Royal Park, an investment company, recently suffered its second defeat in its attempt to certify a class action against Deutsche Bank regarding bond-like instruments collateralized by mortgages held in trusts entitling instrument-holders to the mortgages’ cash flow for various contractual and common law claims. The Southern District of New York denied Royal Park’s first motion to certify on the grounds the proposed class was insufficiently ascertainable, finding it was ... Keep Reading »
Archives for May 2018
Supreme Court Upholds Use of Class Action Waivers in Employment Arbitration Agreements
In a significant decision awaited by U.S. employers since January 2017, the Supreme Court upheld the use of class action waivers in arbitration agreements. Justice Gorsuch wrote the majority opinion, which was joined by Justices Roberts, Kennedy, Thomas, and Alito. Justice Ginsburg filed an extensive dissenting opinion joined by Justices Breyer, Sotomayor, and Kagan. The decision answers a question that has loomed large for employers: Can they include class action ... Keep Reading »
Aw Schnucks! Seventh Circuit Dismisses Data Breach Class Action by Financial Institution Plaintiffs Under Economic Loss Doctrine
The Seventh Circuit recently upheld the dismissal of a novel putative class action filed by financial institutions against grocer Schnuck Markets (“Schnucks”) based on the economic loss doctrine. Schnucks suffered a data breach that exposed nearly 2.5 million credit and debit cards over four months until the intrusion was discovered. Instead of being filed by the usual data breach class action featuring a putative class of customers, this case was filed by financial ... Keep Reading »
Supreme Court to Determine Whether An Arbitration Clause Must Explicitly Authorize Class-wide Arbitration
The Supreme Court recently granted certiorari in Lamps Plus Inc. v. Varela, to determine “[w]hether the Federal Arbitration Act forecloses a state-law interpretation of an arbitration agreement that would authorize class arbitration based solely on general language commonly used in arbitration agreements.” In other words, at issue is whether an arbitration clause must explicitly allow for class-wide arbitration, rather than solely on an individual basis, in order to find ... Keep Reading »
Will the Supreme Court Take a Charitable View of Cy Pres Settlements?
On April 30, the Supreme Court granted certiorari in Frank v. Gaos, No. 17-961 to review the fairness of the ever-increasing use of cy pres remedies in class action settlements. Cy pres remedies are often used to fund charitable or educational organizations when it would be infeasible to provide monetary relief directly to class members. In Frank v. Gaos, No. 15-15858 (9th Cir. 2017), the Ninth Circuit affirmed the district court’s approval of a cy pres-only ... Keep Reading »
Third Circuit Rejects ‘Shingle Lottery’ Theory of Common Defect in Putative Homeowner Class
The Third Circuit Court of Appeals recently affirmed a district court order denying certification to a group of homeowners in four states who alleged roof shingle manufacturer Owens Corning sold defective roof shingles and misrepresented their expected useful life. Specifically, plaintiffs alleged claims for breach of express warranty, breach of implied warranty of merchantability, and violation of various state consumer protection statutes because the shingles installed ... Keep Reading »
A Pyrrhic Victory For Petitioner: Ninth Circuit Limits Consolidation of Class Cases
The Ninth Circuit recently denied relief on a petition for a writ of mandamus regarding an alleged erroneous transfer of a class action, despite agreeing with the petitioner that transfer was improper. In the action, a putative class plaintiff brought misrepresentation and fraud claims against defendants responsible for the production, distribution, and marketing of a weight loss supplement. The action was originally filed in the Southern District of California before ... Keep Reading »
Fifth Circuit Dashes Delivery Driver’s Bid to Keep Wage Hour Claims Out of Arbitration
In Edwards v. DoorDash, Inc., No. 17-20082 (5th Cir. Apr. 25, 2018), the Fifth Circuit Court of Appeals reaffirmed its position that arbitrability of claims, including whether class or collective claims must be arbitrated individually, is a threshold question that must be determined by the court prior to deciding certification motions. In Edwards, a driver asserted claims against a food-delivery service under the Fair Labor Standards Act (FLSA), asserting that he was ... Keep Reading »