The Supreme Court’s Vindication of The In re Nexium Dissent

We have commented previously on several aspects of the Supreme Court’s recent decision in Tyson Foods.  One additional important aspect that deserves special attention in the First Circuit is the issue of how to cull uninjured class members prior to judgment, an issue a divided panel of the First Circuit addressed in In re Nexium last year.

On the central general principle, all of the various opinions in the two cases agree: a case cannot result in a judgment that awards damages to uninjured persons.  As Chief Justice Roberts said in concurrence, “Article III does not give federal courts the power to order relief to any uninjured plaintiff, class action or not.”  In important respects, though, the Supreme Court’s decision in Tyson Foods appears to be inconsistent with the majority opinion in In re Nexium.

The Supreme Court clearly agreed with the procedural point made by the In re Nexium dissent: an appellate court is not well positioned to fashion culling mechanisms in the first instance, a decision that should instead be entrusted to the district court.  So far as it goes, that procedural finding is neither surprising nor particularly likely to arise in most future cases.  But the Supreme Court’s care in taking that step – and the debate that the majority’s dicta on the issue touched off – highlights a likely substantive inconsistency between the Supreme Court and the majority opinion in In re Nexium.

Specifically, the Supreme Court does not appear to share the In re Nexium majority’s view that one could solve culling problems with novel approaches such as permitting the submission of unchallenged, self-serving affidavits.  The concurring opinion stated expressly that, even in a case where a jury has already heard the evidence and issued an award, the court must “ensure that the jury’s damages award goes only to injured class members.”  And, in suggesting “invited error” as a procedural workaround to this potential problem, the majority seemed to recognize that making some plausible guesses at what the jury might have been thinking in order to come up with an allocation approach generally would be impermissible.  If making a reasonable choice between a few plausible findings by a jury is impermissible, it is hard to see how permitting unchallenged affidavits could be okay.

One other small, but important, inconsistency bears noting.  The Supreme Court certainly seems to believe that it is the plaintiff that has the burden to show a permissible culling methodology.  As the dissent pointed out in In re Nexium, the majority there seemed instead to shift the burden to the defendant to show that no culling is possible.  On this particular issue, burden could matter quite a lot.