DC Circuit Punts on Whether Bristol-Myers Applies to Class Actions
The 2-1 ruling found that Whole Foods' dismissal motion, based on the U.S. Supreme Court's decision in Bristol-Myers Squibb v. Superior Court of California, was premature. But in a lengthy dissent, Judge Laurence Silberman found that Bristol-Myers should have applied to the class action.
March 10, 2020 at 04:18 PM
5 minute read
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."
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View All'Appropriate Relief'?: Google Offers Remedy Concessions in DOJ Antitrust Fight
4 minute read'Serious Disruptions'?: Federal Courts Brace for Government Shutdown Threat
3 minute read'Unlawful Release'?: Judge Grants Preliminary Injunction in NASCAR Antitrust Lawsuit
3 minute read'Almost Impossible'?: Squire Challenge to Sanctions Spotlights Difficulty of Getting Off Administration's List
4 minute readLaw Firms Mentioned
Trending Stories
- 1The Key Moves in the Reshuffling German Legal Market as 2025 Dawns
- 2Social Media Celebrities Clash in $100M Lawsuit
- 3Federal Judge Sets 2026 Admiralty Bench Trial in Baltimore Bridge Collapse Litigation
- 4Trump Media Accuses Purchaser Rep of Extortion, Harassment After Merger
- 5Judge Slashes $2M in Punitive Damages in Sober-Living Harassment Case
Who Got The Work
Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
Who Got The Work
Edmund Polubinski and Marie Killmond of Davis Polk & Wardwell have entered appearances for data platform software development company MongoDB and other defendants in a pending shareholder derivative lawsuit. The action, filed Oct. 7 in New York Southern District Court by the Brown Law Firm, accuses the company's directors and/or officers of falsely expressing confidence in the company’s restructuring of its sales incentive plan and downplaying the severity of decreases in its upfront commitments. The case is 1:24-cv-07594, Roy v. Ittycheria et al.
Who Got The Work
Amy O. Bruchs and Kurt F. Ellison of Michael Best & Friedrich have entered appearances for Epic Systems Corp. in a pending employment discrimination lawsuit. The suit was filed Sept. 7 in Wisconsin Western District Court by Levine Eisberner LLC and Siri & Glimstad on behalf of a project manager who claims that he was wrongfully terminated after applying for a religious exemption to the defendant's COVID-19 vaccine mandate. The case, assigned to U.S. Magistrate Judge Anita Marie Boor, is 3:24-cv-00630, Secker, Nathan v. Epic Systems Corporation.
Who Got The Work
David X. Sullivan, Thomas J. Finn and Gregory A. Hall from McCarter & English have entered appearances for Sunrun Installation Services in a pending civil rights lawsuit. The complaint was filed Sept. 4 in Connecticut District Court by attorney Robert M. Berke on behalf of former employee George Edward Steins, who was arrested and charged with employing an unregistered home improvement salesperson. The complaint alleges that had Sunrun informed the Connecticut Department of Consumer Protection that the plaintiff's employment had ended in 2017 and that he no longer held Sunrun's home improvement contractor license, he would not have been hit with charges, which were dismissed in May 2024. The case, assigned to U.S. District Judge Jeffrey A. Meyer, is 3:24-cv-01423, Steins v. Sunrun, Inc. et al.
Who Got The Work
Greenberg Traurig shareholder Joshua L. Raskin has entered an appearance for boohoo.com UK Ltd. in a pending patent infringement lawsuit. The suit, filed Sept. 3 in Texas Eastern District Court by Rozier Hardt McDonough on behalf of Alto Dynamics, asserts five patents related to an online shopping platform. The case, assigned to U.S. District Judge Rodney Gilstrap, is 2:24-cv-00719, Alto Dynamics, LLC v. boohoo.com UK Limited.
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250