Nelson Levine's Class Action Quarterly analyzes important litigation developments from recent opinions to rule changes and trends. This special edition briefly discusses important developments from 2013 and touches upon the issues to look for in the year ahead. These topics have been discussed at greater length in previous issues of the publication.
2013: The Year in Review
Supreme Court Issues Two Notable Opinions on Class-Wide Arbitration
The United States Supreme Court issued two opinions in 2013 recognizing that class-wide arbitration will ordinarily be governed by the language of arbitration agreements. In American Express Co. v. Italian Colors Restaurant, the Court held that contractual waivers precluding class-wide arbitration are enforceable even when they would prevent a party from "effectively vindicating" their rights under the Federal Arbitration Act. In Oxford Health v. Sutter, the Court held that an arbitrator did not exceed the scope of his authority by authorizing class-wide arbitration based on the parties' arbitration agreement.
Supreme Court Addresses Rule 23's Predominance Standard
In Comcast v. Behrend, the Supreme Court held that trial courts must conduct a "rigorous analysis" of plaintiffs' damages theories under Rule 23(b)(3), which requires predominance of common questions of law or fact over individual questions. The Court overturned certification after looking at the merits of the plaintiffs' damages model finding that individual damages calculations were too numerous.
Supreme Court Foils Plaintiffs' Attempts to Circumvent Class Action Fairness Act Jurisdiction via Stipulation
The Supreme Court held in Standard Fire Ins. Co. v. Knowles that putative class representatives cannot avoid removal to federal court by stipulating in complaints that the class would not seek damages at or above the Class Action Fairness Act's (CAFA) $5-million amount in controversy threshold.
2014: The Year Ahead
Supreme Court to Weigh in on Removability of Parens Patriae Actions
The Supreme Court agreed to resolve a circuit split arising over whether parens patriae actions - brought by a state on behalf of its citizens - are removable as "mass actions" under the CAFA. Whether the suit qualifies as a "mass action" depends on whether the state - or the citizens on whose behalf the state acts - is the real party in interest. An opinion will further clarify the reach of CAFA's jurisdiction.
Liability-Only Classes: A Potential Response to Comcast v. Behrend
Two circuit courts recently allowed plaintiffs to bypass the rule set forth in Comcast v. Behrend. In both cases, the courts affirmed certification of liability-only classes reserving the question of damages for subsequent proceedings or for individual actions. It remains to be seen whether the Supreme Court will approve this approach as a valid response to the limitations imposed by Behrend.
Rise of the Ascertainability "Requirement"
Over the last two years, the Third Circuit has overturned class certification in a few cases where it found that plaintiffs had not satisfied the implied "requirement" of ascertainability: that the proposed class must be objectively and definitively identified by a preponderance of the evidence. In doing so, the court may have opened the door for review by the Supreme Court.