In case you missed it, the BakerHostetler class action defense team published its second annual Year-End Review of Class Actions last month. The 2013 issue was expertly edited by Dustin Dow of our Cleveland office, and features contributions from other members of the firm’s class action defense team across the country. The 54-page report has a thorough recap of the key class action developments in the U.S. Supreme Court as well as other federal and state courts, summaries of key developments in various substantive areas of law in which class actions are prominent, and a preview of what to look for in 2014. Click the link above to download a copy.
Posts Tagged ‘daubert’
Posted in Class Action Decisions, Class Action Trends, tagged 2013 class action, amex III, behrend, CAFA, class action, class action settlement, class certification, comcast, cy pres, daubert, genesis healthcare, italian colors, kiobel, oxford health plans, raskas, standard fire, year in review, year-end review on February 17, 2014 | Leave a Comment »
Posted in Class Action Decisions, Supreme Court Decisions, tagged 2013, 6th circuit, 7th circuit, alien tort, amex III, amgen, behrend, CAFA, clapper, class action, comcast, daubert, diversity, erica p. john fund, extraterritorial, genesis healthcare, halliburton, italian colors, kiobel, moldy, oxford health, posner, royal dutch shell, scotus, sears, standard fire, Supreme Court, symczyk, top ten, whirlpool on January 7, 2014 | Leave a Comment »
2013 was a memorable year for class actions. I’ve assembled my top 10 most significant developments below. There were almost enough U.S. Supreme Court decisions to fill up the entire list, but my number 1 development was still a pair of lower court decisions that may also become the story of the year in 2014.
10. Kiobel v. Royal Dutch Petroleum Co., 133 S.Ct. 1659 (2013) – Not a class action decision per se, but likely to have significant repercussions on the development of international class action law. Extraterritorial effect of the Alien Tort Statute is significantly limited.
9. Clapper v. Amnesty Intern. USA, 133 S. Ct. 1138 (2013) – Another non-class action decision already having a significant impact on the question of standing in data privacy class actions.
8. Oxford Health Plans LLC v. Sutter, 133 S. Ct. 2064 (2013) – Class Arbitration is not completely dead, but there’s a blueprint for how to kill it.
7. American Express Co. v. Italian Colors Restaurant, 133 S. Ct. 2304 (2013)- Arbitration continues to reign supreme, even under the “federal law of arbitrability”
6. Genesis Healthcare Corp. v. Symczyk, 133 S. Ct. 1523 (2013) – Can class actions be defeated simply by picking off the representatives one at a time? That’s for the circuits to decide.
5. Amgen Inc. v. Connecticut Retirement Plans and Trust Funds, 133 S.Ct. 1184 (2013) – Supreme Court holds that materiality is a common question and that proof of materiality is not a prerequisite to class certification, but raises questions about the continued viability of the Basic fraud on the market presumption in securities cases.
4. Certiorari granted in Halliburton v. Erica P. John Fund, No 13-317 – That didn’t take long. On the heels of , Supreme Court agrees to revisit the Basic fraud on the market presumption.
3. Comcast Corp. v. Behrend, 133 S.Ct. 1426 (2013) – Limited holding = damages theory has to match theory of liability. Expansive holding = no class certification unless the question of damages is susceptible to common, classwide proof. Which holding will be embraced by the lower courts?
2. Standard Fire Ins. Co. v Knowles, 133 S. Ct. 1345 (2013) – First ever CAFA decision limits representative plaintiffs’ ability to bind class prior to class certification. Can’t avoid federal jurisdiction by stipulating to no more than $4,999,999.99 in damages on behalf of a putative class.
1. Moldy Washing Machine Decisions – Limited Comcast holding prevails so far. Two lower courts reaffirm class certification orders after remand in light of Comcast. Issue certification is alive and well, for the moment, but stay tuned to see if the Court takes up these cases in 2014.
