        and
            ``(2) all plaintiff class actions filed in State court in 
        which--
                    ``(A) any class member resides outside the State in 
                which the action is filed; and
                    ``(B) the transaction or occurrence that gave rise 
                to the lawsuit occurred in more than one State.
    ``(c) No later than 10 days after a proposed settlement in a class 
action is filed in court, class counsel shall serve the State attorney 
general of each State in which a class member resides and the 
Department of Justice as if they were parties in the class action 
with--
            ``(1) a copy of the complaint and any materials filed with 
        the complaint;
            ``(2) notice of any scheduled judicial hearing in the class 
        action;
            ``(3) any proposed or final notification to class members 
        of--
                    ``(A) their rights to request exclusion from the 
                class action; and
                    ``(B) a proposed settlement of a class action;
            ``(4) any proposed or final class action settlement;
            ``(5) any settlement or other agreement contemporaneously 
        made between class counsel and counsel for the defendants;
            ``(6) any final judgment or notice of dismissal; and
            ``(7) any written judicial opinion relating to the 
        materials described under paragraphs (3) through (6).
    ``(d) A hearing to consider final approval of a proposed settlement 
may not be held earlier than 120 days after the date on which the State 
attorney generals and the Department of Justice are served notice under 
subsection (c).
    ``(e) A class member may refuse to comply with and may choose not 
be bound by a settlement agreement or consent decree in a class action 
lawsuit if the class member resides in a State where the State attorney 
general has not been provided notice and materials under subsection 
(c). The rights created by this subsection shall apply only to class 
members or any person acting on their behalf.
    ``(f) Any court order certifying a class, approving a proposed 
settlement in a class action, or entering a consent decree in a class 
action, and any written opinions concerning such court orders and 
decrees, shall be made available for publication in official court 
reporters and electronic legal databases.
    ``(g) Any court with jurisdiction over a plaintiff class action 
shall require that--
            ``(1) any written notice provided to the class through the 
        mail or publication in printed media contain a short summary 
        written in plain, easily understood language, describing--
                    ``(A) the subject matter of the class action;
                    ``(B) the legal consequences of joining the class 
                action;
                    ``(C) if the notice is informing class members of a 
                proposed settlement agreement--
                            ``(i) the benefits that will accrue to the 
                        class due to the settlement;
                            ``(ii) the rights that class members will 
                        lose or waive through the settlement;
                            ``(iii) obligations that will be imposed on 
                        the defendants by the settlement;
                            ``(iv) a good faith estimate of the dollar 
                        amount of any attorney's fee if possible; and
                            ``(v) an explanation of how any attorney's 
                        fee will be calculated and funded; and
                    ``(D) any other material matter; and
            ``(2) any notice provided through television or radio to 
        inform the class of its rights to be excluded from a class 
        action or a proposed settlement shall, in plain, easily 
        understood language--
                    ``(A) describe the individuals that may potentially 
                become class members in the class action; and
                    ``(B) explain that the failure of individuals 
                falling within the definition of the class to exercise 
                their right to be excluded from a class action will 
                result in the individual's inclusion in the class 
                action.
    ``(h) Compliance with this section shall not immunize any party 
from any legal action under Federal or State law, including actions for 
malpractice or fraud.''.
    (b) Technical and Conforming Amendment.--The table of chapters for 
part V of title 28, United States Code, is amended by inserting after 
the item relating to chapter 113 the following:

``114. Class Actions........................................    1711''.

SEC. 3. APPLICABILITY.

    This Act and the amendments made by this Act shall apply to all 
class action lawsuits filed after or pending on the date of enactment 
of this Act.
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