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President Bush has signed into law legislation to curb class action lawsuits in his first major legislative victory of his second term.
U.S. businesses have long sought the measure, which will shift most class action lawsuits from state courts to federal courts, which has historically been less friendly to such cases.
Opponents of the measure have argued overworked federal courts will not allow consumer, environmental and civil rights cases filed under state laws, making it difficult for ordinary citizens to hold large companies accountable.
Bush said the new law would restore “common sense and balance to America’s legal system,” but consumer groups and trial lawyers have criticized the law for providing scapegoats for large businesses while the most vulnerable population are left with limited access to the judicial system.
Under the legislation, class action lawsuits seeking $5 million or more would be heard in state court only if the primary defendant and more than one-third of the plaintiffs are from the same state. If less than one-third of the plaintiffs are from the same state as the primary defendant, and more than $5 million is at stake, the case would go to federal court.
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