Here are some blog entries from the week that was that might be of interest to class action practitioners:
Class Action Decisions
Law and Insurance discusses a recent Texas Supreme Court decision holding that a duty to defend was triggered in the context of class actions in which the plaintiffs argued that an alleged product defect in cell phones allegedly could cause brain injury, even though the plaintiffs only sought to recover the cost of a headset as damages on behalf of class members and did not seek damages for actual bodily injuries…
http://lawandinsurance.typepad.com/law_and_insurance/2008/09/cost-of-cellpho.html
… and Point of Law discusses a Pennsylvania federal court decision dismissing a putative class action involving similar claims that cell phones cause brain damage on federal preemption grounds:
http://www.pointoflaw.com/archives/2008/09/angelos-strikes.php
CAFA Law Blog discusses a Rhode Island federal court decision rejecting the “legal certainty” standard for meeting the $5 million amount in controversy requirement under CAFA:
http://www.cafalawblog.com/-case-summaries-short-case-from-small-state-rhode-island-handles-cafa-amount-in-controversy-standard.html
Alaska Employment Law discusses a 9th Circuit Court of Appeals decision upholding sanctions in an FLSA/state wage hybrid class action for the failure to provide Rule 26 damages disclosures for all plaintiffs who opted in to the suit:
http://www.akemplaw.com/wiki/2008/09/04/9th-cir-sanctions-in-hybrid-flsa-opt-in-class-action/
How Appealing and Securities Docket discuss and provide links to a Third Circuit Court of Appeals decision reversing a lower court’s dismissal of a securities fraud case involving statements about the commercial marketability of the drug Vioxx:
http://howappealing.law.com/090908.html#030206
http://www.securitiesdocket.com/2008/09/09/third-circuit-reverses-dismissal-by-lower-court-in-merck-securities-class-action/
Plan Adviser summarizes and provides a link to a recent Iowa federal district court decision denying class certification in an ERISA case filed against a retirement plan service provider on behalf of a would-be class of tens of thousands of 401K plans:
http://www.planadviser.com/article.php/2778
Class Action Defense Blog summarizes an Eleventh Circuit Court of Appeals Decision upholding decertification of a class based on the individualized nature of the damages claimed in a case alleging federal Truth in Leasing regulations:
http://classactiondefense.jmbm.com/2008/09/class_action_defense_casesowne.html
Class Action News
The Complex Litigator reports that a petition for review has been filed in the highly publicized wage and hour class action decision by the California Court of Appeal in Brinker Restaurant Corp. v. Superior Court:
http://www.thecomplexlitigator.com/2008/09/petition-for-re.html
The D&O Diary discusses a securities class action filing against mortgage giant Fannie Mae in the wake of the federal government’s takeover this past weekend:
http://www.dandodiary.com/2008/09/articles/subprime-litigation/first-the-government-takeover-then-the-lawsuit/
Classified provides a summary of recent class action news from the Southeastern U.S.:
http://www.carltonfields.com/classactionblog/blog.aspx?entry=236
THR Esq. reports on the upcoming trial date in a class action filed by former NFL players against the NFL Player’s Association:
http://reporter.blogs.com/thresq/2008/09/class-action-ag.html
PogoWasRight.org discusses reports on a trend in Korea on class action filings resulting from alleged acts of illegal downloading of customer information from publicly available broadband wireless connections:
http://www.pogowasright.org/article.php?story=20080908063543355
Class Action (and related) Commentary
The Race to the Bottom offers more installments of its response to securities class action reforms proposed by the U.S. Chamber of Commerce Institute for Litigation Reform:
http://www.theracetothebottom.org/home/the-chamber-of-commerce-and-excessive-litigation-be-careful-5.html
Drug and Device Law Blog provides a follow up to last week’s discussion of the Multidistrict Litigation (MDL) process:
http://druganddevicelaw.blogspot.com/2008/09/how-long-does-mdl-process-take.html
Class Action Settlements
Overlawyered and The AmLaw Daily report on the $688 million fee award approved for imprisoned lawyer William Lerach’s former firm in a class action settlement arising out of the Enron scandal:
http://overlawyered.com/2008/09/enron-class-action-lawyers-set-to-get-688-million/
http://amlawdaily.typepad.com/amlawdaily/2008/09/coughlin-stoia.html
Life of Brad asks lawyers for help in assessing whether any negative repercussions might come of his decision to do nothing and remain part of a class action settlement:
