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Class Action Update from the U.S. Supreme Court’s 2018-2019 Term

The 2018-2019 term of the U.S. Supreme Court opened with a newly configured court in which Justice Kavanaugh joined as an Associate Justice following the retirement of Justice Kennedy. Since October of last year, the Court has heard 69 argued appeals, several of which arose from class action litigation. Over the past nine months, the Court has addressed issues relating to class action practice concerning arbitration provisions, federal removal statutes, consumer antitrust law, FDA preemption, and the equitable tolling of interlocutory appeals. Although presented with class action questions related to cy pres awards, data privacy litigation standing, issue class certification, securities laws, and TCPA claims, the Court declined to resolve these issues. Reflective of the Court’s decisions this term at large, rulings were unanimous or sharply divided along ideological lines, with the Court declining to hear a number of controversies. The below summary provides an overview of class action decisions by the Court this term, including recent remands and certiorari decisions.

Opinions from the 2018 October Term

  • Lamps Plus v. Varela, No. 17-988: In a 5-4 opinion authored by Chief Justice Roberts, the Court reversed and remanded a decision from the Ninth Circuit and held that under the Federal Arbitration Act, an ambiguous agreement cannot provide the necessary consent for class-wide arbitration. The decision limits the availability of class-wide arbitration to contracts where it is expressly and unambiguously authorized.

  • Home Depot U.S.A. Inc. v. Jackson, No. 17-1471: In a 5-4 opinion authored by Justice Thomas, the Court affirmed the Fourth Circuit’s holding limiting the removal of class action claims from state to federal court on the basis that neither the general removal provision of 28 U.S.C. §1441(a), nor the removal provision in the Class Action Fairness Act of 2005, permit a third-party counterclaim defendant to remove a class action claim.

  • Apple Inc. v. Pepper, No. 17-204: In a 5-4 opinion authored by Justice Kavanaugh, the Court affirmed the ruling of the Ninth Circuit and held that consumers who purchased apps for their iPhones through Apple’s App Store were direct purchasers from Apple under Illinois Brick Co. v. Illinois and may sue Apple in an antitrust consumer class action for allegedly monopolizing the retail market for the sale of iPhone apps.

  • Merck Sharp & Dohme Corp. v. Albrecht, No. 17-290: In a 9-0 opinion authored by Justice Breyer, the Court vacated and remanded a Third Circuit decision and held that judges, not juries, should decide whether Food and Drug Administration actions pre-empt state court failure-to-warn class action suits on the basis of “clear evidence” the FDA would not have approved a change to a drug’s label.

  • Nutraceutical Corp. v. Lambert, No. 17-1094: In a 9-0 opinion authored by Justice Sotomayor, the Court reversed and remanded a decision from the Ninth Circuit and held that Rule of Civil Procedure 23(f), providing a 14-day deadline to seek permission for the interlocutory appeal of an order granting or denying class certification, is not subject to equitable tolling.

  • Frank v. Gaos, No. 17-961: In a per curiam opinion, the Court vacated and remanded the Ninth Circuit’s decision upholding a $8.5 million settlement where all net proceeds were to be distributed in a cy pres award with no direct relief to class members. The Court remanded to the courts below to address the plaintiff’s standing in light of Spokeo, Inc. v. Robins.

  • PDR Network, LLC v. Carlton & Harris Chiropractic Inc., No. 17-1705: In a 9-0 opinion authored by Justice Breyer, the Court vacated and remanded the Fourth Circuit’s decision concerning whether the Hobbs Act required the district court to accept the Federal Communication Commission’s legal interpretation of “unsolicited advisement” under the Telephone Consumer Protection Act. The Court remanded to the court below to address whether the FCC’s interpretation was a legislative or interpretive rule and whether petitioners had a prior, adequate opportunity to seek review.

Certiorari Decisions from the 2018 October Term

  • Behr Dayton Thermal Products, LLC v. Martin, No. 18-472: the Court declined to hear an appeal from the Sixth Circuit concerning whether plaintiffs may obtain issue class certification under Federal Rule of Civil Procedure 23(c)(4) without demonstrating that common issues predominate over individual issues for the entire action under Rule 23(b)(3).

  • Hagan v. Khoja, No. 18-1010: the Court declined to hear an appeal from the Ninth Circuit concerning a corporate issuer’s duty to update its disclosures under Securities and Exchange Commission Rule 10b-5(b).

  • Retirement Plans Committee of IBM v. Jander, No. 18-1165: the Court agreed to hear an appeal from the Second Circuit concerning whether the “more harm than good” pleading standard can be satisfied in ERISA class actions by generalized allegations that the harm of an inevitable disclosure of alleged fraud generally increases over time.

  • Intel Corp. Investment Policy Committee v. Sulyma, No. 18-1116: the Court agreed to hear an appeal from the Ninth Circuit concerning whether the three-year limitations period in Section 413(2) of ERISA bars a class action suit when all relevant information was disclosed to the plaintiff by the defendants more than three years before the filing of the complaint and the plaintiff either did not read or did not recall the information.

  • Rotkiske v. Klemm, No. 18-328: the Court agreed to hear an appeal from the Third Circuit concerning whether the “discovery rule” applies to toll the one-year statute of limitations under the Fair Debt Collection Practices Act.

  • Emulex Corp. v. Varjabedian, No. 18-459: the Court in a per curiam decision dismissed the writ of certiorari as improvidently granted in this appeal from a Ninth Circuit decision concerning whether Section 14(e) of the Securities Exchange Act of 1934 supports an inferred private right of action.

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About this Author

Melanie Conroy Commercial Litigation Attorney Pierce Atwood Law Firm
Counsel

Melanie Conroy focuses her practice on class action defense and complex commercial litigation. She has represented clients in connection with internal, government, and regulatory investigations, and has counseled boards of directors, board committees, and senior management on a broad range of matters, including securities, corporate governance, disclosure, and regulatory issues.

Melanie represents businesses and organizations across a wide range of industries, including life sciences, financial services, insurance, private equity, real estate, energy, media, consumer electronics,...

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