H.R. 3624: Fraudulent Joinder Prevention Act of 2016

This was a vote to pass H.R. 3624 in the House.

The House passed a bill to try to crack down on a certain type of judicial fraud. Federal jurisdiction law allows trial lawyers to keep their case in state jurisdiction as long as one of the defendants is local, but according to House Republicans this process can be abused to prevent cases from reaching federal court. A “fraudulent joinder” is when a plaintiff tries to keep a lawsuit against an out-of-state defendant in state court by joining a local defendant to the case without proper grounds.

H.R. 3426, the Fraudulent Joinder Prevention Act, would set a standard for determining if a defendant has been fraudulently joined to a lawsuit.

H.R. 3426 passed with a partisan vote of 229–189, with all supporting votes coming from Republicans. The Democratic Whip urged members to vote against the bill, and the White House issued a veto threat should the bill pass in the Senate.

What exactly would the bill do?

Under current procedures federal courts determine jurisdiction if it is in question. This means that federal courts already have some protection against fraudulent joinders, since they can always claim jurisdiction if it appears that the same-state defendant is not appropriately joined to the case. H.R. 3426 would establish a uniform standard for the courts. The bill clarifies four situations in which a joinder of a defendant is fraudulent:

  • The jurisdictional facts with respect to the joined defendant are false.
  • It is not plausible that State law would impose liability on the defendant.
  • State or federal law bars all claims in the case against the defendant.
  • Objective evidence demonstrates there is no good faith intention to prosecute the defendant of join them to the case.
Why is it partisan?

Since federal courts already have a way to deal with fraudulent joinders, Democrats find the bill unnecessary. Democratic Whip Rep. Steny Hoyer (D-MD5) said “Despite its name, the bill does not target ‘fraud’ as the term is commonly understood, but instead targets the judicial rules for determining whether a particular case belongs in a state court or a federal court.”

He continued that “The effect of H.R. 3624, would be to make it easier for corporations named as defendants in a lawsuit to have the case heard in a federal court (where cases are more expensive and take longer) while making it more difficult for workers, consumers, and patients generally to have their cases heard closer to home in state courts.”

The Center for Justice and Democracy, alongside various other advocacy groups, sided with Democrats in a group letter to Congress.

Congress
114th Congress
Date
Feb 25, 2016
Chamber
House
Number
#89
Question:
On Passage of the Bill in the House
Result:
Passed

Key: R Aye R No D No
Seat position based on our ideology score.
This is a cartogram. Each hexagon represents one congressional district.
Totals     Republican     Democrat
  Aye 229
 
 
53%
229 0
  No 189
 
 
44%
10 179
Not Voting 15
 
 
3%
6 9
Required: Simple Majority source: house.gov

Vote Details

Notes: The Speaker’s Vote? “Aye” or “Yea”?
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