Litigation Commons^™

Should Congress Repeal Securities Class Action Reform?, Adam C. Pritchard

Other Publications

The Private Securities Litigation Reform Act of 1995 was designed to curtail class action lawsuits by the plaintiffs’ bar. In particular, the high-technology industry, accountants, and investment bankers thought that they had been unjustly victimized by class action lawsuits based on little more than declines in a company’s stock price. Prior to 1995, the plaintiffs’ bar had free rein to use the discovery process to troll for evidence to support its claims. Moreover, the high costs of litigation were a powerful weapon with which to coerce companies to settle claims. The plaintiffs’ bar and its allies in Congress have called …

Clear Sailing Agreements: A Special Form Of Collusion In Class Action Settlements, William D. Henderson

Articles by Maurer Faculty

A clear sailing agreement (or clause) is a compromise in which a class action defendant agrees not to contest the class lawyer's petition for attorneys' fees. This Article argues that clear sailing provisions often facilitate collusive settlements in cases involving non-pecuniary relief or claims-made common funds that return all unclaimed monies to the defendant. Because these types of settlements present difficult valuation problems, trial courts lack a clear benchmark for calculating attorneys' fees. Defendants and class can exploit this uncertainty by presenting an inflated settlement value to the court (to justify higher attorneys' fees) while simultaneously reducing the true cost …

Litigation Narratives: Why Jensen V. Ellerth Didn't Change Sexual Harassment Law, But Still Has A Story Worth Telling, Melissa Hart

Publications

No abstract provided.

A Novel Approach To Mass Tort Class Actions: The Billion Dollar Settlement In The Sulzer Artificial Hip And Knee Litigation: A Symposium, Susan J. Becker

Law Faculty Articles and Essays

As you know our primary focus today is on the Sulzer knee and hip replacement class action. My remarks are intended to place this fascinating and innovative case in the larger context of the many issues that we all face as participants in our modern civil justice system. I am going to do this by briefly refreshing your recollection as to the procedural requirements for modern class actions, describing the ongoing controversy surrounding use of these procedures, and touching on reform efforts currently underway. I will then provide a short introduction to the Sulzer litigation and introduce each panelist.

Federal Class Action Reform In The United States: Past And Future And Where Next?, Edward H. Cooper

Articles

Predicting the likely future developments in class action practice in the federal courts of the United States must begin in the past.

Aggregation And Settlement Of Mass Torts, Edward H. Cooper

Articles

It is the way of symposia that, after conveners assign topics for discussion, participants interpret those topics to cover subjects that interest themselves. I understand my assignment to be discussion of "nonbankruptcy closure" and "settlement." The Judicial Conference Working Group on Mass Torts suggests possible approaches that might facilitate closure of mass tort claims by litigation or by settlement! This paper will explore two models prepared to illustrate the challenges that confront any approach to fair and efficient closure. The first model is the "All-Encompassing Model," while the second is a draft of settlement-class provisions for Federal Rule of Civil …

Aggregation And Settlement Of Mass Torts, Edward H. Cooper

Articles

The following essay is the pre-editing draft of the introduction to a paper delivered at a Mass Torts conference held at the University of Pennsylvania Law School in November 1999. Thc conference grew out of the work of the ad hoc Mass Torts Working Group that on February 15, 1999, delivered a Report to the Chief Justice of the United States and the judicial Conference of the United States. The Working Group, chaired by Third Circuit Judge Anthony J. Scirica, '65, included members drawn from several Judicial Conference committees, including the Advisory Committee on the Federal Rules of Civil Procedure, …

Markets As Monitors: A Proposal To Replace Class Actions With Exchanges As Securities Fraud Enforcers, Adam C. Pritchard

Articles

Fraud in the securities markets has been a focus of legislative reform in recent years. Corporations-especially those in the high-technology industry-have complained that they are being unfairly targeted by plaintiffs' lawyers in class action securities fraud lawsuits. The corporations' complaints led to the Private Securities Litigation Reform Act of 1995 ("Reform Act"). The Reform Act attempted to reduce meritless litigation against corporate issuers by erecting a series of procedural barriers to the filing of securities class actions. Plaintiffs' attorneys warned that the Reform Act and the resulting decrease in securities class actions would leave corporate fraud unchecked and deprive defrauded …

Interjurisdictional Preclusion, Howard M. Erichson

Michigan Law Review

Res judicata is hard enough already. Consider it at the interjurisdictional level, and we are asking for headaches. But consider it at that level we must, because litigation trends make interjurisdictional preclusion more important than ever. Lawyers, judges, litigants, and other litigation participants increasingly must contemplate the possibility that a lawsuit will have claim-preclusive or issue-preclusive effect in a subsequent suit in another jurisdiction. With great frequency, multiple lawsuits arise out of single or related transactions or events. Mass tort litigation and complex commercial litigation provide the most emphatic examples, but the phenomenon of multiple related lawsuits extends to every …

Will New Legislation Preempt State Court Class Actions?, Susan J. Becker

Law Faculty Articles and Essays

Proponents of 1995's federal securities litigation reform are proposing new legislation to prevent plaintiffs from using state court class actions to circumvent the restrictive federal rules. This article reviews these legislative proposals.

