Litigation

Two Courts of Appeals Issue Decisions Addressing Whether Bristol-Myers Squibb’s Personal Jurisdiction Holding Extends to Class Actions

We have previously written about the Supreme Court’s personal jurisdiction decision in Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017) and how the federal district courts were applying it.  Now, two Courts of Appeals have finally weighed in, issuing the very first appellate decisions addressing whether Bristol-Myers applies to class actions in federal courts.

In Molock v. Whole Foods Market Group, Inc., No. 18-7162, 2020 WL 1146733 (D.C. Cir. March 10, 2020), plaintiffs, current and former employees of Whole Foods, brought a putative class action seeking to recover alleged lost wages.  Defendant moved to dismiss and argued that the court lacked personal jurisdiction over the claims of nonresident putative class members.  The district court denied the motion, and Whole Foods appealed.  In a 2-1 decision, the D.C. Circuit held that the question of whether Bristol-Myers applied to class actions was premature and need not be addressed because no class had been certified and

District Of Massachusetts Holds That Consumers With No Arbitration Agreement Must Arbitrate Their “Closely Intertwined” Class Action Claims

It is a legal maxim that arbitration is a creature of contract. A recent District of Massachusetts decision explores critical questions about when that creature can exist outside of the confines of a binding agreement to arbitrate among the parties.

The November 27, 2019 decision by Senior U.S. District Judge George A. O’Toole ordered that plaintiff fantasy sports players were obligated to arbitrate their class action claims against DraftKings, Fan Duel, and their payment processing companies. The claims referred to arbitration included not only those brought by players with arbitration agreements with DraftKings and Fan Duel, but claims by players with no contractual relationship with the defendant on the basis that their claims were closely “intertwined” with claims subject to arbitration. However, the Court drew a line at family members of players, determining that they had not reaped any benefit from a contract with an arbitration agreement, and thus could not be compelled to arbitrate. Judge O’Toole also declined to hear challenges

After-Effects of In re Asacol: Recent District Court Decisions on Certification and Uninjured Class Members

About a year ago, I observed that the First Circuit in In re Asacol Antitrust Litigation had constrained plaintiffs’ ability to rely on affidavits to prove injury-in-fact.  In so doing, the First Circuit substantially curtailed its prior decision in In re Nexium Antitrust Litigation, which certified a class containing uninjured consumers because class members would be able to prove injury via affidavit.  In its In re Asacol decision, the First Circuit made it clear that trial-by-affidavit is a permissible means to establish injury only if the affidavits are unrebutted.

As the D.C. Circuit observed in relying on In re Asacol, that case “sharply limited” In re Nexium and established that “any winnowing mechanism” used to identify uninjured class members

must be truncated enough to ensure that common issues predominate, yet robust enough to preserve the defendants’ Seventh Amendment and due process rights to

The District of Massachusetts Orders that Comcast Subscribers Must Individually Arbitrate Privacy Class Action Claims

On November 4, 2019, in Wainblat v. Comcast Cable Communications, LLC, et. al., No. 19-cv-10976, the District of Massachusetts ordered that a consumer privacy class action against Comcast must be arbitrated on an individual basis because the claims are subject to a valid and enforceable arbitration provision. Against a backdrop of rapidly expanding consumer class action litigation, especially based on consumer privacy laws with statutory damages, the case is an important reminder that arbitration provisions in customer agreements offer robust and critical protections for businesses.

Wainblat’s Consumer Privacy Class Action Claims against Comcast

In a class action complaint filed on April 25, 2019, plaintiff Wainblat asserted claims on behalf of all Massachusetts Comcast subscribers under the Cable Privacy Act, 47 U.S.C. § 55l(a)(l), and the Massachusetts consumer protection statute, M.G.L. c. 93A § 9 (“Chapter 93A”). The plaintiff alleged that Comcast “systematically violates cable television subscribers’ federal statutory privacy rights

Class Action Settlements and the Importance of Clarity

Practice area:

Most class actions resemble three-act plays. In the first act, the players are adversaries – fighting to kill the case or keep it alive, and if kept alive, to keep it limited to a solitary dispute or allow it to burgeon into the combined claim of large numbers of absent parties. If the case survives these early scenes, it proceeds to Act II, in which the cast members pause to see whether they can negotiate a resolution. In cases that are mediated, Act II often extends beyond the mediation sessions and does not end until a Settlement Agreement is signed. Act III begins upon execution of the Settlement Agreement. As the matter approaches its denouement, the parties’ interests come into alignment, as both sides work together to gain court approval.

