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Class Action Bills H.R. 1875/S. 353:
Making Food Unsafe

The Class Action "Fairness" Act (S. 353) and the Interstate Class Action Jurisdiction Act (H.R. 1875) rewrite class action rules so that, if passed, defendants would be able to remove most state class actions to federal court.

Removals to federal court are detrimental to consumers because:

Under S. 353 and H.R. 1875, the defendants in the following class action cases involving food safety would be permitted to remove these cases to federal court.

In a well-known 1993 case against involving contaminated hamburgers served at Jack-in-the-Box restaurants, a class action was filed in Washington state court alleging Washington common law tort claims following the defendants' flaunting of Washington health department regulations. The restaurants' failure to cook beef to the state-mandated temperature contributed to an outbreak of a deadly strain of e-coli which killed some victims and injured hundreds more.

Had S. 353 or H.R. 1875 been the law of the land, either of the defendants, the slaughterhouse that contaminated the beef or the restaurant that served undercooked contaminated beef, being residents of California, could have removed the lawsuits against them to federal court. Despite the fact that the defendants had chosen to market their products in Washington and benefitted from the protection of Washington state laws, they could have opted out of the jurisdiction of state judges.

Moreover, federal judges applying state law are less likely than state judges to apply state law in innovative ways to protect consumers. In the Jack-in-the-Box case discussed above, the state court judge was able to devote the time and attention to resolve the case in a creative way that is much less likely to be used in federal court. The judge appointed a retired state court judge experienced in such cases to oversee the settlement over the long term. The settlement included class-wide remedies, including medical monitoring and a medical care trust fund. Objective mediators, funded by the defendants, heard claims of the individual claimants, to ensure that everyone, including those whose infections and resulting illnesses were less severe, received fair compensation. Federal judges, with their backlog of cases, would be much less able to devote the time devoted by the state judge in the Jack-in-the-Box case to resolve the case in a prompt and satisfactory manner. Cases such as these are simply best left to the state courts to resolve.

Because of constitutional limits on federal courts, federal judges are limited in their use of state government resources. In the Jack-in-the-Box case, the Washington state court judge who presided over the case obtained cooperation from the state health department, to which e-coli infections were reported, to identify class members. Had S. 353 or H.R. 1875 been the law of the land and the case had been removed to federal court, the federal judge would not have been able to easily obtain that cooperation.

Every year, an estimated 2,000 persons in the U.S. become seriously ill, and 500 people die, from consuming food contaminated with Listeria monocytogenes bacteria. According to 1998 FoodNet data collected in Connecticut, Minnesota, Oregon and selected counties in California, New York, Georgia and Maryland, of all types of food poisoning, listeriosis had the highest hospitalization rate and caused nearly half the deaths associated with food-borne illness.(1) Consuming the bacteria is especially dangerous for pregnant women, newborns, the elderly and persons with weakened immune systems.

Recent Listeria monocytogenes outbreaks, such as the outbreak at issue in Cress, have highlighted the deficiencies of the USDA's pathogen reduction system. For example, the USDA has not mandated testing for Listeria monocytogenes at food-processing plants, and the USDA lacks the authority to order recalls of food contaminated with the bacteria. Where government regulations are insufficient to protect consumers, strong tort laws provide industry actors with a crucial incentive to produce safe products.

Between July 1, 1998 and April 1, 1999 meat produced and packaged by a division of Sara Lee Corporation was contaminated with listeria monocytogenes bacteria. An unknown number of people bought the products, which included Ball Park Frank Hot Dogs, and became infected before an alert by the CDC and various state Departments of Health impelled Sara Lee to issue a recall. The severity of illness experienced by victims varied, but the majority suffered severe flu-like symptoms for one to three days and incurred medical expenses for doctor visits, oral and intravenous antibiotics and, in severe cases, hospital stays. A suit was filed in Cook County, Illinois, on behalf of people who consumed the infected products and became ill as a result. (Those claiming permanent injury were excluded from the class.)

This case illustrates the usefulness of class actions as a tool for bringing suits and making companies take responsibility for the harm they cause. The cost of bringing such suits individually is prohibitive because the injuries experienced by the majority of victims were small in monetary value, consisting of little more than a day off from work and the cost of a prescription. The fact that this case was brought and the defendant was forced to take responsibility for producing unsafe food is a deterrent to unsafe food handling practices and will save lives when future outbreaks are averted because companies chose safer practices.

Under S. 353/H.R. 1875 this case could, and probably would, have been removed to federal court. Even though Sara Lee's headquarters are in Chicago, Illinois, and the decisions regarding food handling procedures, testing and safety were all made in Chicago, Sara Lee would have been sheltered from Illinois courts and Illinois Rules of Procedure simply because some plaintiffs were citizens of other states. Moreover, the bill would effectively extinguish the right of the state of Illinois to determine its own rules of civil procedure pertaining to most class actions. Illinois has a strong interest in controlling a corporation located in Illinois, even if distribution of the product is nationwide.

This case illustrates an additional problem with S. 353/H.R. 1875 -- the need to determine the relative proportions of plaintiff citizenship early in the case. As of June, 2000, this case has been filed, discovery has been held and closed, the class has been certified for purposes of settlement and a hearing on the final approval of the settlement will be held in September, 2000. The vast majority of the work has been completed and the expenses of trial avoided. However, class counsel are still unable to estimate whether residents of Illinois constitute a "substantial majority" of the class because it is only at this stage that class members identify themselves and claim their damage awards. Had this case been removed to federal court under S. 353/H.R. 1875, class counsel would have been unable to show that the federal judge should abstain under the "substantial majority" exception in the bill because the residences of the class were not known.


Footnotes

1. At the time of the Survey, data on deaths caused by food-borne pathogens was still being collected.

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