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Posts Tagged ‘practice tip’

I recently authored a practice tip for the ABA Consumer Litigation Committee website entitled Consumer Class Action Defense: A Checklist for the First 10 Days, highlighting some key things that class action defense counsel should do or consider within the first 10 days after a class action is filed.  Audra Petrolle of The Rose Law Group in Phoenix authored a complementary practice tip for plaintiffs’ attorneys.  Click the links below to see both practice tips.

http://www.americanbar.org/publications/litigation-committees/consumer/practice/2016/consumer-class-action-defense-a-checklist-for-the-first-10-days.html

http://www.americanbar.org/publications/litigation-committees/consumer/practice/2016/consumer-class-action-prosecution-a-checklist-for-the-first-10-days.html

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Anyone still checking this site will have noticed a complete lack of new content lately, which is mostly the result of pure laziness on my part but partially due to the demands of several other writing projects I’ve been working on.  I’m pleased to announce that one of these articles it out, and the folks at Practical Law the Journal have graciously given permission for me to post a reprint here.  Click the following link to view the article, entitled Key Issues in Data Breach Litigation, which is featured in the October 2014 issue.  Please be sure to visit the Practical Law website to learn how to subscribe to more great content on timely legal topics.

Also, speaking of data privacy litigation, I’ll be part of a panel presenting on the topic at the ABA Institute on Class Actions next week in Chicago.  It’s not too late to register.

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The Class Action Playbook, Second Edition

I was nearly distraught when I recently misplaced my only copy of The Class Action Playbook by Brian Anderson and Andrew Trask (Oxford University Press 2010).  Not only was the book a handy guide to just about every issue one might face in a class action, but it is also an accessible introduction to class action practice that has saved me hours of having to explain difficult concepts to new associates (I suspect that one of these associates is hoarding my lost copy, but alas, I have no solid proof).  Thankfully, Anderson and Trask have released the Second Edition of the book, which now is available at the OUP website.   So, not only do I have my quintessential guide to defending class actions back, it’s up to date with the latest trends and authorities.  Just in time!

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Conventional wisdom says that a defendant should move to dismiss a class action complaint if there are grounds to do so.  Motions to dismiss have many potential strategic benefits beyond the mere possibility of an early victory, including allowing the defendant to avoid expensive discovery pending resolution of key threshold legal issues, providing an early opportunity to educate the judge about the weaknesses of the plaintiffs’ case, and pinning down the plaintiff’s legal theories at an early stage.  However, it is always important to consider that there are alternative approaches, including:

  • Moving for summary judgment instead of moving to dismiss on the pleadings;
  • Moving to strike the class allegations or for an early ruling on class certification, leaving for a later date the matter of the plaintiffs’ individual claim; or
  • Simply filing an answer and waiting until the record is more well-developed before raising a potentially dispositive legal argument, either in a later motion for summary judgment or a motion for judgment on the pleadings.

Without question, every defendant has an incentive to obtain resolution of a class action in the quickest, most efficient way possible.  However, filing a motion to dismiss is not the most efficient means of resolution in every case.  If the motion is unsuccessful, the trial court can develop preconceived notions about the strength of the plaintiff’s claims if they are attacked too early based on an undeveloped record.  This is a risk especially where the trial judge has a reputation of denying motions to dismiss without serious analysis.  But beyond the possibility that the motion will be denied, there is a potential downside to winning an early motion to dismiss on the pleadings.  Having to defend a successful motion to dismiss on appeal can be an unnecessary expense in comparison to the available alternatives, and there is a risk of an unfavorable appellate ruling that can cause lasting harm on remand.  Another consideration is that winning a dispositive motion prior to class certification will only bind the named plaintiff and doesn’t bind other class members (although in practice, defendants are usually willing to take the risk of future lawsuits if it means getting the current one dismissed).

There are two common scenarios in which defendants are successful in obtaining early dismissal of class action claims.  The first is where the plaintiff’s underlying legal theory is a novel one.  One recent example is a putative class action filed against New York Law School alleging that the school misrepresented its employment statistics, causing students to attend law school with the hopes of significant employment prospects, only to find themselves with limited job options upon graduation.  A state court recently dismissed the case in a lengthy opinion that relies heavily on factual matters of which the court took judicial notice (link courtesy of www.abovethelaw.com).  Another example is a putative class action in California challenging McDonald’s alleged practice of using toys in Happy Meals to entice children to buy unhealthy food.  That case was dismissed last week, in a written decision that does not contain any analysis of the court’s reasons for sustaining the defendant’s demurrer (presumably, the court articulated the reasons orally). 

There is no particular reason to believe that either of these decisions will be reversed on appeal, but the risk of reversal is present in almost any decision granting a motion to dismiss due to the individual plaintiff’s failure to state a claim.  Even if the plaintiff’s legal theory is novel or borderline frivolous, there is always a danger that an appellate panel, left to analyze the case from the perspective of pure application of the law based on the facts viewed in the light most favorable to the plaintiff, will find that the plaintiff has stated a claim.  This creates the related risk that due to the undeveloped state of the record, the appellate court will make generalized statements about the viability of the cause of action that will make it more difficult to obtain summary judgment or a denial of class certification later.  This risk is most evident where the named plaintiff has alleged facts that, while implausible, would state an individual claim if accepted as true, but where the facts alleged are so individualized to the named plaintiff that they wouldn’t possibly support a common claim on a class-wide basis.  In that situation, it is important to at least consider the alternative approaches of attacking class certification or filing a motion for summary judgment on a more well-developed record.

