Wednesday, April 17, 2013
As we as scholars and practictioners begin to explore class action alternatives, one problem continues to arise: when to preclude subsesequent litigation. Of course, this problem arose early on in the class action's history, most notably with (b)(2) civil rights cases where some class members disagreed fundamentally over the remedy requested. But the problem has persisted in multidistrict litigation and, perhaps most notably, in parens patriae actions. I explore this problem and propose a solution in my latest piece, titled Adequately Representing Groups. Here's the SSRN abstract, which gives a brief summary of the proposed solution:
Adequate representation and preclusion depend on whether the courts treat a litigant as part of a group experiencing an aggregate harm or as a distinct person suffering individual injuries. And though a vast literature about adequate representation exists in the class-action context, it thins dramatically when contemplating other forms of group litigation, such as parens patriae actions and multidistrict litigation. As class actions have gradually fallen into disfavor and attorneys and commentators seek alternative means for resolving group harms, the relative clarity of Rule 23 wanes. How should courts evaluate adequate representation in parens patriae actions and in multidistrict litigation? The answer to this question matters immensely since adequate representation is critical to precluding relitigation and achieving finality.
This Article suggests that courts should differentiate between inadequate representation claims based on the underlying right at stake. When the underlying right arises from an aggregate harm — a harm that affects a group of people equally and collectively — and demands an indivisible remedy, courts should tolerate greater conflicts among group members when evaluating a subsequent claim of inadequate representation. Because the harm is aggregate and the remedy is indivisible (typically declaratory or injunctive relief), if one group member receives the remedy, then they all receive the remedy. The litigation operates to group members’ benefit or detriment equally, so if one group member is inadequately represented, they are all inadequately represented. Consequently, a subsequent litigant can successfully avoid preclusion only where the lawyers or the named representatives acted contrary to the group’s best interests or attempted to represent an overinclusive, noncohesive group where some members required unique relief that the representative had no selfish reason to pursue.
Conversely, when plaintiffs suffer individual injuries at the same defendant’s hands and unite their claims for economic or efficiency reasons, that aggregation does not convert their individual injuries into an aggregate harm. When counsel fails to fairly represent her client in vindicating that harm, inadequate representation is an individual injury. In multidistrict litigation and Rule 23(b)(3) class actions, which typically include individuals litigating their individual harms together for systematic and litigant efficiency, courts should look for “structural conflicts” between the claimants themselves as well as between the representatives and the claimants. This means that both initially and on a collateral attack, courts should accept fewer conflicts than in cases involving aggregate rights. Accordingly, judges should assess whether there are reasons the lawyers “might skew systematically the conduct of the litigation so as to favor some claimants over others on grounds aside from reasoned evaluation of their respective claims or to disfavor claimants generally vis-à-vis the lawyers themselves.”
Jaime Dodge (Georgia) has posted Disaggregative Mechanisms: The New Frontier of Mass-Claims Resolution Without Class Actions on SSRN. Here's the abstract:
Aggregation has long been viewed as the primary if not sole vehicle for mass claims resolution. For a half-century, scholars have consistently viewed the consolidated litigation of similar claims through joinder, class actions and more recently multi-district litigation as the only mechanism for efficiently resolving mass claims. In this Article, I challenge that long-standing and fundamental conception. The Article seeks to reconceptualize our understanding of mass claims resolution, arguing that we are witnessing the birth of a second, unexplored branch of mass claims resolution mechanisms — which I term “disaggregative” dispute resolution systems because they lack the traditional aggregation of common questions that has been the hallmark of traditional mass claims litigation. Disaggregation returns to a focus on the individual akin to that of the single-plaintiff system, but uses either procedural or substantive streamlining, or a shift of costs to the defendant, to correct the asymmetries that prompted the creation of class actions. Many of our most innovative claims structures — from the BP GCCF and the fund created in the wake of the Costa Concordia disaster, to the common single-plaintiff arbitration clauses in consumer and employment agreements — use this new, bottom-up model of disaggregative mass claims resolution instead of the familiar top-down aggregative model.
These next-generation systems have been heralded as a significant advancement in mass claims resolution, capable of awarding more compensation to claimants more quickly and at lower cost than aggregate litigation. But like the single-plaintiff and aggregate litigation systems that preceded it, disaggregation has its flaws. Because the defendant typically designs these systems, they often give rise to questions about legitimacy and the accuracy of compensation. More shockingly, situating disaggregation within the existing doctrinal trends reveals that the rise of disaggregation allows corporations to avoid class actions in a far broader swath of cases than has previously been identified — such that class actions will, as a practical matter, proceed only at the defendant’s election, raising substantial questions about the viability of private actions as a mechanism for the enforcement of law. Yet, because these systems are the product of contract, attempts to restrict these systems have largely failed. The answer to these problems lies in an unlikely and potentially controversial approach: expanding rather than restricting the availability of disaggregation, by creating a public mechanism for disaggregation — comparable to the existing public aggregation mechanisms.
Looks really interesting and definitely worth a read!