It’s back! We can’t promise that it will appear weekly, so we changed the name to Class Action Blogosphere “Periodic” Review. But, as always, we have combed through our favorite blogs and news feeds to bring our readers up to speed on a some of the notable developments in class action news.
The End of Consumer Class Actions as We Know Them?
One story is, by far, the biggest news in the class action world. Today, the U.S. Supreme Court will hear argument in the case of AT&T Mobility Services v. Concepcion. The key issue is whether class action exemptions in consumer contracts are enforceable even when state contract law bars such exemptions. AT&T argues that the Federal Arbitration Act preempts state contract law. Thus, if a class action exemption is tied to an arbitration clause it is enforceable despite contrary law at the state level. For an accessible read, check out Brian T. Fitzpatrick’s story in the San Francisco Chronicle…
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2010/11/06/INA41G6I3I.DTL
… and see also
All Writs Act Better than Collateral Estoppel
Class action defense lawyers may have a new tool to use against copycat class actions; particularly those involving plaintiffs’ lawyers who attempt to extort settlements through threat of discovery. It’s called the All Writs Act. It was used by Judge Posner in the Seventh Circuit to grant an injunction blocking a copycat class action in another jurisdiction. The case is called Thorogood v. Sears, Roebuck & Co. For more information check out Andrew Trask’s November 10 post on Class Action Countermeasures. Judge Posner even cites Trask’s new book, The Class Action Playbook. (See CAB Review of the book here).
http://www.classactioncountermeasures.com/2010/11/articles/discovery/using-the-all-writs-act-to-block-copycat-class-actions/
For a slightly different take on Posner’s decision, read Russell Jackson’s post on Consumer Class Actions & Mass Torts.
http://www.consumerclassactionsmasstorts.com/2010/11/articles/predominance-1/7th-circuit-enjoins-relitigation-of-denial-of-class-certification/
Motion to Dismiss + Discovery = Motion Granted?
The Rule 12(b)(6) Motion to Dismiss can sometimes feel like a mini-motion for summary judgment. Over the years, courts have been more willing to consider information beyond merely the pleadings including documents that are referenced by plaintiffs and central to their claims. Anything more is supposed to convert the motion to dismiss into a motion for summary judgment, right? Maybe not. One court has apparently permitted discovery in the context of a Rule 12 Motion to dismiss. Get the story in a post titled Preemption, Pleading & Rule 11 at Drug and Device Law.
http://druganddevicelaw.blogspot.com/2010/11/preemption-pleading-rule-11.html
Big Changes Coming for Rule 26 and Expert Witnesses
The communications between attorneys and their expert witnesses are currently discoverable in federal court. Not for long. Federal Rule 26 is about to change in a way that will protect certain communications between counsel and expert. The rule change will also extend work product protection to the draft reports of experts. Check out the latest post in the North Carolina Business Litigation Report.
http://www.ncbusinesslitigationreport.com/2010/11/articles/discovery-1/work-product-protection-for-communications-between-lawyers-and-expert-witnesses-coming-next-month-under-revised-federal-rules-of-civil-procedure/
Hooters Waitresses Have no Class … Action?
Always read the fine print. According to the Washington Post, whatever the Supreme Court decides in AT&T Mobility Services vs. Concepcion may have ramifications for a class of waitresses trying to sue Hooters. You see, the job application has an arbitration clause that bars lawsuits.
http://www.washingtonpost.com/wp-dyn/content/article/2010/11/05/AR2010110507318.html?hpid=moreheadlines
Oppress Me, Please
Professor James C. Morton reports on a Canadian decision allowing class certification of a case seeking the remedy of “oppression” in his blog, Morton’s Musings. Doesn’t sound like a very pleasant remedy to us, but they march to the beat of their own drummer north of the border.
http://jmortonmusings.blogspot.com/2010/11/oppression-remedy-properly-sought-in.html
You Mean to Tell Me that Fast Food Makes you Fat!?
