Antitrust Action Defense Cases–Ginsburg v. InBev: Missouri Federal Court Grants Motion For Judgment On The Pleadings Of Antitrust Class Action

Antitrust Class Action Challenging Merger of Anheuser-Busch and InBev Fails as a Matter of Law because InBev could not Reasonably be Viewed as a “Potential Competitor” Prior to the Merger Missouri Federal Court Holds Plaintiffs, characterizing themselves as “a group of Missouri beer consumers and purchasers,” filed a putative class action against Anheuser-Busch and InBev NV/SA challenging the proposed merger of the companies; the class action complaint alleged that “the merger “violates Section 7 of the Clayton Act because it would eliminate InBev as a ‘perceived’ and ‘actual’ potential competitor” in the United States beer market.

Class Action Court Decisions Uncategorized

UPS Class Action Defense Cases–Hohider v. United Parcel Service Express: Third Circuit Reverses Class Action Certification Of ADA Class Action Holding District Court Abused Discretion In Granting Certification

District Court Order Granting Certification Of ADA Class Action under Rule 23(b)(2) Warranted Reversal because District Court Abused Discretion in Overlooking Individualized Inquiries Inherent in Class Action Claims and because Monetary Relief was not Merely Incidental to Class Action Complaint Third Circuit Holds

Plaintiffs filed a putative class action against United Parcel Service “alleging UPS has adopted and implemented companywide employment policies that are unlawfully discriminatory under the [Americans with Disabilities Act] ADA.” Hohider v. United Parcel Service, Inc., ___ F.3d ___ (3d Cir. July 23, 2009) [Slip Opn., at 6]. A separate class action was filed against UPS that was ultimately consolidated for all purposes with the initial action. _Id._, at 7. In broad terms, “Plaintiffs’ claims of unlawful discrimination focus on UPS’s alleged treatment of employees who attempt to return to work at UPS after having to take leave for medical reasons.” _Id._ According to the allegations underlying the class action, “UPS, as a matter of companywide policy, refuses to offer any accommodation to employees seeking to return to work with medical restrictions, effectively precluding them from resuming employment at UPS in any capacity because of their impaired condition.” _Id._, at 8. Plaintiffs moved the district court to certify the litigation as a nationwide class action, _id._, at 6-7, 10. In analyzing plaintiffs’ motion, the district court concluded that the proper “framework for analyzing a Title VII pattern-or-practice claim” in “a private-party class action brought under the ADA” was that set forth in _Franks v. Bowman Transp. Co._, 424 U.S. 747 (1976), _Int’l Brotherhood of Teamsters v. United States_, 431 U.S. 324 (1977), and _Cooper v. Federal Reserve Bank of Richmond_, 467 U.S. 867 (1984). _Id._, at 29. The district court concluded that plaintiffs satisfied the requirements for class action certification under Rule 23(b)(2), _id._, at 11-12. UPS appealed, and in an 86-page opinion the Third Circuit reversed, _id._

The Circuit Court noted that the district court recognized the difficulties in allowing the litigation to proceed as a class action. For example, the district court “recognized that, in the present case, some of these ‘individual elements of a reasonable accommodation claim’ are not suitable for class treatment, as their resolution would require inquiries too individualized and divergent with respect to this class to meet the requirements of Rule 23.” Hohider, at 34. The court found, however, that “these individualized inquiries could be delayed until the second, ‘remedial’ stage” and so did not preclude class certification for the “‘liability’ stage,” which required “only proof of the existence of the alleged policies as UPS’s ‘standard operating procedure.’” Id. In the district court’s words, “It is sufficient in order to certify a class pursuant to Rule 23(b)(2) for the court to find that either UPS has acted on grounds generally applicable to the class by engaging in the alleged de facto 100% healed policy or by not engaging in the alleged de facto 100% healed policy; by implementing its formal ADA compliance procedures in violation of the ADA, or by implementing them in compliance with it; or by creating job classifications that are designed without regard to essential job functions to preclude anyone from returning to work who could not lift seventy pounds, or by creating job classifications that are designed with regard to essential job functions.” Id., at 34-35. The Third Circuit found that the district court misconstrued the Teamsters framework, and that “[t]o the extent the District Court relied upon the Teamsters method of proof to reach a certification decision incompatible with the substantive requirements of the ADA, it abused its discretion.” Id., at 42. The Third Circuit held at page 42, “Having reviewed plaintiffs’ claims in light of the substantive requirements of the ADA, we find those claims cannot be adjudicated within the parameters of Rule 23 such that a determination of classwide liability and relief can be reached. Rather, establishing the unlawful discrimination alleged by plaintiffs would require determining whether class members are ‘qualified’ under the ADA, an assessment that encompasses inquiries acknowledged by the District Court to be too individualized and divergent with respect to this class to warrant certification under Rule 23(a) and (b)(2).” Put simply, “the Teamsters framework cannot, by its own force, cure this flaw in the class.” Hohider, at 43. “Accordingly, the court’s grant of class certification was an abuse of discretion.” Id.

