Thursday, June 30, 2011

SCOTUS Denies Cert. After Staying $250M+ Class Action Judgment

This week the Supreme Court denied certiorari in Philip Morris USA Inc. v. Jackson (No. 10-735), a case from Louisiana state court involving a quarter-billion-dollar class action judgment against several tobacco companies.

As covered back in September, the case was notable because of Justice Scalia’s Opinion in Chambers (issued in his capacity as Circuit Justice for the Fifth Circuit) granting a stay to allow the defendants time to file a petition for certiorari challenging the judgment on due process grounds. At the time, Justice Scalia wrote: “I think it reasonably probable that four Justices will vote to grant certiorari, and significantly possible that the judgment below will be reversed.” He also wrote:

The extent to which class treatment may constitutionally reduce the normal requirements of due process is an important question. National concern over abuse of the class-action device induced Congress to permit removal of most major class actions to federal court, see 28 U. S. C. §1332(d), where they will be subject to the significant limitations of the Federal Rules. Federal removal jurisdiction has not been accorded, however, over many class actions in which more than two-thirds of the plaintiff class are citizens of the forum State. See §1332(d)(4). Because the class here was drawn to include only residents of Louisiana, this suit typifies the sort of major class action that often will not be removable, and in which the constraints of the Due Process Clause will be the only federal protection. There is no conflict between federal courts of appeals or between state supreme courts on the principal issue I have described; but the former seems impossible, since by definition only state class actions are at issue; and the latter seems implausible, unless one posits the unlikely case where the novel approach to class-action liability is a legislative rather than judicial creation, or the creation of a lower state court disapproved by the state supreme court on federal constitutional grounds. This constitutional issue ought not to be permanently beyond our review.

The Supreme Court had apparently been holding the Philip Morris cert. petition pending its decision in Wal-Mart v. Dukes, and some speculated that the Court would either grant certiorari or GVR the case for reconsideration by the Louisiana courts in light of Wal-Mart. Ultimately, the Court simply denied certiorari.

For more coverage, see the Associated Press (Mark Sherman) and SCOTUSblog (Lyle Denniston).


Class Actions, Recent Decisions, Supreme Court Cases | Permalink


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