Last week, the Rule 23 Subcommittee of the Federal Rules Advisory Committee published its draft concept amendments to Rule 23. You can find them here. (They’re in the April 2015 Agenda Book.) What follows is my personal reaction to the proposed concept amendments. They will be subject to public comment, and, I imagine, vigorous further debate.
Here’s the good news. The Subcommittee has made two completely unobjectionable proposals. First, it would modify Rule 23(e) to require a statement of any side agreements before an objector withdraws an objection. Greater transparency is always good. Second, it would allow for emailed notice, which is a long-overdue recognition of the way technology has advanced since 1966.
The remainder of the Rule 23 Subcommittee’s Agenda Book appears to be a systematic attempt to undermine the caselaw that has curbed class action abuses over the last twenty years. Most notably:
Rule 23(b)(4). The Subcommittee admits that it is seeking to overturn Amchem, and take the predominance requirement out of settlement classes. In particular, it worries that it is too easy for objectors to invoke predominance as a means of blocking a proposed class settlement.
Rule 23(c)(4). The Subcommittee recommends amending Rule 23(b)(3) to state that it is subordinate to Rule 23(c)(4). This proposed amendment clearly contravenes both the legislative history and structure of Rule 23. It would also raise a number of very difficult policy questions with which the Subcommittee has not engaged.
Rule 68. The Subcommittee wants to put in language that would specifically state that Rule 68 offers of judgment don’t apply to class actions. Leave aside the fact that, as the Subcommittee admitted in its October 2014 Report, this won’t actually do anything to curb the “picking off” practice that frightens plaintiffs so. What it does do is to preserve the fiction that individual plaintiffs are in charge of class actions in an attempt to undermine the cost-limiting provision of Rule 68.
There are other provisions in the proposed amendments that should concern those who follow class actions closely, including an attempt to formalize cy pres relief (which I imagine will agitate Professor Redish), and provisions to sanction objectors.
In general, these amendments reflect the stated view of at least one of the Subcommittee’s members that class actions have become too difficult to certify. And that places them at odds with the Supreme Court’s stated view that class actions should be difficult to certify.
Here’s the thing: the class action is a great device for vindicating the rights of large numbers of people in certain circumstances. But they only work when they are conducted according to due process. The requirements of Rule 23 are not simply technical obstacles to bringing group cases, they ensure that the cases certified can actually bind absent class members, both as a constitutional and a practical matter. Abolishing the predominance requirement, either overtly or covertly, will do little to make class actions more effective. It will just enrich plaintiffs’ lawyers at the expense of absent class members. So my personal reaction is disappointment: the Subcommittee is full of smart people whom I believe are sincere in wanting to improve the lot of the absent class member. That’s why it’s so unfortunate that they fell so short.