Constructing Issue Class Actions

There's been a lot of chatter over the past few years about the greater use of issue classes.  The Rule 23 Subcommittee in its recent report (p. 41) indicated that issue classes top its agenda for possible reform and there's been a greater willingness to rely on Rule 23(c)(4) among the circuit courts over the last few years.  Much of the scholarship on issue classes thus far, however, has focused on how to use issue classes in conjunction with Rule 23(b)(3)'s predominance requirement.  Professor Laura Hines (Kansas) has, for instance, written a series of articles on the topic and there have been several debates in symposium pages, such as DePaul's 2013 symposium.  

Whatever side of the debate one adheres to on the to-be-or-not-to-be question, the courts are embracing issue classes.  Thus, there remains much work to be done on discerning which issues should qualify for certification, how to think about Seventh Amendment Reexamination Clause questions, and how to compensate plaintiffs' attorneys who initiate issue classes.

I've recently written a paper on issue classes that takes some steps toward fleshing out these problems.  The paper is long since it's meant to be a one-stop shop for judges and attorneys on the subject, but here are the critical points worth underscoring:

First, one of the main difficulties of our system is that the focus in massive lawsuits has shifted to the ways in which the plaintiffs are dissimilarly situated, even when the defendant's conduct is uniform.  Take the GM ignition switch debacle or the Toyota acceleration cases, for example.  Corporate actions are nonindividuated; it doesn't make sense to litigate what GM or Toyota did in 40,000 different cases.  (Draft pp 5-8) But defendants have successfully shifted the procedural focus to how their behavior affected claimants, which tends to defeat class certification because common questions do not predominate over individual ones.  The issue class has the potential to recapture what is common to the plaintiffs: defendant's conduct--at least so long as that conduct is nonindividuated.  One can capture this notion by divvying up the legal elements in any claim or defense as "conduct components," which concern the defendant's conduct, or "eligibility components," which concern a plaintiff's eligibility for relief.  (Draft pp 15-29)

Second, by embracing the standard suggested by the ALI's Principles of the Law of Aggregate Litigation, courts can ease the supposed tension (to the extent any remains) between Rule 23(c)(4) and Rule 23(b)(3).  (Draft pp 31-32)  Courts should certify issue classes where resolving the issue would "materially advance the resolution of multiple civil claims by addressing the core of the dispute in a manner superior to other realistic procedural alternatives, so as to generate significant judicial efficiencies." (Principles, 2.02(a)(1), 2.02 cmt. a, 2.08, 2.08 cmt. a)  Predominance is embedded in the "materially advance" language and superiority is included as a condition that certifying the issue would be "superior to other realistic alternatives" such that it "generate[s] significant judicial efficiencies."  Moreover, the courts themselves seem to have reached a general consensus on this matter, with even the Fifth Circuit embracing issue classes in In re Deepwater Horizon, 739 F.3d 790, 804 (5th Cir. 2014).  (Draft p. 30)

Third, courts must figure out a way to compensate (and thus incentivize) plaintiffs' attorneys.  This is perhaps the trickiest part because of both the lack precedent and doctrinal hurdles such as Lexecon.  Lexecon presents a special challenge in multidistrict litigation cases where issue classes might prove most useful.  Nevertheless, one need not invent a theory out of whole cloth.  Charging liens and the common-benefit doctrine provide sound analogies for fashioning a coherent path forward.  (Draft pp 42-50)

Finally, there are some hurdles to making issue classes stick, such as preclusion doctrines, adequate representation, and the Seventh Amendment Reexamination Clause.  Thus, the paper concludes by suggesting solutions to these problems and arguing that preclusion can provide a way to coordinate dispersed public and private regulators.

As always, comments are welcome (eburch at uga.edu).