Strategies In Class Action Engagement: Response To Class Certification

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This concludes our series of blog posts on effective partnering between inside and outside counsel to defend against class action lawsuits.

An order granting class certification is not the end of the battle regarding class certification. Under federal law, and under the laws or rules of certain states, the company may have the right to seek immediate review by an appellate court of an adverse class certification decision. [1] Counsel will almost always want to invoke the opportunity, if available, unless they believe the company can make a stronger record as the litigation proceeds on issues that caused the trial judge to certify a class. Of course, if an adverse decision is affirmed, the trial court’s view will harden, making decertification by the trial court at a later date less likely.

Even though class certification is committed to the discretion of the trial court, the cases are legion in which appellate courts have reversed decisions granting (and sometimes denying) class certification. This is because statutory requirements, court rules, substantive law, and class action case law amply restrain the discretion of trial courts in what they may do in this area and also because appellate courts recognize that class certification can be a game changer in the litigation—or even in the life of the company.

If an interlocutory appeal is unsuccessful (or not pursued), the company will have the opportunity as the litigation progresses to move to decertify a previously certified class action based on later developments in the litigation. In one recent Ford case, for example, the Third Circuit remanded a certified class action to the district court for decertification where some class members benefitted from the challenged practice and others suffered a greater or lesser alleged injury.[2] Hence, even if a class is initially certified, it is important to continue to develop defenses against class certification that the trial court may not have appreciated fully at an earlier point in the litigation.

[1] See Fed. R. Civ. P. 23(f); Hagan v. Rogers, 570 F.3d 146, 157 (3d Cir. 2009) (stating that the “Court has the discretion to exercise jurisdiction over an interlocutory appeal denying class certification”).

[2] Danvers Motor Co., Inc. v. Ford Motor Co., 543 F.3d 141, 148-9 (3d Cir. 2008). See also Clarke ex rel. Pickard v. Ford Motor Co., 228 F.R.D. 631, 636-37 (E.D. Wis. 2005) decertifying class once the court realized that the language of the representative plaintiff’s retirement plan differed materially from that contained within the class members’ plans).

Topics:  Appeals, Class Action, Class Certification, Complex Litigation, Corporate Counsel, Interlocutory Appeals, Litigation Strategies

Published In: Civil Procedure Updates, General Business Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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