Tenth Circuit

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Although the Class Action Fairness Act of 2005 (CAFA) permits most significant class actions to be heard in federal court, the law requires district courts to remand so-called “local controversies” to state court. A “local controversy” is a class action in which “greater than two-thirds of the members of the proposed classes” are “citizens” of the forum state and at least one defendant “from whom significant relief is sought” and whose “alleged conduct forms a significant basis for the claims asserted” is also a “citizen” of that state. 28 U.S.C. §1332(d)(4).

In an effort to come within this exception,…
Continue Reading Tenth Circuit holds that environmental contamination case doesn’t require remand under Class Action Fairness Act’s “local controversy” exception

330px-Supreme_Court_Front_DuskThe Supreme Court will decide before the end of this Term whether to hear any or all of four important cases that raise recurring questions of class action law that have sharply divided the lower courts. These cases address questions that we have blogged about before (e.g., here and here): whether a class full of uninjured members may be certified, and whether plaintiffs may rely on experts and statistics to gloss over individualized differences among class members in order to prove their class claims and damages. These questions strike at the heart of what it means to be a “class,” because class actions generally must be litigated using common evidence to show that each class member has been harmed.
Continue Reading Supreme Court To Decide Whether To Hear Four High-Stakes Cases Asking When A Suit May Be Litigated As A Class Action

[Editors’ note:  Today we’re featuring a guest post by Tim Fielden, who is in-house counsel at Microsoft.  His post spotlights an emerging—and important—issue in class-action litigation.]

In two recent decisions, the Ninth Circuit has carved out a new path for plaintiffs seeking immediate review of the denial of class certification: voluntarily dismiss the complaint under Rule 41(a), appeal from the final judgment, and challenge the class certification denial on appeal. If this tactic gains currency, plaintiffs (but not defendants) will have the right to an immediate appeal from any adverse class certification ruling. But at least four circuits…
Continue Reading Did The Ninth Circuit Just Give Plaintiffs—But Not Defendants—An Automatic Appeal From Class Certification Orders?

To remove a civil action from state court to federal court, the defendant must “file … a notice of removal … containing a short and plain statement of the grounds for removal.” 28 U.S.C. § 1446(a). Under the Class Action Fairness Act of 2005 (CAFA), federal courts have jurisdiction over certain class actions if, among other things, the amount in controversy exceeds $5 million. 28 U.S.C. § 1332(d)(2). Today, the Supreme Court held in Dart Cherokee Basin Operating Co. v. Owens (pdf), that a defendant’s notice of removal need only contain a “plausible allegation” that the amount in…
Continue Reading Supreme Court Holds That Defendants Need Not Submit Evidence with a Notice of Removal Under the Class Action Fairness Act

This morning I attended oral arguments at the Supreme Court in Dart Cherokee Basin Operating Co. v. Owens.  The issue presented in Dart Cherokee is whether a defendant who wishes to remove a case to federal court under the Class Action Fairness Act (CAFA) is required to submit evidence supporting federal jurisdiction along with the notice of removal.    Here’s my key takeaway from the argument:  The answer will be “no”—defendants need not attach evidence to a notice of removal—but only if the Court concludes that it has the power to reach the merits.

In most circuits, when a defendant…
Continue Reading Supreme Court May Clarify Procedures For Removal Under CAFA—If It Decides To Answer The Question Presented in Dart Cherokee Basin Operating Co. v. Owens

To remove a civil action from state court to federal court, the defendant must “file … a notice of removal … containing a short and plain statement of the grounds for removal.” 28 U.S.C. § 1446(a). Today, the Supreme Court granted certiorari in Dart Cherokee Basin Operating Co. v. Owens, No. 13-719, to decide whether a notice of removal must also include evidence supporting jurisdiction if the facts establishing jurisdiction do not appear on the face of the state-court complaint. The Court’s resolution of this issue will be important to all businesses seeking to remove state-court class actions…
Continue Reading Supreme Court to Decide Whether All Evidence Supporting Removal Under the Class Action Fairness Act Must Be Submitted With The Notice of Removal

Last year, we reported on the Second Circuit’s ruling in Police & Fire Retirement System of City of Detroit v. IndyMac MBS, Inc. (pdf), 721 F.3d 95 (2d Cir. 2013), that the filing of a class action does not toll the statute of repose in the Securities Act of 1933 for would-be class members who later seek to intervene or file their own suits. On Monday, the Supreme Court announced that it has chosen to review the Second Circuit’s ruling. Now, the Supreme Court has an opportunity to establish a uniform national rule that the tolling principles applicable to statutes…
Continue Reading Supreme Court Will Decide Whether Filing A Class Action Tolls Statute of Repose Under Federal Securities Laws

One of the more alarming recent developments in the class-action arena is the increase in actions by state attorneys general that mirror private class actions. These state AG actions aren’t like the typical enforcement action, in which the government pursues claims for civil penalties that are distinct from the relief sought in the private class action. Instead, these are copycat actions in every sense of the word. The state AG seeks restitution or disgorgement that is equivalent to the remedies requested in the private class action. And increasingly, the state AG is handing over the reins entirely to class-action plaintiffs’…
Continue Reading You’ve Settled the Class Action—Can the State AG Demand Another Payout?

Here’s the situation: You’re facing a class action in federal court in which the plaintiffs define the putative class so broadly as to encompass many people who weren’t injured by the alleged wrongdoing. For example, consider a false-advertising class action on behalf of “all purchasers” of a product that the vast majority of purchasers would have used without any problem whatsoever, meaning that the alleged rarely occurring (or entirely hypothetical) defect that the defendant failed to disclose makes no difference to them. What’s the best way to attack this weakness in the complaint?

One option would be to characterize the…
Continue Reading Do the Plaintiffs Lack Standing or Are Their Claims Simply Meritless—or Both?