Gibbons Law Alert

Gibbons Law Alert

Category: Class Action Defense

Third Circuit Holds Truth in Consumer Contract Notice and Warranty Act Claim May Not Be Based Upon Omission of Price Information

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Posted in Class Action Defense

On December 2, 2014

In Watkins v. DineEquity, Inc., the Third Circuit recently considered whether the District Court properly dismissed a putative class action brought against Applebee’s and International House of Pancakes, in which Plaintiff claimed that Defendants violated the New Jersey Truth in Consumer Contract Notice and Warranty Act (“TCCNWA”) by failing to disclose beverage prices on their menus. In affirming the District Court’s dismissal, a divided Third Circuit panel ruled that the “TCCNWA encompasses only illegal provisions in writings covered by the statute, and does not make actionable omissions, including the omission of beverage prices from a restaurant menu.”

“Safe and Effective,” Without More, Does Not Warrant Unqualified Safety and Efficacy

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Posted in Class Action Defense / General Litigation

On December 1, 2014

The Third Circuit in In re: Avandia Marketing Sales Practices & Products Liability Litigation recently refused to revive a putative class action accusing GlaxoSmithKline PLC (“GSK”) of violating an express warranty allegedly contained on the label of its diabetes drug, Avandia, which declared the drug “safe and effective.” In so doing, the Court reaffirmed the narrow scope of a breach-of-express-warranty claim under New Jersey law and the requirements necessary to sustain such a claim.

Seventh Circuit Rejects Unbalanced “Division of Spoils” Between Class Counsel and Class Members in RadioShack Settlement

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Posted in Class Action Defense

On October 8, 2014

In Redman v. RadioShack Corp., the Court of Appeals for the Seventh Circuit, in an opinion by Judge Richard Posner, reversed and remanded the district court’s judgment approving the settlement terms for a class action filed against RadioShack Corp. alleging violation of the Fair and Accurate Credit Transactions Act. The court expressed concern about “the division of spoils between class counsel and class members” and found it likely that “each class member has a valid claim to a good deal more than one $10 coupon, and it would seem therefore that the equities favor a reallocation of some of what we are calling the spoils from class counsel to class members who have submitted claims for the coupons.”

Classwide Arbitration is a Gateway Issue That Must Be Decided by Courts Not Arbitrators

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Posted in Class Action Defense

On September 25, 2014

In Opalinski v. Robert Half International Inc., the Third Circuit recently tackled the question of whether a district court— rather than an arbitrator—should decide if an agreement to arbitrate between two parties also authorizes the arbitration of unidentified individuals’ claims on a classwide basis. Concluding that the district court should decide this question, the Third Circuit joined the Sixth Circuit as the only Courts of Appeals to squarely confront the “who decides” inquiry.

California High Court Holds That Federal Arbitration Act Preempts Arbitration Agreements with Class Action Waivers

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Posted in Class Action Defense

On July 28, 2014

The California Supreme Court, in Iskanian v. CLS Transportation Los Angeles, LLC, recently overturned precedent holding that class action waivers in arbitration agreements are unenforceable in California. Citing AT&T Mobility LLC v. Concepcion et ux, California’s high court strengthened the enforceability of class action waivers in arbitration agreements by holding that the Federal Arbitration Act (FAA) preempts the state’s refusal to enforce such a waiver on grounds of public policy or unconscionability.

Halliburton Gives Defense Bar New Tool to Defeat Class Certification

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Posted in Class Action Defense

On July 7, 2014

The Supreme Court has raised the class certification stakes yet again, holding in Halliburton v. Erica P. John Fund that defendants in securities class actions may rebut the fraud-on-the-market presumption of reliance at the class certification stage. Over the objections of Justices Thomas, Scalia, and Alito, the Court declined to toss out the presumption altogether.

Juridical Link Doctrine Does Not Relax Article III Standing Requirements in Class Actions

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Posted in Class Action Defense

On June 12, 2014

In 6803 Boulevard East, LLC v. DIRECTV, LLC, the District of New Jersey rejected the notion that “the juridical link doctrine” provided a limited exception to Article III standing requirements in a class action against several related defendants and granted DirecTech’s motion for summary judgment because the named plaintiffs were not injured by DirecTech’s actions.

Third Circuit Finds Proposed Dual Service as Class Counsel and Class Representative Does Not Preclude CAFA Removal

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Posted in Class Action Defense

On June 9, 2014

The Third Circuit recently considered whether the District Court properly denied a motion for remand brought by a pro se plaintiff, an attorney also seeking to serve as class counsel, who argued that since his “dual service” precluded class certification in federal court, the defendant could not aggregate the proposed class’s claims to satisfy the $5 million amount in controversy under the Class Action Fairness Act (“CAFA”). In affirming the denial of the plaintiff’s remand motion, the Third Circuit built upon recent Supreme Court precedent confirming that a plaintiff cannot stipulate to less than $5 million in damages to avoid the federal court’s subject matter jurisdiction under CAFA.

Supreme Court to Address Evidentiary Requirements for Determining Removal Jurisdiction in Class Actions

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Posted in Class Action Defense

On May 21, 2014

The Supreme Court of the United States granted certiorari in Dart Cherokee Basin Operating Company, LLC v. Owens, to resolve a circuit split over the evidentiary standard for determining removal jurisdiction pursuant to the Class Action Fairness Act (“CAFA”). Specifically, the Court will consider “[w]hether a defendant seeking removal to federal court is required to include evidence supporting federal jurisdiction in the notice of removal, or is alleging the required ‘short and plain statement of the grounds for removal’ enough?”

Hobbs Act Remains a Formidable Obstacle in Challenging FCC Regulations Under the TCPA

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Posted in Class Action Defense

On May 19, 2014

In Nack v. Walburg, the plaintiff consented to receive a fax advertisement from the defendant. But, because the fax lacked an “opt-out” notice arguably required by regulations promulgated under the Telephone Consumer Protection Act (“TCPA”), plaintiff filed a class action complaint, seeking millions of dollars in class-wide statutory damages under the TCPA. The district court granted summary judgment in favor of the defendant, holding that the pertinent regulation should be narrowly interpreted to require opt-out notices only for unsolicited faxes, not invited faxes. The Eighth Circuit, however, relying on an amicus brief from the FCC, disagreed and reversed, holding that the Hobbs Act prevented judicial review of administrative regulations, except on appeal from a prior agency review. The court expressed skepticism as to “whether the regulation (thus interpreted) properly could have been promulgated under the statutory section” at issue but suggested that defendant seek a stay of the civil proceedings while it pursued administrative remedies.

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