Amber M. Nesbitt is an Associate Attorney at Wexler Wallace, LLP. She has experience in civil rights, securities, consumer fraud, healthcare, and antitrust matters. Res Publica interviewed Ms. Nesbitt on October 31, 2011.
What is your class action background and experience?
At Wexler Wallace, we litigate all kinds of class actions, in addition to a few other nonclass cases. Personally, in the past two or three years I’ve been focusing more on pharmaceuticals, whether it’s antitrust, consumer fraud, or other pricing issues. I do some non-pharmaceutical work as well, including consumer fraud and breach of contract or fiduciary duty cases. However, lately my focus has mostly been pharmaceutical antitrust.
You are you familiar with the Dukes decision. Is there anything, any part of it, that you think the Supreme Court got right?
No. Most of the classes we seek to certify are Rule 23(b)(3) classes, so focusing on the portion of the decision relating to whether a common question of law or fact exists as required by Rule 23(a)(2), I think they got it wrong. We actually think the decision changes the law more with respect to Rule 23(b)(2), but some of the unfortunate language from the decision is making its way into our cases.
What do you think they got wrong?
That’s a tough question. Rule 23(a)(2) is clear that common questions of fact or law must exist across the class, and historically this has always been a relatively easy factor to satisfy. The common question in Dukes was essentially whether Wal-Mart’s policy itself, which afforded discretion in making pay and promotion decisions, gave rise to the discrimination that was being complained of. That, to me, is the common question that should satisfy Rule 23(a)(2), and the dissent thought so as well. But the majority framed the issue as requiring there to be not only a common question, but essentially that there is also a common answer. That is not the what Rule 23(a)(2) says, but now the Dukes plaintiffs were required to prove their Title VII claims at class certification by establishing that Wal-Mart’s policy in fact did result in discriminatory practices to the proposed class. In addition, before Dukes, one of the desirable aspects of Rule 23(b)(2) was the absence of the need to prove predominance, where most of the fighting occurs in the (b)(3) context. In Dukes, the Court essentially created the need to prove predominance under Rule 23(a), so it added an element that has never been required under Rule 23(b)(2).
Going forward, how will this change your class certification strategy?
Our approach to class certification is largely based on the specific claims in each litigation, so it’s hard to talk in the abstract. While Dukes may make certification of certain kinds of claims more complicated or difficult, a lot of Rule 23(b)(3) class actions should be largely unaffected by Dukes. Dukes essentially affirmed the higher level of proof that most Circuits have been imposing for years at the class certification stage, so we are used to withstanding the rigorous analysis courts must conduct regarding whether the prerequisites of Rule 23 are met. So, for example, when you’re talking about a company that sells a defective product, a class action complaint would typically allege that anyone who bought that product has been injured, and we would engage in discovery allowing us to demonstrate proof of the merits on a class wide basis. At class certification, the primary common question is whether the product is defective—and then, if so, whether the class members were injured—and whether those questions predominate across the class. Unlike in Dukes, the answer to these questions will undoubtedly resolve the claims of all class members who bought the product and predominate across the class. This analogy reaches a wide variety of classes primarily seeking to remedy economic injuries. In that sense, I believe many of the claims that we bring are not going to be changed by Dukes.
That said, I expect defendants in these kinds of cases to try to get more traction from Dukes. Until Dukes, defendants typically didn’t contest the existence of common questions, focusing instead on their predominance across the class, so I can foresee that they will now start taking a step back and arguing that no common questions exist in the first place. However, in my opinion, most class actions pretty plainly involve a common contention capable of a common answer through class-wide resolution as Justice Scalia required. While there may be a few claims or cases in which this is legitimately in dispute, even in those cases, class certification may still not be insurmountable.
I imagine it’s that way in an antitrust context too?
Right. For example, several of our antitrust cases deal with foreclosed generic competition. If you’re not allowed to buy generics because the brand name manufacturer is blocking their sale, then whether that conduct is illegal and how much the class members have been damaged is clearly an issue across the class. Whereas the Dukes majority believed it was unclear that Wal-Mart’s policy resulted in discrimination to all female employees, a defendant’s “policy” of engaging in anticompetitive conduct implicates all purchasers. So in that sense, the common questions and their answers clearly apply across the class in the antitrust context. When gearing up for a class certification brief, we’ve always tried to define our classes in a way that is thoughtfully constructed and defined to include those class members which have been injured in the ways we allege. If anything, I think Dukes will just make us do that even more, and take a harder look at the class that we’re seeking to certify to make sure that it is appropriate and certifiable under Dukes.
