Gibbons Law Alert

Gibbons Law Alert

Category: Class Action Defense

Consent to Class Arbitration: What is the Meaning of “Silence?”

by and

Posted in Class Action Defense

On April 24, 2012

In Stolt-Nielsen S.A. v. Animal Feeds International Corp., the United States Supreme Court held that “a party may not be compelled under the FAA to submit to class arbitration unless there is a contractual basis for concluding that the party agreed to do so.” As the parties in Stolt-Nielsen stipulated that their arbitration “agreement was ‘silent’ in the sense that they had not reached any agreement on the issue of class arbitration,” the Court ruled that the arbitrator could not infer the parties’ consent to class arbitration solely from the fact of their agreement to arbitrate, or failure to preclude it.

Ninth Circuit Reverses Itself, Withdraws Opinion Which Held that Magnuson-Moss Warranty Act Prohibits Mandatory Arbitration in Warranties

by

Posted in Class Action Defense / General Litigation

On April 19, 2012

As reported in an earlier post in September 2011, the Ninth Circuit in Kolev v. EuroMotors West/The Auto Gallery held that the Magnuson Moss Warranty Act (“MMWA”) “precludes enforcement of pre-dispute agreements . . . that require mandatory binding arbitration of consumer warranty claims.” The Ninth Circuit’s ruling would have prohibited manufacturers and distributors of consumer products from attempting to take advantage of the Supreme Court’s recent pro-arbitration rulings, including AT&T Mobility v. Concepcion, involving MMWA consumer warranty claims. According to the original majority opinion in Kolev, to the extent the MMWA precludes arbitration clauses, class waivers in such clauses, which Concepcion rendered immune from invalidation under state laws, would thus likewise be unenforceable in MMWA actions, providing a complete end-run around Concepcion.

Third Circuit Rejects Employee’s Unconscionability Arguments in Compelling Arbitration

by

Posted in Class Action Defense

On April 4, 2012

In Quilloin v. Tenet HealthSystem Phila. Inc., the Third Circuit reversed the Eastern District of Pennsylvania’s denial of a motion to compel arbitration, finding error in the district court’s conclusion that genuine disputes of material fact might render the parties’ arbitration agreement unconscionable and unenforceable under Pennsylvania law.

Third Circuit Holds that Injunctive-Relief-Only Class Cannot Be Certified Where Plaintiffs Based the Threat of Future Harm on Irrational Consumer Behavior

by

Posted in Class Action Defense

On March 23, 2012

In McNair v. Synapse, a precedential opinion, the Third Circuit held that former customers could not certify an injunctive-relief-only class asserting consumer fraud claims against defendant Synapse, Inc., the largest marketer of magazine subscriptions in the United States, because they lacked Article III standing. In short, the Third Circuit concluded that plaintiffs could not show a likelihood of future injury based on their claim that they might be deceived by the same conduct twice.

Second Circuit Holds That Concepcion Preemption Analysis Does Not Apply to Federal Statutory Claims, Rejecting Class Action Waiver in Arbitration Agreement Where Individual Plaintiffs Would Be Left Unable to Vindicate Their Rights

by

Posted in Class Action Defense

On February 24, 2012

In In re: American Express Merchants’ Litigation (Feb. 1, 2012) (“AmEx III”), the Second Circuit refused to enforce American Express’s class action waiver where the “practical effect” would be to deprive plaintiffs of the ability to vindicate their federal statutory rights. By framing the issue in terms of the ability to vindicate federal statutory rights, the Second Circuit sidestepped the preemption analysis mandated by the United States Supreme Court in AT&T Mobility LLC v. Concepcion. But whether AmEx III is ultimately reversed, or deemed to carve out an exception to Concepcion where federal statutory rights are at issue, it brings into sharp focus the real question on everyone’s mind: Can companies bar class actions in both courts and arbitral forums in favor of bilateral arbitration, and if so, how?

Third Circuit, En Banc, Approves Settlement Class Containing Members Who Lack “Viable Claim”

by

Posted in Class Action Defense

On February 14, 2012

The U.S. Court of Appeals for the Third Circuit has issued an en banc opinion in Sullivan v. DB Investments, Inc. affirming a District Court’s certification of two nationwide settlement classes. In sum, though the multiplicity of states’ laws would affect the predominance inquiry in a litigated nationwide class action, in the settlement context, the Circuit eased the burden somewhat by declining to require a showing that each class member possess “a viable claim” based upon what would have been the applicable state statute or law.

No Class Certification in Consumer Fraud Case When Lead Plaintiff Seeks to Recant Critical Allegations in Complaint

by

Posted in Class Action Defense

On October 11, 2011

A lead plaintiff in a consumer class action who attempts to recant allegations in her complaint concerning the date she purchased the product at issue places her credibility in issue and, therefore, subjects her claim to unique defenses. Such a plaintiff may not be an adequate class representative under Rule 23(a)(4) and therefore may not be able to certify a class.

AT&T Mobility Permits Nullification of Arbitration Agreements Containing Class-Action Waivers When Agreements are so Ambiguous and Internally Inconsistent that Mutual Assent is Lacking

by

Posted in Class Action Defense

On September 19, 2011

In AT&T Mobility LLC v. Concepcion, the United States Supreme Court held that the Federal Arbitration Act preempted state laws providing that arbitration agreements containing class-action waivers are unconscionable and therefore unenforceable. But the Supreme Court also stated that “generally applicable contract defenses” continue to apply to arbitration agreements, so long as such defenses do not conflict with the FAA or frustrate its purposes.

No Class Certification When Class Members Can Obtain Adequate Statutory Damages in Small Claims Court

by

Posted in Class Action Defense

On September 19, 2011

In Local Baking Prods., Inc. v. Kosher Bagel Munch, Inc., the New Jersey Appellate Division held that private causes of action under the Telephone Consumer Protection Act (TCPA), which prohibits the sending of unsolicited faxes, cannot be prosecuted as class actions under Rule 4:32. The court reasoned that a class action is not a “superior” method for adjudicating such claims, as required by Rule 4:32-1(b)(3), because the TCPA entitles victims to at least $500 in statutory damages which can be recovered in the Small Claims section of the Special Civil Part in a matter of months.

Connect:

About Gibbons

With 200 attorneys, Gibbons is a leading law firm in New Jersey, New York, Pennsylvania, Delaware, Washington, DC, and Florida, ranked among the nation’s top 200 by The American Lawyer. More…

Subscribe

Archived Blog Posts

Categories