I highly recommend Quinn-Barabanov’s article for those of you who may have missed it when it came out in November.  The article is a must-read for anyone facing (or prosecuting) a medical monitoring class action.

It also makes at least two key contributions that are independent of the medical monitoring context.  First, it offers an analysis of the potential application of various aspects of the Wal-mart Stores Inc. v. Dukes decision outside of the employment discrimination context, including the arguably heightened commonality analysis and the admissibility of expert testimony in support of class certification.  Second, it is a good primer on the possible distinctions between truly injunctive relief, which still may be the basis for a Rule 23(b)(2) class action, and merely equitable relief incidental to a claim for monetary relief, which the Dukes Court held cannot support class certification under Rule 23(b)(2).

Class action settlements can be jeopardized or delayed by objections by nonclass counsel, government officials and public interest groups. Particularly vexing are objections from “professional objectors” who may appear to be motivated only to extract part of the fee or take over as class counsel.

Government official objections are usually aimed at coupon settlements and settlement release language intended to bind state officials. Public interest groups that file objections have varied purposes and political agendas. Coupon settlements and cy pres provisions are natural targets.

There are several key preventative measures and tactics that both sides to a class action settlement can take to ward off and protect proposed settlements from nonclass counsel objectors as well as government and public interest objections.

Listen as our authoritative panel of class action attorneys discusses trends in settlement objections and best practices that both plaintiff and defense counsel can take to protect proposed settlements.

The main holding of the Colorado Supreme Court’s decision in Jackson can be summarized with the court’s statement that:

A trial court must conduct a rigorous analysis of the evidence and find to its satisfaction that each C.R.C.P. 23 requirement is established.

Jackson, Slip Op. at 18.  At first glance, this statement may not seem out of step with the “rigorous analysis” standard commonly recognized by the federal courts.  However, the majority’s intentional use of the phrase “to its satisfaction” rather than “by a preponderance of the evidence” makes the Colorado standard a potentially far less exacting hurdle.  A large portion of Justice Martinez’s majority opinion is dedicated to explaining why the court chose to make the class certification decision a matter of pure judicial discretion by the trial court rather than a matter of evidentiary proof.  The majority opinion makes reference no less than four times to the state’s “policy of favoring the maintenance of class actions” and juxtaposes this policy against a federal policy that the majority characterizes as “limiting class actions.” 

Also key to the majority’s analysis was the language of Colorado’s rule 23 allowing the court to make a “conditional” class certification order, language that has recently been removed from the federal rule.  Because certification can be tentatively granted and later revoked by the trial court in Colorado, the court reasoned, the applicable evidentiary standard should be more flexible and less definitive than the “preponderance” of the evidence standard applied in most federal courts, where (the Jackson court reasoned) the rule requires a single class certification decision.

The majority addressed two other issues that are closely related to the standard of review.  The first was whether a trial court may resolve factual disputes that overlap with the merits of the case.  On that issue, the majority reached the relatively uncontroversial conclusion that a court may consider disputes about facts that overlap with the merits, but “only to the extent necessary to satisfy itself that the requirements of C.R.C.P. 23 have been met.”  Slip op. at 27.   

The second issue was whether the trial court should resolve expert witness disputes in reaching its determination on class certification.  On this issue, the court’s holding was nuanced.  Although it recognized that the trial court must evaluate the competing experts’ opinions in order to determine whether the evidence at trial can be presented in a way to resolve the class claims through a common set of facts, the majority held that a trial court should not rule on the admissibility of the plaintiffs’ expert’s testimony at the class certification phase.  The majority again recognized that this holding was contrary to the holdings of several federal court decisions, but it reasoned that a different standard was justified under the Colorado rule because a trial court had the power to reconsider a preliminary certification order following a pretrial Shreck (the Colorado equivalent of Daubert, not to be confused with Shrek, the surly but loveable ogre) hearing on the admissibility of a plaintiffs’ expert’s testimony.  See id. at 31-32.

A strongly-worded dissent from Justice Eid, who was joined by Justice Rice, criticized the decision by stating, in summary, that:

the majority’s standardless approach makes class certification in Colorado essentially unreviewable by appellate courts and raises serious procedural due process concerns.

Slip Op. at 1 (Eid, J., dissenting).  Justice Eid’s dissent contains a wealth ammunition for academics, commentators, and the courts of other jurisdictions to question the majority’s reasoning.  But alas, for litigants in Colorado, it does not have the force of law.  So, rather than discuss it in depth, I simply commend it to your reading.

