An amendment numbered 1 printed in House Report 108-148, to slightly broaden the category of class action cases that would remain in state court in two ways. First, this amendment raises the aggregate amount in controversy required for federal court jurisdiction from $2 million to $5 million. Second, it allow federal courts discretion to return intrastate class actions in which local law governs to state courts after weighing five factors to determine if the case is appropriately of a local character. This discretion would come into play when between one-third and two-thirds of the plaintiffs are citizens of the same state as the primary defendants. If less than one-third are citizens of the same state, the case would automatically be eligible for federal court jurisdiction under the new diversity rules in this bill. Likewise, if more than two-thirds are citizens of the same state, the case would not be subject to the new rules in this bill and would remain in state court.

1. 1

   Change 1: Replaces “$2,000,000” at the section 1332(d)(2) with “$5,000,000”

   Replaces

   [struck: $2,000,000][inserted: $5,000,000]

   Original wording

   (1) in paragraph (2), strike “$2,000,000” and insert “$5,000,000”;

2. 2

   Change 2: Renumbers paragraphs (4) through (9) as (5) through (10)

   RenumbersSection 1332(d)
   Original wording

   (2) redesignate paragraphs (4) through (9) as paragraphs (5) through (10), respectively;

3. 3

   Change 3: Rewrites section 1332(d)(3)

   Replaces

   Removes section 1332(d)(3).

   Inserted: (3) A district court may, in the interests of justice, decline to exercise jurisdiction under paragraph (2) over a class action in which greater than one-third but less than two-thirds of the members of all proposed plaintiff classes in the aggregate and the primary defendants are citizens of the State in which the action was originally filed based on consideration of the following factors:

   Inserted: (A) Whether the claims asserted involve matters of national or interstate interest.

   Inserted: (B) Whether the claims asserted will be governed by laws other than those of the State in which the action was originally filed.

   Inserted: (C) In the case of a class action originally filed in a State court, whether the class action has been pleaded in a manner that seeks to avoid Federal jurisdiction.

   Inserted: (D) Whether the number of citizens of the State in which the action was originally filed in all proposed plaintiff classes in the aggregate is substantially larger than the number of citizens from any other State, and the citizenship of the other members of the proposed class is dispersed among a substantial number of States.

   Inserted: (E) Whether 1 or more class actions asserting the same or similar claims on behalf of the same or other persons have been or may be filed.

   Inserted: (4) Paragraph (2) shall not apply to any class action in which--

   Inserted: (A) two-thirds or more of the members of all proposed plaintiff classes in the aggregate and the primary defendants are citizens of the State in which the action was originally filed;

   Inserted: (B) the primary defendants are States, State officials, or other governmental entities against whom the district court may be foreclosed from ordering relief; or

   Inserted: (C) the number of members of all proposed plaintiff classes in the aggregate is less than 100.

   Original wording

   (3) strike paragraph (3) and insert the following:

Read automatically from the Congressional Record. Check the original before relying on it.

As printed