House Republicans ready Volkswagen bailout vote

By Joan McCarter
Monday Jan 04, 2016 11:59 AM MST

House Republicans come back after their break this week ready to give Volkswagen a huge belated Christmas gift—a bailout. The car company has been reeling from scandal after it admitted that it's been cheating on the air pollution standards test, and it's facing law suits from some 500,000 duped VW owners in the U.S., including hundreds of class action suits, which would be likely consolidated. True to form, House Republicans are plotting a massive corporate bailout for the company, David Dayen reports, one that would knee-cap American consumers deserving redress.

The combination of regulatory oversight and class-action litigation can keep companies in line. But a bill in Congress consisting of a little more than 100 words would not only prevent Kaplan from seeking justice but also cripple virtually all class-action lawsuits against corporations. It’s known as the "Fairness in Class Action Litigation Act," but lawyers and advocates call it the “VW Bailout Bill.”

The bill, which will get a vote on the House floor in the first week of January, follows a series of steps by the judiciary to block the courthouse door on behalf of corporations. "There's no question the Supreme Court has been moving in that direction to limit access to courts," said Joanne Doroshow, executive director of the Center for Justice and Democracy. "But Congress has never done something like this, trying to step in and wipe out class-actions."

The simplicity of the VW Bailout Bill belies the chaos it would create. Proponents like the U.S. Chamber of Commerce, the bill's leading lobbyist, say they merely want to get rid of "non-injury" class-action cases, based on potential damages from defective consumer products or corporate actions that have yet to result in harm. Lawyers for class-action litigants argue that defective products deserve compensation even if the consumer hasn't yet been injured.

But the bill goes much further, stating that courts may not certify class-action suits unless the plaintiff "affirmatively demonstrates that each proposed class member suffered the same type and scope of injury as the named class representative or representatives."

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