In a significant appeal decided on March 31 — largely ignored by the media — a plurality of justices in Shady Grove Orthopedic Associates P.A. v. Allstate Insurance Co. rescued federal class actions from withering demise at the hands of the states. The media are to be forgiven, however, as Shady Grove turned on a nuanced Erie problem, a jurisprudential doctrine that defies witty sound bites and easy summarization. Even Justice Antonin Scalia, delivering the plurality opinion, noted: “Eyes glaze over.”
The Court decided that Federal Rule of Civil Procedure 23 takes precedence in federal diversity class actions and pre-empts state statutory provisions that limit class litigation. Shady Grove, however, is muddled by an array of decisions, with the alignment of justices defying ideological predispositions. Thus, Justice Sonia Sotomayor joined Scalia, Justice Clarence Thomas and Chief Justice John Roberts Jr. to save the federal class action; Justice Samuel Alito Jr. joined dissenting justices Ruth Bader Ginsburg, Anthony Kennedy and Stephen Breyer in support of state prerogative.
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