Justia Class Action Opinion Summaries
Robinson v. Southern Counties Oil Co.
Robinson worked as a truck driver for Southern in 2015-2017. In 2018, after filing a notice with the California Labor Workforce Development Agency, he filed suit under the Private Attorneys General Act (PAGA) (Lab. Code 2698), alleging that Southern denied Robinson and other employees meal and rest breaks, and, as a result, failed to pay timely wages, furnish complete and accurate wage statements, and pay all wages due upon termination.The San Diego County Superior Court subsequently approved a settlement in a class action that sought individual damages and civil penalties under PAGA for the same alleged Labor Code violations (Gutierrez), which covered all persons employed by Southern in certain jobs, 2013-2018. Robinson and three other employees opted out of the class settlement. Robinson amended the allegations of his complaint to represent Southern employees who opted out of the Gutierrez settlement and persons who were employed by Southern from January 27, 2018, to the present. The court of appeal affirmed the dismissal of the case. Robinson is barred from bringing a PAGA action asserting the same claims that were settled in Gutierrez and lacks standing to bring a representative action on behalf of employees employed during the time period when he was no longer employed by Southern. View "Robinson v. Southern Counties Oil Co." on Justia Law
Vicki Linneman v. Vita-Mix Corp.
Some Vita-Mix blenders contained tiny flecks of polytetrafluoroethylene, a substance commonly used in kitchen appliances and used in the blenders' seals. Normal wear-and-tear caused tiny pieces to rub off from the seal into the blender container. Blender owners filed this class action. The parties entered into a settlement for two classes of plaintiffs: a household class and a commercial class. Household class members could request either a $70 gift card or a replacement blade assembly. Commercial class members could request only a replacement blade assembly. The court preliminarily approved this settlement.The court calculated attorneys' fees by multiplying the hours class counsel reasonably worked on the case by a reasonable hourly rate, resulting in an award of about $2.2 million. Based on the purportedly exceptional nature of the litigation, the court enhanced that figure by 75% for a final award of about $4 million, plus post-judgment interest.The Sixth Circuit vacated. The district court correctly used the lodestar method of calculation and correctly interpreted the settlement agreement but erred when it determined the billing rates based on class counsel’s affidavits. A lawyer seeking fees has the burden to show the reasonableness of his billing rate with something in addition to the attorney’s own affidavits” The district court abused its discretion when it used an upward multiplier, without addressing a crucial question: whether this case involves “rare and exceptional circumstances.” The court upheld the award of post-judgment interest. View "Vicki Linneman v. Vita-Mix Corp." on Justia Law
Attias v. CareFirst, Inc.
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
Frank v. Target Corp.
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
Davidson v. O’Reilly Auto Enterprises, LLC
The Ninth Circuit affirmed the district court's order denying plaintiff's motion for class certification in an action challenging the written rest-break policy of O'Reilly Auto. Plaintiff raised procedural and substantive arguments on appeal.The panel held that the district court did not abuse its discretion in setting and enforcing a deadline for moving to certify the class; the district court did not abuse its discretion in denying plaintiff's motion for class certification while at the same time granting her an additional month to develop evidence and submit a supplemental brief; and plaintiff was unable to establish that there were questions of law or fact common to the class where she failed to offer any evidence that the written policy was applied to employees. Finally, plaintiff waived her right to appeal the dismissal of her wage-statement claim. View "Davidson v. O'Reilly Auto Enterprises, LLC" on Justia Law
Floyd v. American Honda Motor, Co.
Plaintiffs filed a putative class action raising warranty claims arising out of crashes or injuries caused by the alleged "rollaway effect" of certain Honda Civic vehicles. The district court dismissed plaintiffs' claims under the Magnuson-Moss Warranty Act (MMWA) and state law for express and implied warranty against Honda.The Ninth Circuit held that the Class Action Fairness Act (CAFA) may not be used to evade or override the MMWA's specific numerosity requirement. In this case, plaintiffs name only three individuals, but argue that, by satisfying CAFA requirements, they are relieved of the MMWA's obligation to name at least one hundred plaintiffs. The panel rejected plaintiffs' argument and affirmed the district court's dismissal of the MMWA claim. The panel vacated the district court's dismissal of the state law claims, holding that the district court erred in not considering whether plaintiffs' state law claims met the diversity requirements of CAFA even if the MMWA claim failed. Therefore, the district court improperly dismissed the state law claims based only on lack of supplemental jurisdiction. View "Floyd v. American Honda Motor, Co." on Justia Law
In re: Suboxone Antitrust Litigation
Reckitt developed Suboxone tablets, a prescription drug used to treat opioid addiction. Toward the end of its seven-year period of exclusivity in which other manufacturers could not introduce generic versions, Reckitt developed an under-the-tongue film version of Suboxone, which would enjoy its own exclusivity period. Generic versions of Suboxone tablets would not be rated as equivalent to the name-brand Suboxone film, so state substitution laws would not require pharmacists to substitute generic Suboxone tablets if a patient were prescribed Suboxone film.Purchasers filed suit, alleging that Reckitt’s transition to Suboxone film was coupled with efforts to eliminate the demand for Suboxone tablets and to coerce prescribers to prefer film in order to maintain monopoly power, in violation of the Sherman Act, 15 U.S.C. 2. The Purchasers submitted an expert report indicating that, due to Reckitt’s allegedly-anticompetitive conduct, the proposed class paid more for brand Suboxone products. The district court certified a class of “[a]ll persons or entities . . . who purchased branded Suboxone tablets directly from Reckitt” during a specified period. The Third Circuit affirmed. Common evidence exists to prove the Purchasers’ antitrust theory and the resulting injury. Although allocating the damages among class members may be necessary after judgment, such individual questions do not ordinarily preclude the use of the class action device; the court correctly found that common issues predominate. View "In re: Suboxone Antitrust Litigation" on Justia Law
Jabbari v. Wells Fargo & Co.