There are a host of questions that arise out of Jackson that will likely be the subject of future litigation in the Colorado courts, and I’ll address a few of them now.  However, I’ll apply the Colorado Supreme Court’s class certification standard to the following remarks by saying that they are preliminary and tentative and subject to later reconsideration as the record develops.

Does the Jackson decision mean that trial courts in Colorado should take a ”certify first, ask questions later” approach to the certification question?  

This is a position that any party seeking class certification will likely take in the wake of Jackson.  However, a review of all four companion cases decided by the Colorado Supreme Court on Monday makes clear that this is not a permissible approach.  Jackson vests wide discretion in the trial court to grant or deny certification depending on whether the class certification elements are met to the court’s satisfaction, but it also requires the trial court to consider evidence presented by both sides in analyzing whether class treatment is appropriate.  These conclusions are reflected by the results in State Farm Mutual Automobile Insurance Co. v. Reyher, in which the court applied its new standard and held that a trial court had acted within its discretion in denying class certification after a rigorous analysis, and Garcia v. Medved Chevrolet, Inc., in which it determined that the trial court had erred by granting class certification without taking into consideration the evidence presented by the defendant showing that individual questions would predominate.

Is the “rigorous analysis” standard meaningless in light of the trial court’s vast discretion under Jackson?

 Justice Eid’s dissent argues that the majority’s decision renders the “rigorous analysis” requirement a purely procedural requirement.  In other words, as long as the trial court goes through all the motions, the court still has relatively unfettered discretion to grant or deny certification.  This may be true as an analytical matter, but as a practical matter, performing the “rigorous analysis” requires the trial judge to think critically about how the trial is actually going to be conducted.  It also prevents the trial judge from glossing over what may turn out to be insurmountable practical problems in fairly adjudicating the case through common, class-wide evidence.  Thus, even if a “rigorous analysis” is a purely procedural requirement, that does not mean that it will have no impact on the outcome of class certification motions.

Has the Colorado Supreme Court resurrected the pre-Dukes misinterpretation of Eisen as prohibiting any analysis of the merits of the case?

That the answer to this question is no may not be completely clear from the majority’s opinion in Jackson itself, but it becomes clear when Jackson is read in combination with Justice Martinez’s companion opinion in Reyher.  While, curiously, the majority opinion in Jackson makes no reference to Dukes, the opinion in Reyher cites Dukes approvingly in holding that a trial court cannot simply accept the plaintiff’s allegations as true.  The line that can’t be crossed is that the trial court cannot prejudge the merits, a conclusion that is consistent with the Supreme Court’s recent ruling in Erica P. John Fund, Inc. v. Halliburton Co.

Is class certification now effectively unreviewable in the Colorado appellate courts?

The widely disparate outcomes in the three companion cases decided along with Jackson reflect that appellate review will still have a function after Jackson.  An appellate court may clearly find 1) that the trial court conducted a rigorous analysis of the evidence and acted within its discretion in either granting (Jackson, Patterson) or denying (Reyher) class certification; or 2) that the trial court failed to conduct a rigorous analysis of the evidence and therefore the case must be remanded (Garcia).   What is less clear is whether there ever going to be circumstances in which an appellate court could find that a trial court performed a rigorous analysis but abused its discretion in deciding the outcome of the class certification motion, and whether, if so, the appellate court could dictate the result of the class certification motion rather than remanding that decision to the trial court.

What are the practical implications of Jackson?

There many potential practical implications of the Jackson decision.  First, the standard in Colorado is clearly less stringent than the federal court standard.  This raises the prospect that plaintiffs will view Colorado as a favorable forum for class action litigation, and it will almost certainly raise the stakes in battles over forum selection and federal jurisdiction.  Moreover, given the trial court judge’s broad discretion over the class certification, the particular leanings and predispositions of the trial court judge become pivotal in the likely success or failure of a class action.

Second, the court’s emphasis on the tentative nature of class certification decisions under Colorado Rule 23 means that even once they are certified, class actions in Colorado are likely to be subjected to repeated efforts at decertification as the case progresses.

Third, the emphasis on the “rigorous analysis” standard increases the likelihood that, despite the lack of a clear standard for resolving the issue, class certification will necessitate a mini-trial involving the presentation of live witnesses and a fully-developed record, likely increasing the cost of discovery and the class certification process itself.

On the other hand, none of these potential impacts would be a drastic change from the way that class actions are already being litigated in the Colorado Courts.  Parties already fight over removal and forum selection, courts already conduct evidentiary hearings on class certification motions, and defendants already make repeated efforts at decertifying a class.  Thus, the legacy of  Jackson may ultimately be merely to validate the existing customs and practices for litigating  class actions in Colorado.

