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California Class Action Reform Act (2008)

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The Class Action Reform and Corporate Accountability Initiative (07-0043)was shooting for the November 2008 general election ballot in California. Its supporters would have had to turn in 433,971 valid signatures by March 3, 2008 in order to make the November ballot.

In mid-March 2008, the California Secretary of State announced that the measure had failed to qualify for the November 2008 ballot.

The objective of the initiative is to require California courts to determine whether class action lawsuit settlements provide "meaningful relief" to plaintiffs.

Specifically, it:

  • Limits settlements from releasing claims not covered by the lawsuit.
  • Requires special justification for using discount coupons for future purchases as the primary relief to the class members.
  • Requires twenty-five percent of punitive damages awarded in class action lawsuits be paid to the state instead of the class members to enforce laws promoting consumer, shareholder, pension, fire and police, insurance, and discrimination protections.
  • Provides for methods of notice to class members.


James C. Harrison
Margaret R. Prinzing
Remcho, Johansen & Purcell, LLP

Estimate fiscal impact of the measure

Fiscal impact estimate as provided by California's Legislative Analyst office:

Unknown fiscal impact on state revenues from court filing fees and the cost of court operations. Unknown net increase in state revenues, potentially up to the low tens of millions of dollars in some years, from providing a 25 percent share of punitive damage awards from class action cases to the state.

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