“For lo the Winter is past, the rain is over and gone.” Song of Solomon, 2:11. Except it’s not gone. The torrents of Spring have arrived in the Delaware Valley. Yesterday was dank and stormy, and it shows no signs of letting up. “There is a sound of abundance of rain.” Kings, 18:41. We do
Yesterday, we reported on the federalism aspects of Rhodes v. E.I. du Pont de Nemours & Co., 636 F.3d 88 (4th Cir. 2011). We mentioned in that post that another interesting aspect to Rhodes involved the dismissal of the medical monitoring claims. Here’s what that’s about.
What happened is this:
First, the trial court
To the surprise of precisely nobody, including – according to 360 (subscription required), the plaintiffs’ lawyers themselves – certification of a class action in the Yazmin/Yaz MDL has been denied. See In Re Yasmin & Yaz (Drospirenone) Marketing, Sales Practices & Relevant Products Liability Litigation,
Today the Eleventh Circuit vacated the certification of a Florida consumer protection (FDUTPA) class action in Fitzpatrick v. General Mills, Inc., ___ F.3d ___, No. 10-11064, slip op. (11th Cir. March 25, 2011). The complaint alleged false statements about the health benefits of Yoplait yogurt. The trial court has certified a class consisting of
You may have heard Einstein’s definition of insanity: doing the same thing over and over and expecting different results. Well, if that’s right, then squirrels must be looking for TPP plaintiffs, because they’re nuts at this point if they think they’re going to get a RICO class certified (in the Second Circuit, at least).
We’ve previously reported on the Second Circuit blowing out a putative class in Zyprexa; in fact, it came in number one on our 2010 Top Ten Opinions list. Now we have more good news to report: a Magistrate Judge Report & Recommendation finding class certification inappropriate in a RICO/consumer fraud class action involving Ketek. See Sergeants Benevolent Assn. Health & Welfare Fund v. Sanofi-Aventis U.S. LLP, Case No. 1:08-cv-00179-SLT-RER (E.D.N.Y. Feb. 16, 2011) (we’re just going to call it Ketek). Hat-tip to Gary Spahn for sending along the opinion.
Ketek is a prescription antibiotic; plaintiffs were third-party payors (TPPs) who alleged the defendant fraudulently marketed Ketek by misrepresenting its safety and efficacy, and when the “truth” came out, prescriptions of Ketek plummeted. Plaintiffs sued on behalf of a nationwide class of TPPs, alleging claims under RICO, the consumer protection laws of forty-four states, and “unjust enrichment.”
The magistrate’s report and recommendation addressed only the RICO claims and deferred the pendent state claims, as plaintiffs suggested. Slip op. at 8 and n.7. The magistrate, following Zyprexa, found that individual issues predominated and doomed class certification.Continue Reading Another TPP RICO Class Cert Denial
Just a quickie post about today’s Supreme Court oral argument in Smith v. Bayer, a copy of the transcript here. This is the case where the, once the Baycol MDL had denied class certification, the plaintiffs tried for certification of an identical class in West Virginia state court.
In the interim, as we
Twenty-one million dollars is an awful lot of moola. Sure, it probably won’t even buy you one (at least towards the end of that contract) year of Cliff Lee befuddling opposing batters (yeah, we’re still feeling good about that). But in almost any situation, $21 million would seem like a pretty significant chunk of change.
But context is everything.
So we think everyone would agree with us, that $21 million seems like a relatively tiny sum compared to the catastrophic devastation wrought by Hurricanes Katrina and Rita a few years ago. Yet $21 million was the insurance policy limit for a group of defendants in Katrina-related litigation. And, not coincidentally, $21 million was the amount to be paid to proposed class members pursuant a “limited fund” class that was just bounced by the Fifth Circuit. See In re Katrina Canal Breaches Litig., No. 09-31156, slip op. (5th Cir. Dec. 16, 2010).
Our skepticism meters zoom whenever we hear “limited fund” in the same sentence as “mass tort.” It all goes back to the Bone Screw Litigation, where the fix was in over a supposed “limited fund” class action involving one of our co-defendants. The trial court let both sides get away with it, see In re Orthopedic Bone Screw Products Liability Litigation, 176 F.R.D. 158 (E.D. Pa. 1997), and any objectors were either bought off or scared off. Within a week of the settlement becoming final – guess what happened? The supposed “limited fund” company was sold for three times the amount of the [fill in adjective] limited fund. We concluded then that limited fund settlements in mass torts are rife with potential for abuse, and in Katrina Canal, the court of appeals pretty much agreed with us.
