Source - Developments in Class Action Law

Class Action Decisions Published September 2023

Highlights from this issue include:

Class Action Fairness Act Jurisdiction. The Fifth Circuit clarified when courts have exclusive federal jurisdiction under the Class Action Fairness Act. Among other holdings, it held significant relief was sought against a local defendant notwithstanding the defendants’ argument that the out-of-state defendants were “deeper pockets” and thus had a “greater ability to pay.” The Fifth Circuit, joining its sister circuits, decided that the in-state defendant’s ability to pay is not a consideration for this requirement.

Environmental Toxic Tort. The Southern District of Indiana denied certification of a class alleging their property had been exposed to toxic and hazardous substances released because of the defendants’ ownership and operation of a nearby manufacturing facility. The court found the class failed the numerosity requirement because all class members live (or have a possessory interest) in real property within two miles of the sites, which was only 25 miles from the courthouse, so identifying and contacting class members would not be exceedingly difficult. The plaintiff also failed to show the class did not have means of financial motivation to file individual suits—in fact, the plaintiffs’ counsel had filed individual suits on behalf of two individuals in state court.

Numerosity in Employment Actions. The Western District of Oklahoma denied certification of a class of welders who alleged Fusion misclassified them as independent contractors and were not properly paid overtime wages. The court found the class failed the numerosity requirement because there were at most 43 putative class members, they all lived in southern Texas, their identities were readily discernible and ascertainable from Fusion’s business records, many of the claims could exceed $10,000 (before considering attorney fees, costs, or punitive damages), and the plaintiff did not present evidence that the class members spoke limited English or were fearful of the American legal system.

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