Justia Class Action Opinion Summaries

Plaintiff filed suit alleging that Godiva chocolate stores had printed too many credit card digits on hundreds of thousands of receipts over the course of several years, and pointed out that those extra numbers were prohibited under a federal law aimed at preventing identity theft. After the parties agreed on a class settlement, the Supreme Court issued Spokeo, Inc. v. Robins, which held that a party does not have standing to sue when it pleads only the bare violation of a statute.The Eleventh Circuit held that plaintiff has no standing because he alleged only a statutory violation and not a concrete injury. In this case, plaintiff alleged that a cashier handed him a receipt containing some of his own credit card information printed on it. Although the receipt violated the law because it contained too many digits, the court explained that plaintiff has alleged no concrete harm or material risk of harm stemming from the violation. Therefore, this amounts to nothing more than a "bare procedural violation, divorced from concrete harm." Consequently, the court cannot evaluate the fairness of the parties' settlement and vacated the district court's order approving it. View "Muransky v. Godiva Chocolatier, Inc." on Justia Law

In multi-district litigation (MDL), the district court certified an opt-out “negotiation class” under Federal Rule of Civil Procedure 23, consisting of all cities and counties (34,458 identified entities) throughout the United States for purposes of negotiating a settlement. These municipalities brought RICO and Controlled Substances Act claims, alleging that opioid manufacturers, distributors, pharmacies, and retailers acted in concert to mislead medical professionals into prescribing, and millions of Americans into taking and often becoming addicted to, opiates. Unlike a litigation class, formed to aggregate and try common issues, the negotiation class would attempt to reach a settlement while the individual MDL cases continue on litigation paths. Negotiation class members would likely not have a second opportunity to opt-out and would have to decide at the class certification stage—without knowing the settlement figure— whether they wish to bind themselves. A proposed agreement could only be accepted if a supermajority of six categories of voting class members assent to it.Several defendants objected; 556 putative class members opted-out of the negotiation class. In consolidated appeals, the Sixth Circuit reversed the class certification. Rule 23 does not identify negotiation as a separate category of certification distinct from settlement. The negotiation class device frustrates a court’s analysis of whether a class action is the superior method of adjudication and avoids some of the procedural requirements of litigation class certification without halting the underlying litigation. View "In re: National Prescription Opiate Litigation" on Justia Law

The Eleventh Circuit held that the district court, in approving the class action settlement underlying this appeal, repeated several errors that have become commonplace in everyday class action practice. First, the district court violated the plain terms of Federal Rule of Civil Procedure 23(h) by setting a schedule that required class members to file any objection to the settlement—including any objection pertaining to attorneys' fees—more than two weeks before class counsel had filed their fee petition. However, on the record, the district court's error was harmless. Second, the district court ignored on-point Supreme Court precedent by awarding the class representative a $6,000 incentive payment as acknowledgement of his role in prosecuting the case on behalf of the class members.Finally, in approving class counsel's fee request, overruling objections, and approving the parties' settlement, the district court made no findings or conclusions that might facilitate appellate review. Rather, the district court offered only rote, boilerplate pronouncements ("approved," "overturned," etc.). Therefore, the district court violated the Federal Rules of Civil Procedure and the court's precedents requiring courts to explain their class-related decisions. Accordingly, the court reversed in part, vacated in part, and remanded for the district court to adequately explain its fee award to class counsel, its denial of the interested party's objections, and its approval of the settlement. View "Johnson v. NPAS Solutions, LLC" on Justia Law

The class’s version of events painted the Hutchenses as cunning con artists who "puppeteered" a advance-fee loan scam from afar. Defendants Sandy Hutchens, Tanya Hutchens, and Jennifer Hutchens, a three-member family who purportedly orchestrated a loan scam, challenged a district court’s rulings to avoid paying all or part of the judgment against them brought pursuant to a class action suit. The Tenth Circuit concluded almost all of those challenges failed, including their challenges to the jury’s verdict, class certification, proximate causation, and the application of the equitable unclean hands defense. However, the Court agreed with the Hutchenses’ position on the district court’s imposition of a constructive trust on some real property allegedly bought with the swindled fees. The Court therefore affirmed in part, reversed in part, and remanded to the district court for entry of a revised judgment. View "CGC Holding Company v. Hutchens" on Justia Law

