Justia Class Action Opinion Summaries
Bermudez Chavez v. Occidental Chemical Corp.
The New York Court of Appeals answered two certified questions, holding that (1) New York recognizes cross-jurisdictional class action tolling; and (2) "tolling ends—as a matter of law—when there is a clear dismissal of a putative class action, including a dismissal for forum non conveniens, or denial of class certification for any reason." The Court of Appeals further held that the underlying orders terminated class action tolling in 1995, thus rendering plaintiffs' claims untimely.In light of these holdings, the Second Circuit vacated the district court's order denying Occidental judgment on the pleadings, remanding with instructions to enter judgment, consistent with this opinion and the Court of Appeals' answers to the court's certified questions, in Occidental's favor. View "Bermudez Chavez v. Occidental Chemical Corp." on Justia Law
FWK Holdings, LLC v. Merck & Company, Inc.
Plaintiffs, a group of pharmaceutical buyers, filed a class action against two manufacturers who allegedly reached an anticompetitive settlement in a patent dispute. Plaintiffs are a class of direct purchasers of Merck's brand-name drug and Glenmark's generic version of that drug. Defendants Merck and Glenmark challenge the district court's class certification order.The Fourth Circuit vacated the district court's order, holding that the district court's numerosity analysis fell short in several respects. The court clarified that the text of Federal Rule of Civil Procedure 23(a)(1) refers to whether the class is so numerous that joinder of all members is impracticable, not whether the class is so numerous that failing to certify presents the risk of many separate lawsuits. In this case, the district court erred in analyzing the judicial-economy factor. When analyzing the judicial-economy factor on remand, the court instructed the district court to consider whether judicial economy favors either a class action or joinder. Furthermore, the district court's numerosity analysis improperly looked to the impracticability of individual suits rather than joinder, and thus the court is compelled to conclude that legal error infected the district court's class-certification decision.The court also concluded that there was no abuse of discretion in the district court's adequacy determination and the court rejected Merck's and Glenmark's contention that the district court abused its discretion in finding the named plaintiffs adequate class representatives. The court also found no issue with the district court's predominance finding. Finally, plaintiffs waived any objection to the district court's dismissal of 23 companies. View "FWK Holdings, LLC v. Merck & Company, Inc." on Justia Law
Cain v. Midland Funding, LLC
In this two putative class action cases concerning the applicable statute of limitations for claims filed by consumer debtors against a consumer debt buyer, Midland Funding, LLC, the Court of Appeals held that Petitioners' claims for unjust enrichment and statutory claims for money damages were subject to the three-year statute of limitations established by Md. Code Cts. & Jud. Proc. 5-101.Petitioner Clifford Cain and Petitioner Tasha Gambrell each filed a putative class action complaint against Midland, alleging improper debt collection activities in connection with money judgments that Midland obtained against the plaintiffs during a time when Midland was not licensed as a collection agency under Maryland law. In Cain's case, the circuit court granted summary judgment to each party in part and a separate declaratory judgment declaring the rights of the parties. In Gambrell's case, the circuit court granted Midland's motion to dismiss. The court of appeals held (1) Petitioners were not entitled to injunctive relief, and (2) Petitioners' claims seeking restitution under an unjust enrichment theory and money damages for statutory claims were barred by CJ 5-101's three-year statute of limitations. The Court of Appeals affirmed the judgment as to Gambrell in its entirety and reversed the judgment in part as to Cain, holding that Cain's individual claims were timely filed. View "Cain v. Midland Funding, LLC" on Justia Law
McIntosh v. Royal Caribbean Cruises, Ltd.
