IIB 

115TH CONGRESS 

1ST SESSION H. R. 985 

IN THE SENATE OF THE UNITED STATES 

MARCH 13, 2017 

Received; read twice and referred to the Committee on the Judiciary 

AN ACT 

To amend the procedures used in Federal court class actions 

and multidistrict litigation proceedings to assure fairer, 

more efficient outcomes for claimants and defendants, 

and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 


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1 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

2 (a) SHORT TITLE.—This Act may be cited as the 

3 ‘‘Fairness in Class Action Litigation and Furthering As4 bestos Claim Transparency Act of 2017’’. 

5 (b) TABLE OF CONTENTS.—The table of contents for 

6 this Act is as follows: 

Sec. 1. Short title; table of contents. 

TITLE I—FAIRNESS IN CLASS ACTION LITIGATION 

Sec. 101. Short title; reference; table of contents. 

Sec. 102. Purposes. 

Sec. 103. Class action procedures. 

Sec. 104. Misjoinder of plaintiffs in personal injury and wrongful death actions. 

Sec. 105. Multidistrict litigation proceedings procedures. 

Sec. 106. Rulemaking authority of Supreme Court and Judicial Conference. 

Sec. 107. Effective date. 

TITLE II—FURTHERING ASBESTOS CLAIM TRANSPARENCY 

Sec. 201. Short title. 

Sec. 202. Amendments. 

Sec. 203. Effective date; application of amendments. 

7 TITLE I—FAIRNESS IN CLASS 

8 ACTION LITIGATION 

9 SEC. 101. SHORT TITLE; REFERENCE; TABLE OF CONTENTS. 

10 (a) SHORT TITLE.—This title may be cited as the 

11 ‘‘Fairness in Class Action Litigation Act of 2017’’. 

12 (b) REFERENCE.—Whenever, in this title, reference 

13 is made to an amendment to, or repeal of, a section or 

14 other provision, the reference shall be considered to be 

15 made to a section or other provision of title 28, United 

16 States Code. 

17 (c) TABLE OF CONTENTS.—The table of contents of 

18 this title is as follows: 


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Sec. 101. Short title; reference; table of contents. 

Sec. 102. Purposes. 

Sec. 103. Class action procedures. 

Sec. 104. Misjoinder of plaintiffs in personal injury and wrongful death actions. 

Sec. 105. Multidistrict litigation proceedings procedures. 

Sec. 106. Rulemaking authority of Supreme Court and Judicial Conference. 

Sec. 107. Effective date. 

1 SEC. 102. PURPOSES. 

2 The purposes of this title are to— 

3 (1) assure fair and prompt recoveries for class 

4 members and multidistrict litigation plaintiffs with 

5 legitimate claims; 

6 (2) diminish abuses in class action and mass 

7 tort litigation that are undermining the integrity of 

8 the U.S. legal system; and 

9 (3) restore the intent of the framers of the 

10 United States Constitution by ensuring Federal 

11 court consideration of interstate controversies of na12 tional importance consistent with diversity jurisdic13 tion principles. 

14 SEC. 103. CLASS ACTION PROCEDURES. 

15 (a) IN GENERAL.—Chapter 114 is amended by in16 serting after section 1715 the following: 

17 ‘‘§ 1716. Class action injury allegations 

18 ‘‘(a) IN GENERAL.—A Federal court shall not issue 

19 an order granting certification of a class action seeking 

20 monetary relief for personal injury or economic loss unless 

21 the party seeking to maintain such a class action affirma22 tively demonstrates that each proposed class member sufVerDate Sep 11 2014 22:12 Mar 13, 2017 Jkt 069200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H985.RFS H985

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1 fered the same type and scope of injury as the named class 

2 representative or representatives. 

3 ‘‘(b) CERTIFICATION ORDER.—An order issued under 

4 Rule 23(c)(1) of the Federal Rules of Civil Procedure that 

5 certifies a class seeking monetary relief for personal injury 

6 or economic loss shall include a determination, based on 

7 a rigorous analysis of the evidence presented, that the re8 quirement in subsection (a) of this section is satisfied. 

