Sixth Circuit Affirms Class-Certification Order Despite Lack of Commonality

Cruz-Alvarez_FFeatured Expert Contributor – Civil Justice/Class Actions

Frank Cruz-Alvarez, Shook, Hardy & Bacon L.L.P. (co-authored with Talia Zucker, Shook, Hardy & Bacon L.L.P.)*

The U.S. Court of Appeals for the Sixth Circuit’s recent decision in Rikos v. The Procter & Gamble Company was a setback to Rule 23 jurisprudence, but as is often the case, there is a silver lining—Judge Deborah Cook’s dissenting opinion.  Judge Cook penned a thoughtful dissent that unravels the analytical shortcomings of the majority’s opinion, and demonstrates the conflict that exists between the majority opinion and the Supreme Court’s Rule 23 jurisprudence.

This lawsuit arose when three consumers (“Plaintiffs”), each residing in different states, purchased the product Align, a probiotic nutritional supplemental designed to promote digestive health, but believed it did not work as advertised. They subsequently brought this action against Procter & Gamble (“P&G”), the manufacturer of Align, claiming violations of various state unfair and deceptive practices because Align did not promote digestive health for anyone. Continue reading

Ninth Circuit Decision Allowing Appeal of Right from Order Denying Class Certification Is Ripe for Supreme Court Review

9thCirRule 23(f) of the Federal Rules of Civil Procedure gives appeals courts unfettered discretion in deciding whether to permit an interlocutory appeal from a class certification decision. Most circuits have exercised that discretion sparingly. But a U.S. Court of Appeals for the Ninth Circuit decision issued last week affirmed that circuit’s unique rule: plaintiffs (but not defendants) are entitled to take an immediate appeal from an adverse class certification ruling, even when an appeals court panel has previously denied discretionary appeal under Rule 23(f). All plaintiffs need do is stipulate to dismissal of the complaint with prejudice, and then seek review of the order denying certification in connection with an appeal from the final judgment of dismissal. Never mind that a plaintiff who stipulates to dismissal of his lawsuit might reasonably be deemed to have abandoned his claims. Continue reading

Update: New Jury Again Exonerates KC Royals’ Mascot in Hot-Dog Incident

Not a Tortfeasor

Not a Tortfeasor

Almost exactly a year ago in the WLF Legal Pulse,  WLF general counsel Mark Chenoweth (a Kansas native and Royals fan) called foul on the Missouri Supreme Court for ordering a new trial in the case of a fan that alleged a hot dog, tossed by the Kansas City Royals’ mascot Sluggerrr (pictured left), caused an eye injury.

We recently learned that on June 17, a Jackson County jury, after a wasteful second trial, once again found the Royals not responsible for the fan’s injuries. In addition, it found the fan was not responsible for the injury either. In the original trial, the jury found him 100% responsible for his injuries. The second jury reached the correct decision without the benefit of the “Baseball Rule,” which, as pointed out in last year’s commentary, the Missouri high court inexplicably ruled inapplicable.

The plaintiff’s lawyer told the Kansas City Star that he “hoped the trial ‘sent a message’ to Major League Baseball.” The nature of such a message is unclear, however, especially given the fact that the fan lost his suit and the team won even without the protection of the Baseball Rule.

Unfortunately, the result in Coomer v. Kansas City Royals Baseball Corp. won’t put an end to plaintiffs’ lawyers’ persistent efforts to shift responsibility for ballpark injuries from inattentive fans to deep-pocketed sports franchises. For instance, a Seattle plaintiffs’ firm that specializes in bet-the-company lawsuits has filed a class action in the Northern District of California against Major League Baseball alleging common law negligence and California Unfair Competition Act violations for its failure to provide a safe fan experience. The suit amounts to a frontal assault on the Baseball Rule.

One of the arguments the class makes in support of its negligence claim: baseball teams’ allegedly distracting efforts to entertain fans with activities such as food tosses.

Majority Rule: Standing Continues to be Plaintiffs’ Achilles’ Heel in Data-Breach Class Actions

securityGuest Commentary

by Spencer Salmon, a 2015 Judge K.K. Legett Fellow at the Washington Legal Foundation and a student at Texas Tech School of Law.

Some years ago, when data breaches first became a problem for the business community, plaintiffs’ lawyers thought class actions on behalf of consumers whose information had been stolen would be the next big moneymaker. To their disappointment, a majority of federal courts across the United States has ruled in favor of data breaches’ most direct and obvious victim—hacked businesses—because plaintiffs have failed to establish standing to sue. In order to establish constitutional standing, plaintiffs must show that the alleged injury is concrete, particularized, actual or imminent, fairly traceable to the action challenged, and redressable. Absent standing, courts lack subject matter jurisdiction over the suit under Federal Rule of Civil Procedure Rule 12(b)(1).