Certification of Class Actions Class Action Court Decisions Employment Law Class Actions Uncategorized

Class Action Defense Cases—In re Comcast: Judicial Panel On Multidistrict Litigation (MDL) Grants Plaintiff Motion To Centralize Class Action Litigation In Eastern District Of Pennsylvania

Judicial Panel Grants Plaintiff Request for Pretrial Coordination of Class Action Lawsuits Pursuant to 28 U.S.C. § 1407, Rejects Request of Overwhelming Majority of Responding Parties for Transfer to Northern District of Illinois, and Transfers Actions to Eastern District of Pennsylvania as Requested by Moving Party Nine class actions –three each in Illinois and Pennsylvania, and one each in the Eastern and Northern Districts of California, and the Southern District of West Virginia – were filed against Comcast and others alleging antitrust violations; specifically, the class action complaints allege that “Comcast improperly tied and bundled the lease of cable boxes to the ability to obtain premium cable services in violation of Section 1 of the Sherman Antitrust Act.

Class Action Court Decisions Multidistrict Litigation Uncategorized

Insurance Class Action Defense Cases–Spagnola v. Chubb: Second Circuit Generally Affirms Dismissal Of Class Action Claims For Violations Of New York’s Insurance Law And Deceptive Business Practices Act But Reverses As To Breach Of Contract Claim

Class Action Claims Challenging Increases in Homeowner’s Insurance Premiums Properly Dismissed Except for One Aspect of Breach of Contract Claim Second Circuit Holds Plaintiff filed a putative class action against his homeowner’s insurer, Chubb, alleging inter alia violations of New York’s Insurance Law and deceptive business practices act; the class action complaint alleged that Chubb violated the terms of the policy “by improperly increasing coverage and premiums without his consent and in excess of the [Consumer Price Index].

Class Action Court Decisions Uncategorized

Class Action Defense Cases–Desai v. Deutsche Bank: Ninth Circuit Affirms Denial Of Class Action Treatment In Securities Fraud Class Action Case Holding Issue Of Reliance Defeated Predominance Prong Of Rule 23(b)(3)

District Court did not Abuse Discretion in Denying Class Action Certification in Securities Fraud Class Action because Reliance Required to Establish Securities Exchange Act § 10(b) Violation could not be Proven on a Class-Wide Basis Ninth Circuit Holds Numerous putative class action complaints were filed against Deutsche Bank alleging securities fraud in the alleged manipulation of the stock price of GenesisIntermedia, Inc. (“GENI”); the class action lawsuit “followed the collapse of an elaborate stock manipulation scheme.

Certification of Class Actions Class Action Court Decisions PSLRA/SLUSA Class Actions Uncategorized

Target Class Action Defense Cases–Loeffler v. Target: California State Court Affirms Dismissal Of Class Action Holding Plaintiffs Lacked Standing To Challenge Sales Taxes Collected By Target

Class Action Alleging Target Improperly Collected Sales Tax on Sale of Hot Coffee “To Go” Properly Dismissed because Plaintiffs do not have Standing under California Statutory Scheme to Seek Reimbursement from Retailer of Sales Taxes Paid to State and Lack Standing to Directly or Indirectly Enjoin the Collection of Sales Taxes California State Court Holds Plaintiffs filed a putative class action in California state court against Target alleging that it unlawfully collected sales taxes on purchases of coffee; the class action complaint sought reimbursement of the sales taxes paid by class members, and an injunction against the collection of such sales taxes in the future.

