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The Supreme Court issued its decision today in Tyson Foods, Inc. v. Bouaphakeo, No. 14-1146, a case that many commentators predicted would provide an opportunity for the Court to limit or bar the use of statistical evidence as a substitute for common proof in class actions.  The majority opinion, authored by Justice Kennedy, rejected the invitation to create a “broad rule” limiting the use of statistical evidence, however.  Instead, the Court offered practical guidance on the situations in which statistical evidence may or may not be appropriate.  The relevant portion of the opinion is short and succinct, so I have quoted it in its entirety below:

[P]etitioner and various of its amici maintain that the Court should announce a broad rule against the use in class actions of what the parties call representative evidence. A categorical exclusion of that sort, however, would make little sense. A representative or statistical sample, like all evidence, is a means to establish or defend against liability. Its permissibility turns not on the form a proceeding takes—be it a class or individual action—but on the degree to which the evidence is reliable in proving or disproving the elements of the relevant cause of action. See Fed. Rules Evid. 401, 403, and 702.

It follows that the Court would reach too far were it to establish general rules governing the use of statistical evidence, or so-called representative evidence, in all class-action cases. Evidence of this type is used in various substantive realms of the law. Brief for Complex Litigation Law Professors as Amici Curiae 5–9; Brief for Economists et al. as Amici Curiae 8–10. Whether and when statistical evidence can be used to establish classwide liability will depend on the purpose for which the evidence is being introduced and on “the elements of the underlying cause of action,” Erica P. John Fund, Inc. v. Halliburton Co., 563 U. S. 804, 809 (2011).

In many cases, a representative sample is “the only practicable means to collect and present relevant data” establishing a defendant’s liability. Manual of Complex Litigation §11.493, p. 102 (4th ed. 2004). In a case where representative evidence is relevant in proving a plaintiff’s individual claim, that evidence cannot be deemed improper merely because the claim is brought on behalf of a class. To so hold would ignore the Rules Enabling Act’s pellucid instruction that use of the class device cannot “abridge . . . any substantive right.” 28 U.S.C. § 2072(b).

Those who were hoping for a rule barring statistical evidence as a proxy for common evidence in class actions will no doubt be disappointed, but Justice Kennedy’s opinion does go much further than it had to in beginning to develop standards that will govern resolution of the issue in future cases.  To summarize:

  1. There is no general rule barring the use of statistics to prove class-wide liability in a class action.
  2. The extent to which statistical evidence is allowable in a class action depends on whether the evidence is reliable in proving or disproving the elements of a relevant cause of action.
  3. Statistical evidence is admissible in a class action if it would be admissible in an individual action to prove or disprove elements of a plaintiffs’ claim.
  4. Whether statistical evidence can be used to establish class-wide liability depends on the purpose for which the evidence is being introduced and on “the elements of the underlying cause of action.”

As a final side-note, the decision in Tyson Foods does not appear to have been impacted at all by the recent death of Justice Scalia.  Only two of the eight remaining Justices, Justices Thomas and Alito, dissented.

The Supreme Court issued its opinion today in the first of what will be several class-action-related decisions this term.  As noted in my Supreme Court preview post, the primary issue in Campbell-Ewald Co. v. Gomez, No. 14-857 was whether an unaccepted offer of complete relief to a named plaintiff in a class action had the effect of mooting the plaintiff’s claim, depriving a federal court of Article III jurisdiction.  The Court said no, agreeing with the now unanimous view of the Circuit Courts of Appeals.   Click this link for a copy of the slip opinion.  Justice Kennedy sided with the liberal wing of the Court in supporting Justice Ginsburg’s majority opinion, with Justice Thomas concurring in the judgment.  Perhaps the most interesting thing about the opinion from a practitioner’s point of view is the issue that the majority expressly decline to address despite having been discussed at some length during oral argument:

We need not, and do not, now decide whether the result would be different if a defendant deposits the full amount of the plaintiff ’s individual claim in an account payable to the plaintiff, and the court then enters judgment for the plaintiff in that amount. That question is appropriately reserved for a case in which it is not hypothetical.

 

So, just as we were left with a cliffhanger when the Court decided its previous case involving offers of judgment, Genesis Healthcare Corp. v. Symczyk, we’ll have to stay tuned for the third chapter of the trilogy to find out whether paying the full amount of a plaintiff’s claim into the registry of the Court moots a class action.  Be on the lookout for a preview of this issue at a District Court near you.

A key trend in employment-related class actions these days is a surge in lawsuits alleging that employers have violated wage and hour or employee benefits laws by misclassifying employees as independent contractors.  BakerHostetler Partner Todd Lebowitz has authored an excellent white paper on the subject, titled Independent Contractor Misclassification, 2016 Legal Analysis.  The paper details the analytical framework by which a particular worker is properly classified as employee or independent contractor and discusses the potential legal and regulatory implications arising from an employer’s misclassification of workers.  To download the paper, CLICK HERE.

 

 

I authored a recent article on developments in data privacy class actions, which was published late last week as part of a year-in-review series on BakerHostetler’s Data Privacy Monitor.  For my article, titled 5 Big Developments in Privacy Class Actions in 2015, and 3 to Look for in 2016 and for other great content on data privacy issues, including class action developments, be sure to check out www.dataprivacymonitor.com.

 

 

I’ll be speaking at a data breach and privacy litigation conference on February 11, 2016 at the Julia Morgan Ballroom, 465 California Street, San Francisco.  The program is sponsored by HB Litigation Conferences and features an all-star faculty (present company excluded) of plaintiffs’ and defense litigators, insurers, settlement administrators, coverage lawyers, and other key stakeholders in this exciting and emerging area of the law.  For more information about this can’t-miss program, see the link below.  Hope to see you there!

http://hblc.litigationconferences.com/data-breach-privacy-litigation-request-agenda-2016-0?utm_referrer=http%3A%2F%2Flitigationconferences.com%2F35252%2F

 

Thomson Reuters contributor Alison Frankel interviewed me for an article she posted today on the class action cases pending during the current Supreme Court term.  Here is a link to her article.  For those who are not familiar with Frankel’s On the Case Blog, be sure to add it to your regular reading list.  She is one of the best in the business.

I just received my courtesy copy to the latest edition of the Akron Law Review, a symposium issue titled The Class Action After a Decade of Roberts Court Decisions, Volume 48, Issue 4 (2015).  My colleague Dustin Dow and I contributed an article entitled The Practical Approach: How the Roberts Court Has Enhanced Class Action Procedure by Strategically Carving at the Edges.  The contributors to the issue are academics, students, and practitioners from both sides of the bar, including Professor Bernadette Bollas Genetin, Professor Richard Freer, Elizabeth Cabraser, Professor Michael Selmi & Sylvia Tsakos, Andrew Trask, Professor Mark Moller, and Eric Alan Isaacson.  The articles range in perspective from theoretical to historical to practical, with some surveying the Roberts Court’s class action decisions generally, and others focusing on the Roberts Court’s contributions in key areas of the law.

For anyone who follows the Supreme Court’s decisions on class action issues, this is a must-read issue.  Check it out by clicking the link on the symposium title above.