A second common scenario where defendant can obtain early dismissal of a class action is where there is a possible complete legal defense to the plaintiff’s class claims, but the defense is based on an unsettled question of law.  In that situation, a win in the trial court may only guaranty years of litigation in the appellate courts rather than putting an end to the dispute.  There may be strategic advantages to a defendant testing the legal theory early in the case anyway, but it is always important to consider other approaches.  One situation in which the defendant may be better off waiting to raise a potentially dispositive legal defense is where the facts are likely to show that the plaintiff’s claim is baseless as a matter of fact, so that an early motion for summary judgment may be a more efficient alternative.

Of course, there is no set formula for deciding whether to file an early motion to dismiss.  Instead, the decision requires an analysis of a variety of different variables that will depend on the specific case.  A non-exhaustive list of the factors includes:

  • the strength of the legal arguments and the extent to which the law is settled;
  • the style and predilections of the trial court judge;
  • the extent to which discovery can be limited or stayed if a motion to dismiss is pending;
  • the likelihood of reversal given the composition and leanings of the applicable appellate court;
  • the existence of alternative defenses, such as those based on facts outside the pleadings;
  • the likelihood that the case will survive class certification; and
  • the perceived willingness of the named plaintiffs and their attorneys to explore settlement or to abandon the case following an adverse trial court ruling;
  • the effect of long-term uncertainty over a challenge to a particular business practice as the case awaits resolution in the appellate courts; and
  • the cost of defending the judgment on appeal in comparison to the amount at stake in the litigation.

There are many situations in which the cost and potential long-term risks of seeking an early dismissal are outweighed by the benefits of a quick win in the trial court.   But, while filing an early motion to dismiss is always a strategy to consider, it is important to at least consider alternatives that may be only slightly more costly in the short term and may provide a better foundation for a win in the trial court to remain a win forever.

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In December, I posted this preview of the then forthcoming book, Drug and Device Product Liability Litigation Strategy, by Mark Herrmann and David B. Alden (Oxford University Press 2011).  I received my copy of the book just before the holidays, and it is as good as advertised. 

The book has many strengths.  It is comprehensive, generally accessible, eloquently written, and well-researched.  Perhaps its greatest accomplishment is the breadth of its usefulness to a wide range of readers with varying levels of sophistication.  The book starts at the beginning, with a discussion of the history of mass tort litigation and a summary of the relevant FDA regulations.  Following a discussion of each of the typical causes of action in drug and device cases, the book goes on to cover every conceivable procedural phase, from MDL assignment, to motions practice, to discovery, and finally through the rarest of events in mass tort litigation: trial.  The step-by-step approach makes the book a perfect starting point for a new associate, client, or colleague who is just becoming familiar with medical products litigation.  But packed in to the logically organized chapters are a wealth of practice tips and research summaries that make the book a handy practice aid to even the most seasoned practitioner. 

The book’s authors admit (and make no apologies for the fact) that it has a defense-oriented slant, and it’s main audience would certainly be defense-oriented practitioners and corporate legal departments, but that does not mean that it would not be a useful guide to plaintiffs in pharmaceutical or other mass tort litigation. 

In short, this book is a welcome addition to my personal law library.  Now, my problem is figuring out how to protect it from being permanently “borrowed” from one of my colleagues.

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The Class Action Playbook

The Class Action Playbook

Andrew Trask, author of the blog Class Action Countermeasures, recently sent me an advance copy of a new book that he co-authored with O’Melveny partner Brian Anderson: The Class Action Playbook (Oxford University Press 2010).  The title is self-explanatory, and the book lives up to its name.  It’s clear after just a few pages that the authors are eloquent writers who know their way around a class action.  The book as a whole provides an anatomy of a class action from pre-filing to discovery, trial or settlement, appeal, and even post-judgment collateral attack.  Each section contains concrete practice tips in addition to a discussion of the applicable legal principles and procedural requirements.  Aside from being an accessible and comprehensive practitioner’s guide to litigating class actions, the book is filled with entertaining quips and illustrations that make the book an enjoyable read from cover to cover.  Here are some examples:

On ascertainability as component of the numerosity requirement (pp. 23-24):

A merits-based (also known as a “fail-safe”) class is like Schrödinger’s cat: until the verdict, there is no way of telling whether the class has 1,000 members or none at all.

On drafting class certification briefs (p. 135):

Indeed, class-action litigation can sometimes seem almost fractal in nature.  From the 30,000-foot view the plaintiff advocates, all issues look common: contracts are uniform, misrepresentations are substantially similar, and reasons for not hiring are all part of a larger pattern or practice.  But from the close-up view the defendant advocates, every class member is unique, and common proof could never resolve everyone’s claims.  One could say that the outcome of the class certification debate turns on whether the court decides that the lawsuit is best viewed through a telescope or a microscope.

On the importance of plain language notice (p. 185):

Most adults who pay with a credit card, use a cell phone, or drive a car have seen at least one class notice in their lives.  Class notices have a reputation for being long and opaque, reading much like the credit cards agreements, cell phone calling plans, or warranties that the plaintiff complained about in the first place.  Some of this complexity is unavoidable: It is extremely difficult to balance accuracy and clarity, and the presence of lawyers likely tips the scale in the wrong direction. . . .

I highly recommend the Class Action Playbook to fellow practitioners and their clients as well as students, judges, and academics alike.  Very well done, gentlemen.

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Conventional wisdom says that for a defendant, class certification is to be avoided at all costs, and many defendants may assume that the best strategy for dealing with a certified class, short of settlement, is to find a way to get the class decertified.  But it’s important to remember that a class action judgment has a preclusive effect on all class members if the defendant wins. 

As a result, a defendant should always at least consider whether filing a dispositive motion or simply defending the case on the merits at trial may be a better strategy than seeking decertification.  This may especially be true where there is a risk that individual plaintiffs will pursue their own suits even if the class action is not successful.  If so, a successful defense of the class action may prevent even greater exposure, or at least the significant defense costs associated with defending numerous individual cases.

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