The question of whether a class action is one for monetary relief or whether the monetary relief is “incidental” to broader injunctive or equitable relief triggers unique concerns for whether a class action can be maintained in the first instance, and if so, what protections need to be afforded to absent class members (i.e., those class members not before the court, but who will otherwise be bound by a court’s decision). The New York Court of Appeals recently analyzed this question in the context of a proposed class action settlement, and its approach is instructive to how New York law may follow—and may diverge from—federal law in the areas of class actions.

While both Article 9 of the New York Civil Practice Law and Rules (Article 9) and Federal Rule of Civil Procedure 23 (Rule 23) govern the requirements for maintaining class actions in New York state courts and U.S. federal courts respectively, there remain significant differences that require a practitioner’s attention when litigating class actions in state court. Indeed, while Article 9 does not have the robust jurisprudence of its federal counterpart, the New York Court of Appeals has historically been guided by decisions interpreting its federal counterpart while at the same time recognizing material differences between the two statutory schemes. The most recent example of this is the case of Jiannaras v. Alfant, No. 64, 2016 N.Y. LEXIS 1062 (N.Y. May 5, 2016), decided on May 5, 2016. In Jiannaras, the New York Court of Appeals reiterated its position that Article 9 is a unique statute with material differences from Rule 23. Id. at *6-*7. However, the New York Court of Appeals also maintained that it remains ready to interpret New York’s class action rule consistent with the federal courts, especially where issues of due process are concerned. Id.

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