The Gauntlet: Early - PowerPoint Presentation

Slide1

The Gauntlet: Early Challenges to Class Certification

Andrew Trask, McGuireWoods LLP

Garrett

Wotkyns

, Schneider WallaceSlide2

Trask is not British

But

Wotkyns is half-Czech.We know each other wellSo there has been collusion.We are University of Chicago gradsSo we are deeply nerdy.And pretty cynical.And we say “incentive” a lot.There will be no mention of MazzaExcept this one.All of these cases are in the written materialsBut the slides will go up on www.classactioncountermeasures.com today.

Things you should know :Slide3

Trans-substantive – one size fits allRule 23(a)

(1) numerosity – how big is this case really?

(2) commonality – will we get a single answer?(3) typicality – is the plaintiff a special snowflake?(4) adequacy – who’s the plaintiff working for?Rule 23(b)(1) – zero-sum games(2) – declaratory or injunctive relief(3) – damagesPredominance – Just how many special snowflakes are there?Superiority – Can’t we hand this off to someone else?Rule 23 in 60 seconds or lessSlide4

Class certified =Heavy incentive for defendant to settleScope of case finally defined

Class denied =

Individual lawsuit, resulting inSmallish settlement or Voluntary dismissal The Big Assumption – Class Certification Is the Real FightSlide5

Is to make the class proposal look like this.

So the defense strategy

(Sondra Locke optional.)Slide6

How do they do this?A complicated three-step process.

Class proposal

Early challengesClass certification motionSlide7

Motion to Deny CertificationEarly Summary Judgment

Discovery Battle

Motion to StrikeMotion to Dismiss5 Possible Early ChallengesSlide8

Procedural challenges (or direct challenges)Look to win the game outright

Motion to Deny

Motion to StrikeSubstantive challenges (or indirect challenges)Look to rearrange the chessboardSummary JudgmentDiscovery battlesMotion to Dismiss2 ways to think of themSlide9

Defense faces incentive to challenge

early

Dukes has frontloaded discovery costsIn-house counsel have been asked to do more with less“In 2012, corporate legal departments expect to handle slightly more of them—on average, 5.4 matters per company, up from 4.4 in 2011. At the same time, they plan to decrease their per suit costs, which average $776,500, by 17 percent this year.”(Carlton Fields survey)

Why do we care about this?Slide10

Vinole

v. Countrwide Home Loans, Inc., 571 F.3d 935, 939 (9th Cir. 2009) (“Rule 23 does not preclude a defendant from bringing a ‘preemptive’ motion to deny certification.”). Motion to Deny CertificationSlide11

Defense Advantage:Allows defendant to frame debate.

Allows defendant reply brief.

Defense Risk:Tips hand to plaintiffs on arguments.If court denies on procedural grounds, 1 motion for the price of 2.Motion to Deny CertificationSlide12

Focused on plaintiff-specific issues.

Wright

v. Schock, 742 F.2d 541, 543-44 (9th Cir. 1984) (court properly ruled on summary judgment before certification because (1) resolution protected parties from needless and costly litigation and (2) parties did not suffer prejudice by early determination on merits).

Early Summary JudgmentSlide13

“These are not the droids you are looking for.”Named plaintiff not injured/not member of class.

Early rehearsal of adequacy/typicality.

“Please deny this motion.”Attack on causation.(e.g., plaintiff did not rely on representation)Early attack on commonality/predominance.Early MSJ argumentsSlide14

Defense Advantage:Win on merits, no case.

Lose on contested material facts, sets up variations for class certification.

Defense Risk:Adverse decision on merits – legal grounds.Early Summary JudgmentSlide15

Heerwagen

v. Clear Channel Communications, 435 F.3d 219 (2d Cir. 2006). Limitation of discovery OK because “plaintiff failed to make any showing, however preliminarily, that she could satisfy the predominance requirement of Rule 23(b)(3) or that she might be able to do so with additional discovery.” (234)Mantolete v

. Bolger

, 767 F.

2d

1416 (9th Cir. 1985).

“[

T]he

plaintiff bears the burden of advancing a

prima facie showing

that the class action requirements of Fed

. R. Civ. P

.

23 are satisfied or that discovery is likely to produce substantiation of the class allegations.” (1424)

So defense can use discovery objections to force debate on scope of class.

DiscoverySlide16

Defense Advantage:Possible to limit discovery (& limit cost)

Possible to limit scope of class

Can force early debate on dubious classesDefense Risk:Courts don’t like discovery disputes.“Rigorous analysis” implies plaintiffs need evidence.DiscoverySlide17

John v

. Nat’l Sec. Fire &

Cas. Co., 501 F.3d 443, 445 (5th Cir. 2007) (“Where it is facially apparent from the pleadings that there is no ascertainable class, a district court may dismiss the class allegation on the pleadings.”).Motion to StrikeSlide18

Variations in state law

-

Pilgrim v. Universal Health Card, LLC, 660 F.3d 943, 946 (6th Cir. 2011).Incurable problems with class definition - John v. Nat’l Sec. Fire & Cas. Co., 501 F.3d 443, 445 (5th Cir. 2007).

Better alternatives

out there

–

Kamm

v

. Cal. City Dev. Co

., 509 F.2d 205 (9th Cir. 1975) (previous AG settlement justified motion to strike)

.

Individual

causation/reliance

-

Schilling

v

. Kenton County,

2011 U.S. Dist. LEXIS 8050 (E.D. Ky. Jan. 27, 2011) ("to resolve the legal issue presented the Court must delve into the specific facts of each inmate's incarceration and the medical needs relative to that inmate.")

.

Motion to Strike – Possible GroundsSlide19

Defense Advantage:

Early defeat of certification

Defendant gets to frame issuesDefense Risk:Could be denied as prematureSee, e.g., Eliason v. Gentek Building Prods., Inc., 2011 U.S. Dist. LEXIS 94032, *7 (N.D. Ohio Aug. 23, 2011) (“While raising possibly valid concerns, Defendants' arguments on class certification are premature.”) Tips plaintiffs off to argumentsMotion to StrikeSlide20

Specific motions have specific Rule 23 criteria they help

Standing – Adequacy

Preemption - SuperioritySufficiency of allegations – CommonalityPlaintiff-specific problems – Typicality/commonalityAvailability of injunctive relief – Rule 23(b)(2)Availability of attorneys’ fees – Plaintiffs’ reason for beingMotion to DismissSlide21

Defense Advantage:

Early resolution of case

Educate judge on individualized issuesShape class cert briefingDefense Risk:Early determination that issues are commonIn re Bridgestone/Firestone, Inc. Tires Prods. Liab. Litig., 205 F.R.D. 503 (S.D. Ind. 2001).(subsequent certification overruled)Motion to

Dismiss