http://lifeofbrad.wordpress.com/2008/09/03/symantec-corporation-class-action-lawsuit-vs-a-lot-of-people/
Canadian Class Action Law
Morton’s Musings reports on a ruling by an Ontario court allowing a class action to proceed against the Canadian federal government for alleged negligence in allowing “Mad Cow” disease to spread into the Canadian market from England:
http://jmortonmusings.blogspot.com/2008/09/mad-cow-class-action-gets-judges.html
Dipper Chick discusses the use of class actions as a tool by minority party candidates in Canada for seeking ballot and media access in elections:
http://dipperchick.blogspot.com/2008/09/dion-doesnt-get-to-bring-his-personal.html
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Governmental Immunity from Negligence Claims an Issue in Recent U.S. and Canadian Class Action Rulings
Posted in Class Action News, Class Action Trends, Commentary, Federal Court Decisions, International Class Action Law, tagged canadian class action law, Crown Liability Act, Federal Tort Claims Act, FEMA, FTCA, Hurricane Katrina, Katrina class action on October 6, 2008| 1 Comment »
Class action suits against governmental agencies in the U.S. and Canada for alleged negligence saw mixed results in a pair of recent rulings this past week, with a favorable ruling for the plaintiffs from a federal trial court in Louisiana and a ruling for the government by an appellate court in Ontario.
As the AP reported on Friday, a federal judge in New Orleans refused to dismiss, on governmental immunity grounds, a class action brought against the Federal Emergency Management Agency (FEMA). The case has been brought on behalf of a would-be class of Hurricane Katrina victims, who were allegedly harmed as a result of the agency’s inaction and negligence in discovering that trailers that were brought in to provide emergency housing after storm were contaminated with formaldehyde. According to the AP story, the portion of the court’s order declining to recognize immunity relied on evidence that FEMA officials put “their heads in the sand” rather than conduct testing to find the contamination, for fear that affirmative steps by the agency to determine the existence and extent of the problem would lead to liability for the agency. The court did agree that the agency’s conduct in making the trailers available to hurricane victims in the first place was an exercise of discretion that should be protected from “judicial second-guessing.”
By contrast, according to a story by The Canadian Press last week (thanks to the blog Beauty and the Breast for the link), the Ontario Court of Appeal recently upheld the dismissal of a would-be class action claim against the Canadian agency Health Canada, alleging negligence in the agency’s regulation of manufacturers of silicone breast implants. The Court of Appeal reportedly based its decision in part on the reasoning that to allow the imposition of liability for negligence for an agency’s actions in performing regulatory functions within its mandate could have the effect of causing “decreased vigilance” by the regulated industry in ensuring the safety of its own products.
The two decisions must be understood in the context of the different statutes that allow for tort actions against the government in the U.S. and Canada, but the standards under the two laws appear to be similar. In the U.S., negligence claims against the federal government are governed by the Federal Tort Claims Act, or FTCA. For a good summary of the FTCA and several of its key exceptions, including the “discretionary function” exception that appears to have been the issue in the FEMA case, see this report to Congress from the Congressional Research Service. Vancouver attorney Brad M. Caldwell has written this introductory overview of the Canadian counterpart to the FTCA, the Crown Liability Act. It appears that the recent Ontario Court of Appeal decision turned in part on a special element for evaluating the existence of a duty of care in evaluating negligence claims against the government, which looks to “whether there are residual policy considerations outside the relationship of the parties that may negative the imposition of a duty of care.”
The two cases may also be distinguished based on the function being undertaken by the agency in committing the alleged negligence. In contrast to the clearly regulatory function at issue in the Health Canada case, FEMA was carrying out an executive function in providing emergency housing to hurricane victims.
Neither decision appears to have addressed the issue of whether the claims were appropriate for class certification. Individual fact questions regarding causation and damages would appear to provide a possible barrier to class treatment in the FEMA case, but the court has yet to rule on class certification.
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