Pagliacci Pizza hired Steven Burnett as a delivery driver. Steven Burnett attended a mandatory new employee orientation at a local Pagliacci Pizza. During the orientation, Pagliacci gave Burnett multiple forms and told him to sign them so that he could start working. One of the forms that Burnett signed was a one-page “Employee Relationship Agreement” (ERA). The ERA mentioned nothing about arbitration of disputes. Pagliacci’s “Mandatory Arbitration Policy” (MAP) was printed in Pagliacci’s employee handbook, “Little Book of Answers,” a 23-page booklet in which Pagliacci’s MAP appeared on page 18. The MAP was not listed in the handbook’s table of contents, and page 18 fell within the “Mutual Fairness Benefits” section. Burnett was given a copy of Little Book of Answers during his orientation and told to read it at home. Consistent with that instruction, the ERA contained a section entitled “Rules and Policies.” Delivery drivers like Burnett filed a class action alleging wage and hour claims against Pagliacci Pizza. At issue on interlocutory review was whether the trial court sustainably denied the employer’s motion to compel arbitration. The Court of Appeals affirmed, determining that the mandatory arbitration policy contained in the employee handbook, which was provided to the named plaintiff after he signed the employment relationship agreement, was procedurally and substantively unconscionable and, thus, unenforceable. The Washington Supreme Court held that the MAP at issue in this case was indeed unenforceable because no arbitration agreement was formed when the employee signed the employment agreement when he had no notice of the arbitration provision contained in the employee handbook. The Court also held that in light of the noted circumstances, even if an arbitration contract existed, it was procedurally unconscionable and unenforceable. Furthermore, the Court held the same arbitration provision was substantively unconscionable because its one-sided terms and limitation provisions would bar any claim by the terminated employee here, an overly harsh result. Accordingly, the trial court’s order denying the employer’s motion to compel arbitration was affirmed and the matter remanded for further proceedings. View "Burnett v. Pagliacci Pizza, Inc." on Justia Law

Plaintiffs filed suit against CareFirst after hackers allegedly stole sensitive customer information from the health insurer's data system, alleging tort, contract, and statutory claims. The district court dismissed all claims of five plaintiffs and most claims of two plaintiffs. At issue was whether the district court permissibly certified the dismissed claims under Federal Rule of Civil Procedure 54(b), so as to make the dismissal order final and immediately appealable.The DC Circuit held that it lacked appellate jurisdiction over the certified claims of the Tringlers and of the other plaintiffs. Under basic principles of claim preclusion, the court explained that the Tringlers could not have litigated to judgment one action involving the claims still pending before the district court and another involving the claims already dismissed. Under Tolson v. United States, 732 F.2d 998, 1001–03 (D.C. Cir. 1984), they likewise cannot sever the latter claims for an immediate appeal under Rule 54(b). In regard to the non-Tringler claims, the court stated that it is unclear whether the district court would have certified these claims for immediate appeal had it properly declined to certify the claims of the Tringlers. Therefore, the court cannot determine whether the district court would have certified only the non-Tringler claims, much less whether it could have come up with a permissible justification for doing so. View "Attias v. CareFirst, Inc." on Justia Law

Named plaintiffs filed a putative class action in Illinois, alleging that defendants made false claims about dietary supplements. The parties negotiated a settlement. Over the objection of class member Frank, the district court approved it. The Seventh Circuit reversed. In 2015, the parties submitted “the Pearson II settlement.” Three class members objected to the Pearson II settlement.Nunez had filed his own putative class action against the defendants in California. After the Seventh Circuit vacated the first Pearson settlement, Nunez wanted to represent a Pearson subclass. The Pearson parties refused to include Nunez’s counsel in their negotiations. Nunez objected to the Pearson II settlement. The district court approved it. All three objectors appealed, then dismissed their appeals. Frank moved for disgorgement of any payments made to objectors in exchange for those dismissals. Discovery showed that the objectors had received side payments in exchange for dismissing their appeals. The district court denied disgorgement.The Seventh Circuit reversed. The district court had the equitable power to order the settling objectors to disgorge for the benefit of the class the proceeds of their private settlements. “Falsely flying the class’s colors, these three objectors extracted $130,000 in what economists would call rents from the litigation process simply by showing up and objecting" to the settlement.” Settling an objection that asserts the class’s rights in return for a private payment to the objector is inequitable and disgorgement is the most appropriate remedy. Those objectors are, in essence, “not paid for anything they owned.” View "Frank v. Target Corp." on Justia Law

