Class Action Reform Boosted by Franchise Community


Washington, DC-The International Franchise Association(IFA) has announced its support for the Class Action Fairness Act(HR 2341), a bill sponsored by U.S. House Representatives BobGoodlatte (R-VA) and Rick Boucher (D-VA) that could curb classaction lawsuit abuse. The bill would require all complaints to bewritten in plain English, protect defendants from settlements thatwould cause them to suffer a net loss, and change otherrequirements regarding the locations of plaintiffs and the size ofthe damages they seek.

IFA chair and Mail Boxes Etc. president and CEO Jim Amos hailedthe legislation, acknowledging the implications for franchisedbusinesses. IFA and its members support class action legislation asthe first step in needed litigation reform.

"Attorneys may go after franchises in class action suitsthinking they are digging into deep corporate pockets, when in factthey are threatening the stability of a network of perhapsthousands of individually owned and operated smallbusinesses," Amos says.

One of the goals of the legislation is to allow large,multistate class action suits to be moved to federal courts,something that concerns the American Association of Franchisees& Dealers.

"The proposed legislation simply makes it more convenientand less costly for large corporations to defend class actions, andmore difficult and expensive for small plaintiffs to bringthem," says W. Michael Garner, AAFD spokesperson and afranchisee attorney with Dady & Garner PA in Minneapolis.

The bill was introduced in the House on June 27 and is currentlyin committee. -International Franchise Association,American Association of Franchisees and Dealers

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