Appeals Court Upholds Tort Reform Ruling

An appeals court panel has upheld a lower court’s ruling that a so-called mass action can be moved to a federal court from a state court under the federal Class Action Fairness Act, even if a group of plaintiffs deny that their action is a mass action.

In the Chicago-based 7th U.S. Circuit Court of Appeals on Friday, August 1, opinion in Bullard et al. v. Burlington Northern Santa Fe Railway Co. et al., Chief Judge Frank Easterbrook noted that under the Class Action Fairness Act, a mass action can be sent to federal court if the plaintiffs propose a trial involving the claims of at least 100 litigants, if at least one plaintiff seeks at least $75,000, if the stakes as a whole are more than $5 million and if the parties involved are from different states.

The plaintiffs in the case—144 people seeking damages from Burlington Northern and three other defendants that allegedly allowed dangerous chemicals to escape from a wood-processing plant—sought to have the case tried in Cook County, Illinois, circuit court. The defendants, citing the Class Action Fairness Act, sought to have the case heard in the U.S. District Court for the Northern District of Illinois. The plaintiffs said the case should be moved back to state court because their suit was not a mass action.

The plaintiffs “insist that a complaint never proposes a trial,” wrote Easterbrook. “According to the plaintiffs, defendants may remove a ‘mass action’ only on the eve of a trial, once a final pretrial order or equivalent document identifies the number of parties to a trial.”

The district court denied the plaintiffs’ motion, and the appeals court affirmed that ruling, with Easterbrook noting that the appeals court took the case because the legal issue had never been addressed in any federal circuit court. He wrote that the lower court’s “conclusion is the only sensible reading” of the statute.

The plaintiffs argued that “no mass action could ever be a class action, for a suit cannot be identified as a ‘mass action’ until close to trial, while a suit is a class action or not,” under the relevant section of CAFA, “on the date of filing,” wrote Easterbrook. “Courts do not read statutes to make entire subsections vanish into the night.”

Filed by Mark A. Hofmann of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.