No. 09SC668 – Jackson v. Unocal Corp. - Judgment Reversed (class certification upheld) - Addresses the burden of proof on class certification.

No. 09SC1080 – Garcia v. Medved Chevrolet, Inc. - Judgment Affirmed (case to be remanded to trial court to conduct rigorous analysis of class certification) – Addresses the circumstances in which the plaintiff in a fraud class action can establish that reliance, injury, and causation can be tried a class-wide basis.

No. 10SC77 – State Farm Mut. Auto. Ins. Co. v. Reyher  - Judgment Reversed (denial of class certification upheld) - Addresses the standards for determining whether individual issues predominate and the extent to which the court may consider the merits of a plaintiff’s claims in ruling on class certification.

No. 10SC214 – BP America Prod. Co. v. Patterson - Judgment Affirmed (class certification upheld) - Addresses the circumstances in which the plaintiff can prove fraudulent concealment and ignorance of facts giving rise to a claim on a common, class-wide basis.

My colleague here in Denver, Holli Hartman, authored an article summarizing developments in challenges to class arbitration waivers following the Court’s decision in AT&T Mobility LLC v. Concepcion.

Cleveland Partner Greg Mersol and Summer Associate George Skupski contributed an entry examining the application of Daubert standards to expert testimony at the class certification stage in light of the Supreme Court’s decision in Wal-Mart Stores, Inc. v. Dukes.

Although I’m admittedly somewhat biased, I highly recommend both articles, as well as other employment class action-related news and commentary on the firm’s Employment Class Action Blog.

A recent article in the Wisconsin Lawyer caught my eye as a case in point for the potential divergence of state and federal class action standards.  A Call to Reform Wisconsin’s Class-Action Statute, authored by Paul Benson, Joe Olson & Ben Kaplan of the Milwaukee firm Michael Best, discusses the brief and arcane language of Wisconsin’s class action statute (Section 803.08 of the Wisconsin Statutes), which reads, in its entirety:

When the question before the court is one of a common or general interest of many persons or when the parties are very numerous and it may be impracticable to bring them all before the court, one or more may sue or defend for the benefit of the whole.

Benson, Olsen and Kaplan point out in their article that although the courts have generally looked to case law interpreting federal Rule 23 in deciding whether class certification is proper under the state rule, the broad statutory language leaves state trial courts with broad discretion in deciding what standards to apply in a particular case.  This, they argue, leaves the state rule open to uncertainty of application, inconsistent decisions, and forum shopping.   They propose that the state rule be reformed so that it more closely mirrors the federal rule.

It remains to be seen whether states like Wisconsin with ill-defined class action rules will become battleground for class action litigation, where plaintiffs can attempt to avoid the more rigorous standards now required in the federal courts. Even assuming that CAFA and other jurisdictional issues could be overcome, there could be a variety of practical reasons why plaintiffs’ lawyers would not want to pursue class action litigation in the Wisconsin courts.  However, Wisconsin’s broadly-worded class action rule provides at least a possible inducement to pursue litigation there.

In other words, for potential class action defendants (and in observance of National Talk Like a Pirate Day), Ye maye want to considarrrr steerrrin’ clear o’ Wisconsin, me maties!

As class certification standards have become more rigorous, the use of statistical evidence in certification proceedings has become an integral part of class action litigation. Effectively using or challenging statistics can be the difference between winning and losing a class certification motion.

Since statistical evidence is introduced through expert witness testimony, Daubert challenges may be an effective strategy. This raises the issue of the scope of the court’s inquiry into the merits at the class certification stage.

The prominent role of statistical evidence in class certification is underscored in Wal-Mart v. Dukes. The Court weighed in on both the level of statistical proof to sustain certification as well as the appropriate standard for a Daubert analysis.

My fellow panelists and I will provide class action counsel with a review of the Court’s treatment of statistical evidence and expert testimony in Wal-Mart v. Dukes, discuss admissibility and use of statistics in certification proceedings, and outline strategies for using statistics and cross-examining statistics witnesses.

We will offer our perspectives and guidance on these and other critical questions:

• How did the Supreme Court in Wal-Mart v. Dukes address the level of Daubert analysis at the class certification stage?
• What types of statistics can be introduced and what are the proper ways to utilize statistics?
• What strategies can counsel use to effectively cross-examine statistics witnesses?
• What are the recent trends in the use of statistical evidence to support a class certification motion?

After our presentations, we will engage in a live question and answer session with participants — so we can answer your questions about these important issues directly.

I hope you’ll join us.

For more information or to register, click here. 

The October 2010 Supreme Court Term in review: For defendants, life returns to normal after the celebration ends