Class Action Court Decisions Uncategorized

FedEx Class Action Defense Cases–Babineau v. Federal Express: Eleventh Circuit Affirms Denial Of Class Action Certification Of Labor Law Class Action Holding District Court Acted Within Its Discretion

District Court did not Err in Denying Class Action Treatment of Labor Law Class Action because Court did not Abuse its Discretion in Concluding that Individualized Factual Issues Concerning Gap and Break Periods Predominate over Common Issues Eleventh Circuit Holds

Plaintiffs filed a putative class action against Federal Express alleging labor law violations in that FedEx allegedly “fail[ed] to pay hourly employees for all time worked”; the lawsuit has been characterized as “Round Two” because “the district court denied certification of a nationwide class of FedEx employees asserting substantially similar claims in Clausnitzer v. Federal Express Corp/, 248 F.R.D. 647 (S.D. Fla. 2008)” and then this class action was filed in an “attempt[] to address the defects identified in Clausnitzer by limiting the scope of the class….” Babineau v. Federal Express Corp., ___ F.3d ___ (11th Cir. July 27, 2009) [Slip Opn., at 1-3]. Plaintiffs moved the district court to certify the litigation as a class action, but the court denied the motion concluding that “individualized factual inquiries into whether and how long each employee worked without compensation would swamp any issues that were common to the class.” _Id._, at 2. Plaintiff’s appealed the denial of class certification, _id._ The Eleventh Circuit explained that the issue on appeal was “whether the district court abused its discretion in declining to certify the class.” _Id._ The Circuit Court held the district court acted within its discretion and affirmed.

We do not here summarize the lengthy summary of facts in the Circuit Court opinion, see Babineau, at 2-14. Nor do we address Rule 23(a)’s requirements for class action treatment, as the district court assumed that they had been satisfied. See id., at 14-15. The Eleventh Circuit immediately began its analysis with Rule 23(b)(3)’s class certification requirements. See id., at 15. The Court noted that “common issues will not predominate over individual questions if, ‘as a practical matter, the resolution of [an] overarching common issue breaks down into an unmanageable variety of individual legal and factual issues.’” Id., at 15-16 (citation omitted). In other words, “[c]ertification is inappropriate if the ‘plaintiffs must still introduce a great deal of individualized proof or argue a number of individualized legal points to establish most or all of the elements of their individual claims.’” Id., at 16 (citation omitted). Using these rules, the district court refused class action treatment because it concluded “adjudication of Plaintiffs’ claims on a class basis would be swamped by individual factual inquiries into the activities of each employee during the gap periods or during breaks.” Id. The Circuit Court addressed each in turn.

Certification of Class Actions Class Action Court Decisions Employment Law Class Actions Uncategorized

Class Action Defense Cases—In re LandAmerica: Judicial Panel On Multidistrict Litigation (MDL) Grants Plaintiff Motion To Centralize Class Action Litigation In District of South Carolina

Judicial Panel Grants Defense Request for Pretrial Coordination of Class Action Lawsuits Pursuant to 28 U.S.C. § 1407 and Agrees to Transfers Class Actions to District of South Carolina Two class actions – one in California and one in South Carolina – were filed against various defendants, including LandAmerica and SunTrust Banks, “on behalf of individuals and entities that sought to enter into a Section 1031 tax-deferred exchange and entrusted money to facilitate the exchange with the qualified intermediary LandAmerica 1031 Exchange Services, Inc.

Class Action Court Decisions Multidistrict Litigation Uncategorized

BofA Class Action Defense Cases–In re Consumer Privacy: California Appellate Court Affirms Trial Court Approval Of Class Action Settlement And Award Of Attorney Fees Under Clear Sailing Agreement

Trial Court did not Err in Approving Class Action Settlement in Class Action Against Bank of America for Invasion of Privacy Arising from Sale of Customer Information to Third Party Marketers and “Clear Sailing Agreement” as to Attorney Fee Award to Class Counsel did not Invalidate Award California Appellate Court Holds Plaintiffs filed a putative class action against Bank of America and related entities alleging inter alia invasion of privacy arising from the Bank’s alleged disclosure of “personal and confidential information to third party telemarketers and direct mail marketers for a fee, to enable them to market services to plaintiffs”; the class action was coordinated with two similar class actions against the Bank, and a consolidated class action complaint was filed in 2003.

