Today’s case, Critchfield Physical Therapy, P.C. v. Techhealth, Inc., 2013 U.S. Dist. LEXIS 13440 (E.D. Mo. Feb. 1, 2013), is a short one, but it contains a valuable lesson.
Critchfield filed a class action against Techhealth. The basis of the lawsuit was not important enough for the court to mention in this opinion. What was important was that a mediation conference was scheduled in the case. A representative of Techhealth attended, as did its counsel. But on the plaintiff’s side, only plaintiffs’ counsel showed up. This is not an unusual arrangement in a class action: I have attended several class mediations over the years where I brought my client along, but plaintiffs’ counsel (the real party in interest, as some courts acknowledge) did not.
In this case, however, the defendant demanded that the actual plaintiff show up. (A canny move, given that the plaintiff may well have different ideas of acceptable remedies–and acceptable fees–than its counsel.) When counsel refused, claiming that a representative was available by phone, the defendant shut down the mediation.
Then it moved for sanctions.
The court granted the motion. As it reasoned:
both Local Rule 6.02(B)(1) and the Order referring the case to mediation in this case required that a corporate representative of Plaintiff having authority to settle claims attend the mediation in person, unless otherwise agreed to by the parties or excused by the court. Attendance in person by the parties is not a mere technicality. It is what ensures a meaningful mediation and is the cornerstone of good faith participation. Merely "being available" by phone does not satisfy this requirement. Furthermore, the Court discerns no reason why there should be an exception for a named plaintiff in a putative class action. Such an exception would run contrary to a class representative’s obligations as a representative of the class.
(Emphasis added; internal citations and quotations omitted.) The court did, however, reduce the sanctions by 30% because the defendant could have called the court during the mediation to resolve the issue, saving some costs.
So what’s the takeaway? Plaintiffs are not optional in class actions, not even in settlement talks. Including the plaintiffs may well reduce costs (and fees) over time.