Volkswagen bail-out bill moving through Congress

"Class action fairness" bill would get VW off the hook

You can count on Congress to come to the help of corporations in trouble, and right now it's Volkswagen USA that's in trouble. The Virginia-based automaker faces huge fines and a blizzard of class action lawsuits because of its German parent's use of allegedly deceptive emissions inspection-cheating software on "clean diesel" cars.

So to the rescue races Rep. Bob Goodlatte, a Virginia Republican who is among those promoting what's called the "Fairness In Class Action Litigation Act of 2015," a short and rather vague bill that would group injured parties into "classes" for the purpose of class-action litigation. Lawyers for aggrieved VW owners are calling it the "VW bailout bill."

The idea of a consumer class-action lawsuit is that consumers who have suffered basically the same injury -- a shoddy product, misrepresentation, or fraud, among others -- can be represented in a single lawsuit, since in most cases the injury sustained is not serious enough to enable each individual to pursue his or her own lawsuit.

What does this have to do with Volkswagen? 

Effort derailed


Attorneys representing some of the nearly 500,000 consumers who bought VW diesels with the test-tricking software say it would require breaking large groups -- 2.0-liter owners and 3.0-liter owners, say -- into much smaller groups, such as 2009 Golf TDI owners, 2010 Golf TDI owners, etc., basically derailing the entire class action effort. 

To hear Goodlatte and other backers of the bill tell it, consumers who are grievously injured by faulty consumer products are suffering because they are being grouped into class actions with people who were not as seriously harmed.

“The Fairness in Class Action Litigation Act is a simple, one-page bill, that furthers a common sense principle that should apply to class action lawsuits in the future," Goodlate said in a statement. "Only those people who share injuries of the same type and extent should be part of a class action lawsuit. ... I am introducing this legislation to supplement the protections afforded to victims in class actions, and further reduce wasteful litigation in our courts.”

Corporate defense

Attorney Lori Andrus represents a group of VW owners and says the intention of the bill is obvious. “There’s no question this was written by a defense lawyer whose job it is to defend corporations,” she told the Fiscal Times.

The implications go far beyond VW.

“In a mortgage fraud case, the class might have all been deceived in same way, but the documents signed might have been inconsistent,” Andrus said, accordng to the Fiscal Times report. “Or with for-profit schools, they might have paid different tuition or taken different classes.” 

The bill is headed for action by the House as early as this week. 

Take a Home Warranty Quiz. Get matched with an Authorized Partner.