Whole Food Market headquarters, in Austin, Texas.

A federal appeals court has punted on a growing debate over whether a key U.S. Supreme Court ruling limiting personal jurisdiction should apply to class actions.

The U.S. Court of Appeals for the D.C. Circuit upheld a lower court decision refusing to dismiss a class action against Whole Foods based on the Supreme Court's 2017 holding in Bristol-Myers Squibb v. Superior Court of California. At oral arguments last September, the panel appeared likely to dodge the question, and, in a 2-1 opinion Tuesday, the majority found that the case was premature, because the class action was not certified.

"Absent class certification, putative class members are not parties before a court, rendering the defendant's motion premature," wrote Judge David Tatel for the majority, which also included Chief Judge Merrick Garland. "Putative class members become parties to an action—and thus subject to dismissal—only after class certification."

Plaintiffs attorney Matthew Wessler, a principal at Gupta Wessler in Cambridge, Massachusetts, wrote in an email, "We're pleased the D.C. Circuit affirmed and made clear that defendants cannot use Bristol-Myers to try to dismiss class actions at the beginning of the case."

In a lengthy dissent, however, Judge Laurence Silberman provided the first appellate view on the growing debate, concluding that Bristol-Myers should apply to class actions, including the case at issue.

"A court that adjudicates claims asserted on behalf of others in a class action exercises coercive power over a defendant just as much as when it adjudicates claims of named plaintiffs in a mass action," he wrote.

In a critical distinction from the majority as to the case, he also concluded that Texas-based Whole Foods had sought to dismiss the claims of class members not resident in Washington, D.C.—not the class members themselves.

Whole Foods attorney Gregory Casas, a shareholder at Greenberg Traurig in Austin, Texas, declined to comment, and Whole Foods did not respond to a request for comment.

Cory Andrews, vice president of litigation at the Washington Legal Foundation, which filed an amicus brief supporting Whole Foods, called the opinion an "excellent candidate for en banc rehearing."

"It would be difficult to improve on Judge Silberman's cogent dissent," Andrews wrote in an email. "He gets the better of the argument at every turn. Whole Foods didn't ask the district court to dismiss the claim that the plaintiffs are entitled to represent a class (that comes later in the proceedings). Instead, Whole Foods asked the district court to dismiss those claims alleging injuries occurring outside the jurisdiction of the court. That issue is fully ripe, regardless of certification, and the court should have decided it. It won't be able to avoid addressing the merits of the defendant's argument forever."

The decision comes in one of two cases now on appeal over Bristol-Myers and class actions. The U.S. Court of Appeals for the Seventh Circuit has yet to rule in a second, in which the defendant, IQVIA Holdings Inc., argued last September to affirm dismissal of a class action based on Bristol-Myers.

In Bristol-Myers, the Supreme Court held that most of the 600 plaintiffs in a mass action over the blood thinner Plavix had failed to establish specific jurisdiction, because there wasn't enough of a link between their claims and California, where they brought their lawsuit in state court. But in a footnote to her dissent, Justice Sonia Sotomayor noted that the majority's opinion, in a case involving a mass action, failed to address its impact on nationwide class actions. On that question, judges have divided, and no federal appeals court has ruled on the issue.

In addition to the Washington Legal Foundation, the U.S. Chamber of Commerce filed an amicus brief supporting Whole Foods, while Public Citizen Inc. sided with the plaintiffs, who are seven current and former Whole Foods employees in the District of Columbia and five other states. They alleged that Whole Foods failed to pay bonuses under a "gainsharing" incentive program, which compensated employees for keeping their departments under budget. The case, filed in 2016, alleges the wrongdoing was nationwide, despite Whole Foods firing employees at nine of its 457 stores.

Public Citizen attorney Scott Nelson called the decision "correct as far as it goes, but it doesn't go very far. It leaves the hard questions for later, but properly so given that dismissing claims and parties that aren't before the Court would be premature."

In Tuesday's decision, the majority took up an issue that the plaintiffs raised for the first time on appeal: that the judge, U.S. District Judge Amit Mehta of the District of Columbia, had not yet certified the class action.

Tatel insisted that Whole Foods, in an "unconventionally framed" motion, had moved to dismiss the unnamed class members prematurely.

Silberman, however, said the Federal Rule 23 of Civil Procedure, which governs class actions, is not "an adequate substitute for normal principles of personal jurisdiction," and whether unnamed class members were parties was irrelevant.

"That is a run-of-the-mill attack on class certification at the pleading stage, and such a motion was not premature," he wrote. "The motion did not ask for dismissal of any person, let alone the putative class members."

Unlike the majority, he added, he would not have adopted a position the plaintiffs first raised on appeal—a move he called "gratifying the musings of judges acting like law professors or worse yet, activist policymakers."