The decision provides valuable lessons, not only for parties trying to craft “limited fund” settlement classes, but for lawyers settling any kind of class or mass action requiring judicial approval.Continue Reading Hurricane Settlement An Imperfect Storm
We’ve reported several times about Thorogood v. Sears, Roebuck & Co., the endless class action drama currently playing in the Seventh Circuit. In “There’ll Always Be Posner: Final Rinse,” we summarized Judge Posner’s opinion holding that the district court should have enjoined plaintiffs and plaintiff’s counsel from filing class actions concerning Sears stainless steel
The Supreme Court granted certiorari in the Dukes v. WalMart (now called WalMart v. Dukes) class action today. By blogging standards, that fact is probably old news. For example, here’s a New York Times story about the grant. The law profs’ blogs have also been all over this.
We weren’t even going to blog about this, except we’ve already had two people contact us and ask what we thought. Since we figure there’s some confusion about what Dukes is all about, we thought we’d better say something.
First, the text of the Court’s order is:
Petition GRANTED limited to Question I presented by the petition. In addition to Question I, the parties are directed to brief and argue the following question: “Whether the class certification ordered under Rule 23(b)(2) was consistent with Rule 23(a).”
That means, to know what’s going on, we have to go to the cert. petition – filed by WalMart as the petitioner, since it lost in the 9th Circuit below. That’s also why WalMart’s name goes first in the Supreme Court. The Court’s practice is always to list the petitioner first, even if it was the defendant in the lower courts (and thus went after the “v.” in those courts).
OK, we’ve dug out the petition. That first question is: “(1) Can claims for monetary relief be certified under Fed. R. Civ. P. 23(b)(2) – which by its terms is limited to injunctive or corresponding declaratory relief – and, if so, under what circumstances?”
So what is Dukes about? The briefest description we can give is that it’s about the scope of Rule 23(b)(2). We’ll get back to that.Continue Reading The Dukes Cert. Grant – What It Is; What It Isn’t
For those of you who don’t know, Twinkie the Kid is the mascot for that classic American dessert cake, Twinkies. You may also be surprised to learn that Twinkies originally contained banana cream, until bananas were rationed during World War II (interesting), that a nutrition professor recently lost 27 pounds on a “Twinkie diet” (take that, Jared), or that, sadly, Twinkies do not keep forever (goodbye to the urban legend). These are some of the fascinating facts you learn when you look up Twinkies on Wikipedia.
Plaintiffs’ lawyers, though, seem more inclined to sue Hostess rather than revel in the cultural history of the Twinkie. Last week, a federal court in California shot down a putative class action complaining about Hostess’s “100 calorie packs” – not because you don’t get very many mini-Twinkies in those packs, but rather because they contain the following claim: “0 Grams of Trans Fat.” The putative class claimed this trans fat claim was misleading because the baked-goods products contained partially hydrogenated oils, which allegedly are linked to a parade of horribles – “heart disease, diabetes, cancer, obesity, liver dysfunction, Alzheimer’s disease, and female infertility.” Peviani v. Hostess Brands, Inc., Case No. 2:10-cv-02303-CBM-VBK (C.D. Cal. Nov. 3, 2010), slip op. at 2. The putative class brought claims under California and Missouri consumer protection laws, as well as a Lanham Act claim that was doomed from the get-go because consumers lack standing under the “false advertising” prong of that Act. Slip op. at 3, 12.
The consumer protection claims fared no better – they were preempted by the Food, Drug, and Cosmetic Act (FDCA) and its 1990 amendment, the Nutrition Labeling and Education Act (NLEA). When you flip over a package of food to check out the nutritional contents, all the information you see in that Nutrition Facts Panel is heavily regulated by the FDA through the NLEA. And the FDA will consider foods misbranded if the labeling is “false or misleading in any particular.” Slip op. at 7 (quoting 21 U.S.C. § 343 (a)(1)).Continue Reading Twinkie The Kid Guns Down A Consumer Fraud Class Action