Articles Posted in Class Action

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In Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011), the Supreme Court reversed the certification of a nationwide class of female Wal-Mart employees claiming gender discrimination. The unnamed plaintiffs in Dukes then filed new actions seeking certifications of regional classes. A group of would-be class members of one of these regional class actions, appealed the district court's dismissal of the class claims and the denial of appellants' motion to intervene. The Eleventh Circuit held that the appeal from the order dismissing the class claims was untimely filed, and was therefore jurisdictionally barred, and the appeal from the order denying appellants' motion to intervene was moot. View "Love v. Wal-Mart Stores, Inc." on Justia Law

Posted in: Class Action

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Plaintiffs filed a class action in state court claiming that the City of Montgomery's red-light program and fines violated state law. City and Traffic Solutions removed to federal court under the Class Action Fairness Act, 28 U.S.C. 1332(d), but the district court remanded to state court. After determining that it had jurisdiction over the appeal, the Eleventh Circuit held that the home state exception to CAFA jurisdiction was applicable in this case where the only primary defendant was a citizen of the state in which the action was originally filed and other requirements under the statute were met. Accordingly, the court affirmed the judgment. View "Hunter v. City of Montgomery, Alabama" on Justia Law

Posted in: Class Action

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Plaintiffs filed suit alleging that defendants operated a racketeering enterprise through which they performed and billed for unnecessary heart procedures. The district court dismissed the case. At issue on appeal was whether the Class Action Fairness Act's local-controversy provision, (CAFA), 28 U.S.C. 1332(d)(4), precluded the district court from exercising federal-question jurisdiction. If not, the court must decide whether plaintiffs alleged that they were injured in their "business or property," under the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. 1964(c). The court affirmed the denial of plaintiffs' motion to remand because CAFA's local-controversy provision does not prohibit district courts from exercising federal-question jurisdiction under 28 U.S.C. 1331. However, the court vacated the district court's grant of defendants' motion to dismiss because plaintiffs alleged economic injuries that were recoverable under RICO. View "Blevins v. Seydi V. Aksut, M.D." on Justia Law

Posted in: Class Action

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Wright filed suit in federal court against Pilot, alleging that Pilot and certain Pilot employees systematically shortchanged some trucking companies with whom Pilot had discount agreements by failing to give them the agreed-upon benefits. Wright filed claims under both state and federal law. At issue here is whether federal courts that are given original subject-matter jurisdiction over state-law claims by the Class Action Fairness Act (CAFA), 28 U.S.C. 1332(d), retain that jurisdiction even when the class claims are dismissed before the class is certified. The district court found that CAFA does not vest the federal courts with original jurisdiction over state-law claims after the class claims are dismissed. Pilot argues that CAFA conferred original jurisdiction over all of Wright’s claims at the time Wright filed them, such that the jurisdiction could not have divested when the class claims were later dismissed. Here, Wright first filed directly in federal court under CAFA but now wishes to refile in state court. When the post-filing action that did away with the class claims is not an amendment to the complaint, the court saw no basis for distinguishing cases originally filed in federal court under CAFA from those removed to federal court. Therefore, the court concluded that CAFA continues to confer original federal jurisdiction over the remaining state-law claims in this suit. Because CAFA vested the district court with original jurisdiction over the remaining claims, there was no need for it to analyze supplemental jurisdiction. Accordingly, the court reversed and remanded. View "Wright Transportation, Inc. v. Pilot Corporation" on Justia Law

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General Motors challenged the district court's order granting in part a motion for class certification in an action brought by plaintiffs under the Florida Deceptive and Unfair Trade Practices Act (FDUTPA), Fla. Stat. 501.201 et seq. The district court certified a class consisting of all Florida purchasers and lessees of 2014 Cadillac CTS sedans. In this case, the district court found the predominance requirement to be satisfied by an essential question common to each class member: whether the inaccurate Monroney sticker provided by General Motors constituted a misrepresentation prohibited by FDUTPA. The court concluded that, by inaccurately communicating that the 2014 Cadillac CTS had attained three perfect safety ratings, General Motors plainly obtained enhanced negotiating leverage that allowed it to command a price premium. The size of that premium represents the damages attributable to that theory of liability. Because that theory is consistent for all class members, the predominance requirement under Federal Rule of Civil Procedure 23(b)(3) is satisfied. This consistency is also sufficient to establish the commonality requirement under Rule 23(a)(2). Because common questions of law and fact predominate, class-wide adjudication appropriately conserves judicial resources and advances society’s interests in judicial efficiency. Finally, the court rejected General Motor's contention that plaintiff failed to prove that she can fairly and adequately protect the interests of the class. Because the district court did not abuse its discretion in certifying the class, the court affirmed the judgment. View "Carriuolo v. General Motors Co." on Justia Law

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Plaintiffs, consumers from California and Texas, filed class actions against Electrolux, the manufacturer of front-loading washing machines, alleging warranty and consumer claims. Specifically, plaintiffs allege that the rubber seal on the front door of the machines retains water, allowing mildew to grow, causing stains on clothing, and creating a foul odor. The court concluded that the district court abused its discretion in assessing predominance and therefore vacated the class certification. On remand, the district court should revisit Electrolux's argument that the consumer claims do not satisfy predominance because plaintiffs cannot prove causation on a classwide basis, and the district court abused its discretion by certifying the warranty claims without first resolving preliminary questions of state law that bear on predominance. The court further concluded that plaintiffs' damages do not necessarily defeat predominance, and Electrolux's defense of misuse does not necessarily defeat predominance. Accordingly, the court vacated and remanded. View "Brown v. Electrolux Home Products, Inc." on Justia Law

