Legislature(2003 - 2004)
04/30/2003 01:48 PM Senate JUD
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 249-RESTRAINT OF TRADE: ATTY FEES AND COSTS
CHAIR SEEKINS announced HB 249 to be up for consideration.
REPRESENTATIVE LESIL MCGUIRE, sponsor of HB 249, said it
clarifies provisions of the Alaska anti-trust act with respect
to attorney's fees and costs that are awarded to a prevailing
party in an anti-trust case. Alaska Civil Rule 82(A) is the
prevailing rule for attorney's fees in the state of Alaska in
all civil actions. That rule states that, "Except as otherwise
provided by law or agreed to by the parties, the prevailing
party in a civil case shall be awarded attorney's fees
calculated under this rule."
REPRESENTATIVE MCGUIRE stated that she thought Alaska's law was
fair in that when parties enter into litigation, they know there
is the potential, if they lose the case, for having to pay
attorney's fees and likewise for the other side. She thought it
makes sense to ask the parties to take a hard look before they
enter into litigation to make sure the case is based on sound
law and principles - otherwise they might have to pay the
prevailing parties' costs and fees. This has not been clarified
in the area of anti-trust. Current law states that a successful
plaintiff may recover at least partial attorney's fees and, in
some circumstances, may recover full attorney's fees (AS
45.50.576(a). The act as it exists now, does not expressly state
how, if at all, this statutory provision is intended to affect
the right of a successful anti-trust defendant. HB 249 clarifies
that the rule that is applicable to all civil cases in Alaska
will be applied to anti-trust litigation.
She said that her committee's research has showed that the
courts have been heading in that direction. It is consistent
with another area of law, consumer protection in unfair trade
practices cases. That provision is governed under AS 45.50.537,
where the Legislature sought to address it specifically the same
way as Rule 82(a) that says, if you are a successful plaintiff
in a consumer protection and unfair trade practice case, you
shall recover full and reasonable attorney's fees and a
successful defendant shall recover partial attorney's fees in
accordance with standard court rules. There is precedence for
the legislature acting in specific areas of the law.
REPRESENTATIVE MCGUIRE said some objections were addressed with
an amendment and she called their attention to page 1, lines 14
- page 2, which clarifies, because of a pending lawsuit, that if
you are a member of a class action anti-trust suit, you can't be
held personally liable. She explained that Rule 23 is an opt-out
rule and because of that, you can be a member of a class action
lawsuit and not even be aware of it. It would be inappropriate
to hold any person liable.
She said there was considerable discussion about the effective
date, which did pass. She emphasized that when the Legislature
seeks to clarify an area of the law they believe is appropriate,
as in this case, it should be done clearly, effectively and
immediately. To say that it won't be effective immediately sends
a convoluted message to the court.
MR. JEFF FELDMAN, attorney representing Trident Seafoods, stated
that this is a fair bill. Alaska anti-trust law is modeled after
the federal law that has no Rule 82. He supported it for the
reasons already stated. Alaska's anti-trust statute doesn't
specifically address what happens to prevailing defendants and
leaves them essentially litigation orphans. They are one of the
few special classes of litigants where if you defend yourself
and win, if you can convince a jury the case was wrongfully
brought, you alone are not granted any relief unless you bear
the cost of that case without any compensation. "People who are
in that position think it's unfair."
SENATOR FRENCH asked if there is no recovery of attorney's fees
if the plaintiffs don't prevail at all and no other monies have
been collected from the defendants throughout the litigation.
MR. FELDMAN replied that is correct.
CHAIR SEEKINS asked Mr. Feldman if in Alaska a person could be
part of a class action lawsuit without having assessed the risks
and rewards of being involved in the action.
MR. FELDMAN replied that's not supposed to happen, but it does
work out that way. When the court certifies a class, the class
counsel is directed to send notices to the class members. Those
notices go out, but a lot of people don't pay attention to them.
CHAIR SEEKINS questioned the fact that a person could be a part
of a lawsuit without knowing it the same as he could receive a
magazine subscription by not returning a card saying he didn't
want it.
MR. FELDMAN explained that Alaska is an opt-out state and the
opt-out rate is very low in class action lawsuits, because most
people don't pay attention. If it were opt-in, most people
wouldn't take the time to opt in, either.
SENATOR FRENCH asked if the Miller's Reach case is class action.
MR. FELDMAN said it is.
REPRESENTATIVE CARL MOSES said he attempted to amend the bill so
it wouldn't affect a judicial proceeding that is happening right
now. "You don't change the rule in the middle of the game,
particularly when there are a number of defendants that have
settled out of court to the tune of over $40 million."
SENATOR ELLIS said he remembers discussing pending cases in
committees, but there was a different standard on the floor.
SENATOR THERRIAULT read section 111 that says any matter waiting
adjudication in the court should not be debated or discussed in
a legislative body.
REPRESENTATIVE MOSES reiterated that decisions have been made
based on what the rule is today and yesterday. The decisions
might have been otherwise if the rule was different.
CHAIR SEEKINS said he would hold CSHB 249(JUD) am for further
review.
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