Court of Appeals Decision Raises the Bar for Class Certification
One of the most costly forms of litigation is a class action suit filed against a company or manufacturer by a large group of people claiming an alleged defect that caused harm. In order for a class action suit to be filed, the class must be “certified” by a court. The Eleventh Circuit Court of Appeals just raised the proverbial bar for parties seeking class certification. The court’s opinion in Brown v. Electrolux Home Products, 2016 WL 1085517 (11th Cir. Mar. 21, 2016) reversed a district court’s order granting class certification for alleged violations of California and Texas consumer protection acts and breach of warranty claims.
The Court rescinded the class certification largely because a “causation” element necessary to establish consumer protection claims required individual proof. The class was relying on the less burdensome “common” proof to move forward with its case. The Eleventh Circuit determined that the lower court incorrectly decided that the consumer protection claims made by the class satisfied the predominance requirement codified in Federal Rule of Civil Procedure 23(b)(3). The lower court stated that there were common questions of law and fact necessitating class-wide proof.
The Eleventh Circuit reversed finding that the consumer protection claims did not meet the standard for class certification because certain claimants were not exposed to a uniform misrepresentation and other members of the class had to establish actual reliance on misrepresentations prior to the class being certified. Therefore, the Eleventh Circuit held that the class failed to prove causation on a class-wide basis and vacated the class certification.
The Court’s opinion is a sea-change since it overrules numerous federal cases that decided in favor of plaintiffs and class certification by eliminating the notion that the plaintiffs’ allegations in a complaint are accepted as true and any doubts actually should go in favor of class certification.
The Eleventh Circuit, citing a recent Supreme Court decision, stated that “the presumption is against class certification because class actions are an exception to our constitutional tradition of individual litigation.”
The Eleventh Circuit’s opinion is a victory for defendants being subjected to class action litigation. The decision effectively raises the bar by placing the burden on claimants seeking class certification to produce sufficient evidence, prior to certification, that would enable to a district court to thoroughly examine the elements of the claim and decide that there is individual proof for the action to move forward. Furthermore, the Court’s opinion eliminated any advantage or “benefit of the doubt” previously afforded to claimants seeking class certification.
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