Posted in CLE Programs, tagged class actions, class certification, daubert, descriptive statistics, dukes, expert testimony, expert witness, inferential statistics, regression analysis, shreck, statistical evidence, statistician, statistics, wal-mart on June 18, 2013 | Leave a Comment »
I’m very excited to be speaking at a Strafford Publications CLE webinar tomorrow entitled: Statistics in Class Action Litigation: Admissibility, Expert Witnesses and Impact of Comcast v. Behrend. The program is scheduled for June 18, 2013 at 1:00pm-2:30pm EDT. This is the third iteration of this presentation, which has been updated to offer insights in light of the Supreme Court’s Comcast decision earlier this term. Brian Troyer of Thompson Hine in Cleveland and Justin Hopson and Rick Preston from Hitachi Consulting in Denver will be co-presenting. Below is a synopsis of the program. Click here for more information and to register:
Class certification standards have become more rigorous, and the skillful use of statistical evidence is an important part of class actions. Effectively employing or challenging statistics can make a difference in winning or losing a class certification motion.
Statistical evidence is introduced through expert witness testimony, and 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 2011 Wal-Mart v. Dukes Supreme Court ruling underscored the prominent role of statistical evidence in assessing the merits at the certification stage. The Court’s recent Comcast v. Behrend ruling reinforces Dukes regarding merits assessments at class certification, thus impacting the continued role of statistical evidence.
Listen as our experienced panel examines statistical evidence in certification proceedings, the impact of Comcast v. Behrend and related case law, and best practices for using statistics and cross-examining witnesses.
- Role of statistical evidence in support of class certification
- Expert testimony and Daubert analysis at class certification stage
- Impact of Comcast v. Berhrend and Wal-Mart v. Dukes
- Science of statistics and cross-examining the statistics witness
The panel will review these and other key questions:
- What is the impact of Comcast and Dukes upon the use of statistical analysis at class certification?
- What strategies can counsel use to effectively cross-examine statistics witnesses?
- What types of statistics can be introduced and what are the proper ways to utilize statistics?
Following the speaker presentations, you’ll have an opportunity to get answers to your specific questions during the interactive Q&A.
Class Action CLE Recap – Insights on the 2012-13 Supreme Court Term from the Bench and Both Sides of the Bar
Posted in Class Action Trends, CLE Programs, Supreme Court Decisions, Uncategorized, tagged amgen, antitrust, basic, behrend, CAFA, class action, class certification, classwide proof, colorado, comcast, daubert, efficient market, eisen, expert, federal judge, fitzpatrick, fraud on the market, hellhole, katz, knowles, kreiger, levinson, merits, securities fraud, standard fire, stipulation on May 14, 2013 | Leave a Comment »
The Class Actions, Mass Torts and Derivative Suits Subcommittee of the Colorado Bar Association, now ably chaired by my BakerHostetler partner, Casie Collignon, held its first CLE luncheon of the year this past Friday. The program, United States Supreme Court vs. Class Actions in 2013, featured excellent commentary about the Supreme Court’s 2013 class action decisions by The Honorable Marcia Krieger, Chief Judge, U.S. District Court for the District of Colorado, Seth Katz of Burg Simpson, and John Fitzpatrick of Wheeler Trigg O’Donnell. Here are just a few of the many insightful observations made by each of the speakers:
Judge Krieger opened by observing that none of the cases this term have been a surprise from the standpoint of what a trial court judge would have expected given existing law. Amgen was predictable because the question of materiality in a securities fraud case is unquestionably a common issue, so it is not surprising that it is a question for trial, not a prerequisite for class certification. Standard Fire can be viewed as a straightforward application of agency law: a plaintiff cannot bind a class of people that he or she doesn’t yet represent. Comcast exemplifies the importance of examining the plaintiffs’ theory of liability and the relationship to the theory of loss. Damages are not the same as loss. The theory by which the plaintiff establishes loss determines the measure of damages.
When asked to identify any trends that she has been seeing in class actions recently, Judge Krieger identified issue certification as a key trend. She has been seeing more situations where the factual issues may be individualized but there are common legal issues that can be resolved classwide. She noted that she has been inclined to grant partial certification limited to the common legal issue(s) in that situation.
