The Roundup covers notable class action decisions each month from federal appellate courts, as well as notable Supreme Court class action cert petitions.
Sixth Circuit
Wayside Church v. Van Buren County – A law firm communicated with members of a putative class regarding the putative class action in which they were members — the catch is that the firm was not putative class counsel. The district court entered a protective order barring further such communications, and the Sixth Circuit affirmed. The Sixth Circuit decision endorses three notable principles. First, an order limiting communications to class members “should be based on a clear record and specific findings that reflect a weighing of the need for a limitation and the potential interference with the rights of the parties.” Second, a Rule 23(e)(1) order granting preliminary approval of a class settlement and directing notice to the class does not certify a class, and so does not create an attorney-client relationship between putative class members and putative class counsel. Because putative class members remain merely putative class members even after entry of a preliminary approval order, communications with them by lawyers other than putative class counsel are not communications with represented parties. Third, “a lawyer’s truthful, non-misleading criticisms of a proposed settlement are not a valid reason to proscribe his communications with members of a proposed (or actual) class.” Despite endorsing those principles, the Sixth Circuit affirmed the protective order on the ground that the law firm knowingly communicated with named plaintiffs (not just putative class members) and made misrepresentations to the district court. As the Sixth Circuit put it, that “a district court must narrowly tailor its restrictions on speech to members of a proposed class does not mean it must allow a demonstrably untrustworthy speaker to keep speaking to them.”
Albright v. Ascension Michigan – A putative class of hospital employees in Michigan sued their employer, Ascension Michigan, when they were suspended for refusing the COVID-19 vaccine. Ascension Michigan is an affiliate of Ascension Health Alliance, which has a network of affiliates around the country. Putative class counsel negotiated a nationwide settlement agreement with Ascension. The plaintiffs then amended their complaint to broaden the class definition — a putative Michigan class became a putative nationwide class — and to name Ascension and all of its affiliates other than the previously named Ascension Michigan as defendants. But the amended complaint did not add any named plaintiffs — all of the named plaintiffs in the amended complaint, as in the initial complaint, were employees of Ascension Michigan. The district court approved the proposed settlement over the objections of nine class members, all of whom were employees of the newly named affiliates, not Ascension Michigan. The Sixth Circuit vacated and remanded, finding that the district court lacked jurisdiction to approve the settlement. The Sixth Circuit drew on precedent establishing that for each defendant in a class action, there must be at least one named plaintiff with standing to assert at least one claim against that defendant. Since there was no such named plaintiff for Ascension or any of its affiliates other than Ascension Michigan, their inclusion in the settlement deprived the district court of jurisdiction to approve it.
Eighth Circuit
Cody v. City of St. Louis – This case reminds us that the record really matters. Here, the Eighth Circuit reversed class certification for detainees alleging inhumane conditions in the city of St. Louis’ medium security prison. It handed the city a win, but with choice words about the city’s arguments on appeal. For example, the city argued the class representatives were inadequate, citing their deposition testimony that the plaintiffs did not seek damages. “But the City’s first deposition reference is completely erroneous: the quoted language appears nowhere in Wortham’s deposition, and she states the exact opposite of what the City claims,” Judge Bobby Shepherd wrote. The city waived another argument, “presented without citations to legal authority.” And the city misconstrued a key case, claiming the case established an obligation that district courts conduct a “tailored” or “focused” Daubert analysis at the class certification stage. In fact, the court wrote, the case expressly said the interest at issue in Daubert rulings “is not implicated at the class certification stage.” Despite this criticism, the city’s argument against class certification carried the day. The court held that the detainee class could not be certified even though all the claims concerned a single prison. Each claim, related to different conditions about plumbing, mold, and pests, turned on the severity and duration of the conditions that each individual plaintiff faced.
Ninth Circuit
DeFries v. Union Pacific Railroad Co. – American Pipe establishes that the filing of a class action begins tolling the statute of limitations for putative class members’ individual claims — at least until the court denies class certification. This case considered when American Pipe tolling ends if a named plaintiff decides to seek certification of a narrower class than the one she initially proposed. In a case of first impression in the Ninth Circuit, the court ruled “that to end American Pipe tolling for a particular bystander plaintiff based on a revised class definition, a court must adopt a new definition that ‘unambiguously’ excludes that bystander plaintiff. Ambiguity in the scope of the class definition should be resolved in favor of continuing to extend American Pipe tolling to members of the putative or certified class.” Visiting Judge David Hamilton of the Seventh Circuit wrote the opinion for the court. As a result of the new rule, the court reversed summary judgment against a putative class member whose individual claim under the Americans with Disabilities Act was tossed on statute of limitations grounds. The plaintiff had been part of the original class definition when the case began. But during the case, the putative named plaintiff narrowed the class — arguably transforming Nicholas DeFries from an absent class member to no class member at all. DeFries argued, using extratextual evidence, that neither the court nor class counsel intended to exclude him from the class with the narrower definition. That meant the statute of limitations on his individual claim remained tolled until the Eighth Circuit ultimately decertified the class much later. As a result, the statute of limitations did not bar DeFries’ individual claim. The Ninth Circuit sent the case back to the district court to consider other summary judgment arguments.
White v. Symetra Assigned Benefits Service Co. – The Ninth Circuit reversed a nationwide class certification for RICO and state law claims based on common marketing materials that class members allegedly relied upon when entering into financial agreements to convert their annuities into discounted lump sum payments. The court reversed the certification of a class of 2,000 customers who obtained state court approval to enter into “factoring” transactions that converted their annuities into a smaller lump sum payment. The district court had based certification in part on a “common sense inference of reliance” on the allegedly deceptive marketing materials. That was an error. Instead, the court held, the plaintiffs needed to prove causation one by one as each putative class member entered into his or her agreement based on different follow-up conversations with sales staff, approval of the agreements by different state courts, and consideration of individual personal and financial circumstances. The court also held that the district court could not certify a subclass for customers with the same language in settlement agreements that led to the annuities. The court would need to apply state laws from at least four states to the subclass, and that made individual issues predominate over common issues and rendered the class action unmanageable.
Eleventh Circuit
Allen v. AT&T Mobility Services LLC – After a district court denies class certification and the named plaintiffs settle their individual cases, a putative class member can timely intervene in the case to keep it alive. Everyone agrees on that much. But the intervening plaintiff cannot appeal the denial of class certification without fully litigating his or her individual claim and obtaining a final judgment, the Eleventh Circuit held in this case. That’s what the intervening plaintiff tried to do here. She was wrong to do so, Judge Andrew Brasher wrote in dismissing the appeal for lack of jurisdiction. “Instead of exercising a right to appeal that [the original plaintiffs] forwent, [the intervening plaintiff] is trying to exercise a right to appeal that they never had.” In a concurrence, Judge Adalberto Jordan noted that the Supreme Court or Congress could clear up the “murky” jurisdictional issue in this case. He noted that the Supreme Court, in United Airlines Inc. v. McDonald, had let a putative class member appeal a class certification denial before final judgment — just as the intervening plaintiff wanted to do here. But McDonald did not say anything about appellate jurisdiction. “We typically do not imply jurisdictional holdings from cases which do not directly address the matter of jurisdiction,” Judge Jordan wrote.
