Law Commons^™

Cafa Judicata: A Tale Of Waste And Politics, Kevin M. Clermont, Theodore Eisenberg

Kevin M. Clermont

The Class Action Fairness Act has taken on its real form through construction by the federal judges. That form emerges in this empirical study of judicial activity and receptivity to the Act. Our data comprise the opinions under the Act published during the two and a half years following its enactment in 2005. CAFA has produced a lot of litigation in its short life. The cases were varied, of course, but most typically the resulting published federal opinion involved a removed contract case, with the dispute turning on the statute's effective date or on federal jurisdiction. Even though the opinions …

Class Certification’S Preclusive Effects, Kevin M. Clermont

Kevin M. Clermont

In September 2010, the Supreme Court granted certiorari in the controversial Baycol litigation. The central question will be whether, subsequent to a denial of class certification, preclusion can prevent an absentee from seeking to certify another class action on a similar claim. This Essay answers that question in the affirmative, while warning that the preclusion is very limited in scope. It arrives at this answer by analogizing to the more established doctrine of jurisdiction to determine no jurisdiction: if a court’s finding of no jurisdiction over the subject matter or the person can preclude, then a finding of no authority …

Reexamining The Seventh Amendment Argument Against Issue Certification, Douglas Mcnamara, Blake Boghosian, Leila Aminpour

Pace Law Review

Issue certification does not run afoul of the Seventh Amendment because of the constitutional doctrines of standing and ripeness. Part II(A) and II(B) examines FRCP 23 and the history of class actions and issue certifications. Next, Part II(C) analyzes Rhone Poulenc and its Seventh Amendment analysis. Part III(A) argues that ripeness and standing undermine Seventh Amendment arguments concerning reexamination. First, as to ripeness, the reexamination argument relies on a series of speculations: that the class plaintiffs will prevail on the trial of the common issues; and that a second jury would—contrary to legal presumptions — ignore the trial judge’s instructions, …

Enforceability Of Mandatory Arbitration Clauses For Shareholder-Corporation Disputes, Garry D. Hartlieb

Michigan Business & Entrepreneurial Law Review

Investor litigation is an increasingly vexatious field of law. Nearly every time a significant change of control or corporate ownership occurs, plaintiffs’ attorneys file standardized complaints to set in motion class action suits. Ultimately, the settlements shareholders receive fail to achieve the practical effects that parties on both sides desire. Shareholders may receive pennies on the dollar of what they allege was lost by corporate wrongdoing, and, in some cases, shareholders may not receive monetary recovery as the settlement requires only that the corporation to make changes to its governing documents. These suits distract directors and management from the core …

A Blended Approach To Reducing The Costs Of Shareholder Litigation, Valian A. Afshar

Michigan Law Review

Multiforum litigation and federal securities law class actions impose heavy costs on corporations and their shareholders without producing proportionate benefits. Both are largely the result of the agency problem between shareholders and their attorneys, driven more by the attorneys’ interests in generating fees than by the interests of their clients. In response to each of these problems, commentators have recommended a number of solutions. Chief among them are forum selection and mandatory arbitration provisions in a corporation’s charter or bylaws. This Note recommends that corporations unilaterally adopt both forum selection and mandatory arbitration bylaws to address shareholder lawsuits under state …

Employment Arbitration Reform: Preserving The Right To Class Proceedings In Workplace Disputes, Javier J. Castro

University of Michigan Journal of Law Reform

The recent judicial enforcement of class waivers in arbitration agreements has generated ample debate over the exact reach of these decisions and their effects on the future of collective action for consumers and employees. In AT&T Mobility v. Concepcion, a 5-4 majority of the Supreme Court majority held that the Federal Arbitration Act (FAA) preempted state laws prohibiting companies from incorporating class action waivers into arbitration agreements. The Court upheld such waivers on the grounds that they are consistent with the language and underlying purpose of the FAA. Most courts across the country have since reinforced the strong federal policy …

Death By Daubert: The Continued Attack On Private Antitrust, Christine P. Bartholomew

Journal Articles

In 2011, with five words of dicta, the Supreme Court opened Pandora’s box for private antitrust enforcement. By suggesting trial courts must evaluate the admissibility of expert testimony at class certification, the Court placed a significant obstacle in the path of antitrust class actions. Following the Supreme Court’s lead, most courts now permit parties to bring expert challenges far earlier than the traditional summary judgment or pretrial timing. Premature rejection of expert testimony dooms budding private antitrust suits — cases that play an essential role in modern antitrust enforcement. The dangers for private antitrust plaintiffs are compounded by the Court’s …

Aggregating Defendants, Greg Reilly

Florida State University Law Review

No procedural topic has garnered more attention in the past fifty years than the class action and aggregation of plaintiffs. Yet, almost nothing has been written about aggregating defendants. This topic is of increasing importance. Recent efforts by patent “trolls” and Bit-Torrent copyright plaintiffs to aggregate unrelated defendants for similar but independent acts of infringement have provoked strong opposition from defendants, courts, and even Congress. The visceral resistance to defendant aggregation is puzzling. The aggregation of similarly situated plaintiffs is seen as creating benefits for both plaintiffs and the judicial system. The benefits that justify plaintiff aggregation also seem to …

Cultural Dimensions Of Group Litigation: The Belgian Case, Stefaan Voet

Georgia Journal of International & Comparative Law

No abstract provided.

