U.S. Supreme Court to Consider Shook Cy Pres Case For Review
On March 16, 2018, the U.S. Supreme Court will take up in conference Shook’s petition for a writ of certiorari on the constitutionality of the use of cy pres settlements in class action cases. Speedway, LLC v. Wilson, No. 17-1030 (petition submitted January 2, 2018). Shook Partner Tristan Duncan, Co-Chair of the Class Action & Appellate Litigation Practice Group, is counsel of record for Speedway, LLC, along with Partner Holly Smith and Of Counsel Bill Northrip.
The National Law Journal reports the Speedway petition is one of “Five Cases to Watch at Friday’s U.S. Supreme Court Conference,” along with petitions involving the Flint, Michigan, water crisis; the conduct of American Civil Liberties Union lawyers in an abortion access case involving an undocumented minor; and a challenge to the Auer doctrine of judicial deference in administrative law cases.
The Speedway petition challenges $24.5 million in cy pres class settlements used to set up a fund to induce state regulators to enact laws requiring gasoline to be sold by “temperature-adjusted gallon” instead of its actual volume. Speedway’s petition argues that such settlements—in which funds can be distributed to third parties, even those with no relationship to the class members—violate the Rules Enabling Act and the First Amendment. Significantly, regulators from all 50 states and the federal government filed an amicus brief in support of the petition, saying cy pres settlements misuse the judicial system because they effectively create quid pro quo arrangements for changing the law and undermine legislative authority.
According to The National Law Journal, any cases granted review at the March 16 conference will likely be heard in the October 2018 court term.