The 7th Circuit recently vacated a 25% attorneys’ fee award in In re Stericycle Securities Litigation, No. 20-2055, 2022 WL 1564997, at *1–14 (7th Cir. May 18, 2022).  The Court’s reasoning focused on the previous litigation against the defendant.

Years before this litigation, a former Stericycle employee brought a qui tam action under the False Claims Act with similar claims.  Various settlements with governments and private customers followed.

Continue Reading Seventh Circuit Vacates 25% Attorneys’ Fee Award

The 7th Circuit in Schutte v. Ciox Health, LLC., construed the Local Controversy Exception to the Class Action Fairness Act.[1]  CAFA’s Local Controversy Exception applies, in pertinent part, if “during the 3-year period preceding the filing of that class action, no other class action has been filed asserting the same or similar factual allegations against any of the defendants, on behalf of the same or other persons.”[2]  The Court interpreted this requirement broadly, finding that even when cases with different legal theories had been filed in different states, courts may refuse to remand if there are “the same or similar factual allegations” in those cases.  There are three other situations that trigger the Local Controversy Exception[3] but the court did not address them.

Continue Reading Seventh Circuit Construes CAFA Exception for the First Time

A recent Ninth Circuit decision—In re Cathode Ray Tube Antitrust Litig., 20-15697, 2021 WL 4306895 (9th Cir. Sept. 22, 2021)—that prevented a group of plaintiffs from challenging the approval of a settlement award in a price-fixing case might be on its way to the Supreme Court.   Although non-precedential, the case reflects continuing uncertainty as to the status of intervention rights in class settlements.

Continue Reading Ninth Circuit Case Reflects Split Judicial Landscape Regarding Intervenors’ Appellate Rights in Class Settlements

In 1988 Trust for Allen Children Dated 8/8/88 v. Banner Life Insurance Co., 2022 WL 774731 (4th Cir. Mar. 15, 2022), the Fourth Circuit identified the correct burden of proof required for a party to object to a proposed class action settlement under Federal Rule of Civil Procedure 23(e)(5).

Continue Reading Fourth Circuit Outlines Burden of Proof for Objector to Class Action Settlement

Last week, the Court of Appeals for the Seventh Circuit issued an opinion clarifying the distinction between two distinct, but often closely related concepts: Article III standing and the more prudential doctrine known as “antitrust standing.”

Continue Reading Seventh Circuit Stresses the Distinction Between Article III Standing and Antitrust Standing

In Ruhlen v. Holiday Haven Homeowners, Inc., 11th Cir. No. 21-90022, 2022 WL 701622 (11th Cir. Mar. 9, 2022), the Eleventh Circuit denied a petition for permission to appeal a district court’s sua sponte remand of a case to state court.

Initially, this case was filed in Florida state court by a group of current and former mobile homeowners and their homeowners’ association. The basis for plaintiffs’ claims were violations of the Florida Antitrust Act and the Americans with Disabilities Act (“ADA”). Plaintiffs characterized their suit as a representative action under Florida Rule of Civil Procedure 1.222, which allows a mobile homeowner’s association to bring a class action suit in a representative capacity.

Continue Reading Eleventh Circuit Denies Petition to Appeal a Sua Sponte Remand of a “Class Action”

On a question of first impression in the Fourth Circuit, McAdams v. Robinson, 2022 WL 401806 (4th Cir. Feb. 10, 2022) concluded that absent class members[1] objecting to a magistrate judge’s jurisdiction over settlement are not “parties” under 28 U.S.C. § 636(c).  So a magistrate judge does not need the consent of an absent class member to rule on settlement.

Continue Reading Fourth Circuit Upholds Class Settlement Despite Absent Class Member’s Objections to Notice, Fees, and Scope of Release

In Arkansas Teacher Retirement System v. State Street Corporation, — F.4th —-, 2022 WL 391450 (1st Cir. Feb. 9, 2022), the First Circuit Court of Appeals upheld a district court’s sanction of law firm Lieff Cabraser Heimann & Bernstein LLP (“Lieff Cabraser”) related to class action attorney’s fees.

Lieff Cabraser, along with several other firms, represented a class of investors in a challenge to charges imposed on foreign exchange products.  After years of litigation and mediation, the parties reached a settlement of $300 million.  Relying on representations made by class counsel, the district court awarded class counsel almost $75 million—roughly 25% of the total settlement.

Continue Reading First Circuit Upholds Sanctions Related to Attorney’s Fees

As we touched on last summer,[1] whether a district court may certify a class action without resolving challenges to the admissibility of fact or expert evidence is still an unsettled question.  This question is particularly important with respect to expert evidence, given that class certification frequently hinges on competing experts’ opinions regarding the propriety of an aggregate action.  If an expert’s opinion is deemed inadmissible, the party proffering it is almost certain to be on the receiving end of an adverse certification ruling.

Continue Reading Northern District of Ohio Holds Expert Evidence Must Be Admissible to Be Considered at Class Certification