9 ‘‘§ 1717. Conflicts of interest 

10 ‘‘(a) REQUIRED DISCLOSURES.—In a class action 

11 complaint, class counsel shall state whether any proposed 

12 class representative or named plaintiff in the complaint 

13 is a relative of, is a present or former employee of, is a 

14 present or former client of (other than with respect to the 

15 class action), or has any contractual relationship with 

16 (other than with respect to the class action) class counsel. 

17 In addition, the complaint shall describe the circumstances 

18 under which each class representative or named plaintiff 

19 agreed to be included in the complaint and shall identify 

20 any other class action in which any proposed class rep21 resentative or named plaintiff has a similar role. 

22 ‘‘(b) PROHIBITION OF CONFLICTS.—A Federal court 

23 shall not issue an order granting certification of any class 

24 action in which any proposed class representative or 

25 named plaintiff is a relative or employee of class counsel. 


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1 ‘‘(c) DEFINITION.—For purposes of this section, ‘rel2 ative’ shall be defined by reference to section 3110(a)(3) 

3 of title 5, United States Code. 

4 ‘‘(d) EXCEPTION.—This section shall not apply to a 

5 private action brought as a class action that is subject to 

6 section 27(a) of the Securities Act of 1933 (15 U.S.C. 

7 77z–1(a)) or section 21D(a) of the Securities Exchange 

8 Act of 1934 (15 U.S.C. 78u–4(a)). 

9 ‘‘§ 1718. Class member benefits 

10 ‘‘(a) DISTRIBUTION OF BENEFITS TO CLASS MEM11 BERS.—A Federal court shall not issue an order granting 

12 certification of a class action seeking monetary relief un13 less the class is defined with reference to objective criteria 

14 and the party seeking to maintain such a class action af15 firmatively demonstrates that there is a reliable and ad16 ministratively feasible mechanism (a) for the court to de17 termine whether putative class members fall within the 

18 class definition and (b) for distributing directly to a sub19 stantial majority of class members any monetary relief se20 cured for the class. 

21 ‘‘(b) ATTORNEYS’ FEES IN CLASS ACTIONS.— 

22 ‘‘(1) FEE DISTRIBUTION TIMING.—In a class 

23 action seeking monetary relief, no attorneys’ fees 

24 may be determined or paid pursuant to Rule 23(h) 

25 of the Federal Rules of Civil Procedure or otherwise 


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1 until the distribution of any monetary recovery to 

2 class members has been completed. 

3 ‘‘(2) FEE DETERMINATIONS BASED ON MONE4 TARY AWARDS.—Unless otherwise specified by Fed5 eral statute, if a judgment or proposed settlement in 

6 a class action provides for a monetary recovery, the 

7 portion of any attorneys’ fee award to class counsel 

8 that is attributed to the monetary recovery shall be 

9 limited to a reasonable percentage of any payments 

10 directly distributed to and received by class mem11 bers. In no event shall the attorneys’ fee award ex12 ceed the total amount of money directly distributed 

13 to and received by all class members. 

14 ‘‘(3) FEE DETERMINATIONS BASED ON EQUI15 TABLE RELIEF.—Unless otherwise specified by Fed16 eral statute, if a judgment or proposed settlement in 

17 a class action provides for equitable relief, the por18 tion of any attorneys’ fee award to class counsel that 

19 is attributed to the equitable relief shall be limited 

20 to a reasonable percentage of the value of the equi21 table relief, including any injunctive relief. 

