class action

Judicial review of pre-certification settlements: it’s time to put some district courts’ continued reliance on the Ninth Circuit’s Diaz rule to rest

By Archis A. Parasharami & Colleen M. Campbell on January 11, 2022

Most potential class actions are resolved before class certification. Often courts dismiss cases at the pleadings stage or grant early summary judgment. Sometimes plaintiffs choose to dismiss their cases rather than continuing to pursue them. And often class actions settle on an individual basis at an early stage.

The benefits are obvious. Early settlements offer individual plaintiffs relatively quick payments. They allow defendants the opportunity to end cases early without the need to pay the high costs—including often burdensome discovery-related costs—to defend against class litigation. And they benefit the court system by avoiding needless litigation that can clog court dockets. …
Continue Reading Judicial review of pre-certification settlements: it’s time to put some district courts’ continued reliance on the Ninth Circuit’s Diaz rule to rest

Supreme Court Will Review NLRB’s Anti-Arbitration D.R. Horton Rule

By Evan M. Tager, Archis A. Parasharami & Matt Waring on January 17, 2017

Posted in Arbitration, U.S. Supreme Court

As we’ve noted in this space before, one of the most persistent efforts to undermine the Supreme Court’s decision in AT&T Mobility LLC v. Concepcion—which held that the Federal Arbitration Act (FAA) generally requires enforcing arbitration agreements that waive class or collective proceedings—has been spearheaded by the National Labor Relations Board. In 2012, the Board concluded in the D.R. Horton case (pdf) that Section 7 of the National Labor Relations Act (NLRA), which protects the ability of employees to engage in “concerted activities” (for example, union organizing), supersedes the Supreme Court’s interpretation of the FAA in Concepcion and its progeny and requires that employees be allowed to bring class actions (either in court or in arbitration).

Until recently, the D.R. Horton rule had been rejected by every appellate court to consider it—the Second Circuit, Fifth Circuit, and Eighth Circuit as well as the California and Nevada Supreme Courts—not to mention numerous federal district courts. But last year, the Seventh Circuit and Ninth Circuit parted ways with this consensus, agreeing with the Board and concluding that (at least in some circumstances) agreements between employers and employees to arbitrate their disputes on an individual basis are unenforceable.

This circuit split all but guaranteed that the Supreme Court would need to step in, and sure enough, last Friday, the Court granted certiorari in three cases involving the validity of the D.R. Horton rule. (We drafted amicus briefs for the U.S. Chamber of Commerce in each case). One case, NLRB v. Murphy Oil USA, Inc., arises out of a Board decision finding that an employer had engaged in an unfair labor practice by entering into arbitration agreements with its employees, and the other two, Epic Systems Corp. v. Lewis and Ernst & Young LLP v. Morris, are private-party disputes in which employees invoked D.R. Horton to challenge their arbitration agreements.Continue Reading Supreme Court Will Review NLRB’s Anti-Arbitration D.R. Horton Rule