Justia Class Action Opinion Summaries

After the 1998 merger of NationsBank and BankAmerica formed Bank of America, shareholders filed class actions alleging violations of securities laws. The cases were resolved when the court approved a $490 million global settlement, overruling an objection by NationsBank class representative Oetting that allocating $333.2 million to those classes was inadequate because their claims had greater merit than the claims of the BankAmerica Classes. After a 2004 distribution and a court-ordered second distribution of $4.75 million to NationsBank claimants in 2009, $2,440,108.53 remained. In 2012, class counsel for the NationsBank Classes moved to terminate the case with respect to those classes, to award class counsel $98,114.34 in attorneys’ fees for work done after the 2004 distribution and to distribute cy pres the remainder of the “surplus settlement funds” to charities suggested by class counsel. The district court granted the motion over Oetting’s objections and ordered “that the balance of the NationsBank Classes settlement fund shall be distributed cy pres to the Legal Services of Eastern Missouri.” The Eighth Circuit vacated and reversed; a further distribution to the classes is feasible, and LSEM is unrelated to the classes or the litigation and is an inappropriate “next best” cy pres recipient. View "Oetting v. Green Jacobson, P.C." on Justia Law

Plaintiffs filed a putative class action under the Class Action Fairness Act of 2005 (CAFA), 28 U.S.C. 1332(d), against Knight, alleging that Knight misclassified them as independent contractors and asserting other labor law violations. Knight removed to federal court, but the district court granted plaintiffs' motion to remand to state court. The district court concluded that Knight did not meet its burden of proof to establish the amount in controversy because all of Knight's calculations relied on a flawed assumption that all drivers worked 50 weeks a year. The court held in Ibarra v. Manheim Investments, Inc., filed simultaneously with this opinion, that when the defendant relies on a chain of reasoning that includes assumptions to satisfy its burden of proof by a preponderance of the evidence that the amount in controversy exceeds $5 million, the chain of reasoning and its underlying assumptions must be reasonable. Applying Ibarra, the court concluded that because defendants relied on a reasonable chain of logic and presented sufficient evidence to establish that the amount in controversy exceeds $5 million, defendants have met their burden of proof. Accordingly, the court reversed and remanded for further proceedings. View "LaCross v. Knight Transportation" on Justia Law

Plaintiff filed a putative class action against his former employer, Manheim, alleging violations of the California Labor Code. Manheim removed the case to federal court and the district court remanded to state court, concluding that Manheim's proof of the $5 million amount in controversy requirement was inadequate. At issue was what a defendant seeking removal must produce to prove the amount-in-controversy requirement under the Class Action Fairness Act of 2005 (CAFA), 28 U.S.C. 1332(d), when the complaint does not include a facially apparent amount in controversy or the plaintiff may have understated the true amount in controversy. The court concluded that when " a defendant's assertion of the amount in controversy is challenged... both sides submit proof and the court decides, by a preponderance of the evidence, whether the amount-in-controversy requirement has been satisfied." A damages assessment may require a chain of reasoning that includes assumptions and such assumptions must be based on reasonable ground. Because the complaint does not allege that Manheim universally, on each and every shift, violates labor laws by not giving rest and meal breaks, Manheim bears the burden to show that its estimated amount in controversy relied on reasonable assumptions. A remand is necessary to allow both sides to submit evidence related to the contested amount in controversy. Therefore, the court vacated and remanded for further proceedings. View "Ibarra v. Manheim Investment, Inc." on Justia Law

Montano filed a putative class action against Wet Seal, alleging that it failed to offer all required meal and rest periods to its California non-exempt retail employees; failed to provide all regular and overtime pay when due or when employment terminated; and failed to provide accurate semi-monthly itemized wage statements, in violation of the Labor and Business and Professions Codes, Industrial Welfare Commission Wage Order No. 7, and Title 8 of the California Code of Regulations. She included a representative claim under the Private Attorneys General Act. Montano propounded discovery requests and Wet Seal responded with objections but no substantive information. Montano moved to compel discovery responses. Before the hearing, Wet Seal moved to compel arbitration of Montano’s individual claims and to stay the action pending completion of arbitration, based on a “Mutual Agreement to Arbitrate Claims." The trial court ultimately denied the motion for arbitration and granted the discovery motion. The court of appeal affirmed. View "Montano v. Wet Seal Retail, Inc." on Justia Law

The Special Management Unit housing unit within the Lewisburg U.S. Penitentiary houses inmates identified as having violent tendencies or having a history of gang involvement while incarcerated. Inmates assigned to the SMU are confined to their cells for 23 hours a day, but can spend the remaining hour in a recreation cage. When first assigned to the SMU, inmates are interviewed by prison officials to ensure that inmates who may be hostile to each other are not housed in the same cell. Shelton, a USP inmate, filed a purported class action, alleging that the defendants have engaged in a pattern, practice, or policy of improperly placing inmates who are known to be hostile to each other in the same cell. He also claims that the defendants fail to intervene when the predictable inmate-on-inmate violence erupts, and that defendants improperly restrain inmates who refuse cell assignments with inmates who are known to be hostile to them. The district court denied Shelton’s motion for class certification and granted defendants’ motion for summary judgment. The Third Circuit affirmed dismissal of a Federal Tort Claims Act claim, but vacated the denial of class certification and summary judgment as to an Eighth Amendment claim. View "Shelton v. Bledsoe" on Justia Law

