Justia Class Action Opinion Summaries

Plaintiff, a resident of Los Angeles, filed a class action lawsuit on behalf of himself and similarly situated individuals challenging the city's telephone users tax (TUT) and seeking refund of funds collected under the TUT over the previous two years. At issue was whether the Government Code section 910 allowed taxpayers to file a class action claim against a municipal government entity for the refund of local taxes. The court held that neither Woosley v. State of California, which concerned the interpretation of statutes other than section 910, nor article XIII, section 32 of the California Constitution, applied to the court's determination of whether section 910 permitted class claims that sought the refund of local taxes. Therefore, the court held that the reasoning in City of San Jose v. Superior Court, which permitted a class claim against a municipal government in the context of an action for nuisance under section 910, also permitted taxpayers to file a class claim seeking the refund of local taxes under the same statute. Accordingly, the court reversed and remanded the judgment of the Court of Appeals.

T-Mobile Central LLC ("T-Mobile") sued Missouri municipalities for refund of certain tax payments that it had paid under protest and filed ten separate lawsuits seeking to recoup tax payments made within ten specific time periods. Appellees brought ten separate class action suits against T-Mobile in state court for passing the contested tax onto customers and sought to recover any money that the Missouri municipalities refunded to T-Mobile. At issue was whether the district court had jurisdiction under the Class Action Fairness Act ("CAFA"), 28 U.S.C. 1332(d)(6), to remand the ten class actions to the state court from which they were removed. The court affirmed the judgment of the district court and held that there was no indication that appellees artificially divided the lawsuit to avoid the CAFA where the structure of appellees' class actions exactly mirrored the underlying ten lawsuits brought by T-Mobile and were driven by T-Mobile's own litigation decisions.

Respondents filed a complaint against AT&T Mobility LLC ("AT&T"), which was later consolidated with a putative class action, alleging that AT&T had engaged in false advertising and fraud by charging sales tax on phones it advertised as free. AT&T moved to compel arbitration under the terms of its contract with respondents and respondents opposed the motion contending that the arbitration agreement was unconscionable and unlawfully exculpatory under California law because it disallowed classwide procedures. The district court denied AT&T's motion in light of Discover Bank v. Superior Court and the Ninth Circuit affirmed. At issue was whether the Federal Arbitration Act ("FAA"), 9 U.S.C. 2, prohibited states from conditioning the enforceability of certain arbitration agreements on the availability of classwide arbitration procedures. The Court held that, because it "stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress," quoting Hines v. Davidowitz, California's Discover Bank rule was preempted by the FAA. Therefore, the Court reversed the Ninth Circuit's ruling and remanded for further proceedings consistent with the opinion.