Lessons in federalism from the 1960s class action rule and the 2005 Class Action Fairness Act: "the political safeguards" of aggregate translocal actions.

• Author: Resnik, Judith

1. INSIGHTS FROM CAFA AND FROM FEDERALISM II. ASSESSING THE IMPORT OF CAFA A. A Range of Appraisals B. Commonalities (to Borrow a Term) C. The Resiliency of Collective Action III. CELEBRATING FEDERAL RIGHTS-CLAIMING: THE 1960s CLASS ACTION RULE IN ITS TIME IV. BEMOANING ADJUDICATION'S OPPORTUNITIES: CAFA AND ITS COHORT A. CAFA 's Attitudes Toward Federalism B. CAFA 's Context: Bell Atlantic, Mandatory Arbitration, and Preemption V. THE POLITICAL SAFEGUARDS OF AGGREGATIVE TRANSLOCALISM A. Neither Separate Spheres nor Solo Actors B. Safeguards but No Safety VI. FEDERALISM'S OPTIONS, COLLECTIVE NECESSITIES, AND SOVEREIGNTY-SKEPTICISM I. INSIGHTS FROM CAFA AND FROM FEDERALISM

   What does the Class Action Fairness Act of 2005 (CAFA) (1) teach us about federalism? A first lesson is that, when confronted with statebased decision making of which they disapprove, national lawmakers federalize rights, as they have repeatedly done throughout United States history. In 2005, Congress turned to the federal courts because CAFA's proponents believed that state courts were too welcoming of collective adjudication. CAFA is part of a cohort of enactments and doctrinal developments of this era that preempt state decision making and push litigants toward noncollective and nonadjudicative remedies such as privately sponsored arbitration programs.

   CAFA's reliance on federal courts to deal with aggregate litigation parallels decisions made in the 1960s to revise the Federal Rules of Civil Procedure to facilitate the aggregation of parties and claims. (2) The mechanism--federalization--is the same, but the goals are not. In the 1960s, Rule 23 was redrafted to expand class action opportunities for claimants in the federal courts. By easing access, rulemakers wanted to maximize the enforcement of federal rights, which they perceived to be under-protected in state courts, especially when state actors were charged with discrimination. In 2005, the purpose was, once again, to offer an alternative to state courts, perceived by then to have over-protected rights for various kinds of plaintiffs. Thus, a second lesson to be drawn from the enactment of CAFA is how quickly substantive "national" goals can change--aimed now at deploying federal courts to very different ends.

   Turning the question around to ask what federalism teaches us about CAFA yields other insights. A review of the history of the interactions between state and federal governance results in a third lesson, that efforts to centralize authority in the federal government and to exclude the states are not likely to endure. In this federation, national rule pronouncement regularly relies on local implementation. Fifty years after Brown v. Board of Education, (3) local judgments about schooling, housing, and spending continue to shape opportunities for integrated schools. Further, local officials are regularly pressed by constituencies--troubled by the warming climate, the safety of the products that they use, the acceptance of same-sex marriage, or the inequalities around them--to pursue welfare and safety in ways different from those pursued at the national level. Concurrent, overlapping, and sometimes conflicting legal regimes are part and parcel of a federalist system.

   Fourth, local decision making does not occur in isolation. Rather, state policies and laws are regularly shaped through the interaction of state officials crossing their own borders as well as those of the nation. As localities try to make judgments about legal rights and remedies, they look to their colleagues domestically and sometimes internationally--borrowing proposals on global warming or product safety and adapting them to local conditions. The interactions across localities have increased as government officials work, translocally as well as transnationally, through national organizations of local officials such as the U.S. Conference of Mayors, the National Governors Association, and the National League of Cities. While CAFA may try to centralize decision making at the national level in an effort to assert the United States' sovereign interests, pressures from local and transnational levels function as "political safeguards" (4) that limit concentrations of power through countervailing mechanisms that produce other policy judgments.