22 ‘‘§ 1719. Money distribution data 

23 ‘‘(a) SETTLEMENT ACCOUNTINGS.—In any settle24 ment of a class action that provides for monetary benefits, 

25 the court shall order class counsel to submit to the DirecVerDate Sep 11 2014 22:12 Mar 13, 2017 Jkt 069200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H985.RFS H985

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1 tor of the Federal Judicial Center and the Director of the 

2 Administrative Office of the United States Courts an ac3 counting of the disbursement of all funds paid by the de4 fendant pursuant to the settlement agreement. The ac5 counting shall state the total amount paid directly to all 

6 class members, the actual or estimated total number of 

7 class members, the number of class members who received 

8 payments, the average amount (both mean and median) 

9 paid directly to all class members, the largest amount paid 

10 to any class member, the smallest amount paid to any 

11 class member and, separately, each amount paid to any 

12 other person (including class counsel) and the purpose of 

13 the payment. In stating the amounts paid to class mem14 bers, no individual class member shall be identified. No 

15 attorneys’ fees may be paid to class counsel pursuant to 

16 Rule 23(h) of the Federal Rules of Civil Procedure until 

17 the accounting has been submitted. 

18 ‘‘(b) ANNUAL SETTLEMENT DISTRIBUTION RE19 PORTS.—Commencing not later than 12 months after the 

20 date of enactment of this section, the Judicial Conference 

21 of the United States, with the assistance of the Director 

22 of the Federal Judicial Center and the Director of the Ad23 ministrative Office of the United States Courts, shall an24 nually prepare and transmit to the Committees on the Ju25 diciary of the Senate and the House of Representatives 


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1 for public dissemination a report summarizing how funds 

2 paid by defendants in class actions have been distributed, 

3 based on the settlement accountings submitted pursuant 

4 to subsection (a). 

5 ‘‘§ 1720. Issues classes 

6 ‘‘(a) IN GENERAL.—A Federal court shall not issue 

7 an order granting certification of a class action with re8 spect to particular issues pursuant to Rule 23(c)(4) of the 

9 Federal Rules of Civil Procedure unless the entirety of the 

10 cause of action from which the particular issues arise sat11 isfies all the class certification prerequisites of Rule 23(a) 

12 and Rule 23(b)(1), Rule 23(b)(2), or Rule 23(b)(3). 

13 ‘‘(b) CERTIFICATION ORDER.—An order issued under 

14 Rule 23(c)(4) of the Federal Rules of Civil Procedure that 

15 certifies a class with respect to particular issues shall in16 clude a determination, based on a rigorous analysis of the 

17 evidence presented, that the requirement in subsection (a) 

18 of this section is satisfied. 

19 ‘‘§ 1721. Stay of discovery 

20 ‘‘In any class action, all discovery and other pro21 ceedings shall be stayed during the pendency of any mo22 tion to transfer, motion to dismiss, motion to strike class 

23 allegations, or other motion to dispose of the class allega24 tions, unless the court finds upon the motion of any party 

25 that particularized discovery is necessary to preserve eviVerDate Sep 11 2014 22:12 Mar 13, 2017 Jkt 069200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H985.RFS H985

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1 dence or to prevent undue prejudice to that party. This 

2 section shall not apply to a private action brought as a 

3 class action that is subject to section 27(a) of the Securi4 ties Act of 1933 (15 U.S.C. 77z–1(a)) or section 21D(a) 

5 of the Securities Exchange Act of 1934 (15 U.S.C. 78u– 

6 4(a)). 

7 ‘‘§ 1722. Third-party litigation funding disclosure 

8 ‘‘In any class action, class counsel shall promptly dis9 close in writing to the court and all other parties the iden10 tity of any person or entity, other than a class member 

11 or class counsel of record, who has a contingent right to 

12 receive compensation from any settlement, judgment, or 

13 other relief obtained in the action. 

14 ‘‘§ 1723. Appeals 

15 ‘‘A court of appeals shall permit an appeal from an 

16 order granting or denying class-action certification under 

17 Rule 23 of the Federal Rules of Civil Procedure.’’. 

18 (b) CONFORMING AMENDMENT.—The table of sec19 tions for such chapter is amended by inserting after the 

20 item pertaining to section 1715 the following: 

‘‘Sec. 1716. Class action injury allegations. 

‘‘Sec. 1717. Conflicts of interest. 

‘‘Sec. 1718. Class member benefits. 

‘‘Sec. 1719. Money distribution data. 

‘‘Sec. 1720. Issues classes. 

