This document summarizes recent issues and developments in class action litigation. It discusses certifying class actions for less than predominantly common issues and damages, practical and constitutional problems with this approach, and recent trends in scrutinizing class action settlements, including concerns about notice to class members, valuing class benefits, and attorneys' fees awards.

1. Issues and Developments in Class
Action Litigation
October 2015
EXCERPT
The information provided in this presentation is not legal advice and does not
create an attorney-client relationship. It is for general purposes only and should
not be interpreted to indicate a certain result will occur in your specific legal
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applicable rules of certain states.

2. Issue Class Certification
Susan Razzano

3. What Is New
• Certifying less than predominantly common issues in
a damages class
• Rule 23(c)(4)(A) provides that “[w]hen appropriate,
an action may be brought or maintained as a class
action with respect to particular issues”
(emphasis added).
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4. Practical Problems
• The text of Rule 23 does not support this
• What does “appropriate” mean?
• Narrowly-sliced issues …
▫ Leave the mass of issues in a case unresolved
▫ Produce a judgment a class member might not know what
to do with
• Probably impossible for multi-state classes
• Negative value suits …
▫ Present the strongest rationale for issue class treatment
▫ Yet the class trial necessarily would be pointless
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5. Constitutional Problems
• Cohesiveness & one’s day in court
• Severing issues weakens strong claims and
strengthens weak ones
▫ General causation v. specific causation
• The Seventh Amendment
• Adequacy of notice
▫ Explaining abstract issues
▫ Explaining what should happen after an abstract issue
trial
• Claim-splitting and claim/issue preclusion
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6. Settlement Class Actions
Recent Trends and Key
Considerations for Avoiding
Objections and Obtaining Approval of
Settlement Class Actions
Susan Razzano

7. Scrutiny of
Class Action Settlements
By Judges
• At settlement phase, Judges are viewed as “a fiduciary
of the class.”
• Abuse of discretion standard, but appellate courts
demand vigilance by district court.
• Concern about the incentive of class counsel and
defense counsel to “sell out the class.”
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8. Scrutiny of
Class Action Settlements
By Objectors
• Only class members may object. FED. R. CIV. P. 23(e)(5).
▫ Professional objectors – extract more money
▫ Class action watchdogs – policy and fairness grounds
• Common Grounds for Objecting
▫ Excessive attorneys’ fees
▫ Inadequate or illusory class compensation
▫ Inadequate notice
▫ Cy Pres
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9. Notice
Direct Notice
• Gold Standard: First-class mail
• Additional precautions for email notice
▫ Attention-grabbing subject lines
▫ Spam filters
▫ “Bounce back”
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10. Notice
Indirect Notice
• Publication Notice: must be tailored
to the class
• Social Media: must demonstrate that
class members use it
• Internet Banners: FJC Checklist cautions judges to
be wary of this form of notice
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11. Notice
Complexity of Claims Form/Process
• Simplified and uncomplicated claim forms
• Ease of submission
• Reasonable proof requirements
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12. Valuing Class Benefits
• Review of actual claim rates vs. hypothetical
maximum
• Coupons for future purchases are suspect
• Scrutiny of non-monetary benefits
▫ Administrative costs should not be part of the
valuation
▫ Extended warranties: illusory benefit if company is
already providing
▫ Injunctions: suspect if damages originally sought
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13. Attorneys’ Fees
• Courts have an obligation to ensure
the award is reasonable
▫ Even if the parties have already agreed to the amount
▫ Relevant calculation: ratio of fee to what class
members actually received vs. total possible maximum
recovery
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