On May 28, 2019, the U.S. Supreme Court issued a 5-4 ruling that undermines reform legislation designed to ensure that defendants in state-court class actions are permitted to remove the cases to federal court. The decision was a setback for WLF, which filed a brief supporting removal rights guaranteed by the Class Action Fairness Act. Congress adopted CAFA in 2005 after concluding that plaintiffs’ lawyers were gaining an unfair advantage over defendants by filing class actions before friendly state-court judges. To prevent removal to federal court, plaintiffs’ lawyers are now filing their class actions as counterclaims in existing lawsuits—and arguing that targets of the counterclaims are not included among the “defendants” protected by CAFA. WLF argued that a party drawn into a lawsuit for the first time by means of a counterclaim qualifies as a “defendant.” The Supreme Court disagreed and remanded the case to state court. WLF’s brief was joined by the Allied Educational Foundation.
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