‘‘Sec. 1721. Stay of discovery. 

‘‘Sec. 1722. Third-party litigation funding disclosure. 

‘‘Sec. 1723. Appeals.’’. 


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1 SEC. 104. MISJOINDER OF PLAINTIFFS IN PERSONAL IN2 JURY AND WRONGFUL DEATH ACTIONS. 

3 Section 1447 is amended by inserting after sub4 section (e) the following: 

5 ‘‘(f) MISJOINDER OF PLAINTIFFS IN PERSONAL IN6 JURY AND WRONGFUL DEATH ACTIONS.— 

7 ‘‘(1) This subsection shall apply to any civil ac8 tion commenced in a State court in which— 

9 ‘‘(A) two or more plaintiffs assert personal 

10 injury or wrongful death claims; 

11 ‘‘(B) the action is removed on the basis of 

12 the jurisdiction conferred by section 1332(a); 

13 and 

14 ‘‘(C) a motion to remand is made on the 

15 ground that one or more plaintiffs are citizens 

16 of the same State as one or more defendants. 

17 ‘‘(2) In deciding the remand motion in any such 

18 case, the court shall apply the jurisdictional require19 ments of section 1332(a) to the claims of each plain20 tiff individually, as though that plaintiff were the 

21 sole plaintiff in the action. 

22 ‘‘(3) Except as provided in paragraph (4), the 

23 court shall sever the claims that do not satisfy the 

24 jurisdictional requirements of section 1332(a) and 

25 shall remand those claims to the State court from 

26 which the action was removed. The court shall retain 


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1 jurisdiction over the claims that satisfy the jurisdic2 tional requirements of section 1332(a). 

3 ‘‘(4) The court shall retain jurisdiction over a 

4 claim that does not satisfy the jurisdictional require5 ments of section 1332(a) if— 

6 ‘‘(A) the claim is so related to the claims 

7 that satisfy the jurisdictional requirements of 

8 section 1332(a) that they form part of the same 

9 case or controversy under Article III of the 

10 United States Constitution; and 

11 ‘‘(B) the plaintiff consents to the removal 

12 of the claim.’’. 

13 SEC. 105. MULTIDISTRICT LITIGATION PROCEEDINGS PRO14 CEDURES. 

15 Section 1407 is amended by adding at the end the 

16 following: 

17 ‘‘(i) ALLEGATIONS VERIFICATION.—In any coordi18 nated or consolidated pretrial proceedings conducted pur19 suant to subsection (b), counsel for a plaintiff asserting 

20 a claim seeking redress for personal injury whose civil ac21 tion is assigned to or directly filed in the proceedings shall 

22 make a submission sufficient to demonstrate that there 

23 is evidentiary support (including but not limited to medical 

24 records) for the factual contentions in plaintiff’s complaint 

25 regarding the alleged injury, the exposure to the risk that 


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1 allegedly caused the injury, and the alleged cause of the 

2 injury. The submission must be made within the first 45 

3 days after the civil action is transferred to or directly filed 

4 in the proceedings. That deadline shall not be extended. 

5 Within 90 days after the submission deadline, the judge 

6 or judges to whom the action is assigned shall enter an 

7 order determining whether the submission is sufficient and 

8 shall dismiss the action without prejudice if the submis9 sion is found to be insufficient. If a plaintiff in an action 

10 dismissed without prejudice fails to tender a sufficient 

11 submission within the following 30 days, the action shall 

12 be dismissed with prejudice. 

13 ‘‘(j) TRIAL PROHIBITION.—In any coordinated or 

14 consolidated pretrial proceedings conducted pursuant to 

15 subsection (b), the judge or judges to whom actions are 

16 assigned by the Judicial Panel on Multidistrict Litigation 

17 may not conduct a trial in a civil action transferred to 

18 or directly filed in the proceedings unless all parties to 

19 that civil action consent. 