Class Action Court Decisions Uncategorized

Labor Law Class Action Defense Cases–Hernandez v. Vitamin Shoppe: California Court Affirms Order Barring Attorney In One Class Action From Contacting Class Members In Related Class Action After Class Conditionally Certified In That Action

As Matter of First Impression, Class Action Plaintiff Attorney Ethically Prohibited from Contacting Class Members in Class Action once Trial Court Conditionally Certifies Litigation as a Class Action and Appoints Class Counsel California State Court Holds

Plaintiffs filed three separate putative class action lawsuits against Vitamin Shoppe alleging labor law violations; specifically, the class action complaint alleged that defendant failed to pay employees overtime, or to provide meal and rest periods, as allowed by California law. Hernandez v. Vitamin Shoppe Ind. Inc., 174 Cal.App.4th 1441, 95 Cal.Rptr.3d 734, 737-38 (Cal.App. 2009). The Perry class action (which included appellant Lisa Hernandez as a named plaintiff) was filed in Marin County, as was the Beauford class action; the Thompson class action was filed in Orange County. Id., at 738. Plaintiff’s attorney in the Thompson class action was Jeffrey Spencer; Spencer also represented named plaintiff Hernandez in the Perry class action. Id., at 737-38. Defense attorneys offered to settle the putative class actions on a class-wide basis, provided that all three plaintiffs attended the mediation; Spencer, on behalf of the Thompson class action, refused to participate. Id., at 738. The parties reached a proposed class action settlement of the Perry class action, and Spencer – as plaintiff’s attorney in Thompson – tried unsuccessfully to coordinate the three class actions or, alternatively, to stay the Perry class action. Id. Spencer, again acting as counsel for the Thompson plaintiffs, opposed court approval of the proposed class action settlement in Perry on the grounds that the settlement “was based on erroneous factual and legal assumptions, and that it was not within a range of reasonableness.” Id. The trial court gave preliminary approval to the proposed class action settlement in Perry and appointed class counsel (not Spencer), but before the claims administrator had sent notice to the class, Spencer (acting as counsel in the Thompson class action) sent letters to Vitamin Shoppe employees urging them to opt-out of the proposed settlement in the Perry class action and to retain him as their attorney. Id., at 739. In pertinent part, the court proceedings that followed included a court order that “ordered that a corrective notice be sent, directed Spencer to refrain from any further communications with class members that he did not represent, and granted the request for monetary sanctions.” Id., at 740. Following reassignment to a new judge after Spencer successfully challenged the original trial court for bias, id., the trial court reaffirmed the court order enjoining Spencer from communicating with any class members that he did not represent, ordering a corrective notice be sent to the class (as well as a procedure for determining the impact of Spencer’s letter on class members), and imposing sanctions against Spencer, id., at 741. The appellate court affirmed the order except for the award of sanctions.

For purposes of this article, we focus on the court order prohibiting Spencer from further communication with members of the putative class and awarding sanctions. The appellate court easily found that the court order did not create any conflict with Spencer’s ethical obligation to communicate with clients because it specifically exempted communications with class members who had retained him. See Hernandez, at 743-44. On the contrary, the court order prohibited Spencer from communicating directly with individuals represented by other counsel – class counsel. The Court of Appeal also concluded that the trial court order was well within its discretionary power to oversee litigation, and “‘to protect the rights of all parties, and to prevent abuses which might undermine the proper administration of justice.’” Id., at 745 (citation omitted). In this regard, the appellate court held that the trial court’s duty to protect absent class members is “particularly pronounced” following class action certification “because class members must decide whether or not to opt out.” Id. (citation omitted). In this case, “Spencer sent his letters unilaterally, without court approval, after the court had reviewed the proposed settlement, counsel’s arguments, preliminarily approved the settlement, and ordered the claims administrator to send notice to the class.” Id. Moreover, Spencer’s letters were misleading, id., at 745-46. And finally, the Court of Appeal rejected the claim that the court order infringed on Spencer’s right to free speech, holding at page 746, “Spencer fails to establish that his constitutional free speech rights entitled him to interfere with the trial court’s duty and authority to supervise the exclusion process after conditionally certifying the class, or to contact class members for whom the court had appointed class counsel.” Accordingly, the Court affirmed the trial court orders, save for the sanction as noted below. Id., at 751.

Certification of Class Actions Class Action Court Decisions Employment Law Class Actions Uncategorized