From the plaintiffs’ perspective, Katz agreed that the outcome of Standard Fire was not surprising, and he went as far as to say that the outcome was correct, noting that plaintiffs’ attorneys shouldn’t be afraid of the federal courts. Although the holding of Amgen was favorable to plaintiffs, Katz noted an issue that should be of great concern to plaintiffs, and that is the commentary from the conservative wing of the court suggesting that they might be willing to revisit the fraud-on-the-market presumption adopted in Basic Inc. v. Levinson. Katz sees the potential of a 4-4 split on that issue, with Chief Justice Roberts being the deciding vote. He predicts market studies being commissioned by both sides over the coming years to demonstrate or disprove the continued efficiency of the markets.
Comcast, Katz noted, caused a collective sigh of relief in the plaintiffs’ bar because it does not go as far as many would have feared by requiring Daubert hearings at the class certification phase. He noted that one positive impact for plaintiffs arising from the “death of Eisen” (the rejection in decisions like Wal-Mart and Comcast of the idea that merits questions were off-limits at the class certification phase) is that it gives plaintiffs’ counsel an opportunity to obtain merits discovery much earlier in a case than was allowed previously. On the other hand, Katz expressed fear about the possibility that the Court is trying to raise the bar for plaintiffs with a subtle change in the language about what common proof is necessary on the issue of damages. Where earlier decisions required that damages be “susceptible to classwide proof,” the Comcast majority phrased the standard as requiring the plaintiff to “prove classwide damages.” Katz predicts that defendants will argue that this means damages must be uniform, as opposed to simply being susceptible to formulaic calculation. He noted, however, that the few lower courts that have interpreted Comcast so far have rejected a broad application of the decision.
Fitzpatrick combined philosophical commentary about the evolution of class actions with some practical tips for defense lawyers. Standard Fire, he argued, is proof that judicial hellholes still exist. He pointed to Amgen as an example of the dangers of accepting conventional wisdom, pointing out that the outcome in that case might well have been different if the defendants had stipulated to the existence of an efficient market.
Comcast, Fitzpatrick said, provides an opportunity for defendants to prevail at the class certification stage by discrediting a plaintiffs’ expert. Focus not just on the opinions themselves, he suggested, but also on 1) the existence of bias; 2) the expert’s credentials, and 3) flaws in the methodology. Scour the country for transcripts about the plaintiffs’ experts. Look at misstatements and exaggerations in the expert’s CV. Make sure you find and read all of their prior statements in books, media, and transcripts. Just as important, Fitzpatrick reminded defense practitioners, is the make sure to prepare your own experts for class certification.
Supreme Court Tells Lower Courts to Roll Up their Sleeves in Assessing Expert Testimony on Issues of Classwide Proof
Posted in Antitrust Class Actions, Class Action Decisions, rule 23, Supreme Court Decisions, tagged antitrust impact, behrend, breyer, class-wide, classwide, classwide impact, classwide proof, comcast, daubert, expert testimony, expert witness, ginsburg, methodology, predominance, regression, rigorous analysis, scalia, scotus, scrutinize, scrutiny, Supreme Court on March 27, 2013 | 4 Comments »
The United States Supreme Court issued its decision in Comcast Corp. v. Behrend, No. 11-864 today. In a 5-4 decision, the Court held that the class of cable subscribers had been improperly certified. Justice Scalia, writing for the majority, reasoned that the expert testimony offered by the plaintiff to show that antitrust damages were capable of class-wide proof addressed alleged damages that did not logically flow from the plaintiff’s theory of class-wide liability. The majority held that the trial court had erred by refusing to consider questions concerning the expert testimony on damages that might overlap with the “merits,” while the Third Circuit had erred by accepting the plaintiffs’ contention that it had a class-wide theory of damages through expert testimony without actually scrutinizing the factual basis for that contention:
The Court of Appeals simply concluded that respondents “provided a method to measure and quantify damages on a classwide basis,” finding it unnecessary to decide “whether the methodology [was] a just and reasonable inference or speculative.” 655 F. 3d, at 206. Under that logic, at the class-certification stage any method of measurement is acceptable so long as it can be applied classwide, no matter how arbitrary the measurements may be. Such a proposition would reduce Rule 23(b)(3)’s predominance requirement to a nullity.