It is generally not legal error for a district court to hold that a settlement class satisfies predominance, particularly for a class asserting a unifying federal claim, without first performing a choice-of-law analysis.The Ninth Circuit affirmed the district court's holding that the class satisfied Federal Rule of Civil Procedure 23(b)(3)'s predominance requirement under the precedent set by the panel's recent en banc decision in In re Hyundai & Kia Fuel Economy Litigation, 926 F.3d 539 (9th Cir. 2019). The class action complaint alleged that Wells Fargo pressured their employees to meet arbitrary and unrealistic sales quotas unrelated to true consumer demand which resulted in Wells Fargo's systematic exploitation of its customers for profit. Applying Hyundai, the panel held that the district court did not abuse its discretion in holding that common questions predominate. The panel explained that the Fair Credit Reporting Act (FCRA) claim unified the class because plaintiffs could show that the FCRA's elements were proven by a common course of conduct, and the existence of potential state-law claims did not outweigh the FCRA claim's importance. View "Jabbari v. Wells Fargo & Co." on Justia Law
Carpenters Pension Trust Fund for Northern California v. Allstate Corp.
In 2013, Allstate announced a new strategy in its auto insurance business: attracting more new customers by “softening” its underwriting standards. Allstate disclosed that new and potentially riskier customers might file more claims and that Allstate would monitor and adjust business practices accordingly. Two years later, Allstate’s stock price dropped by more than 10 percent, immediately after Allstate announced that the higher claims rates it had experienced for three quarters had been fueled at least in part by the company’s recent growth strategy and that the company was “tightening" its underwriting parameters. The plaintiffs claim that Allstate initially intentionally misled the market by falsely attributing the increases to other factors.The Seventh Circuit vacated the certification of a plaintiff class after reviewing recent Supreme Court decisions concerning the fraud-on-the-market presumption of reliance, which allows plaintiffs to avoid proving individual reliance upon fraudulent misrepresentations and omissions. The issues of materiality, loss causation, and transaction causation are left for the merits but the court must consider evidence on those issues in deciding class certification using the presumption, if the defense offers it to show the absence of transaction causation (price impact). The district court granted class certification after admitting, but without engaging with, defense evidence offered to defeat the presumption--an expert opinion that the alleged misrepresentations had no impact on the stock price. Class certification may be appropriate here, but the district court must decide at the class stage the price impact issue. The court directed modification of any class certification to limit the class to buyers of Allstate common stock rather than any other securities. View "Carpenters Pension Trust Fund for Northern California v. Allstate Corp." on Justia Law
McAdams v. Mercedes-Benz, USA, LLC
The Supreme Court reversed the judgment of the court of appeals concluding that Plaintiff had opted out of a class-action settlement that was approved in Seifi v. Mercedes-Benz USA, LLC, holding that McAdams's status as a member of the Seifi class was determined in that case, and therefore, McAdams's claim in this case was barred by res judicata.While the Seifi class action was pending, McAdams filed a complaint against Mercedez-Benz USA, Mercedez-Benz Easton, and Mercedes-Benz of New Rochelle, alleging claims relating to issues with the balance-shaft gear and the transmission conductor plate of her Mercedes. After the judgment in the Seifi class action was issued, the trial court determined that McAdams was bound by the Seifi class action settlement because she had not formally opted out of the class action, and therefore, her balance-shaft-gear claim was barred by res judicata. The court of appeals reversed, concluding that McAdams had opted out of the Seifi class-action settlement. The Supreme Court reversed, holding that McAdams's claim that she had not opted out of the class action was barred by res judicata because the federal court determined who had opted out in its entry adopting the Seifi class-action settlement. View "McAdams v. Mercedes-Benz, USA, LLC" on Justia Law