Justia Class Action Opinion Summaries

The 965 plaintiffs were people who borrowed money from Countrywide in the mid-2000’s. The issue this case presented for the Court of Appeal's review centered on the permissive joinder statute (Code of Civil Procedure Section 378). Had this case been filed prior to 2005, in all probability it would have been filed as a class action (in 2005, Congress enacted the Class Action Fairness Act (CAFA)). Plaintiffs' third amended complaint alleged that in the mid-2000’s, defendant Countrywide Financial Corporation developed a two-prong business strategy to increase its profits: Countrywide would use captive real estate appraisers to provide dishonest appraisals that would inflate home prices beyond levels that would otherwise prevail in an honest market; then Countrywide would induce its borrowers to take loans Countrywide knew they couldn’t afford by misleading them as to their ability to pay their loans, including misrepresenting key terms of the loans themselves. Plaintiffs alleged Countrywide did this because it had no intention of keeping the loans on its books, but intended to bundle them into saleable tranches and sell them to investors. This appeal raised two questions of state law: (1) despite the rather staggering number of joined plaintiffs, did the third amended complaint allege, to track the statutory language of section 378, the “same . . . series of transactions” that would entail litigation of at least one common question of law or fact; and (2) whether California's procedures governing permissive joinder were up to the task of managing mass actions like this one. The Court of Appeal answered "yes" to both questions: a few years after section 378’s enactment in 1927, the California Supreme Court declared the statute’s same-series-of-transactions language is to be construed broadly in favor of joinder, and there are sufficient common questions of law and fact in this case to satisfy section 378, including whether a mortgage lender has a duty to its borrowers not to encourage “high ball,” dishonest appraisals and whether Countrywide really had a deliberate strategy of placing borrowers into loans it “knew” they couldn’t afford. While the Court reversed the judgment dismissing all but one plaintiff for misjoinder, the Court emphasized that on remand the trial court would have to consider a variety of procedural tools with which to organize this case into appropriate and manageable subclaims and subclasses. "While the irony of requiring the case to be divided into tranches has not escaped as, we are confident the trial court can handle the task." View "Petersen v. Bank of America" on Justia Law

In 2002, Warren Lester and hundreds of other plaintiffs filed a lawsuit against Exxon Mobil Corp. and others seeking personal injury damages allegedly caused by exposure to naturally occurring radioactive material (“NORM”) and other hazardous materials at various Louisiana pipeyards operated by Intracoastal Tubular Services, Inc. (“ITCO”). A flight of several plaintiffs, including John Oleszkowicz, was severed and transferred to the 24th Judicial District Court, at which point the only remaining defendants were ITCO and Exxon. The jury considered each of the plaintiffs’ compensatory claims for increased risk of cancer, as well as a claim for exemplary damages pursuant to former La. Civ. Code art. 2315.3. During the course of trial, the district court instructed the jurors that plaintiffs could bring a “new lawsuit” in the event they actually contracted cancer. The jury returned a verdict in favor of the plaintiffs and awarded damages for the increased risk of cancer. Oleszkowicz was personally awarded $115,000 in compensatory damages. Significantly, the jury did not award exemplary damages to the plaintiffs for increased risk of cancer, based on a finding that Exxon did not engage in wanton or reckless conduct in the storage, handling, or transportation of hazardous or toxic substances. The court of appeal affirmed the judgment on appeal, and the Supreme Court denied writs. Several months after the verdict, Oleszkowicz was diagnosed with prostate cancer. As a result, he filed the instant suit against Exxon and others, alleging his cancer stemmed from the same NORM exposure at ITCO’s pipeyard. The Supreme Court granted certiorari to determine whether the plaintiff’s claim for punitive and exemplary damages was barred by res judicata and, if so, whether “exceptional circumstances” existed to justify not applying res judicata to bar the claim, as set forth in La. Rev. Stat. 13:4232(A). Although the court of appeal cited “exceptional circumstances” to justify relief from the res judicata effect of the jury’s verdict on the issue of punitive damages, the Supreme Court found no such “exceptional circumstances” exist under the facts of this case and reversed the appellate court's ruling. View "Oleszkowicz v. Exxon Mobil Corp." on Justia Law