The dissenting Justices would have dismissed the writ of certiorari as having been improvidently granted. The dissent’s criticism of the majority’s holding has more to do with the procedural posture of the case and the methodology used by the majority in reaching its factual conclusions than with the legal class certification concepts underlying the majority’s reasoning. In particular, the dissent faulted the majority for having changed the issue on review after the conclusion of briefing and took issue with the majority’s analysis of the factual basis for the expert’s opinions.
Posted in Class Action News, Class Action Trends, tagged amex, amgen, arbitrability, arbitration, bakerhostetler, behrend, CAFA, class action, class action developments, Class Action News, Class Action Trends, class arbitration waiver, collective action, comcast, data privacy, daubert, dukes, employment class action, expert witness, fraud on the market, genesis health, kiobel, knowles, oxford health, presumed reliance, reliance, rigorous analysis, securities fraud, standard fire, sutter, wal-mart, year-end review on January 28, 2013 | 1 Comment »
I’m pleased to announce that the BakerHostetler Class Action Defense Team has just released its 2012 Year-end Review of Class Actions, a joint project with the firm’s Employment Class Actions, Antitrust, and Data Privacy practice teams. See below for a synopsis of the project. Click the link above to access a copy of the report itself:
We are pleased to share with you the BakerHostetler 2012 Year-end Review of Class Actions, which offers a summary of some of the key developments in class action litigation during the past year. Class action litigation continues to persist in all areas of civil litigation despite the Supreme Court’s 2011 decisions in AT&T Mobility v. Concepcion and in Wal-Mart Stores, Inc. v. Dukes, which were seen by many commentators as marking the beginning of the end of class actions as we know them. But while the Supreme Court’s 2011 decisions have had a significant impact on class action litigation, they have not brought about its demise and are not likely to do so anytime soon. In the last two years, we’ve seen landmark decisions and the addition of important judicial gloss to those decisions. 2013 will be no different as the Supreme Court is set to weigh in on a series of key cases this spring.
We hope you find this Review a useful tool as you move forward into the new year. This comprehensive analysis of last year’s developments in class action procedure and jurisdiction, as well as developments by subject matter will hopefully provide context and insight as you look ahead to 2013’s expected trends in class action law, including the proliferation of privacy class action litigation and class action litigation relating to the LIBOR rate-fixing scandal.
This is the last of six posts summarizing my notes of the six presentations at the ABA’s 16th Annual Class Actions Institute held in October in Chicago. For more on this excellent conference, see my October 31, November 5, November 6, November 18, and December 3 CAB posts.
This year’s Institute was capped off by a presentation and demonstration entitled: “Preparing Early and Often,” State-of-the-Art Strategies for Managing Class Action Experts. Andrew J. McGuiness moderated the panel, which consisted of expert economists Dr. Janet S. Netz and Dr. James Langenfeld, attorneys Mary Jane Fait and Laurie A. Novion, and U.S. District Court Judge Gerald E. Rosen. The panel’s insightful tips were highlighted by vignettes in the form of mock examinations of the two experts.
Daubert analysis of proposed expert testimony is required at the class certification, a question on which the Supreme Court may shed some light when it rules on Comcast v. Behrend later this term. At the moment, circuits that require a Daubert analysis include the Fourth, Seventh, Ninth, and Eleventh Circuits. The Sixth and Eighth Circuits have both adopted a Daubert-lite standard, while the Fifth Circuit has taken a “Daubert Maybe ” or “Daubert I don’t know” approach to the question.
The vignettes illustrated some of the key potential lines of attack on a plaintiff’s or a defendant’s expert’s opinions presented in support of or in opposition to class certification. They include (but are not limited to): 1) whether the expert relied on a reliable dataset; 2) whether there is a formulaic basis for calculating damages; 3) whether there are any inconsistencies between the defendant’s own transactional data and outside data, such as market research data; 4) whether any individual variation in the data can be explained in a systemic way; and 5) whether a regression analysis or other analytical model is a valid way of evaluating the data or its causal connection to the defendant’s alleged misconduct.
Both the vignettes and the panelists’ observations served to reinforce how important it is for the lawyer to present an expert’s testimony in a way so that the judge understands the evidence.
