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July 31, 2017 Practice Points

Takeaways from the Fourth Annual Western Regional CLE Program on Class Actions and Mass Torts

As a recent law-school graduate, I learned a great deal from both the formal presentations and my discussions with attorneys.

By Jonathan Udell – July 31, 2017

On June 16, 2017, the Consumer Litigation Committee joined four other Section of Litigation committees in hosting several dozen attorneys who attended the Fourth Annual Western Regional CLE Program on Class Actions and Mass Torts in San Francisco. The program consisted of four presentations by prominent practitioners on issues relevant to both plaintiff-side and defense-side class-action attorneys. Although the food, drink, and conversation that bookended the event were also enjoyable, this article will focus on several key takeaways from the event’s panel discussions.

First, the presenters detailed how the class-action procedure is changing. During the event’s first presentation, Professor Richard Marcus, who sits on the Civil Rules Advisory Committee for the Judicial Conference of the United States, described various modifications that may emerge from the committee or Congress in the coming year. The Advisory Committee’s efforts have recently been focused in part on amendments to Rule 23 directed to class-action settlements. In addition to establishing the criteria for permissible settlements, and specifying the information parties must provide to courts regarding proposed settlements, the proposed amendments to Rule 23 would also forbid parties from paying objectors to a settlement (or their attorneys) without receiving court approval. Professor Marcus invited the program’s attendees to submit comments regarding the proposed amendments. The panel further discussed the proposed expansive changes to Rule 23 through the Fairness in Class Action Litigation Act currently under Congressional consideration. Among other changes, the bill would (1) require any class seeking monetary relief to have suffered injuries of similar scope, (2) prohibit courts from certifying classes that lack administrative feasibility, (3) alter attorney-fee awards, and (4) restrict eligibility for named plaintiffs. The House Liberty Caucus and Democrats united against the bill in the House of Representatives, but it still passed the House by a 220–201 margin. The bill currently awaits consideration by the Senate Judiciary Committee.

Program panelists also discussed how practitioners are still grappling with the implications of Comcast Corp. v. Behrend, 133 S. Ct. 1426 (2013). In Comcast, the Supreme Court arguably held that plaintiffs must always set out a common damages model to justify class certification. Many courts, however, have construed the decision differently, holding that while class-wide models bolster a case for predominance, they are not always necessary. These courts read Comcast as merely forbidding plaintiffs from relying on models untethered to their theory of liability. Much of the CLE’s third presentation centered around one response to Comcast, conjoint analyses—which is a survey-based technique that seeks to determine a false claim’s impact on product pricing—and whether such analyses represent an adequate model for calculating class-wide restitution. One attorney at the event argued that they often amount to junk science, while an economics expert largely defended them, although he acknowledged their occasional imperfections.

Finally, panelists spoke on the prospect of privacy-based class actions multiplying as the “Internet of Things” becomes more pervasive. While Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016) injected a measure of confusion into data-breach class actions, another breed of high-tech privacy litigation has grown. These cases involve allegations of companies directly invading consumers’ privacy, rather than hackers breaching large companies’ insecure databases. In these cases, plaintiffs can often present more compelling accounts of actual harm. For example, In re Lenovo Adware Litig., 2016 WL 6277245 (Oct. 27, 2016) arose out of a computer manufacturer’s alleged failure to disclose that its laptops came with pre-installed software that monitored users’ online activity. The plaintiffs alleged that the failure to disclose drove up the cost of the laptops because fewer people would have bought them if they knew about the pre-installed software. The court certified several classes on this theory. According to Rafey Balabanian, who represented plaintiffs in the Lenovo Adware Litigation and participated in the CLE program, similar cases will likely appear in the future, as the Internet of Things grows more prominent.

As a recent law-school graduate, I learned a great deal from both the formal presentations and my discussions with attorneys before and after the Western Regional CLE Program on Class Actions and Mass Torts. Undoubtedly, however, attorneys of all ages and levels of experience can benefit from attending the program, which is an annual event and will return next year.

Jonathan Udell is with Rose Law Group in Scottsdale, Arizona.

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