In plaintiff-appellant Dagmar Hale's second appeal in a class action against Sharp Healthcare and Sharp Grossmont Hospital (collectively, Sharp), she argued Sharp unfairly charged her and other uninsured patients more for emergency services than the fees it accepted from patients covered by private insurance or governmental plans. In the first appeal, the Court of Appeal partially reversed a judgment of dismissal following a demurrer. The trial court thereafter certified the class. After engaging in discovery, Sharp moved to decertify the class arguing a class action was inappropriate based on lack of ascertainability and lack of predominantly common issues. The trial court considered the evidence presented and found there was no reasonable means to ascertain the members of class without individual inquiries of more than 120,000 patient records and continued class treatment was not appropriate because individualized issues, rather than common issues, predominate, particularly with respect to whether or not class members are entitled to recover damages. Finding no abuse of discretion, the Court of Appeal affirmed the order decertifying the class. View "Hale v. Sharp Healthcare" on Justia Law

Plaintiffs filed a proposed class action in Florida state court against BLP, alleging that BLP sent unsolicited faxes in violation of the Telephone Consumer Protection Act, 47 U.S.C. 227(b)(1)(C), and its implementing regulations. BLP removed to federal court and BLP served each named plaintiff an offer of judgment under Federal Rule of Civil Procedure 68. BLP then moved to dismiss for lack of jurisdiction, asserting that the unaccepted Rule 68 offers rendered the case moot. The court concluded that a plaintiff's individual claim is not mooted by an unaccepted Rule 68 offer of judgment, and a proffer that moots a named plaintiff's individual claim does not moot a class action in circumstances like those presented in this case, even if the proffer comes before the plaintiff has moved to certify the class. Accordingly, the court reversed the district court's dismissal of the action. View "Jeffrey M. Stein D.D.S., et al. v. Buccaneers Limited Partnership" on Justia Law

Smith sued Greystone, a debt collector, alleging violation of the Fair Debt Collection Practices Act, 15 U.S.C. 1692–92p, and seeking statutory damages and compensatory damages for emotional distress. The district judge certified it as a class action, but the suit was transferred and the new judge decertified the class. Another judge dismissed, ruling that it had been moot since November 2009, when Greystone offered Smith $1,500 plus costs and attorneys’ fees. The Seventh Circuit vacated. A controversy exists when the plaintiff wants more, or different, relief than the defendant is willing to provide. The district judge decided that Smith’s compensatory damages could not exceed $500, but, while an excessive demand may lead to sanctions for frivolous litigation, it does not diminish the court’s jurisdiction. A court must resolve the merits unless the defendant satisfies the plaintiff’s demand. An offer that the defendant or the judge believes sufficient, but which does not satisfy the plaintiff’s demand, does not justify dismissal. View "Smith v. Greystone Alliance LLC" on Justia Law

IntelliGender sold and advertised the IntelliGender Prediction Test as an accurate predictor of a fetus's gender using the mother's urine sample. The district court approved a Class Action Fairness Act (CAFA), 28 U.S.C. 1332(d), settlement between a nationwide certified class of purchasers of the Test and IntelliGender. The State subsequently filed an enforcement action against IntelliGender under the State's Unfair Competition and False Advertising Laws, largely based on the same claims as the class action. The court concluded that the district court correctly denied IntelliGender's motion to enjoin the State's enforcement action in its entirety where IntelliGender had not met its burden of showing that the CAFA class action settlement could bind the State in its sovereign capacity, where it asserted both public and private interests. The court agreed that a CAFA class action settlement, though approved by the district court, does not act as res judicata against the State in its sovereign capacity, even though many of the same claims are included in both actions. Because the State action is brought on behalf of the people, it implicates the public's interests as well as private interests, and therefore the remedial provisions sweep much more broadly. The court concluded, however, that the State is precluded from seeking the same relief sought in the CAFA class action where IntelliGender provided notice to the appropriate parties of the class action and the State chose not to participate. Therefore, the district court erred in denying IntelliGender's motion to enjoin the State's claims for restitution. Accordingly, the court affirmed in part and reversed in part. View "State of California v. IntelliGender" on Justia Law

