This week we take a look at how a trial court’s evidentiary rulings can foreclose pathways to appealing a ruling on certification down the line, as well as a Hail Mary appeal by a group of Super Bowl ticketholders that fell harmlessly to the turf.
Exclusion of Expert by District Court Renders Certification Appeal a Quick Exercise: The Ninth Circuit recently affirmed denial of class certification in a putative class action filed against an automaker over allegedly defective brakes, based on its determination that there was no evidence of a common defect. What may be more interesting to practitioners than the outcome is the path that led to the appellate court’s determination on certification. Because the plaintiffs attempted to prove their “common defect” theory through an expert whose testimony was excluded by the lower court, the Ninth Circuit’s holding that the district court did not abuse its discretion by excluding that testimony effectively resolved the certification issue as well. With no evidence of a common defect, it was a short, easy step to affirm the denial of certification.
Separate Classes Can’t Save Super Bowl Ticket Purchasers’ Bid for Certification: Class counsel seeking to avoid predominance challenges to certification will often use subclasses or separate classes to attempt to concentrate similarly situated class members. That play call fell flat for a group of football fans dissatisfied with their tickets to Super Bowl XLV, as the Fifth Circuit upheld the lower court’s order declining to certify classes of “displaced” ticketholders, “relocated” ticketholders, and “obstructed-view” ticketholders.
For the “relocated” class members who were given different seats, the court held that individual issues still predominated over common issues because the key questions—whether the new seat was of lesser-quality, and if so, how it affected the damages analysis—could not be resolved on a classwide basis. Similarly, the court held that individualized issues regarding the extent or materiality of any particular obstruction prevented certification of the “obstructed-view” class. Lastly, the “displaced” class of ticketholders—those who never received a seat to the game at all—ran into another problem that can haunt those who split their classes too thinly: the court held this class failed to satisfy Rule 23(a)’s numerosity requirement.
Sixth Circuit Aligns with Seventh Circuit on Data Breach Class Actions: Following its decision in Lewert v. P.F. Chang’s China Bistro this April, some commentators declared the Seventh Circuit the place to be for those seeking to bring a data-breach class action (for a discussion of some of the obstacles that remain for those plaintiffs notwithstanding Lewert, look here). Regardless of the ultimate viability of these actions, the Seventh Circuit gained an ally last week when the Sixth Circuit reversed the lower court’s dismissal of a data-breach class action for lack of standing, holding that plaintiffs had sufficiently identified a substantial risk of harm because “[w]here a data breach targets personal information, a reasonable inference can be drawn that the hackers will use the victims’ data for the fraudulent purposes alleged in plaintiffs’ complaint.” The court also held that reasonably incurred mitigation costs, such as paying for credit security freezes, also qualify as a concrete, particularized injury.
Settlement Contingencies Based on Company’s Valuation Too Uncertain for Court: Courts reject proposed class action settlements all the time, often because the court concludes that the terms of the settlement agreement do not afford sufficient relief to class members to justify their waiver of rights (or, for the cynical among us, the attorneys’ fees). A San Francisco Superior Court judge recently held that uncertainty about the relief that will ultimately be afforded to class members can likewise torpedo a settlement. In the Wash.io Wage and Hour Cases, the parties’ proposed settlement calculated different potential payouts to class members based on the future valuation of the defendant, an app-based laundry service, and the court concluded the odds of any particular valuation being reached needed to be assessed prior to determining whether the agreement was a fair deal for class members.