One key practice tip offered by the panel was to consider using a consulting expert before turning to a testifying expert. This way, different models or modes of analysis can be tested without fear of tainting the conclusions of the testifying expert or unnecessarily exposing the testifying expert to impeachment or cross-examination.
However, that does not mean that it is not necessary to make full disclosure to the testifying expert about the material facts and legal issues in the case. A common frustration that experts have with lawyers is they oftentimes fail to provide a fair and clear picture of the facts or applicable law, leading the expert to an opinion that is at odds with the facts or irrelevant to the issues in the case. At minimum, this can put the expert in an awkward position and undermine the attorney’s client’s chances for success. At worst, it can both lead to an adverse decision and cause undeserved and lasting damage to the expert’s professional reputation.
Posted in Antitrust Class Actions, Class Action Decisions, tagged antitrust, behrend, cartel, class action, comcast, conspiracy, daubert, expert testimony, intra-class conflict, milk farmers, monopolization, monopoly, price fixing, regression analysis, sherman act, statistical analysis, subclass on November 21, 2012 | Leave a Comment »
My partner, Bob Abrams, sent me a copy of the order granting Plaintiffs’ Renewed Motion for Class Certification in Allen v. Dairy Farmers of America, an antitrust class action brought on behalf of dairy farmers alleging monopolization and a conspiracy to fix milk prices by various milk cooperatives and processors. Abrams’ team has been appointed as class counsel for one of the subclasses certified as part of the order.
The opinion includes an interesting analysis of at least two important issues: First, the extent to which intra-class conflicts of interest can prevent class certification and the extent to which the creation of subclasses can remedy those conflicts; and Second, the extent to which a defendant can avoid class certification in an antitrust case by pointing out alleged flaws in the plaintiffs’ expert’s opinion that a common, class-wide antitrust injury exists or by presenting conflicting expert testimony. The second issue is one that may be clarified when the Supreme Court rules later this term on Comcast v. Behrend.
16th Annual Class Actions Institute In Review – Session 1 – “Holy Cow! This Year the Courts Said What?!”
Posted in Class Action Trends, CLE Programs, tagged 23(b)(2), 23(b)(3), amchem, burden of proof, CAFA, class action, class certification, collective, commonality, daubert, dukes, expert, fjc, FLSA, genesis, heartland, injunictive, institute, issue certification, lahav. coffee, mcreynolds, medical monitoring, monetary relief, posner, predominance, preponderance, statistical evidence, symczyk, trial by formula, windsor on October 31, 2012 | 1 Comment »
This is the first in what will be six posts summarizing my notes of the six presentations at the ABA’s 16th Annual Class Actions Institute held last Thursday in Chicago. The National Institute sets the gold standard for class action conferences, and this year was no exception. Program Chair Daniel Karon and the rest of the organizing committee did an excellent job selecting six of the most timely and relevant topics facing class action practitioners today. As always, the list of panelists was a veritable who’s who in the class action field. If you ever have the opportunity to attend this annual conference, I highly recommend it.
As has become the custom at the National Institute, Columbia Law Professor John C. Coffee, Jr. kicked off this year’s program with a comprehensive and insightful summary of the year’s key developments in class action law. This year’s presentation saw what has been a hit solo act turn into an even better duet, as Professor Coffee shared the stage with Connecticut Law Professor Alexandra Lahav. The session was titled “Holy Cow! This Year the Courts Said What?!” A Brief History of this Year’s Developments in Class Action Jurisprudence. Attendees were also treated to a comprehensive, 179-page summary of the year in class actions by Professors Coffee and Lahav entitled The New Class Action Landscape: Trends and Developments in Class Certification and Related Topics.
The first part of Professor Coffee’s presentation covered each of the class action-related cases on the U.S. Supreme Court’s docket this term. Here is a list of those cases with some of Professor Coffee’s insights:
- Connecticut Retirement Plans & Trust Funds v. Amgen, Inc., 660 F.3d 1170 (9th Cir. 2011) – Amgen raises the question whether the plaintiff must establish the materiality of an alleged false statement at the class certification stage of a securities fraud class action. Professor Coffee believes that this case is a close call, but whichever way it comes out, it does not threaten to end securities class action litigation as we know it.