In this maritime negligence case involving a "cruise to nowhere," plaintiff filed a class action complaint against Royal Caribbean, on behalf of other similarly situated cruise ship passengers, alleging several tort theories, including negligence, intentional infliction of emotional distress, and negligent infliction of emotional distress. Plaintiff alleged that Royal Caribbean canceled her cruise because of Hurricane Harvey and offered refunds only on the day the cruise ship was set to sail. Because the ticket contracts provided that no refunds would be given for passenger cancelations within 14 days of the voyage, and because Royal Caribbean repeatedly told passengers that they would lose their entire payments for the cruise if they canceled, the plaintiffs claimed that they were forced to travel to Galveston and nearby areas (like Houston) as Hurricane Harvey approached. Therefore, plaintiff alleged that, while in Texas, they were forced to endure hurricane-force conditions, and suffered physical and emotional injuries.The Eleventh Circuit reversed the district court's dismissal of the complaint for lack of subject matter jurisdiction and remanded for further proceedings. The court concluded that the district court committed two errors in ruling that diversity jurisdiction was lacking in this case, and each one provides an independent basis for reversal. First, the district court failed to give the plaintiffs notice of its intent to sua sponte address the matter of diversity jurisdiction. Second, putting aside the aggregation of damages issue, the district court failed to consider whether any individual plaintiff had satisfied the $75,000 amount-in-controversy requirement. On remand, the district court should also consider whether there is maritime jurisdiction. Because of the uncertainty over jurisdiction, the court did not address the class action waiver or the claims for intentional infliction of emotional distress and negligent infliction of emotional distress. View "McIntosh v. Royal Caribbean Cruises, Ltd." on Justia Law
Obeslo, et al. v. Great-Western Life & Annuity, et al.
Plaintiff-Appellants were shareholders in a major mutual fund complex through their employer-sponsored retirement plans. They alleged the complex’s investment adviser, Great-West Capital Management LLC (“GWCM”), and affiliate recordkeeper, Great-West Life & Annuity Insurance Co. (“GWL&A”), breached their fiduciary duties by collecting excessive compensation from fund assets. After holding an eleven-day bench trial in January 2020, the district court adopted and incorporated by reference, with few changes, Defendants’ Proposed Findings of Fact and Conclusions of Law. It also found for Defendants on every element of every issue, concluding “even though they did not have the burden to do so, Defendants presented persuasive and credible evidence that overwhelmingly proved that their fees were reasonable and that they did not breach their fiduciary duties.” Plaintiffs appealed, but finding no reversible error, the Tenth Circuit affirmed. View "Obeslo, et al. v. Great-Western Life & Annuity, et al." on Justia Law
Mersho v. United States District Court for the District of Arizona
The Ninth Circuit granted in part a petition for a writ of mandamus and ordered the district court to vacate its order appointing an individual as lead plaintiff in a consolidated securities fraud action against Nikola and related defendants. In the underlying action, plaintiffs alleged that they suffered losses from buying Nikola securities after a non-party report described apparent false statements made by the founder and contained in company advertising materials. Petitioners Mersho, Chau, and Karczynski moved to be lead plaintiff as a group under the name Nikola Investor Group II (Group II).In a securities fraud class action, the Private Securities Litigation Reform Act (PSLRA) requires the district court to identify the presumptive lead plaintiff, who is the movant with the largest financial interest and who has made a prima facie showing of adequacy and typicality. Once the presumption is established, competing movants can rebut the presumption by showing that the presumptive lead plaintiff will not fairly or adequately represent the class.The panel granted the petition to the extent it seeks to vacate the district court's order appointing Plaintiff Baio as lead plaintiff. The panel concluded that four of the five Bauman factors weigh in favor of mandamus relief and thus a writ of mandamus is appropriate. In regards to the third Bauman factor, the panel explained that the district court clearly erred by finding that the presumption had been rebutted. In this case, the district court failed to point to evidence supporting its decision, instead relying on the absence of proof by Group II regarding a prelitigation relationship and its misgivings. Therefore, the district court did not comport with the burden-shifting process Congress established in the PSLRA. The panel also concluded that the first, second, and fifth Bauman factors weigh in favor of granting the writ. However, the panel declined to instruct the district court to appoint Group II as lead plaintiff, remanding for the district court to redetermine the issue. View "Mersho v. United States District Court for the District of Arizona" on Justia Law
Phelps Oil and Gas v. Noble Energy
Phelps Gas & Oil brought a class action in Colorado state court against Noble Energy and DCP Midstream for underpayments on oil and gas royalties Noble allegedly owed Phelps and other owners of royalty interests. DCP Midstream removed the class action to federal district court. Phelps then moved to remand the case to state court, arguing the case failed to meet the federal $75,000 amount-in-controversy requirement. The district court denied the motion, and later entered summary judgment, dismissing all of Phelps’s claims. The Tenth Circuit concluded the district court erred in denying Phelps’s motion to remand, thus dismissing the appeal for lack of jurisdiction. "[N]either the value to Phelps nor the cost to either defendant in this case would result in more than $75,000 at controversy. Though the contracts between Noble and DCP are worth millions of dollars, we cannot base federal jurisdiction on potential future litigation involving the defendants." View "Phelps Oil and Gas v. Noble Energy" on Justia Law
Smith v. Professional Transportation,Inc.
