November 21, 2011 Articles

The End of Federal Injunctions of State Certification?

A recent Supreme Court ruling suggests that federal courts are never authorized to enjoin state-court, class-action proceedings, at least under the re-litigation exception.

By Stuart M. Feinblatt

Undoubtedly, one of the most challenging aspects of management in class-action litigation is when multiple, overlapping, competing class actions relating to essentially the same conduct or activities are all filed in state and federal court. In particular, when a hard-fought federal class-action, national in scope, results in a determination that a class cannot be certified, what effect should that ruling have on other pending and related class actions in which the class-certification decision has not yet been reached? Certainly, overlapping class actions can create several forms of mischief. For example, the ABA Task Force on Class Action Legislation noted in 2003 that “[s]uch overlapping class actions consume unnecessary litigation resources, encourage ‘gaming’ of court filings, and risk inconsistent treatment of like cases.”

One potential solution is to allow the first court to reach a class-certification decision to enjoin other courts from addressing the same issue in related cases. The propriety of such an injunction is particularly vexing when a federal court seeks to enjoin a parallel proceeding in a state court. This issue was recently addressed by the U.S. Supreme Court in Smith v. Bayer Corp., 131 S. Ct. 2368 (2011).

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