Recently, federal district courts from Nevada (In re, Inc., Customer Data Security Breach Litigation) and Minnesota (Carlsen v. Gamestop, Inc.) joined most federal courts in dismissing data-breach class-action lawsuits for lack of standing. Continue reading

Ninth Circuit Limits CAFA’s “Single Local Event” Exception and Broadens Removal of Mass Actions

Cruz-Alvarez_FFeatured Expert Contributor – Civil Justice/Class Actions

Frank Cruz-Alvarez, Shook, Hardy & Bacon, L.L.P. (co-authored with Rachel A. Canfield, an associate with the firm)

On April 27, 2015, the U.S. Court of Appeals for the Ninth Circuit issued a 2-1 decision in Allen v. Boeing, reaffirming the court’s prior interpretation of the Class Action Fairness Act of 2005’s (CAFA’s) “single local event” exception, which it previously reviewed in Nevada v. Bank of America Corp.

CAFA expands federal jurisdiction over certain mass actions that fall within its purview. CAFA defines such actions as any civil action in which “monetary relief claims of 100 or more persons are proposed to be tried jointly on the ground that the plaintiff’s claims involve common questions of law or fact.”1

CAFA, however, enumerates a number of exceptions which exclude an action from enjoying CAFA mass action jurisdiction and require remand to state court. Pursuant to the single local event exception, civil actions in which “all of the claims in the action arise from an event or occurrence in the State in which the action was filed, and that allegedly result in injuries in that State or States contiguous to that State” are excluded from CAFA’s mass action jurisdiction.2 In Allen, the Ninth Circuit was called upon to interpret the breadth of this exception. Continue reading

Supreme Court Agrees to Review Uninjured Plaintiffs’ Lawsuit

supreme courtThe U.S. Supreme Court this morning granted certiorari in Spokeo, Inc. v. Robbins, a case from the U.S. Court of Appeals for the Ninth Circuit involving an issue that the Court declined to address twice in the past several years: whether Congress can grant citizens the ability to file lawsuits in situations where those plaintiffs could not otherwise satisfy the “case or controversy” requirement of Article III of the U.S. Constitution.

On April 15, a WLF Legal Pulse commentary by WLF Chief Counsel Rich Samp, Supreme Court Has Opportunity to Halt Lawsuits by Uninjured Plaintiffs, explained why the Court should decline the recommendation of the Solicitor General of the U.S., which, at the Court’s invitation, had filed an amicus brief urging the justices to deny review.

Also, soon after the Court sought the views of the Solicitor General, WLF hosted a Web Seminar program on Spokeo and the issue of statutorily-created injury that featured Spokeo‘s Counsel of Record, Andrew Pincus of Mayer Brown LLP, and Meir Feder of Jones Day.

Supreme Court Has Opportunity to Halt Lawsuits by Uninjured Plaintiffs

supreme courtFederal courts have been inundated in recent years by suits filed by plaintiffs who have suffered no injury but who allege that a federal statute provides them with “standing” to sue for alleged violations of federal law. Such lawsuits can be extremely lucrative for the plaintiffs’ bar when the statute provides for an award of statutory damages (typically, $100 to $1,000) for each violation; by filing their suits as nationwide class actions, attorneys can often plausibly seek to recover billions of dollars. The Supreme Court may soon make it much more difficult for such suits to survive a motion to dismiss. The Court on Friday will consider whether to grant review in Spokeo v. Robins, a case that squarely addresses whether plaintiffs can assert Article III standing where their only “injury” is the affront to their sensibilities caused by the belief that someone is not complying federal law. The Court has indicated a strong interest in addressing the issue; Spokeo is an appropriate vehicle for doing so and ought to be granted.

The U.S. Solicitor General recently filed a brief recommending that the Court not hear Spokeo. That brief may, ironically, increase the likelihood that the Court will agree to hear the case, because the Solicitor General very pointedly declined to endorse the appeals court’s rationale for concluding that the plaintiff has standing.

Spokeo involves claims filed under the Fair Credit Reporting Act (FCRA), one of dozens of federal statutes that offer a bounty (in the form of statutory damages) to those who demonstrate a violation of a federal statute. Spokeo, Inc. operates a “people search engine”—it aggregates publicly available information from phone books, social networks, and other sources into a database that is searchable via the Internet, and displays the results of searches in an easy-to-read format. It has always emphasized that it does not verify or evaluate any piece of data and does not guarantee the accuracy of information offered. Continue reading