California Class Action Cases–Supreme Court To Review Gentry v. Superior Court Which Enforced Class Action Waiver In Arbitration Clause

California Supreme Court Grants Review in Gentry Case In a prior article, we discussed the California appellate court opinion enforcing a pre-employment arbitration agreement containing a class action waiver. Gentry v. Superior Court, 135 Cal.App.4th944 (Cal.App. 2006). On April 26, 2006, the California Supreme Court granted review of Gentry. Under California law, the decision cannot be cited during the pendency of the appeal.

Arbitration Class Actions In The News Uncategorized

Defense of Class Action Cases and Multidistrict Litigation (MDL)

Amendment of MDL (Judicial Panel on Multidistrict Litigation) Panel Rules of Procedure Prior articles have discussed class actions and MDL (multidistrict litigation), and have provided the statutory and procedural rules governing MDL. On April 19, 2005, the Judicial Panel on Multidistrict Litigation published an order partially suspending Panel Rule 5.12(a), concerning the manner of filing papers, “insofar as papers submitted for filing requiring an original and eleven copies shall be reduced to four copies along with an original.

Multidistrict Litigation Statutes & Rules Uncategorized

Class Action Defense Cases–Murphy Brothers v. Michetti Pipe Stringing

Removal Period Under 28 U.S.C. § 1446 Begins To Run Upon Service Of Complaint U.S. Supreme Court Holds CAFA (Class Action Fairness Act of 2005) was enacted to greatly expand access to federal courts in class actions. In class actions, defendants often benefit if they can remove the case to federal court. While CAFA contains special rules concern removal and appealability of orders granting or denying motions for remand, removal of cases to federal court generally is governed by 28 U.

Class Action Court Decisions Removal & Remand Uncategorized

Class Action Defense Cases–Abrego Abrego v. Dow Chemical

CAFA (Class Action Fairness Act of 2005) Requires Defendant Establish Removal Jurisdiction in “Mass Action” Cases and Jurisdictional Discovery Discretionary Ninth Circuit Holds

CAFA greatly expands access to federal courts to class action defendants, as well as to defendants in “mass action” cases. One question federal courts have grappled with is whether Congress intended to shift the burden from a class action defendant to establish removal jurisdiction, to a class action plaintiff to prove that the matter should be remanded to state court. On April 4, 2006, the Ninth Circuit held that CAFA does not shift the burden of proof to plaintiffs in mass action cases. Abrego Abrego v. Dow Chemical Co., 443 F.3d 676 (9th Cir. 2006).

Abrego Abrego involved a mass action brought by 1160 Panamanian workers against Dow Chemical for alleged distribution and use in Panama of a pesticide banned in the United States. Dow removed the case to federal court under 28 U.S.C. § 1332(d)(11), added by CAFA to provide federal court jurisdiction over “mass actions.” (The requirements of mass actions are discussed in a separate article.) In response to plaintiffs’ motion to remand the action to state court, Dow argued:

[U]nder CAFA and contrary to preexisting removal jurisdiction law: (1) plaintiffs bear the burden of refuting the district court’s removal jurisdiction; (2) a “mass action” is removable regardless of whether there is jurisdiction over all plaintiffs whose claims are necessary to qualify the action as a mass action; and (3) the district court must allow jurisdictional discovery to determine the amount in controversy.

443 F.3d at 677-78. The district court found that Dow had failed to establish removal jurisdiction and remanded the case to state court. Id., at 679.

Class Action Court Decisions Class Action Fairness Act (CAFA) Uncategorized

Class Action Defense Cases–Braud v. Transport Service Company

Post-CAFA (Class Action Fairness Act of 2005) Amendment of Complaint to Add Defendant Allows Removal to Federal Court by that Defendant of Suit Filed Prior to CAFA’s Effective Date Fifth Circuit Holds On April 6, 2006, the Fifth Circuit Court of Appeals considered “an issue of first impression for this court: whether amending a complaint to add a defendant ‘commences’ a new suit under the Class Action Fairness Act of 2005 (CAFA),” Braud v.

Class Action Court Decisions Class Action Fairness Act (CAFA) Removal & Remand Uncategorized

Best Buy v. Superior Court: Class Action Lawyer Permitted, Over Defense Objection, Precertification Discovery To Identify Substitute Class Action Representative California Court Holds

Plaintiff Lawyer, not Allowed to be Class Counsel and Class Representative, Rewarded with Discovery to Find New Class Action Plaintiffs

Class action case law in California “prohibits a lawyer from serving both as class representative and as counsel for the class, ” Best Buy Stores, L.P. v. Superior Court, 137 Cal.App.4th 772, 774 (Cal.App. 2006) (citing Apple Computer, Inc. v. Superior Court, 126 Cal.App.4th 1253 (Cal.App. 2005). On February 6, 2004, a plaintiff’s lawyer sought to do just that, filing a putative class action to his own name against Best Buy for alleged violations of the CLRA (Consumer Legal Remedies Act, California Civil Code §§ 1750 et seq.), unfair competition, unjust enrichment based on the theory that the “restocking fee” Best Buy charged for returned merchandise was illegal. Best Buy, at 774. Defense attorneys moved to dismiss the case, and the trial court issued an order to show cause why the motion should not be granted. Id.

