Class Actions Flashcards
Class Actions in General
What governs class actions?
In a class action, the court authorizes a single person or a small group of people to represent the interests of a larger group.
Rule 23 and the Class Action Fairness Act of 2005 govern class actions.
Class Actions
Rule 23(a) basic requirements
_Rule 23(a) establishes four requirements for representative members of a class to sue or be sued on behalf of all members of the cl_ass:
i) The class must be so numerous that joinder of all members is impracticable (numerosity);
ii) There must be questions of law or fact that are common to the class (commonality);
iii) The claims or defenses of the representatives must be typical of the class (typicality); and
iv) The representatives must fairly and adequately protect the interests of the class (adequacy).
What are the three types of class action under Rule 23?
In addition to the requirements of Rule 23(a), before a class action can be certified, it must fit within one of the three situations specified in Rule 23(b).
1) Risk of prejudice
Under Rule 23(b)(1), the class is maintainable if the prosecution of separate actions would create the risk that the class opponent would become subject to incompatible standards of conduct resulting from inconsistent adjudications, or if prosecution of the claims through separate actions would, as a practical matter, impair the interests of the class members.
2) Final equitable relief
Under Rule 23(b)(2), a class seeking final injunctive or declaratory relief may be certified if the class shares a general claim against the opposing party.
An additional claim for monetary damages may not be sought, at least when the monetary relief is not incidental to the injunctive or declaratory relief.
Moreover, a claim for individualized monetary relief is not available because a claim under Rule 23(b)(2) is available only when a single, indivisible remedy would provide relief to each class member.
Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011) (a claim for backpay due to alleged gender discrimination could not be certified in an action seeking injunction and declaratory relief for such discrimination).
3) Common legal or factual questions
Under Rule 23(b)(3), a class can be certified if questions of law or fact that are common to the class members predominate over any questions affecting only individual members, and a class action is the superior method for bringing about a fair and efficient adjudication of the controversy.
In making this determination, the court must consider, among other things:
i) The class members’ interests in individually controlling the prosecution or defense of separate actions;
ii) The extent and nature of any litigation concerning the controversy already begun by or against class members;
iii) The desirability or undesirability of concentrating the litigation of the claims in the particular forum; and
iv) The likely difficulties in managing a class action.
The class representatives need not establish that success on a common question of law is likely in order for the class to be certified.
Class Actions - Rule 23
- SMJ*
- Diversity*
- Venue*
Subject matter jurisdiction
A class action must also satisfy federal subject matter jurisdiction requirements. A class action can invoke federal question jurisdiction or diversity jurisdiction.
1) Diversity jurisdiction
If diversity jurisdiction is invoked in a class action, then diversity of citizenship will be satisfied if the class representatives are diverse from the party or parties opposing the claim.
When at least one representative plaintiff of a putative class action has a claim that meets the statutory jurisdictional amount (generally it must exceed $75,000), other persons with claims that do not meet the jurisdictional amount can be made part of the class under the doctrine of supplemental jurisdiction. Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546 (2005).
Venue
When the class action involves a defendant class, venue is determined on the basis of the residences of the representative parties, not the residences of all the class members.
Under Rule 23(b)(3), can a class be certified if the questions of law or fact that are common to the class members predominate over any questions affecting only individual members, and a class is the superior method in bringing about a fair and efficient adjudication of the controversy?
YES.
Under Rule 23(b)(3), a class can be certified if the questions of law or fact that are common to the class members predominate over any questions affecting only individual members, and a class action is the superior method in bringing about a fair and efficient adjudication of the controversy.
