This week we take a look at a Ninth Circuit decision giving short shrift to a Rule 23(f) appeal and revisit two repeat players on Class Action Countermeasures: arbitration clauses and challenges to a class representative’s standing under Spokeo.
Ninth Circuit Succinctly Shoots Down Appeal from Order Granting Certification: The cost of litigating a claim on a class-wide basis can certainly justify seeking an interlocutory appeal from an order granting certification, but that doesn’t mean that such relief is easily obtained. The Ninth Circuit reminded practitioners of that difficult truth last week in a one-page order summarily denying the defendants’ petition for permission to appeal the district court’s order granting class certification. The class certified in that action comprises employees seeking to pursue claims against animation and visual effect studios who they allege secretly agreed not to recruit one another’s employees in order to suppress wages. While Rule 23(f) permits an appeal from an order granting or denying class certification if filed within 14 days of the order, this discretionary appeal is typically only granted when the ruling on certification “sounds the death knell” of the litigation, or turns on a novel or unsettled question of law.
More Arbitration Clauses, More Problems: Another week, another set of reasons a court may refuse to enforce the class action waiver in your arbitration clause. Unsurprisingly, one way to lose the protection of an arbitration clause is to designate a non-existent forum. This was the Eleventh Circuit’s basis for denying a bank’s attempt to send a payday lending dispute to arbitration, holding that the designated Cheyenne River Sioux Tribal Nation arbitral forum did not exist at the time the agreement was made. Turning to what is surely a more common reason for striking an arbitration clause, the Second Circuit reversed the lower court’s order sending a matter to arbitration, ruling that a reasonable fact-finder could conclude it was too difficult to access the set of terms and conditions that included the arbitration clause. These terms and conditions were available by hyperlink on the online order page, but the page included between fifteen and twenty-five other hyperlinks to various pages, which the court held could potentially confuse a consumer.
Court Construes Spokeo to Bestow Standing on a Plaintiff Challenging the Calculation of an Unpaid Cost: The most notable takeaway from an August 30 U.S. District Court decision granting a plaintiff’s motion for class certification on an FDCPA claim has nothing to do with Rule 23; rather, this ruling will most likely provoke discussion based on its application of standing under Spokeo. The class definition at issue encompassed any Illinois resident who received a collection letter from the defendant that included a charge for “costs” calculated as a percentage of the debt the consumer owed. In holding that the class was ascertainable, the court rejected the defendant’s argument that many class members, including the named plaintiff, lacked standing under Spokeo because they had not paid the disputed cost identified in the letter. The court held that the plaintiff had standing because receiving a misleading debt communication is a type of concrete, particularized injury the FDCPA was designed to prevent, even if the lack of payment on the debt renders that injury intangible.
Class Action Spanning Five Decades Comes to a Close: The Eleventh Circuit recently entered an order that bucked two oft-repeated generalizations in one fell swoop: class actions never end, and laches defenses never win. In 1982, the U.S. District Court for the Middle District of Florida entered a modified consent decree regarding hiring practices for the fire department of the City of Jacksonville, which arose from a 1971 class action filed by employees and applicants. In 2007, the plaintiffs filed a motion to show cause against the city for failure to comply with that consent order starting in 1992. The Eleventh Circuit affirmed the district court’s order denying the motion to show cause on the grounds of laches and dissolving the consent decree, holding that plaintiffs’ fifteen-year delay in seeking relief was too prejudicial to the city given the number of witnesses and documents that were no longer available.