- Behrend v. Comcast Corporation, 655 F.3d 182 (3d Cir. 2011) – In Behrend, the Court could decide whether a trial court must perform a full Daubert analysis of expert testimony offered in support of or in opposition to class certification. The case raises the question, at least in the antitrust context, whether the plaintiff must present a formal damages model or whether the mere possibility of common proof is enough.
- Symczyk v. Genesis Healthcare Corp., 656 F.3d 189 (3d Cir. 2011) – This is a wage and hour case under the FLSA, which has a different procedure than Rule 23. FLSA claims are more accurately characterized as collective actions, rather than class action. The issue is whether a settlement offer for the full amount of the named plaintiff’s FLSA claim can moot the claim and prevent the case from proceeding on a collective basis, a concept also known as “picking off.” One of the arguments that has been raised is that the writ of certiorari should be dismissed as improvident granted, so it is unclear whether the Court will actually enter a substantive ruling.
- Knowles v. The Standard Fire Insurance Company, 2011 U.S. Dist. LEXIS 130077 (W.D. Ark. December 2, 2011) – This case raises the question whether a plaintiff can plead around CAFA removal jurisdiction by stipulating to less than $5 million in damages on behalf of the putative class. Professor Coffee felt confident in making the prediction that the defendant will win. He points to dicta in the Court’s recent decision in Smith v. Bayer Corporation calling into question whether a plaintiff can do anything to bind the members of a putative class before it is certified.
Professor Coffee then went on to highlight some of the big developments in the lower courts from over the past year, which include:
The proper burden of proof to be applied at class certification. The circuits are split on this issue, with some applying a preponderance of the evidence standard and others simply requiring a rigorous analysis with no particular evidentiary standard.
Treatment of expert testimony. The federal district courts continue to resist resolving a battle of the experts at the class certification stage, but dicta from the Supreme Court in Dukes, as well as holdings by several of the circuits, are putting increasing pressure on the federal courts to perform a Daubert analysis (and the Court could resolve this issue for good in Behrend).
Class Arbitration Waivers. Some lower courts, especially the Second Circuit, continue to carve out exceptions to the Supreme Court’s ruling favoring arbitration agreements in Concepcion. One key issue is whether a class arbitration waiver may still be held unconscionable as a matter of federal law. Professor Coffee quipped that the Second Circuit will only change if the Supreme Court “stuffs it down their throat.” While unconscionability under state law is no longer a viable argument against enforcing an arbitration clause, clauses with fee-shifting provisions continue to be susceptible to attack.
Settlement Only and Limited Fund Classes. There is a lower court trend in permitting certification in settlement classes in cases that could not be certified as class actions in contested cases, notwithstanding the Supreme Court’s opinion in Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 617 (1997). The primary justification tends to be that any individualized issues of fact in the case went to manageability, which is no longer an issue in the settlement context. In cases where courts have found that individualized issues impact both predominance and manageability, settlement classes have continued to be rejected.
Partial Certification. The question of issue certification has been one of the hottest trends in the federal courts in the wake of Dukes. Professor Coffee pointed out that the resolution of whether courts allow partial certification tends to be determined whether the fact of certification creates an extortionate threat to settle the case.
Class Action Settlements. If you read just one class certification decision this year, Professor Coffee recommends Judge Rosenthal’s memorandum opinion in In re: Heartland Payment Systems, Inc. Customer Data Security Breach Litigation, MDL No. 09-2046 (S.D. Tex. March 20, 2012), which has a well-organized, step-by-step analysis of the approval of a class action settlement.
Professor Lahav focused her remarks on what has been happening in the lower courts in response to the three key aspects of the Court’s decision in Dukes: 1) the “new commonality” requirement; 2) the rejection of the use of Rule 23(b)(2) to recover individualized money damages; and 3) the rejection of “trial by formula,” of the use of statistical sampling to solve individualized damages problems.