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Aero filed a class action in Florida state court in 2010 against defendants, alleging that defendants sent unsolicited facsimile advertisements to the putative class in violation of the Telephone Consumer Protection Act (TCPA), 47 U.S.C. 227(b)(1)(C). These claims concern conduct that took place in 2006 and are governed by a four-year statute of limitations. The Florida state court granted summary judgment in favor of defendants in 2013. Later that year, Ewing filed a similar class complaint in federal court against the same defendants containing similar allegations. Recognizing that more than four years had passed since the alleged conduct, the complaint alleges that the statute of limitations was tolled during the pendency of Aero’s purported class action. The court affirmed, under Griffin v. Singletary, the district court's judgment, concluding that the pendency of Aero's purported class action did not toll the statute of limitations for Ewing's purported class action. View "Ewing Indus. Corp. v. Bob Wines Nursery, Inc." on Justia Law

Posted in: Class Action

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In 1996, a Florida District Court of Appeal approved certification of a class-action lawsuit originating in the Circuit Court of Dade County that encompassed an estimated 700,000 Floridians who brought state-law damages claims against the major American tobacco companies for medical conditions, including cancer, "caused by their addiction to cigarettes that contain nicotine." The Florida Supreme Court then decertified the class but held that the jury findings would nonetheless have "res judicata effect" in cases thereafter brought against one or more of the tobacco companies by a former class member. Here, a member of that now-decertified class, successfully advanced strict-liability and negligence claims that trace their roots to the pre-decertified class' jury findings. Over the defendants' objection, the District Court instructed the jury that "you must apply certain findings made by the [class action] court and they must carry the same weight they would have if you had listened to all the evidence and made those findings yourselves." When the jury found in favor of the plaintiff on both claims, the defendants renewed their motion for a judgment as a matter of law, contending, among other things, that federal law preempted the jury’s imposition of tort liability as based on the class-action jury findings. The District Court denied the motion, and the defendants appealed. The Eleventh Circuit reversed: "the State of Florida may ordinarily enforce duties on cigarette manufacturers in a bid to protect the health, safety, and welfare of its citizens. But it may not enforce a duty, as it has through the [class-action] jury findings, premised on the theory that all cigarettes are inherently defective and that every cigarette sale is an inherently negligent act. So our holding is narrow indeed: it is only these specific, sweeping bases for state tort liability that we conclude frustrate the full purposes and objectives of Congress. As a result, [plaintiff's class-action]-progeny strict-liability and negligence claims are preempted, and we must reverse the District Court’s denial of judgment as a matter of law." View "Graham v. R.J. Reynolds Tobacco Co." on Justia Law

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An interlocutory appeal before the Eleventh Circuit centered on an order granting motions to dismiss by two defendants in a securities class action against Jiangbo Pharmaceuticals, Inc., its principal officers, and its audit firm. Jiangbo came into existence as a U.S. corporation in 2007 when its Chinese operational arm, Laiyang Jiangbo, executed a reverse merger with a Florida shell company. Jiangbo's tenure as a public company "was short and fraught with suspicion of misconduct." Shares began trading on NASDAQ on June 8, 2010 and traded on that exchange for just under a year. Only six months after trading began, the Securities and Exchange Commission (SEC) initiated an informal, non-public investigation into Jiangbo. The company's fortunes unraveled quickly soon thereafter, and the SEC formalized its investigation, which remained non-public. Jiangbo made two significant disclosures in late May 2011 that marked the culmination of its decline: it publicly acknowledged the formal SEC investigation for the first time and reported that the company had defaulted on a relatively small principal payment toward debt from its initial financing. Trading ended days later on May 31, 2011, by which time the share price had fallen from a class-period high of $10.49 per share to $3.08. By November 2011, after Jiangbo had moved to another exchange, its shares were trading for just $0.14. The investors' consolidated amended complaint alleged, inter alia, that Elsa Sung (the former Chief Financial Officer) and Frazer LLP (the external auditor) misrepresented the company's cash balances and failed to disclose a material related-party transaction in statements within or appurtenant to those filings, in violation of Section 10(b) of the Securities Exchange Act. The district court found that the investors failed to sufficiently plead their allegations of fraud against defendants Sung and Frazer LLP ("Frazer"). Applying the heightened pleading standard imposed by the Private Securities Litigation Reform Act ("PSLRA"), the Eleventh Circuit Court of Appeals affirmed the district court. View "Brophy v. Jiangbo Pharmaceuticals, Inc." on Justia Law

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This appeal stemmed from five putative class actions filed against Wells Fargo and its predecessor, Wachovia Bank. At issue was whether Wells Fargo's waiver of its right to compel arbitration of the named plaintiffs' claims should be extended to preclude Wells Fargo from compelling arbitration of the unnamed putative class members' claims. The court concluded that because a class including the unnamed putative class members had not been certified, Article III's jurisdictional limitations precluded the district court from entertaining Wells Fargo's conditional motions to dismiss those members' claims as subject to arbitration; contrary to the position they take in this appeal, the named plaintiffs lack Article III standing to seek the court's affirmance of the district court's provision holding that if a class is certified, Wells Fargo will be estopped to assert its contractual rights to arbitration; and, therefore, the court vacated and remanded for further proceedings. View "Spears-Haymond v. Wells Fargo Bank" on Justia Law