STANDING TO SUE AND CLASS ACTION CERTIFICATION: PART 1.

    Recent lawsuits have raised the question of whether the plaintiffs have standing to sue.  For example, questions have been raised about whether the four named plaintiffs have sufficiently alleged damage in their alleged class action presenting the latest challenge to Obamacare.  The questions were summarized here on February 12 and on February 15, 2015.  Moreover, it is a real question whether several States have standing to sue as plaintiffs in the latest iteration of challenges to immigration in a Federal Court in South Texas.

    Class actions present a mixture of Constitutional questions involving standing, and issues about how the Federal Courts handle class action certification.  An understanding of class action procedures is very helpful to this dicussion, and no better explanation has been given recently than by the Federal District Judge in the lender force-placed insurance case of Wilson v. EverBank, N.A., No. 14-CIV-22264, ___ F. Supp. 3d ___, 2015 WL 265648 (S.D. Fla. January 6, 2015).

    The Wilson Court's explanation cannot be stated more clearly than the Court itself stated it.  Accordingly, for the benefit of the readers of Insurance Claims and Bad Faith Law Blog, here is the unfiltered explanation given by a U.S. District Court of Federal class action procedures, which begins at page *16 and, in this first part of this article, continues through the top of page *18 of the Wilson decision filed on January 6, 2015:

A named plaintiff “in a class action who cannot establish the requisite case or controversy between himself and the defendants simply cannot seek relief for anyone—not for himself, and not for any other member of the class.” Griffin v. Dugger, 823 F.2d 1476, 1483 (11th Cir. 1987). “It is not enough that a named plaintiff can establish a case or controversy between himself and the defendant by virtue of having standing as to one of many claims he wishes to assert. Rather, each claim must be analyzed separately, and a claim cannot be asserted on behalf of a class unless at least one named plaintiff has suffered the injury that gives rise to that claim.”  Prado-Steinman ex rel. Prado v. Bush, 221 F.3d 1266, 1280 (11th Cir. 2000).

However, following Klay v. Humana, Inc., 382 F.2d 1241 (11th Cir. 2004), provided that the named plaintiff articulates a redressable injury suffered as a result of the defendant's conduct and that her claims are based on principles of law that are uniform among the states that are involved, courts in this Circuit permit named plaintiffs to represent class members with claims arising under other states' laws. See Klay, 382 F.2d at 1262 (“if a claim is based on a principle of law that is uniform among the states, class certification is a realistic possibility”); In re Checking Account Overdraft Litig., 275 F.R.D. 666 (S.D. Fla. 2011) (certifying nationwide class with common law claims represented by Plaintiffs from New York, California, and Washington, finding “Plaintiffs' claims arise out of the same course of conduct and are based on the same legal theories as those of the absent class members”).

As the Supreme Court has explained, it is appropriate to defer standing objections until after class certification where certification issues are “ ‘logically antecedent’ to Article III concerns.”  Ortiz v. Fibreboard Corp., 527 U.S. 815, 831 (1999). Thus, there is a strong consensus in favor of “treat[ing] class certification as logically antecedent to standing where class certification is the source of the potential standing problems.”  In re Grand Theft Auto Video Game Consumer Litig. (No. II), 2006 WL 303993, at *2 (S.D.N.Y. Oct. 25, 2006); see also In re Bayer Corp. Combination Aspirin Prods. & Mktg. Sales Practices Litig., 701 F. Supp. 2d 356 (E.D.N.Y. 2010) ( “Whether the named plaintiffs have standing to bring suit under each of the state laws alleged is ‘immaterial’ because they are not bringing those claims on their own behalf, but are only seeking to represent other, similarly situated consumers in those states.”); In re Polyurethane Foam Antitrust Litig., 799 F. Supp. 2d 777, 806 (N.D. Ohio 2011) (explaining that whatever standing issues may arise as a result of the assertion of parallel state common law claims will be resolved in considering class certification). This makes sense. Where a named plaintiff has established individual standing to bring specific claims against a defendant in his or her own right, but asserts parallel common law claims arising under different states' laws on behalf of a putative class, the plaintiff is not “attempting to piggy-back on the injuries of the unnamed class members.”  Winfield v. Citibank, N.A., 842 F. Supp. 2d 560, 574 (S.D.N.Y. 2012).  Thus:

the issue is not whether the named plaintiff has standing to sue the defendant, but whether his or her injuries are sufficiently similar to those of the purported class to justify the prosecution of a nationwide class action, which is properly determined at the class certification stage, when th[e] [c]ourt may consider commonality and typicality issues with respect to the named plaintiffs and other putative class members.

Id. at 214 (quotation omitted).

End of Part 1.  Please Read The Disclaimer.  Copyright 2015 by Dennis J. Wall.  All rights reserved.  No claim to Original U.S. Government Works.

 

 

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