The Securities Litigation Uniform Standards Act Of 1998: The Sun Sets On California's Blue Sky Laws, David M. Lavine, Adam C. Pritchard

Articles

It is often said that California sets the pace for changes in America's tastes. Trends established in California often find their way into the heartland, having a profound effect on our nation's cultural scene. Nouvelle cuisine, the dialect of the Valley Girl and rollerblading all have their genesis on the West Coast. The most recent trend to emerge from California, instead of catching on in the rest of the country, has been stopped dead in its tracks by a legislative rebuke from Washington, D.C. California's latest, albeit short-lived, contribution to the nation was a migration of securities fraud class actions …

Fraud And Federalism: Preempting Private State Securities Fraud Causes Of Action, Michael A. Perino

Faculty Publications

The passage of the Private Securities Litigation Reform Act of 1995 has engendered a significant forum shift in class action securities fraud litigation, from federal to state court. This unintended by-product of the Act has reignited debate over our dual federal-state system of securities regulation and in turn has inspired a discussion as to whether Congress should now preempt state securities fraud causes of action. This article argues that preemption is an appropriate, but not the only, solution to these concerns. To support this argument, this article first traces the history of dual state-federal securities regulation within the context of …

The Theory Of Fee Regulation In Class Action Settlements , Bruce L. Hay

American University Law Review

No abstract provided.

Class Action Chaos? The Theory Of The Core And An Analysis Of Opt-Out Rights In Mass Tort Class Actions, Michael A. Perino

Faculty Publications

From breast implants to cigarettes, mass tort class actions are a prominent and controversial part of the contemporary litigation landscape. A critical component of these actions is the ability of class members to “opt out” and thereby exclude themselves from the effect of any class judgment. The tension between individual autonomy and the desire for global resolution of mass controversies has led to an intense debate concerning the circumstances under which opt-out rights should be constrained, if at all.

This Article makes five distinct contributions to the class action literature. First, the Article applies the game theoretic concept of the …

Structuring Multiclaim Litigation: Should Rule 23 Be Revised?, William W. Schwarzer

Michigan Law Review

The question whether Rule 23 should be revised therefore is not susceptible to a global answer unless revision is stylistic only, limited to making the text more elegant - and even stylistic revision is likely to have some substantive impact, even if unintended. But if the argument for revision is that the Rule is in some respect deficient and should be made to work better, one must begin by answering the question how it should work. That in tum depends on defining the Rule's purpose - what it is intended to accomplish.This paper examines briefly the purposes for which the …

Turning From Tort To Administration, Richard A. Nagareda

Michigan Law Review

My objective here is to challenge the notion that the recent mass tort settlements - for all their novel qualities in the mass tort area - are truly sui generis in the law. Rather, I contend that the rise of such settlements in tort mirrors the development of public administrative agencies earlier in this century - that, in both instances, powerful new institutions emerged outside preexisting channels of control to wield significant power over human lives and resources. I argue that courts usefully may draw upon familiar doctrines of judicial review in administrative law to form a conceptual framework for …

Class Action Rule Changes: A Midpoint Report, Edward H. Cooper

Articles

This a midpoint progress report of the Reporter on current proposals to amend the class action rule, Rule 23 of the Federal Rules of Civil Procedure. In part, it is one of many calls for help. The proposed amendments have been published for comment. It is important that the rulemakers hear from as many interested observers as possible. One of the pitfalls of the comment process - at least one of the pitfalls that the rulemakers like to believe in - is that there are many observers who believe that the rulemakers have got it right, and do not need …

The Political Theory Of The Class Action, Owen M. Fiss

Washington and Lee Law Review

No abstract provided.

The Pentium Papers: A Case Study Of Collective Institutional Investor Activism In Litigation, Joseph A. Grundfest, Michael A. Perino

Faculty Publications

This article suggests that institutional investors have rational incentives to become more active in the litigation arena, but that the current debate is falsely constrained because it rests on the assumption that institutional investors must participate either by (1) assuming the formal role of lead plaintiff, class representative, or intervenor or, (2) not participating at all. This is a false dichotomy because, as this article demonstrates, institutions have available to them a rich array of flexible, informal, and relatively inexpensive mechanisms by which they can make their views known to litigants and courts alike.

Our hypothesis that institutional investor activism …

Settlement Class Actions And The Limits Of Adjudication, James A. Henderson Jr.

Cornell Law Faculty Publications

This paper is the Comment for a symposium on Individualized Justice, Mass Torts, and "Settlement Class Actions."