Occasionally disputes develop over whether the case was resolved in Act II. This can occur when no Settlement Agreement has been signed but one side claims that the negotiations resulted in a binding oral agreement. Although

With Massachusetts’ Consumer Data Privacy Bill Still Under Consideration, Student Data Privacy Class Action Fails In Federal Court

As we have recently reported, the Massachusetts legislature is currently considering a comprehensive data privacy law that would create a private right of action for consumers who allege a violation of any provision of the proposed law. Last week, a Massachusetts federal court dismissed a data privacy class action, concluding that the plaintiffs failed to state an actionable claim under existing law. The decision draws into sharp relief the potential impact of the proposed legislation. The case demonstrates how the data privacy bill, if enacted, could open a new avenue for individuals to sustain private actions based on alleged data privacy violations that courts have previously found do not entitle plaintiffs to relief.

The Mount Ida College Plaintiffs Alleged Data Privacy Violations but Could Not Sustain their Class Claims

In this recent and closely watched case, Squeri v. Mount Ida College, brought on behalf of a putative class of former and

Yan v. ReWalk Robotics, Ltd.: No Substitute for Standing in the District of Massachusetts

On May 16, 2019, the District of Massachusetts denied a lead plaintiff’s motion to amend a complaint that sought to overcome standing deficiencies of the original class representative by adding a new named plaintiff. The Court dismissed the putative class action without prejudice, holding that if a class action has only one representative, and that party does not have standing, the Court lacks jurisdiction over the case and cannot permit the lead plaintiff substitution.

In Yan v. ReWalk Robotics, Ltd., lead plaintiff Wang Yan brought a putative class action for alleged violations of the Securities Act of 1933 and the Exchange Act of 1934 in connection with the company’s 2014 initial public offering. In a class action complaint filed in 2017, Yan claimed that ReWalk concealed material information in its IPO documents concerning a failure to comply with FDA regulations and continued to make materially false statements after the IPO. In August 2018, the Court granted the

Lamps Plus, Inc. v. Varela: Class Arbitration Must Be Expressly Authorized

Class arbitration came back before the Supreme Court this term in Lamps Plus, Inc. v. Varela.  Today, the Supreme Court issued a 5-4 decision in Lamps Plus, holding that, under the Federal Arbitration Act, “courts may not infer from an ambiguous agreement that parties have consented to arbitrate on a classwide basis.”  Rather, class arbitration must be expressly authorized by contract.

The facts of Lamps Plus are straightforward.  An employee had signed an arbitration agreement upon being hired to work for Lamps Plus.  After a data breach, the employee sued Lamps Plus in federal court.  Lamps Plus filed a motion to compel individual arbitration, and the district court granted the motion to compel but authorized arbitration on a class basis.  The Ninth Circuit affirmed, reasoning that the arbitration provision was ambiguous as to class arbitration and must be construed against the employer under California’s contra proferentem rule that ambiguities in a contract must be

Questions Regarding Cy Pres Settlements Remain after Frank v. Gaos

Today, in a case that was being watched closely for its potential ramifications for class settlements, the Supreme Court opted not to address the merits of the cy pres issues that were presented to it.  Frank v. Gaos involved a settlement that would have distributed millions of dollars to cy pres recipients and class counsel, but no money to class members.  Objectors complained that the settlement did not comply with the requirement that class settlements be “fair, reasonable and adequate,” and the Supreme Court granted certiorari to resolve that issue.  It ultimately did not.

Instead, the Supreme Court, in a per curiam decision, vacated and remanded for the lower courts to address whether the named plaintiff had Article III standing in light of Spokeo, Inc. v. Robins.  After the district court rejected the argument the plaintiff lacked injury and thus standing to pursue its claim that Google violated federal law by

Supreme Court Unanimously Rejects Equitable Tolling of Rule 23(f)’s Time Limit to Petition for Interlocutory Appeal

Yesterday, the Supreme Court in Nutraceutical Corp. v. Lambert unanimously held that Rule 23(f) is not subject to equitable tolling. After the District Court for the Central District of California decertified a class of consumers who alleged that Nutraceutical’s marketing of a dietary supplement violated California consumer-protection law, plaintiff Lambert filed a motion for reconsideration, which the court subsequently denied. Fourteen days later, Lambert petitioned the Ninth Circuit Court of Appeals for permission to appeal the decertification order under Rule 23(f). Nutraceutical opposed Lambert’s petition, arguing that it was untimely because more than four months had passed since the court’s decertification order. The Court of Appeals, however, deemed the petition timely and accepted the appeal, stating that the Rule 23(f) fourteen-day deadline should be equitably tolled under the circumstances as the time limit is “non-jurisdictional, and that equitable remedies softening the deadline are therefore generally available,” and Lambert had acted diligently in moving for reconsideration and subsequently filing his petition within fourteen days after