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Class Act

Congress takes a vote on reforming class-action litigation procedures.

By Steven C. Bahls

Opinions expressed by Entrepreneur contributors are their own.

Business advocates hope the U.S. Senate follows the lead of theHouse and passes a bill restricting class-action litigation. Thatwould be good news for small businesses, which can get sucked intolawsuits just because they're located where lawyers expect tofind a sympathetic court.

For some lawyers, filing and trying class-action lawsuits hasbecome a lucrative business. After identifying some consumerproblem, typically in an industry that does business nationwide,they shop for a sympathetic venue before sending out notices topeople who might have been affected. A class-action lawsuit iseasier to win in some states than others, and some counties areknown for judges and juries with a penchant for multimillion-dollarjudgments. The Manhattan Institute, a conservative think tank basedin New York City, recently reported that the Madison Countycourthouse in Edwardsville, Illinois, sees more class-actionlawsuits than any other jurisdiction except Los Angeles andChicago. The county had two filed in 1998, 43 last year, and, ifthe trend continues, will have 78 this year.

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