Power And Legal Artifice: The Federal Class Action, Bryant Garth

Articles by Maurer Faculty

Using case studies and interviews with lawyers and representatives in class actions, this article explores the contribution that class actions make to their ostensible beneficiaries. The article first distinguishes the major types of class actions in terms of the roles of lawyers and class representatives, ranging from very passive representatives to individuals intensively involved with the dispute that gave rise to the litigation. The article next seeks to evaluate the class actions. On the basis of the results of the class actions, the article finds that class actions cannot be proclaimed major contributors to social change. The focus on results, …

Risk, Courts, And Agencies, Clayton P. Gillette, James E. Krier

Articles

Public risks are precisely the risks that have recently captured the attention of the legal community and the world at large, in no small part because they give rise to such novel problems for lawyers and such grave apprehensions among lay people. Public risks have moved the legal system to relax doctrines--regarding, for example, standards of causation and culpability, burdens of proof, sharing of liability--that were designed to deal with the private risks that once dominated the landscape. And public risks have moved lay people to intensify their demands for risk control measures. These developments suggest that public risks are …

Preclusion And Procedural Due Process In Rule 23(B)(2) Class Actions, Mark C. Weber

University of Michigan Journal of Law Reform

This Article examines whether Rule 23(b)(2) violates the procedural due process rights of absent class members by binding them to the judgment in a class case without notice of the suit. It concludes that the Rule almost certainly violates due process and proposes a reform that would permit nonbinding class actions similar to the old "spurious" class suits.

Apocalypse Now?, Richard L. Marcus

Michigan Law Review

A Review of Agent Orange on Trial: Mass Toxic Disasters in the Courts by Peter H. Schuck

Mass And Repetitive Litigation In The Federal Courts, Edward H. Cooper

Articles

The topic of "Mass and Repetitive Litigation in the Federal Courts" is even more vast and unwieldy than the complex litigations it brings to mind. The implicit assignment to address the topic by contemplating the events that may occur over the next century is still more daunting. One hundred years bring untellable changes to all of our social and political institutions, judicial and otherwise. Rather than attempt to meet the challenge by uttering bold prophecies of the circumstances that will confront our successors of the future, I will follow an easier course. This paper will select a few illustrations of …

Abuse In Plaintiff Class Action Settlements: The Need For A Guardian During Pretrial Settlement Negotiations, Sylvia R. Lazos

Michigan Law Review

This Note explores the problem of abuse of the class action device during the pretrial settlement process. Part I analyzes the underlying sources of potential abuse in pretrial settlement negotiations. Part II assesses the adequacy of the standards currently used by courts to detect collusive class action settlements. Part III concludes that the appointment of a neutral third-party guardian to oversee the pretrial negotiation process furthers the judicial policy of encouraging settlements while protecting the interests of the absentee class.

Statutes Of Limitations And Defendant Class Actions, Michigan Law Review

Michigan Law Review

This Note argues that in defendant class actions the statute of limitations should be tolled as to all named and absent class members upon informal notice given by the plaintiff at the beginning of the suit. Part I examines the purposes of statutes of limitations and class actions, and the manner in which these purposes were reconciled in American Pipe. It concludes that American Pipe requires the creation of a tolling doctrine that promotes both the fair notice policy that underlies statutes of limitations and the concern for litigative economy that underlies rule 23 class actions. Part II then …

Flexible Mootness In Class Certification, Enid L. Zafran

Cleveland State Law Review

While the purposes of class actions are easy to comprehend, the actual application and requirements of Rule 23 are complex. Before the suit may proceed, it must be certified by the trial court. Although Rule 23 carefully lists the criteria for the court to consider, certification is not a predictable outcome. If it is denied, the action is then litigated solely on the claims of the named plaintiffs. Under certain circumstances the denial would signal the end of the suit. Such an instance would occur if the named plaintiff's claims had become moot. His action would no longer satisfy the …

Limiting The Plaintiff Class: Rule 10b-5 And The Federal Securities Code, Michigan Law Review

Michigan Law Review

The Penn Central litigation, involving a large, publicly held corporation, illustrates the need to examine the reach of the federal antifraud provisions. This Note discusses the problem of defining the plaintiff class when the number of past and present shareholders who are potential plaintiffs is very great. Attention will center on the methods courts have used to limit the class of investors compensable under rule 10b-5. Also, the effect that enactment of present drafts of the American Law lnstitute's proposed Federal Securities Code would have on the composition of the plaintiff class in analogous actions will be discussed. Finally, the …

The Tentative Settlement Class And Class Action Suits Under Title Vii Of The Civil Rights Act, Michigan Law Review

Michigan Law Review

This Note will examine the potential utility of a tentative settlement class (TSC) in suits initiated under title VII of the Civil Rights Act of 1964. The advantages and disadvantages of the TSC will be discussed in the context of analyzing whether the use of a TSC is valid under rules 23(a) and 23(b) of the Federal Rules of Civil Procedure. The discussion of the merits of the TSC in the title VII context will illustrate the problems inherent in the use of a tentative class for encouraging settlements of any class action.