The District Court for the Southern District of New York recently addressed whether the “next best” or “reasonable approximation” standard should apply when the court evaluates proposed cy pres designations in class action settlements. Observing that the Second Circuit had not definitively resolved this issue to date, the district court engaged in a thorough evaluation of the origins, justifications, and policy implications of the two standards. In the end, the court ... Keep Reading »
Adding to Circuit Split, Divided Ninth Circuit Finds Concerted Action Waiver in Ernst & Young’s Employment Agreement Unenforceable Under NLRA
Ernst & Young’s (“E&Y”) employment agreements contained “separate proceedings” and arbitration provisions, which together required that disputes be resolved individually through arbitration, rather than collectively through some other forum. Despite entering such an agreement, an employee filed a class action against E&Y in federal court, alleging that he and other employees had been misclassified and denied overtime wages in violation of the Fair Labor ... Keep Reading »
Eighth Circuit Privacy Class Action Fails to Clear Second Hurdle
In Carlsen v. GameStop Inc., plaintiff – a paid subscriber to defendant’s online gaming magazine – brought a putative class action lawsuit against defendant for alleged breach of its privacy policy by disclosing plaintiff’s Facebook ID and his browsing information for the defendant’s online content to Facebook. Plaintiff asserted claims for breach of contract, unjust enrichment, money had and received, and violation of Minnesota’s Consumer Fraud Act. Defendant moved to ... Keep Reading »
No Repose for Debate on Applicability of American Pipe Tolling
In its seminal 1974 American Pipe opinion, the Supreme Court held that the commencement of a class action tolls the applicable statutes of limitation as to all putative class members who would have been parties had the class been certified. Since then, courts have repeatedly applied American Pipe to toll statutes of limitation but disagreed as to whether the doctrine is based on legal principals under Rule 23 or the equitable power of the courts. The Eleventh Circuit ... Keep Reading »
Seventh Circuit Strikes Again – Rejects Settlement In Shareholder Deal Litigation
In yet another strongly-worded opinion, the Seventh Circuit rejected the proposed settlement of a Walgreens’ shareholder strike suit in which the class obtained “worthless” supplemental disclosures but class counsel received generous fees. Judge Posner authored the opinion, as he did in Person v. NBTY, Inc., 772 F.3d 778 (7th Cir. 2014) and Eubank v. Pella Corp, 753 F.3d 718 (7th Cir. 2014). He described the practice of settling “deal litigation” like this that yields ... Keep Reading »
Third Circuit Rejects Inflated-Value Theory of Damages, Declines to Certify Law School Tuition Class
The Third Circuit recently affirmed the denial of class certification in a suit alleging that a law school made misrepresentations about the employment status of its graduates, thereby inducing students to pay inflated tuition in violation of the New Jersey and Delaware consumer fraud statutes. Much of the decision centered on damages; plaintiffs claimed they could show damages on a class-wide basis by estimating the amount by which tuition was inflated due to the ... Keep Reading »
Lawyers Sanctioned for Seeking to Settle Federal Court Class Action in State Court
Lawyers seeking to settle class actions pending in federal court by dismissing and refiling in state court beware! In two recent orders, a federal judge in the Western District of Arkansas ruled that the attorneys representing a class and defendants alike violated Rule 11 and abused the judicial process by this practice. The court sanctioned the lawyers for the class in the form of a reprimand. It retreated from a formal sanction of the defendants’ lawyers because it was ... Keep Reading »
“Placeholder” Motions to Certify are Unnecessary after Campbell-Ewald According to South Carolina District Court
Relying on the Supreme Court’s 2016 opinion in Campbell-Ewald, the United States District Court for the District of South Carolina ruled that a class action plaintiff need not file a “placeholder” motion to certify to avoid a defendant’s attempt to “pick-off” the plaintiff and moot the class with a Rule 68 Offer of Judgment (OJ). Plaintiff filed its putative class action complaint alleging violations of the Telephone Consumer Practices Act and immediately sought ... Keep Reading »
Eleventh Circuit’s Liberal Reading of Bonner Mall a Game Changer for Class Actions?
An Eleventh Circuit panel recently vacated two district court orders after sending the parties to mediation, and after the parties’ conditioned settlement on vacatur of the orders. In Hartford Casualty Insurance Company v. Crum & Forster Specialty Insurance Company, after being ordered to mediation a second time by the appellate panel, the parties reached a settlement contingent on the district court’s vacating its orders on summary judgment and attorney’s fees. On ... Keep Reading »
Tendering Funds to Support Unaccepted Offer of Judgment Still Does Not Moot Case
On July 6, the Sixth Circuit addressed a question apparently left open by the Supreme Court in its recent Campbell-Ewald case. In Campbell-Ewald, the Supreme Court ruled that an unaccepted Rule 68 offer of judgment did not moot class claims when no motion for class certification is pending. A plaintiff who rejects a rule 68 offer of tender extinguishes the offer. The court did not address, however, whether an actual tender of funds to a class plaintiff extinguished ... Keep Reading »
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