BILL NUMBER: SB 1218	CHAPTERED  07/23/01

	CHAPTER  96
	FILED WITH SECRETARY OF STATE  JULY 23, 2001
	APPROVED BY GOVERNOR  JULY 23, 2001
	PASSED THE ASSEMBLY  JULY 5, 2001
	PASSED THE SENATE  MAY 30, 2001
	AMENDED IN SENATE  APRIL 30, 2001
	AMENDED IN SENATE  APRIL 23, 2001

INTRODUCED BY   Senator Romero

                        MARCH 19, 2001

   An act to repeal Section 6034 of the Business and Professions
Code, and to amend Section 384 of the Code of Civil Procedure,
relating to class action lawsuits.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1218, Romero.  Class actions:  unpaid residuals.
   Existing law requires the State Bar to establish the California
Legal Corps, and specifies the staffing, duties, and funding thereof.

   This bill would eliminate these provisions.
   Existing law requires that, prior to the entry of any judgment in
a class action, the court determine the total amount that will be
payable to all class members.  The court is also required to set a
date when the parties are to report to the court the total amount
that was actually paid to the class members.  After the report is
received, the court is required to amend the judgment to direct the
defendant to pay the sum of the unpaid residue, plus interest, in any
manner the court determines is consistent with the objectives and
purposes of the underlying cause of action.
   This bill would specify the types of persons or organizations to
which that unpaid residue, plus interest, shall be paid; would
eliminate the requirement that notice of the court order be given to
the State Bar; and would make corresponding changes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 6034 of the Business and Professions Code is
repealed.
  SEC. 2.  Section 384 of the Code of Civil Procedure is amended to
read:
   384.  (a) It is the intent of the Legislature in enacting this
section to ensure that the unpaid residuals in class action
litigation are distributed, to the extent possible, in a manner
designed either to further the purposes of the underlying causes of
action, or to promote justice for all Californians.  The Legislature
finds that the use of funds collected by the State Bar pursuant to
this section for these purposes is in the public interest, is a
proper use of the funds, and is consistent with essential public and
governmental purposes.
   (b) Except as provided in subdivision (c), prior to the entry of
any judgment in a class action established pursuant to Section 382,
the court shall determine the total amount that will be payable to
all class members, if all class members are paid the amount to which
they are entitled pursuant to the judgment.  The court shall also set
a date when the parties shall report to the court the total amount
that was actually paid to the class members.  After the report is
received, the court shall amend the judgment to direct the defendant
to pay the sum of the unpaid residue, plus interest on that sum at
the legal rate of interest from the date of entry of the initial
judgment, to nonprofit organizations or foundations to support
projects that will benefit the class or similarly situated persons,
or that promote the law consistent with the objectives and purposes
of the underlying cause of action, to child advocacy programs, or to
nonprofit organizations providing civil legal services to the
indigent.  The court shall ensure that the distribution of any unpaid
residual derived from multistate or national cases brought under
California law shall provide substantial or commensurate benefit to
California consumers.
   (c) This section shall not apply to any class action brought
against any public entity, as defined in Section 811.2 of the
Government Code, or against any public employee, as defined in
Section 811.4 of the Government Code. However, this section shall not
be construed to abrogate any equitable cy pres remedy which may be
available in any class action with regard to all or part of the
residue.