Cy Pres And The Optimal Class Action, Jay Tidmarsh

Jay Tidmarsh

Prepared for a symposium on class actions, this Article examines the problem of cy pres relief in class actions through the lens of optimal claim structure and class membership. It finds that the present cy pres doctrine does little to advance the creation of optimal class actions, and that it may do some harm to achieving that goal. The Article then proposes an alternative “nudge” to induce putative class counsel to structure class actions in an optimal way: setting attorneys’ fees so that counsel is compensated through a combination of an hourly market rate and a percentage of the net …

Mass Litigation Governance In The Post-Class Action Era: The Problems And Promise Of Non-Removable State Actions In Multi-District Litigation, J. Maria Glover

Georgetown Law Faculty Publications and Other Works

Given a string of decisions restricting the use and availability of the class action device, the world of mass litigation may well be moving into a post-class action era. In this era, newer devices of aggregation—perhaps principally among them multi-district litigation (“MDL”)—increasingly will be called upon to meet the age-old mass litigation goal of achieving global peace of numerous claims arising out of a related, widespread harm. Indeed, coordination of pretrial proceedings in the MDL frequently facilitates the achievement of this peace, given the reality that cases, once consolidated in the MDL, often settle en masse.

However, one clear obstacle …

Class Warfare: The Eighth Circuit Clamps Down On Consumer Class Actions Under Rule 23(B)(3), Caleb Wagner

Missouri Law Review

This Note will discuss a lawsuit, brought on behalf of North Dakota insurance policyholders, which challenged a scheme by their insurance company to reduce payments on medical claims. Though the trial court allowed the suit to proceed as a class action, the Eighth Circuit found this decision improper and ruled that the class must be decertified.4 In doing so, the Eighth Circuit did not merely apply the recent Supreme Court rulings disfavoring class actions but also extended them. This Note will argue that these precedents should instead be narrowly construed so that the goals of class litigation may be achieved.

Auctioning Class Settlements, Jay Tidmarsh

Jay Tidmarsh

Although they promise better deterrence at a lower cost, class actions are infected with problems that can keep them from delivering on this promise. One of these problems is the issue of agency cost, in which the agents of the class (the class representative and class counsel) advance their own interests at the expense of the class. Controlling agency cost, which often manifests itself at the time of settlement, has been the impetus behind a number of class-action reform proposals.

This Essay develops an idea that, in conjunction with reforms in fee structure and opt-out rights, controls agency costs at …

Resurrecting Trial By Statistics, Jay Tidmarsh

Jay Tidmarsh

“Trial by statistics” was one means by which a court could resolve a large number of aggregated claims: a court could try a random sample of claim, and extrapolate the average result to the remainder. In Wal-Mart, Inc. v. Dukes, the Supreme Court seemingly ended the practice at the federal level, thus removing from judges a tool that made mass aggregation more feasible.

After examining the benefits and drawbacks of trial by statistics, this Article suggests an alternative that harnesses many of the positive features of the technique while avoiding its major difficulties. The technique is the “presumptive judgment”: …

Horton The Elephant Interprets The Federal Rules Of Civil Procedure: How The Federal Courts Sometimes Do And Always Should Understand Them, Donald L. Doernberg

Elisabeth Haub School of Law Faculty Publications

In Shady Grove, the Court considered whether a federal class action was maintainable in a diversity case where state law forbade class actions. The justices were sharply split into shifting majorities. One majority concluded that Rule 23 was not substantive for REA purposes and that it applied, but its members could not agree on why. Four justices thought it was proper to look only at the Federal Rule in question to see whether it addressed substance or procedure on its face. A different majority supported an approach to REA questions that required evaluating state law to determine whether the Federal …

Idea Class Actions After Wal-Mart V. Dukes, Mark C. Weber

Mark C. Weber

Wal-Mart v. Dukes overturned the certification of a class of a million and a half female employees alleging sex discrimination in Wal-Mart’s salary and promotion decisions. The Supreme Court ruled that the case did not satisfy the requirement that a class have a common question of law or fact, and said that the remedy sought was not the type of relief available under the portion of the class action rule permitting mandatory class actions. Over the last two years, courts have struggled with how to apply the ruling, especially how to apply it beyond its immediate context of employment discrimination …

