Posted on: Sunday, February 27, 2005

Bill has little effect on class-action cases here

By Ken Kobayashi
Advertiser Courts Writer

Legislation passed by Congress mandating that class-action lawsuits involving more than $5 million be handled by the federal courts won't have much of an impact on Hawai'i cases, according to members of the legal community here.

Congress last week sent to President Bush a bill that requires class-action lawsuits against companies seeking more than $5 million in damages to be heard in federal courts. State courts could handle class-action cases only if the primary defendant and more than a third of the plaintiffs are from that particular state.

Honolulu lawyer Thomas Grande, who has handled class-action cases in state and federal court and is editor in chief of the American Bar Association's survey of class-action law in the 50 states, estimated last week that fewer than 20 class-action suits are filed in Hawai'i each year.

He said class-action cases against local defendants and local plaintiffs involving less than $5 million in claims will still be heard in state courts. Even if a case falls under the legislation, the difference between the way the federal courts and the state courts here handle class-action suits is "very little."

One recent notable class-action case that settled this month resulted in the state agreeing to pay $1.2 million to prisoners who were held after they were supposed to be released. That case was already handled by the federal courts, Grande said.

Honolulu attorney Edmund Burke, a civil defense lawyer, said from his experience, the impact here will be slight. He said some Mainland lawyers might engage in "forum shopping" to find a jurisdiction that provides a "friendly atmosphere" to file the class-action cases in state courts, but that Hawai'i courts do not have that reputation.

Reach Ken Kobayashi at 525-8030 or kkobayashi@honoluluadvertiser.com.