Sarun, uninsured when he received emergency services from a hospital owned by Dignity Health, signed an agreement to pay the "full charges, unless other discounts apply.” The agreement explained uninsured patients might qualify for government aid or financial assistance from Dignity. After receiving an invoice for $23,487.90, which reflected a $7,871 “uninsured discount,” and without applying for any other discount or financial assistance, Sarun filed a putative class action, asserting unfair or deceptive business practices (Business and Professions Code 17200) and violation of the Consumers Legal Remedies Act (Civ. Code, 1750). The complaint alleged that: Dignity failed to disclose uninsured patients would be required to pay several times more than others receiving the same services, the charges on the invoice were not readily discernable from the agreement, and the charges exceeded the reasonable value of the services. The trial court dismissed, finding that Sarun had not adequately alleged “actual injury.” The court of appeal reversed. Dignity’s argument Sarun was required to apply for financial assistance to allege injury in fact would be akin to requiring Sarun to mitigate damages as a precondition to suit. Mitigation might diminish recovery, butt does not diminish the party’s interest in proving entitlement to recovery. View "Sarun v. Dignity Health" on Justia Law

Plaintiffs filed a class action lawsuit against their employer, Pacific Bell, claiming that Pacific Bell violated California law (Lab. Code, 226.7, 512) by failing to relinquish control over their activities during meal and rest break periods, and moved for class certification. Plaintiffs asserted that the company’s guidelines converted them into “de facto security guards for their company vehicles during their breaks,” thereby failing to relieve them of all work-related duties. The trial court concluded plaintiffs failed to show Pacific Bell’s allegedly restrictive policies had been consistently applied to the putative class members. The court denied class certification on the ground that common questions do not predominate over individual questions, making the class action procedure an inappropriate method for resolving this dispute. The court of appeal affirmed, agreeing that it would be impractical to consider each possible combination and interpretation of the six rules at issue, have the trier of fact determine which combinations rise to the level of control so as to amount to a failure to relieve of all duties, and then have each class member show whether he was subject to one of the offending combinations of rules. View "Koval v. Pac. Bell Tel. Co." on Justia Law

Bower was hired by Inter-Con in 2007 and executed an arbitration agreement, covering claims for compensation and wages. In 2008, Bower executed a second arbitration agreement that added clauses prohibiting claims on behalf of a class or in a representative capacity and covering claims for breaks and rest periods. After his 2011 termination, Bower filed a putative class action, claiming failure to: provide meal and rest periods, pay wages, provide accurate itemized wage statements, pay wages upon termination, with claims under the Unfair Competition Act and the Private Attorneys General Act. Instead of moving to compel arbitration, Inter-Con answered, asserting, as an affirmative defense, that Bower’s claims were subject to arbitration. Inter-Con responded to discovery, but objected based on the arbitration agreement, and agreed to provide responses only to Bower in his individual capacity. Inter-Con did respond to an interrogatory concerning the number of class members employed during the class period and propounded its own discovery. Bower moved for leave to file an amended complaint to allege a broader class and additional theories and to compel further discovery responses. Inter-Con then moved to compel arbitration. The court held that “Defendant waived the right to arbitrate by propounding and responding to class discovery.” The court of appeal affirmed. View "Bower v. Inter-Con Sec. Sys., Inc." on Justia Law

Plaintiff filed a class action suit against Old Republic, a company that sells home warranty plans, alleging that Old Republic arbitrarily denied claims made by him and a putative class of similarly situated policyholders of Old Republic plans, or otherwise cheated him and this class out of benefits owed under their policies. On appeal, plaintiff challenged the district court's orders denying his motion for class certification, denying his motion for leave to amend his complaint, and granting Old Republic's motion for partial summary judgment. The court did not reach the merits of the district court's order because the appeal is moot. The parties settled all of plaintiff's claims and plaintiff expressly released all of his claims against Old Republic. Applying Narouz v. Charter Commc'sn, the court concluded that the appeal is moot because plaintiff has no financial interest or other personal interest whatsoever in class certification. View "Campion v. Old Republic Protection Co." on Justia Law

Plaintiff filed suit against Lilly, alleging that Lilly did not make certain incentive payments due to plaintiff and other similarly situated individuals who had been employed at the company. Lilly removed to district court under the Class Action Fairness Act (CAFA), 28 U.S.C. 1332(d), but the district court remanded to state court. The court concluded that the district court did not clearly err in finding that Lilly had not met its burden of establishing by a preponderance of the evidence that the amount in controversy exceeded $5,000,000, as required by federal subject matter jurisdiction under CAFA. Lilly failed to provide estimates of incentive payments that correspond to the categories of incentive payments identified in the complaint; failed to recognize and build into the calculus that not all of the Fixed Duration Employees were alleged to have been denied all of the incentive payments; and failed to provide any meaningful guidepost for the payment estimates it had provided. Accordingly, the court affirmed the judgment. View "Dudley v. Eli Lilly and Co." on Justia Law