Better Bounty Hunting, Amanda Rose

Vanderbilt Law School Faculty Publications

The SEC’s new whistleblower bounty program has provoked significant controversy. That controversy has centered on the failure of the implementing rules to make internal reporting through corporate compliance departments a prerequisite to recovery. This Article approaches the new program with a broader lens, examining its impact on the longstanding debate over fraud-on-the-market (FOTM) class actions. The Article demonstrates how the bounty program, if successful, will replicate the fraud deterrence benefits of FOTM class actions while simultaneously increasing the costs of such suits — rendering them a pointless yet expensive redundancy. If instead the SEC proves incapable of effectively administering the …

Cy Pres And The Optimal Class Action, Jay Tidmarsh

Journal Articles

This Article, prepared for a symposium on class actions, examines the problem of cy pres relief through the lens of ensuring that class actions have an optimal claim structure and class membership. It finds that the present cy pres doctrine does little to advance the creation of optimal class actions, and may do some harm to achieving that goal. The Article then proposes an alternative “nudge” to induce putative class counsel to structure class actions in an optimal way: set attorneys’ fees so that counsel is compensated through a combination of an hourly market rate and a percentage of the …

Don't Throw The Baby Out With The Bath Water: The Merits Of The Intermediate Approach To The Securities Litigation Uniform Standards Act, Selby P. Brown

Oklahoma Law Review

No abstract provided.

Opening The Floodgates Of Small Customer Claims In Finra Arbitration: Finra V. Charles Schwab & Co., Inc., Teresa J. Verges

Articles

No abstract provided.

The Equal Employment Opportunity Commission And Structural Reform Of The American Workplace, Margo Schlanger, Pauline T. Kim

Articles

In one of its most-watched recent cases, the United States Supreme Court struck down a class action alleging that Wal-Mart stores discriminated against female employees in pay and promotion decisions. The plaintiffs alleged that Wal-Mart’s corporate culture and highly discretionary decision-making practices led to sex discrimination on a company-wide basis, and they sought injunctive relief as well as backpay for individual employees. Reversing the Court of Appeals for the Ninth Circuit, the Supreme Court held in Wal-Mart v. Dukes that the proposed class failed to meet the requirements for class action certification under Rule 23 of the Federal Rules of …

It's Not Over 'Til It's Over: Mandating Federal Pretrial Jurisdiction And Oversight In Mass Torts, Tanya Pierce

Faculty Scholarship

In 2004, just five years after introducing the drug, Vioxx, pharmaceutical company, Merck, voluntarily withdrew the prescription pain-killer after a clinical study suggested that the drug increased the risk of heart attack and stroke. But in that relatively short time, an estimated 20 million Americans had already taken the drug. By late 2007, Merck announced it would pay $4.85 billion — the largest drug settlement ever — in “global settlements” for Vioxx-related claims. These settlements ultimately included roughly 47,000 individual lawsuits and about 265 potential class actions, but the Vioxx settlements were far from global.

In 2012, a purported parallel …

Class Actions And Justiciability, Sergio J. Campos

Articles

A lingering issue in class action law concerns the case or controversy requirement of Article III, otherwise known as the requirement of justiciability. For purposes of justiciability doctrines such as standing, mootness, and ripeness, is the class action brought by all class members, some class members, or just the class representative?

This Article argues that the answer should be none of the above-it should be the class attorney. This Article first shows that the function of the class action is to assign dispositive control of, and a partial beneficial interest in, the class members' claims to the class attorney. Put …

Morphing Case Boundaries In Multidistrict Litigation Settlements, Margaret Thomas

Margaret S. Thomas

The boundaries of federal multidistrict litigation (MDL) are blurring, as district courts seek innovative ways to facilitate global settlements to resolve multijurisdictional, multidimensional, national mass torts. The techniques emerging from the district courts have mostly evaded appellate review and received little scholarly attention, but they raise important challenges to traditional understandings of the nature of MDL and complex litigation. This Article argues that factually similar cases proceeding in multiple court systems in mass tort disputes create a “federalism problem” for global settlements: global settlements typically benefit from oversight by a single judge, but often there is no single judge who …

Tort Law's Deterrent Effect And Procedural Due Process, Jill W. Lens

Jill Wieber Lens

Revisiting The Government As Plaintiff, Elizabeth Chamblee Burch

Elizabeth Chamblee Burch

This is a symposium essay dedicated to the late Richard Nagareda and written in response to Adam S. Zimmerman's piece, The Corrective Justice State. As Professor Zimmerman recognizes, the debate over governments acting as plaintiffs and “regulating by deal” has shifted from initial questions over whether litigation produces the best public policy and whether executive officials are acting within the scope of their authority to how government actors should pursue and allocate settlements. Yet, as this first wave of controversy suggests, the slate upon which executive officials currently write is neither clean nor uncontroversial. Instead, this new debate is playing …