To what extent will Dukes affect your pharmaceutical practice?
With our pharmaceutical antitrust practice, beyond what I just discussed, there were already a number of decisions before Dukes that heightened the burden for certification of a Rule 23(b)(3) class. For example, Hydrogen Peroxide in the Third Circuit required courts to rigorously evaluate the evidence and plaintiffs’ proposed methods for establishing antitrust impact and damages at trial, to ensure that the evidence of impact and damages will predominate across the class. So we have already faced that standard in many jurisdictions, and Dukes does not do too much to change it, I would like to think. By meeting this standard, we are also meeting or exceeding Dukes’s standards.
Do you feel, in general, based on your experiences, based on what you have seen, that it could hamper legitimate claims?
Absolutely. For most of the cases that are appropriate for class action treatment to begin with, you would like to think that there will be at least one obvious common question or contention and that Rule 23(a)(2) will not be an issue. But, especially in the employment context, you’re dealing with corporate policies implemented by individuals and applying them to employees. Of course, not every employee or manager acts the same way, so you can certainly envision a situation where absolutely viable claims are dismissed or are not certified because of Dukes. Beyond employment cases, we have already seen the motions to decertify previously certified classes and expect to see Dukes heavily discussed in oppositions to motions for class certification. Defense counsel will certainly remind each and every court across the country of what Dukes says and will urge for it to be broadly construed, but I am hopeful that courts will view it narrowly.
That is kind of funny, the day after Dukes did you just suddenly get a flood of motions to decertify classes?
Yes. We saw both motions to decertify and motions for leave to submit supplemental briefing on Dukes for pending class certification motions. Fortunately, we have since seen a lot of courts that have refused to decertify a class, that have construed Dukes very narrowly by limiting it to Title VII cases or Rule 23(b)(2) classes, and that have said only the major issues need be resolved in “one stroke,” not all issues.
Do you envision ever having to go about a multi-plaintiff case in a different way?
Many of our class cases really would not be appropriate for individual claims unless each plaintiff or class member had really substantial damages. We’ve considered doing that in certain cases and have seen it done when class certification has been denied, but the damages to each class member have to be large enough to warrant bringing individual cases. That’s not an efficient or a viable strategy in many cases that we would typically bring as a class action. If that’s the way class actions are heading, that would be unfortunate for many reasons, including because then consumers would essentially be denied access to the courts.
Beyond litigating these kinds of claims on an individual basis, there are other ways to still proceed as a class [such as] by using subclasses, bringing several cases seeking only state-wide classes, proceeding with an exemplar class, or making the classes more narrowly tailored. These methods can require more work and more judicial resources, but they are available and typically preferred over bringing numerous multi-plaintiff cases. For example, the Dukes plaintiffs have started filing smaller regional class actions with sub-classes, starting with a California state case filed in federal court in San Francisco. It will be interesting to see how these cases go, as the Supreme Court’s opinion gave a rough road map for how they might get a class certified again.
Is there anything else you wanted to share, that we haven’t covered?
The last point I would make is that by making detailed factual determinations at the class certification stage, judges are now stepping into the shoes of the jury and deciding issues that were once the sole province of the jury. With the Seventh Amendment guarantee of the right to a trial by jury, this is a very serious concern. With the class action mechanism, which is embodied in a rule of procedure, you should be able to say that the class is unified by the question of, “Does the defendant have a policy of doing X?,” and let the jury decide whether in fact the defendant has that policy and whether it affected class members in the way plaintiffs say it did.
Knowing that this is a threshold question of fact that would normally be answered by a jury, does that affect the standard? Would a judge be willing to presume disputed facts in the plaintiff’s favor, sort of like on summary judgment?
I would like to think so, but no such presumption – or any standard for that matter – has been articulated. Judges are typically very cognizant of the court’s role versus the jury’s role and even if you do have to look at the merits, how far you go into them. But we’re litigating in this gray area where courts have been instructed to now rigorously analyze the facts and evidence at class certification, so it will be very interesting to see how district courts are dealing with it in the next few years. To say that you have to look at and evaluate the merits, where do you draw the line?