   From the density and richness of such translocal initiatives comes a fifth lesson: CAFA's efforts to diminish the role of aggregate-rights-claiming will not succeed. Joint endeavors by local officials and their national organizations are themselves a form of aggregation, prompted by the need for collective responses to problems that affect large numbers of persons. Like the invention of the class action rules in the 1960s, the development of translocal organizations is likewise innovative.

   These national networks of local actors function as "political safeguards" that check exclusive national authority, but they are not themselves intrinsically "safe." Rather, their power raises questions that are familiar in the class action and political science literatures--about the adequacy of representation by spokespersons for the group, the commonality of interests among members, and the opportunities of members to participate so as to inform and to monitor their representatives. (5) Further, some of these national networks raise new questions for social movement theory, which has been focused on networks of nongovernmental organizations (NGOs) rather than on these voluntary national, private entities gaining authority by virtue of their members holding local and state offices. Thus, I propose capturing their presence through the term "transnational organizations of government actors," or TOGAs, as I begin below to interrogate their contributions both to federalism and to aggregation.

2. ASSESSING THE IMPORT OF CAFA

   CAFA's innovations have to be put in the context of the many debates about whether and how to revise the 1966 class action rule. In 1999, four years before the amendments that put the current version of Rule 23 into place, (6) the University of Pennsylvania Law Review also held a symposium raising many of the issues on the table now, but with a focal point differently described. (7) The topic then was "Mass Torts," and panelists assessed the handling of such claims through multidistrict litigation, class actions, and bankruptcy. Participants included academics, practitioners, several federal judges, and a few state court judges. At that time, the idea of federalizing state-based causes of action seemed remote, but one federal judge spoke forcefully about the need to bring state courts, which he perceived to be unduly permissive, under control.

   The paper I presented focused on what I called the "'F' word," referring to the question of lawyers' fees, a topic that had not been named on the program or in the many proposals for reform that were then pending. But fees were and are central to producing the marketplace of mass tort lawsuits. (8)

   That hesitancy to confront directly the dominant role of money in aggregate litigation reflected the general etiquette of the civil justice system, which does not often face the haunting problem of the costs entailed in making good on the promise of access to justice. Class actions provide a kind of subsidy for certain litigants who, if not part of a group, would lack the resources (in terms of economic ability and knowledge) to pursue claims. Aggregating claims is a complex dynamic that can have effects that vary depending on the nature of the claim, its remedy, and the diversity" of claimants within the group aggregated. For example, through bringing in some claimants otherwise left out, aggregation can affect the value of the claims as a set, thereby producing redistribution among plaintiffs in that some high-end claims may lose value while some low-end claims can gain value. Further, aggregation endows certain players (mostly lawyers) with the power to be spokespersons for groups, thereby raising questions about how to monitor their loyalty and the quality of their work. When lawyers receive fees based on awards to large numbers of individuals, aggregation often gives such lawyers economic stakes that exceed those of any individual class member.

   Over the decades of class action practice, judges took on tasks of appointing lead counsel and awarding fees. Given that power to choose and to pay lawyers, I argued, "in mass torts, judges are the market"; through decisions about which lawyers to select and how to compensate them, judges alter "demand and supply by shaping aggregates and settlements, by valuing certain forms of lawyering, and by directing capital not only to lawyers but to a host of subsidiary service providers." (9) The creation of rules for aggregation thus generates new litigation markets in which various participants become stakeholders, and if enough of them are vested in the status quo, regulatory interventions are hard to achieve. But, as shown in 2005 by CAFA, interventions are not impossible once various forces are politically aligned.

   By then, the code word of "mass torts" no longer quite fit, in part because some of the perceived problems involved consumer, environmental, and property claims. CAFA embraces another term, again beginning with "F," here standing for "fairness." As this Symposium's title makes plain, naming the problem as "fairness" does not necessarily make for a frank discussion of its parameters. CAFA can be read to have several different targets: bad acting by lawyers and litigants in need of judicial control, bad acting by state court judges in need of federal control, and bad acting by trial judges in need of appellate control.

   The technique chosen by Congress in the name of "fairness" relies on a third "F" word: "federalism." Congress divested state courts of jurisdiction over cases formerly called "state cases" (in the sense that the causes of action arose under state law) because...