Plaintiff filed a class action in state court alleging that Costco violated California Labor Code 1198 by failing to provide her and other employees suitable seating. After Costco removed the case to federal court under 28 U.S.C. 1332(a) and the Class Action Fairness Act (CAFA), the district court ultimately granted summary judgment to plaintiff.The Ninth Circuit vacated the district court's grant of summary judgment with instructions to remand to state court, holding that the district court lacked subject matter jurisdiction at the time the action was removed to federal court. The panel first held that the district court lacked diversity jurisdiction under section 1332(a). The panel explained that, because plaintiff's pro-rata share of civil penalties, including attorney's fees, totaled $6,600 at the time of removal, and the claims of other member service employees may not be aggregated under Urbino v. Orkin Services of California, Inc., 726 F.3d 1118 (9th Cir. 2013), the $75,000 jurisdictional threshold was not met. The panel also held that the district court lacked subject matter jurisdiction under CAFA because plaintiff's stand-alone Private Attorney General Act lawsuit was not, and could not have been, filed under a state rule similar to a Rule 23 class action. Therefore, the district court erred by not remanding the case to state court. View "Canela v. Costco Wholesale Corp." on Justia Law

Plaintiff Regina Little asserted claims on her own behalf and on behalf of other New Jersey owners and lessees of 1997, 1998, 1999, and 2000 Kia Sephia vehicles distributed by defendant Kia Motors America, Inc., alleging that those vehicles had a defective brake system. The central question in this appeal was whether the trial court properly permitted plaintiff’s theory of damages based on the cost of brake repairs to be asserted classwide, supported only by aggregate proofs. The jury determined that defendant had breached its express and implied warranties and that the class had sustained damages. The jury found that the class members had suffered $0 in damages due to diminution in value but that each class member had sustained $750 in damages “[f]or repair expenses reasonably incurred as a result of the defendant’s breach of warranty.” The trial court granted defendant’s motion to decertify the class as to the quantum of damages each individual owner suffered. The parties cross-appealed. The Appellate Division reversed the trial court’s post-trial determinations, reinstated the jury’s award for out-of-pocket repair costs based on plaintiff’s aggregate proofs, and remanded for an award of attorneys’ fees. The appellate court held that, notwithstanding the jury’s rejection of plaintiff’s diminution-in-value theory, the trial court should have ordered a new trial on both theories of damages, which it found were not “fairly separable from each another.” Although aggregate proof of damages can be appropriate in some settings, the New Jersey Supreme Court considered such proof improper as presented in this case. The trial court erred when it initially allowed plaintiff to prove class-members’ out-of-pocket costs for brake repairs based on an estimate untethered to the experience of plaintiff’s class. The trial court properly ordered individualized proof of damages on plaintiff’s brake-repair claim based on the actual costs incurred by the class members. Thus, the trial court’s grant of defendant’s motions for a new trial and for partial decertification of the class were a proper exercise of its discretion. View "Little v. Kia Motors America, Inc." on Justia Law

The Court of Appeals affirmed a superior court decision to certify a class action lawsuit against The Medical Center, Inc. ("TMC"). Class representatives were uninsured patients who received medical treatment from TMC and who claimed that TMC charged them unreasonable rates for their medical care, which rates TMC then used as a basis for filing hospital liens against any potential tort recovery by the patients. The Court of Appeals also ruled on the causes of action raised by the plaintiffs. The Georgia Supreme Court granted certiorari to answer three questions: (1) whether the Court of Appeals erred in its determination that class certification was proper; (2) whether the Court of Appeals erred in affirming the denial of summary judgment for TMC on common law claims of fraud and negligent misrepresentation; and (3) whether the Court of Appeals erred in reversing the denial of summary judgment to TMC on claims brought under the Georgia RICO Act. The Supreme Court concluded the Court of Appeals erred with regard to the first two questions, but not the third. Therefore, judgment was reversed in part, affirmed in part and remanded for further proceedings. View "Bowden v. The Medical Center" on Justia Law