In 2006, several borrowers sued their lender, CashCall, Inc., alleging CashCall monitored their telephone conversations without their knowledge or consent. Over CashCall's objections, the trial court certified a class on one of the claims, an alleged violation of Penal Code section 632, which imposes liability on a "person" who intentionally "eavesdrops upon or records [a] confidential communication" and engages in this conduct "without the consent of all parties." After class certification, CashCall successfully moved for summary adjudication on the section 632 claim. The trial court found as a matter of law a corporation does not violate the statute when one of its supervisory employees secretly monitors a conversation between a customer and another corporate employee, reasoning that two employees are a single "person" within the meaning of the statute. The Court of Appeal reversed, holding that the statute applies even if the unannounced listener is employed by the same corporate entity as the known recipient of the conversation, concluding the trial court's statutory interpretation was inconsistent with section 632's language and purpose. The Court also rejected CashCall's alternative argument that summary adjudication was proper because the undisputed facts established the telephone conversations were not "confidential communication[s]." On remand, CashCall moved to decertify the class on grounds that the issue whether any particular class member could satisfy a reasonable-expectation test (as the Court discussed in its earlier opinion) required an assessment of numerous individual factors (including those identified in the earlier opinion) and these individual issues predominate over any remaining common issues, making a continued class action unmanageable. Plaintiffs opposed the motion, arguing CashCall did not meet its burden to establish changed circumstances necessary for class decertification and, alternatively, common issues continued to predominate in the case. The court granted the decertification motion. Plaintiffs appealed the decertification, but finding no error in that decision, the Court of Appeal affirmed. View "Kight v. CashCall" on Justia Law

This class action arose out of the termination of approximately 7,600 former teachers and other permanent employees of the Orleans Parish School Board (OPSB) as a result of Hurricane Katrina and the State of Louisiana’s subsequent takeover of Orleans Parish schools. Although the district court denied defendants’ exceptions of res judicata, a five judge panel of the court of appeal unanimously found that res judicata ordinarily would apply to the facts of this case, but that exceptional circumstances barred its application. The Louisiana Supreme Court granted two writ applications to determine whether the doctrine of res judicata barred plaintiffs’ claims against the OPSB and/or the State defendants, and, if not, whether the OPSB and/or the State defendants violated the plaintiffs’ due process rights in relation to the plaintiffs’ terminations. The Supreme Court agreed with the court of appeal that res judicata applied but found no exceptional circumstances that would preclude its application. Furthermore, the Court found that, even if res judicata did not apply to certain parties’ claims, neither the OPSB nor the State defendants violated plaintiffs’ due process rights. View "Oliver v. Orleans Parish School Board" on Justia Law

In this case involving a class action complaint filed against CVS Pharmacy Inc. in Massachusetts Superior Court for wage and hour violations, the First Circuit clarified the removal time periods and mechanisms under the Class Action Fairness Act of 2005. CVS filed a second notice of removal, claiming that there was a reasonable probability that the amount in controversy exceeded $5 million. The district court granted Plaintiffs’ motion to remand, holding (1) CVS’s notice of removal came too late to meet the thirty-day deadline in 28 U.S.C. 1446(b)(1), and the second thirty-day deadline in section 1446(b)(3) did not apply; and (2) CVS had not met its burden to establish the substantive amount in controversy requirement. The First Circuit reversed, holding (1) the time limits in section 1446(b) apply when the plaintiffs’ pleadings or the plaintiffs’ “other papers” provide the defendant with a clear statement of the damages sought or with sufficient facts from which damages can be readily calculated; (2) CVS’s second notice of removal was timely under section 1446(b)(3); and (3) CVS sufficiently demonstrated that the amount in controversy exceeded $5 million. View "Romulus v. CVS Pharmacy, Inc." on Justia Law

A.S., who suffers from a congenital birth defect, and his mother, Miller, who ingested Paxil while pregnant, sued GSK in the Philadelphia County Court, alleging that all parties were citizens of Pennsylvania. GSK removed the case based upon diversity. On plaintiffs’ motion, the case was consolidated with other Paxil cases before a district court judge who had previously held that GSK was a citizen of Pennsylvania and who remanded A.S.’s case and the other consolidated cases to state court. The case returned to state court on January 4, 2012. On June 7, 2013, the Third Circuit issued its opinion in Johnson, which held that GSK was a citizen of Delaware. Less than 30 days after the Johnson decision, GSK filed a second notice of removal in A.S.’s case and in eight other cases with the same procedural posture. The district court denied the motion and certified its order for interlocutory review. The Third Circuit directed remand to state court, holding that the second removal request was untimely under 28 U.S.C. 1446(b) because there had been a final order. View "A.S. v. SmithKline Beecham Corp" on Justia Law