Friday, December 10, 2010
The Coming Revolution in Class Actions
This term the Supreme Court has granted cert in three class action cases and each case has a far reach. Depending on what the court does with these cases, the world of complex litigation could be dramatically changed. These aren't really mass tort cases, but the topic is tangentially related to ours so here goes, gentle readers. If you are not interested in this stuff, surf on.
As we've been discussing on this blog, the Wal-Mart class action presents the court with the opportunity to rethink the requirements of 23(a) (how much do class members have to have in common for a class action to be certified) and 23(b)(2) (can any money damages claims be included?). The Baycol case presents the court with the question of whether certification determinations are preclusive. And the Concepcion case presents the question as to whether arbitration agreements barring class actions cannot be struck down based on state law contract doctrine -- in other words, must they be upheld under the FAA?
If the court follows its current trend of limiting class actions, by June we will be living in a world where the commonality requirement is very strict (class members will have to show that their common questions of law and fact also have common answers), if they fail to certify their class they'll be precluded from trying again, perhaps even if they were not class representatives, and consumers will be almost universally barred from bringing class actions (because what company in its right mind would choose not to have an arbitration provision barring class treatment?).