Smith worked for PTI, a company that transports railroad crews to and from their workplaces. Believing that her position was misclassified under the Fair Labor Standards Act and that she was not receiving proper overtime wages, she filed a collective action 29 U.S.C. 216(b). Unlike a class action under FRCP 23(b)(3), an FLSA collective action requires group members to affirmatively opt-in to participate. Her suit was within the two-year limitation period. The district court’s docket sheet shows numerous putative group members consenting to opt-in.PTI noted that Smith had not filed anything except her complaint indicating that she herself wished to participate in the group action. The court held that Smith’s group action could not “commence” until such consent was filed, 29 U.S.C. 256, but the limitations periods had run. The court concluded that Smith’s complaint also failed to allege timely individual claims, and dismissed the case. Smith’s appeal concerned only her individual action. The Seventh Circuit vacated. The court erred by refusing to allow Smith to proceed on her individual claims. Read in the light most favorable to Smith, the complaint contained sufficient factual allegations related to her individual claims to put PTI on notice that she intended to sue it both in an individual and a representative capacity. She explicitly stated as much in the caption. View "Smith v. Professional Transportation,Inc." on Justia Law
Rodriguez v. Kaiaffa, LLC
In this public interest appeal, the Supreme Court affirmed the order of the trial court certifying a class action of servers employed by Chip's Family Restaurant, holding that the trial court did not err or abuse its discretion.Plaintiff alleged in her class action complaint that Defendants had violated Connecticut wage laws and regulations by deducting a tip credit from her earnings and paying her and other class members below minimum wage for the performance of "nonservice" tasks in connection with their duties as servers. After class discovery, Plaintiff moved for class certification. The trial court granted the motion. The Supreme Court affirmed, holding that the trial court did not abuse its discretion in certifying this class action. View "Rodriguez v. Kaiaffa, LLC" on Justia Law
T.R. v. School District of Philadelphia
Plaintiffs brought a putative class action against the School District, claiming that shortcomings in the District’s translation and interpretation services violated the Individuals with Disabilities Education Act (IDEA), 20 U.S.C. 1400.The Third Circuit affirmed summary judgment in favor of the District, based on failure to exhaust administrative remedies. A “systemic exception” to IDEA’s administrative exhaustion requirement applies where plaintiffs “allege systemic legal deficiencies and, correspondingly, request system-wide relief" that cannot be addressed through the administrative process. The fact that a complaint is structured as a class action seeking injunctive relief, without more, does not excuse exhaustion; the systemic exception applies when plaintiffs challenge policies that threaten basic IDEA goals, not mere components of special education programs. Both named plaintiffs could bring the same IDEA claim from their complaint before a hearing officer who could then order that the District provide each parent with translated individualized education plans, more qualified or consistent interpretation services, or whatever process would ensure meaningful participation for that parent. Both the claim and the relief would be individualized, even if the relief could create spillover benefits for other parents. View "T.R. v. School District of Philadelphia" on Justia Law