Sean P. Wajert of Mass Tort Defense reports on a recent decision denying class certification to a plaintiff seeking to hold a fast food chain responsible for allegedly misleading consumers into thinking that its fare poses no health risks.
http://www.masstortdefense.com/2010/11/articles/class-action-alleging-false-food-ads-rejected/
Securities Class Action Filings Down
As reported in the Conference Board’s Governance Center Blog by guest contributor Anthony Galban, Sr. V.P. of Chubb & Son, securities class action filings are down significantly in 2010.
http://tcbblogs.org/governance/2010/11/04/guest-contributor-securities-class-action-filings-are-down-but-will-the-trend-continue/
Hot Pockets are Fast and Tasty
Greg Mersol of Baker Hostetler’s new Employment Class Action Blog reports on the latest in a series of California decisions denying class certification in a wage and hour case seeking to hold an employer liable for not ensuring that its employees to take meal breaks.
http://www.employmentclassactionreport.com/class-action/another-court-denies-certification-of-a-california-meal-break-class/
Describe that Class for Me Again?
The Complex Litigator‘s H. Scott Leviant reviews a recent California Court of Appeal decision holding that class certification was not appropriate because the proposed class was not ascertainable.
http://www.thecomplexlitigator.com/post-data/2010/11/1/in-sevidal-v-target-corporation-an-unascertainable-class-doo.html
Read Full Post »
Want to Cash in on the Next Class Action Settlement? Save Those Receipts
Posted in Class Action Settlements, Commentary, Consumer Class Actions, tagged class action reform, class action settlement, consumer class actions, social utility on March 3, 2009| 1 Comment »
This report from Jim Williams of Chicago’s CBS affiliate, CBS 2, illustrates a common quandry facing lawyers in consumer class actions. The report discusses a class action settlement involving allegations that packaged chicken contained excessive amounts of water, resulting in consumers getting less chicken for their money than advertized. The article criticizes the settlement because class members are required to provide receipts as proof that they purchased the chicken, in order to obtain a 3% refund as part of the settlement.
Williams takes issue with the practical difficulties with requiring consumers to provide receipts for low-value purchases made years in the past. He credits a law school dean with the stating the obvious, that the receipt requirement is “unrealistic.”
What was the alternative? Should the plaintiffs worked harder to force the defendant to pay for the alleged harm caused by its conduct, whether or not that payment would ever reach the hands of those who suffered the alleged harm? Or should the case never have been filed in the first place?
For those who see the primary purpose of class actions as retribution or deterrance for corporate wrongdoers, the proof of purchase requirement may seem as an unnecessary barrier to justice. But class actions are a procedural device in civil lawsuits. In other words, they are disputes between private litigants for redress of private wrongs. Punishment and deterrance can be accomplished through criminal and admininstrative enforcement schemes. Moreover, in a settlement, the parties are reaching a comprimise of disputed claims. Typically, the settlement occurs before there has been a determination of whether the defendant did anything wrong.
If compensation is the primary objective, then there are few better alternatives for meeting that objective in a case involving the manufacture of retail products. Possible alternatives in civil settlements, such as a cy pres award to charity, may serve to punish, but they do nothing to compensate actual alleged victims. The parties could have allowed claims through sworn statements rather than documentary proof in the form of a receipt, but the news report suggests a scenario where many purchasers would have no memory of whether they ever purchased the products at issue in the case.
This dilemma raises the question whether there is a social benefit to allowing private attorneys to pursue a class action on behalf of a class of alleged victims whose identies can never reasonably be ascertained (note that most jurisdictions have procedural requirements that should prevent certification of classes whose members are not ascertainable, but how effective those requirements are in practice is a matter of some debate). Even assuming that the wrongdoing can be proved, does forcing a defendant to pay money to private lawyers, a charity, or a random group of self-reporting consumers serve a societal benefit that would not be achieved through other means? The answer to that question may have a lot to do with how much one trusts government regulators, attorneys general, and prosecutors to protect consumer interests–and of course how much one trusts trial lawyers to do the same.
Read Full Post »