20 ‘‘(k) REVIEW OF ORDERS.— 

21 ‘‘(1) IN GENERAL.—The Court of Appeals hav22 ing jurisdiction over the transferee district shall per23 mit an appeal to be taken from any order issued in 

24 the conduct of coordinated or consolidated pretrial 

25 proceedings conducted pursuant to subsection (b), 


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1 provided that the order is applicable to one or more 

2 civil actions seeking redress for personal injury and 

3 that an immediate appeal from the order may mate4 rially advance the ultimate termination of one or 

5 more civil actions in the proceedings. 

6 ‘‘(2) REMAND ORDERS.—Notwithstanding sec7 tion 1447(d), a court of appeals may accept an ap8 peal from an order issued in any coordinated or con9 solidated proceedings conducted pursuant to sub10 section (b) granting or denying a motion to remand 

11 a civil action to the State court from which it was 

12 removed if application is made to the court of ap13 peals within 14 days after the order is entered. 

14 ‘‘(l) ENSURING PROPER RECOVERY FOR PLAIN15 TIFFS.—A plaintiff who asserts personal injury claims in 

16 any civil action transferred to or directly filed in coordi17 nated or consolidated pretrial proceedings conducted pur18 suant to subsection (b) shall receive not less than 80 per19 cent of any monetary recovery obtained for those claims 

20 by settlement, judgment, or otherwise, subject to the satis21 faction of any liens for medical services provided to the 

22 plaintiff related to those claims. The judge or judges to 

23 whom the coordinated or consolidated pretrial proceedings 

24 have been assigned shall have jurisdiction over any dis25 putes regarding compliance with this requirement.’’. 


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1 SEC. 106. RULEMAKING AUTHORITY OF SUPREME COURT 

2 AND JUDICIAL CONFERENCE. 

3 Nothing in this title shall restrict in any way the au4 thority of the Judicial Conference and the Supreme Court 

5 to propose and prescribe general rules of practice and pro6 cedure under chapter 131 of title 28, United States Code. 

7 SEC. 107. EFFECTIVE DATE. 

8 The amendments made by the title shall apply to any 

9 civil action pending on the date of enactment of this title 

10 or commenced thereafter. 

11 TITLE II—FURTHERING ASBES12 TOS CLAIM TRANSPARENCY 

13 SEC. 201. SHORT TITLE. 

14 This title may be cited as the ‘‘Furthering Asbestos 

15 Claim Transparency (FACT) Act of 2017’’. 

16 SEC. 202. AMENDMENTS. 

17 Section 524(g) of title 11, United States Code, is 

18 amended by adding at the end the following: 

19 ‘‘(8) A trust described in paragraph (2) shall, subject 

20 to section 107— 

21 ‘‘(A) file with the bankruptcy court, not later 

22 than 60 days after the end of every quarter, a report 

23 that shall be made available on the court’s public 

24 docket and with respect to such quarter— 

25 ‘‘(i) describes each demand the trust re26 ceived from, including the name and exposure 


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1 history of, a claimant and the basis for any 

2 payment from the trust made to such claimant; 

3 and 

4 ‘‘(ii) does not include any confidential med5 ical record or the claimant’s full social security 

6 number; and 

7 ‘‘(B) upon written request, and subject to pay8 ment (demanded at the option of the trust) for any 

9 reasonable cost incurred by the trust to comply with 

10 such request, provide in a timely manner any infor11 mation related to payment from, and demands for 

12 payment from, such trust, subject to appropriate 

13 protective orders, to any party to any action in law 

14 or equity if the subject of such action concerns li15 ability for asbestos exposure.’’. 

16 SEC. 203. EFFECTIVE DATE; APPLICATION OF AMEND17 MENTS. 

18 (a) EFFECTIVE DATE.—Except as provided in sub19 section (b), this title and the amendments made by this 

20 title shall take effect on the date of the enactment of this 

21 title. 

22 (b) APPLICATION OF AMENDMENTS.—The amend23 ments made by this title shall apply with respect to cases 


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1 commenced under title 11 of the United States Code be2 fore, on, or after the date of the enactment of this title. 

Passed the House of Representatives March 9, 

2017. 

Attest: KAREN L. HAAS, 

Clerk. 


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