Fears of Big Changes in Class-Action Law Didn't Come to Pass With Spokeo
Despite fears the Supreme Court could make sweeping changes in its 2015 session to class-action litigation law, the session that ended in June was "the term that wasn't" since the rulings ultimately didn't have significant impact on developing such law one way or the other, Ellen Meriwether, an antitrust partner at Cafferty Clobes, told us. One of those cases, Spokeo vs. Robins, has been cited repeatedly in telco and media class-action litigation in recent months (see 1607060016, 1606090024 and 1601290008), particularly by defendant companies claiming plaintiffs have no standing.
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The ruling makes the analysis of harm and standing more clear, but it also could result in more class actions being filed in state courts instead of federal, Paul Karlsgodt, head of BakerHostetler's national class-action defense practice team, told us. The stronger Article III requisites for standing get, "I have been surprised not to see more of that strategy by plaintiff lawyers," he said. Article III standing requires plaintiffs demonstrate injury traceable to the defendant's actions in question and that the injury is something that could be redressed by a court decision. Because Article III has been such a good defense tool, Karlsgodt said, “it may be too good of a tool.”
The Supreme Court decision assigned the 9th U.S. Circuit Court of Appeals the task of evaluating standing issues in Spokeo and determining factual or imminent harm exists. The 9th Circuit decision is unlikely before late fall, "since the issues are fairly nuanced and the court is going to want to take the time to get it right," consumer protection lawyer David Cohen of Ropes & Grey told us in an email.
Spokeo didn't change the basic requirements of standing, U.S District Judge Robert Payne of Richmond, Virginia, ruled in June in a memorandum opinion (in Pacer) in a Fair Credit Report Act class-action case, Thomas v. FTS. That ruling, one of the first since Spokeo, illustrates what court thinking is now, Meriwether said. FTS argued Thomas' injuries -- the Cableview Communications cable company worker sued after being fired by parent company FTS when a background check of his driving record turned up violations -- perfectly fit what the Supreme Court in Spokeo said wouldn't constitute concrete injury: a technical procedural violation that resulted in no concrete harm. But Payne said in denying FTS' motion to dismiss claims for lack of standing, Spokeo reaffirmed previous Supreme Court rulings that violating a procedural right given by statute can constitute injury.
The other significant class-action Supreme Court decision in the 2015 session was Tyson Foods v. Bouaphakeo, in which the key issue dealt with the use of statistical evidence to show a common impact, Karlsgodt said. The defense bar generally had hoped for a decision against using statistics to prove class liability, though the court ultimately said stats have a place in class action, he said.
Meriwether said there's an expectation the high court at some point will take up other class-action issues, such as the split among circuits about identifying members of a class before it is certified and whether there is a need to ascertain that each class member is injured before certification.
While there has been a good body of law established on enforceability of arbitration agreements, such as the court's 2015 decision in DirecTV v. Imburgia (see 1512140022), Karlsgodt said that the death of Justice Antonio Scalia might see the court taking up such cases again and coming to different conclusions, especially if he is replaced with a more liberal justice, Karlsgodt said. "That one vote could significantly change the outcome," he said.