The plaintiff lawyer requested that the court compel Best Buy (through a third party) to send a letter to a sampling of members of the putative class so that he could find a new class representative: the trial court granted the motion. Best Buy, at 775. Best Buy filed a petition for writ of mandate in the California Court of Appeal. The defense opposed this class action discovery order as a form of “illegal solicitation”; the appellate court disagreed with this characterization. Id., at 777. The Court agreed, however, that the privacy rights of Best Buy customers needed additional protection. Accordingly, at page 778 it held as follows:

Class Action Court Decisions Class Actions In The News Uncategorized

Merrill Lynch v. Dabit Class Action Defense Case

SLUSA (Securities Litigation Uniform Standards Act) and Pre-emption

SLUSA (Securities Litigation Uniform Standards Act) was enacted by Congress in 1998 to affect sweeping changes to federal securities laws class actions. SLUSA addresses numerous federal securities laws class actions issues including pleading, class representation, discovery, liability, attorney fee awards, expenses and more. SLUSA also sought to pre-empt state law securities class action litigation, but the Circuit Courts disagreed on the breadth of that pre-emption.

In Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Dabit, __ U.S. ___, 126 S.Ct. 1503 (2006), the United States Supreme Court issued its opinion. This opinion addresses whether the Securities Litigation Uniform Standards Act (SLUSA) “only pre-empts state-law class-action claims brought by plaintiffs who have a private remedy under federal law,” as the Second Circuit held in Dabit v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 395 F.3d 25 (2005), or whether SLUSA “also pre-empts state-law class-action claims for which federal law provides no private remedy,” as the Seventh Circuit held in Kircher v. Putnam Funds Trust, 403 F.3d 478 (7th Cir. 2005). The Supreme Court agreed with the Seventh Circuit, holding that SLUSA’s pre-emption provision was intended to be read broadly, and pre-empted state-law class-action claims brought not only by purchasers and sellers of securities, but also by holders of securities. As so read, SLUSA pre-empted state-law claims alleging the fraudulent manipulation of stock prices.

Class Action Court Decisions Class Actions In The News PSLRA/SLUSA Class Actions Uncategorized

Defense of Class Actions Issues: Judicial Panel Rules for Multidistrict Litigation (MDL)

MDL (Multidistrict Litigation) Judicial Panel Rules of Procedure When multiple actions, class action or otherwise, involving the same facts are pending in different federal district courts, 28 U.S.C. § 1407 sets forth the procedure for the transfer of the actions to a single federal court for coordination or consolidation. This is known as “multi-district litigation” (MDL), and is discussed in a separate article. The Judicial Panel on Multidistrict Litigation oversees MDL cases, and has published Rules of Procedure governing MDL cases.

Multidistrict Litigation Statutes & Rules Uncategorized

Class Action Defense Cases-Schumacher v. Tyson: South Dakota Federal Court Denies Defense Motion For Summary Judgment In Class Action Lawsuit Under Packers And Stockyards Act

Producers Adequately Alleged Violation of Federal Packers and Stockyards Act (PSA) and Raised Genuine Issues of Material Fact as to Knowledge that Federal Government’s Published Prices for Boxed Beef were Inaccurate For the few defense attorneys who may benefit from this information, we note that on March 30, 2006, a federal district court denied a defense motion for summary judgment in a class action filed by cattle producers against beef packers under the federal Packers and Stockyards Act (PSA), 7 U.

Class Action Court Decisions Uncategorized

Statutory Rules for Multidistrict Litigation (MDL): Defense of Class Actions Issues

28 U.S.C. 1407 – Multidistrict Litigation (MDL)

When multiple actions – class action or otherwise – involving the same facts are pending in different federal district courts, 28 U.S.C. § 1407 sets forth the procedure for the transfer of the actions to a single federal court for coordination or consolidation. This is known as “multi-district litigation” (MDL). The Judicial Panel on Multidistrict Litigation affects the transfer of cases under Section 1407(a). MDL and Section 1407 are discussed in a separate article. For the convenience of the reader, the full text of Section 1407 is reprinted below.

28 U.S.C. § 1407. Multidistrict litigation

(a) When civil actions involving one or more common questions of fact are pending in different districts, such actions may be transferred to any district for coordinated or consolidated pretrial proceedings. Such transfers shall be made by the judicial panel on multidistrict litigation authorized by this section upon its determination that transfers for such proceedings will be for the convenience of parties and witnesses and will promote the just and efficient conduct of such actions. Each action so transferred shall be remanded by the panel at or before the conclusion of such pretrial proceedings to the district from which it was transferred unless it shall have been previously terminated: Provided, however, That the panel may separate any claim, cross-claim, counter-claim, or third-party claim and remand any of such claims before the remainder of the action is remanded.

(b) Such coordinated or consolidated pretrial proceedings shall be conducted by a judge or judges to whom such actions are assigned by the judicial panel on multidistrict litigation. For this purpose, upon request of the panel, a circuit judge or a district judge may be designated and assigned temporarily for service in the transferee district by the Chief Justice of the United States or the chief judge of the circuit, as may be required, in accordance with the provisions of chapter 13 of this title. With the consent of the transferee district court, such actions may be assigned by the panel to a judge or judges of such district. The judge or judges to whom such actions are assigned, the members of the judicial panel on multidistrict litigation, and other circuit and district judges designated when needed by the panel may exercise the powers of a district judge in any district for the purpose of conducting pretrial depositions in such coordinated or consolidated pretrial proceedings.

Multidistrict Litigation Statutes & Rules Uncategorized