SCOTUS Defines "Mass Action"


On January 14, 2013, the United States Supreme Court decided Mississippi ex rel. Hood v. AU Optronics Corp., --- U.S. ---, No. 12-1036, a case brought under the Class Action Fairness Act of 2005. The question presented was whether a suit filed by a state as the sole plaintiff constituted a “mass action” under CAFA where it included a claim for restitution based on injuries suffered by the state’s citizens. Holding it did not, the Court determined that a “mass action” must involve “monetary claims brought by 100 or more persons who propose to try those claims jointly as named plaintiffs.”

In reaching this conclusion, the Court explained that “Congress chose not to use the phrase ‘named or unnamed’ in CAFA’s mass action provision, a decision we understand to be intentional.” The Court also compared the use of the terms “persons” and “plaintiffs” under CAFA, to their use under Federal Rule of Civil Procedure 20, which governs party joinder. Rejecting respondents interpretation of “plaintiffs” under the statute to include unnamed real parties in interest, the Court concluded “[t]he better understanding is that Congress meant for the ‘100 or more persons’ and the proposed ‘plaintiffs’ to be one and the same.” According to the Court, interpreting “plaintiffs” in accordance with its usual meaning--to refer to the actual named parties who bring an action--“leads to a straightforward, easy to administer rule under which a court would examine whether the plaintiffs have pleaded in good faith the requisite amount.” Justice Sotomayor delivered the unanimous decision for the Court.

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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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