The “new commonality”. Among Professor Lahav’s key observations was that in the Title VII context, there must be a policy, but if there is an identifiable policy, the courts will allow discretionary elements of that policy to be attacked. This trend is best exemplified by Judge Posner’s decision in McReynolds v. Merrill Lynch, Pierce, Fenner & Smith, Inc. As many commentators predicted, Plaintiffs have had better success after Dukes by narrowing the geographic scope of discrimination claims. This has also been true in the consumer context. In the civil rights context, allegations of systemic constitutional violations have had success when the courts have focused on the systemic nature of the practice, but not when courts have focused on the effects of a systemic practice on the prospective class members. In general, there has been an increasing reliance on issues classes to overcome individualized issues that might destroy commonality or predominance.
Rule 23(b)(2) and monetary damages. The majority opinion in Dukes raised the question whether there can ever be a class with monetary damages. None of the circuit courts have provided further guidance on when damages might be sufficiently “incidental” to still allow relief. One area that has seen mixed results since Dukes is the area of medical monitoring class actions, where the remedy sought is medical monitoring of the possible health effects of a toxic exposure but the cost of monitoring can vary from person to person. Professor Lahav pointed to the Third Circuit’s decision in Gates v. Rohm & Haas Co., No. 10-2108 (3d Cir., Aug. 25, 2011), as potentially supporting arguments on both sides. Hybrid class actions, where classes are certified based on both Rule 23(b)(2) and 23(b)(3), are becoming increasingly common, especially in the Title VII context. One unanswered question is whether damages claims are precluded if a Rule 23(b)(2) class is certified but not successful.
Statistical evidence and “trial by formula.” Statistical evidence is still accepted in contexts where it has been accepted traditionally, e.g. civil rights, disparate impact, and antitrust cases. It is not allowed in cases where the defendant can raise individualized defenses. One proposed solution is, again, issues classes, but this creates a class action funding problem – How do lawyers get paid?
Professor Lahav also revisited statistical trends in class actions, focusing primarily on data compiled by the Federal Judicial Center in 2008 which analyzed the impact of the Class Action Fairness Act (“CAFA”). She made the key point that statistical data on class action trends has been severely lacking since the FJC study, making updated empirical analysis of class action trends difficult.
Posted in Supreme Court Decisions, tagged 10b-5, 5 million, amgen, amount in controversy, antitrust, behrend, CAFA, class action, class action lawyer, comcast, daubert, expert testimony, expert witness, fisher, fraud on the market, knowles, scotus, securities class action, securities fraud, standard fire, stipulation, Supreme Court on October 4, 2012 | Leave a Comment »
Forbes columnist Daniel Fisher has authored an excellent preview of the three class-action-related cases set to be decided by the U.S. Supreme Court this term. The article, entitled Class-Action Lawyers Face Triple Threat At Supreme Court, previews the issues in each of the three cases and summarizes what’s at stake for class action lawyers. The article points out that although the three decisions have potential to spell disaster for class action plaintiffs given the conservative majority in the Supreme Court, two of the three class-action-related decisions last term came out in favor of the plaintiffs. I highly recommend this article, as well as Fisher’s work more generally.
For quick reference, the three cases set for decisions on class action issues this term, and the questions presented for review, are as follows:
Comcast v. Behrend, No. 11-864 – “Whether a district court may certify a class action without resolving whether the plaintiff class has introduced admissible evidence, including expert testimony, to show that the case is susceptible to awarding damages on a class-wide basis.”
Standard Fire Insurance Co. v. Knowles, No. 11-1450 – “When a named plaintiff attempts to defeat a defendant’s right of removal under the Class Action Fairness Act of 2005 by filing with a class action complaint a ‘stipulation’ that attempts to limit the damages he ‘seeks’ for the absent putative class members to less than the $5 million threshold for federal jurisdiction, and the defendant establishes that the actual amount in controversy, absent the ‘stipulation,’ exceeds $5 million, is the ‘stipulation’ binding on absent class members so as to destroy federal jurisdiction?”
Amgen Inc. v. Connecticut Retirement Plans, No. 11-1085 – “1. Whether, in a misrepresentation case under SEC Rule 10b-5, the district court must require proof of materiality before certifying a plaintiff class based on the fraud-on-the-market theory. 2. Whether, in such a case, the district court must allow the defendant to present evidence rebutting the applicability of the fraud-on-the-market theory before certifying a plaintiff class based on that theory.”