Class Actions

Question 1

Requirements for Class Action

Answer 1

Requirements—to certify a class, court must find:

1) Numerosity—class size must be so numerous that joinder is impracticable
> No exact threshold depends on context of case and claims

2) Commonality—there must exist questions of law or fact common to the entire class

3) Typicality—claims or defenses of the class representatives are typical of those of the class

4) Adequacy—class representatives will fairly and adequately protect interests of the entire class
> E.g., representatives must not have conflicts of interest with class members, class counsel must be competent

5) Type—action must fit into 1 of 3 types of class actions

Question 2

Types of Class Actions

Answer 2

1) Anti-Prejudice: (UNCOMMON)

2) Injunction/Declaratory Judgement

3) Damages (MOST COMMON);

Question 3

Types of Class Actions: Injunction/Declaratory Judgement

Answer 3

Allows class where suit requests injunctive or declaratory relief as the primary relief sought (i.e., not damages)
E.g., employment discrimination, civil rights cases

Question 4

Types of Class Actions: Anti-Prejudice

Answer 4

Used where actions by or against class members would create a risk of inconsistent decisions or impairment of class interests

Question 5

Types of Class Actions: Damages

Answer 5

Requirements:

1) Predominance—common questions of law or fact predominate over individual questions, and

2) Superiority—class action is superior to other procedures to resolve the dispute

Class members have opt-out rights—judgment binds class members who do not opt-out

Notification required—all reasonably identifiable class members must be notified of pendency of the action, including opt-out rights and right to appear via separate counsel

Question 6

Jurisdiction for Class Actions

Answer 6

PJ satisfied by:
1) reasonable and adequate notice to class members

2) opportunity to opt out (if applicable), and

3) adequate representation

SMJ:
> Federal question jx—same rules as in individual cases

> Diversity jx — court looks only to class representatives; Diversity requirements satisfied if:
1) Class representatives are diverse from all opposing parties; and

2) Class representatives’ individual claims exceed $75k

Question 7

Class Action Fairness Act (CAFA)

Answer 7

Separate means of obtaining SMJ in class action; jx exists if:
1) Any class member is diverse of any opposing party, and

2) Aggregated claims of the class exceed $5 million

3) Any D, even an in-state D, may remove

4) Generally, when most class members and primary D’s are citizens of the same state, the cases will get remanded or dismissed (that is, local actions stay local)

Question 8

Class Action Certification

Answer 8

CERTIFICATION
Court must determine at an early practicable time whether to allow the case to proceed as a class action (i.e., certify class)

If a class is certified, court must:
1) Define the class (i.e., who can be a class member), the class claims, issues, and defenses

2) Appoint class counsel—class counsel must fairly and adequately represent interests of the class as a whole

Certification can be appealed via interlocutory appeal before final judgment on the merits

Question 9

Class Action Judgement

Answer 9

JUDGEMENT
binding as to all absent class members, unless they opt out, if applicable

Question 10

Class Action Settlement

Answer 10

SETTLEMENT
Court must approve any settlement reached between class representatives and opposing party

Settlement must be fair, reasonable, and adequate

Court will seek feedback from absent class members in deciding whether to approve or reject the settlement

In Type 3 action, court may refuse to approve settlement unless members are given second chance to opt out