Doubtless you are aware of the impressive reforms in civil procedure which were enacted in Texas not long ago. Those reforms included several new provisions as to class actions, one of which, I believe, is potentially of national impact.
Texas has now mandated the "lodestar" (enhanced hourly fee) principle, as opposed to share-of-recovery contingency fees, for awards of attorney fees in Texas class actions. Nonetheless, as I type this and as you read it, we may be certain that somewhere, in a class action in another state, some attorney is representing hundreds or thousands of Texans, and is requesting in the name of his Texas clients a huge contingency fee. In the national class action setting, of course, most of the"clients" become clients only through an order of court. In accepting such an appointment, however -- in representing citizens of one state by order of the court of another -- does an attorney not become an officer of the courts of both states?
It seems to me that the jurisdiction of the State of Texas properly extends to the regulation of attorneys who represent Texans, by appointment only, in lawsuits in other states. In ordinary litigation there is an agreement actually negotiated between attorney and cllient, which generally obviates concerns about fidelity and fairness. In class actions there is no such safeguard; and a reasonable remedy would be to make the class attorney, the attorney-by-appointment, accountable in Texas, to his Texas clients. I think that Texas may have done this already, if only implicitly.
Moreover, a law that Texas enacts, or might enact, numerous other states should be able to replicate. State statutes of this type would test the theoretical foundations of class litigation at a very vulnerable point -- the frequent corruption of the attorney-client relation.
I am curious whether you think that this approach might offer a logical and fruitful next step toward turning class action suits back into genuine litigation, in which attorneys have clients to whom they must justify their fees. I am curious also whether, among all the information which comes your way, you might have seen evidence of a similar approach. -- Scott Rutledge, Richardson, TX
I have never heard of this approach being tried. Reader comments are welcomed. -- W.O.
Posted by Walter Olson at December 20, 2004 11:29 AM