SCOTUScast 2-24-16 featuring George Conway
On January 25, 2016, the Supreme Court decided Amgen Inc v. Harris without oral argument. Former employees of an Amgen subsidiary had participated in a benefit plan that offered ownership of Amgen stock. When the value of Amgen stock fell in 2007, stockholders filed a class action against plan fiduciaries alleging a breach of fiduciary duties, including the duty of prudence, under the Employee Retirement Income Security Act of 1974. Although the U.S. Court of Appeals for the Ninth Circuit initially reversed a district court decision dismissing the class action complaint, the U.S. Supreme Court then vacated the Ninth Circuit’s judgment and remanded the case in light of the Supreme Court’s then-recent decision Fifth Third Bancorp v. Dudenhoeffer, which set forth the standards for stating a claim for breach of the duty of prudence against fiduciaries who manage employee stock ownership plans.
On remand, the Ninth Circuit reiterated its conclusion that the plaintiffs’ complaint stated a claim for breach of fiduciary duty, and the Supreme Court again granted certiorari. In a per curiam opinion the Court reversed the judgment of the Ninth Circuit by a vote of 9-0, holding that the Circuit had failed to properly evaluate the complaint. In its current form, the Supreme Court concluded, the complaint failed to state a claim for breach of the duty of prudence. In remanding the case, however, the Court indicated that the district court could decide in the first instance whether the stockholders might amend their complaint in order to adequately plead a claim for breach of the duty of prudence.
To discuss the case, we have George T. Conway III, who is Partner, Litigation at Wachtell, Lipton, Rosen & Katz. SCOTUScast 2-11-16 featuring Karen Harned
Karen Harned February 11, 2016
On November 10, 2015, the Supreme Court heard oral argument in Tyson Foods v. Bouaphakeo. Peg Bouaphakeo and the rest of the plaintiffs in this class action are current and former employees of Tyson Foods. They claim that Tyson violated the Fair Labor Standards Act by not paying them for time spent putting on and taking off protective clothing at the beginning and end of the work day and before and after lunch. The district court certified the class, and the jury returned a multi-million dollar verdict in their favor. Tyson argued on appeal that certification was improper due to factual differences among plaintiffs, but the U.S. Court of Appeals for the Eighth Circuit affirmed the district court.
The questions before the Supreme Court are twofold: (1) Whether differences among individual class members may be ignored and a class action certified under Federal Rule of Civil Procedure 23(b)(3), or a collective action certified under the Fair Labor Standards Act, where liability and damages will be determined with statistical techniques that presume all class members are identical to the average observed in a sample; and (2) whether a class action may be certified or maintained under Rule 23(b)(3), or a collective action certified or maintained under the Fair Labor Standards Act, when the class contains hundreds of members who were not injured and have no legal right to any damages.
To discuss the case, we have Karen Harned, who is Executive Director of the National Federation of Independent Business Legal Center. Litigation Practice Group Podcast
Theodore H. Frank January 11, 2016
In this class action case, counsel for the plaintiffs received over 94% of the total cash recovery provided for in settlement – while the attorneys received $5,680,000 in fees, the millions of class members realized only $344,850. Objector Ted Frank’s petition for cert in the U.S. Supreme Court is pending. The petition essentially asks whether such an award is fair, reasonable and adequate under the Federal Rules of Civil Procedure. What will this case mean for the future of cy pres and class action litigation?
SCOTUScast 12-15-15 featuring Cory Andrews
- Theodore H. Frank, Senior Attorney, Director of the Center for Class Action Fairness, Competitive Enterprise Institute
Cory L. Andrews December 17, 2015
On December 14, 2015, the Supreme Court decided DIRECTV v. Imburgia. This case involves a class action lawsuit against DIRECTV by various California customers. Among other things, the agreement between DIRECTV and its customers contained a waiver of any right by either party to undertake class arbitration, unless “the law of your state” made such waivers unenforceable. At that time class arbitration waivers were unenforceable under California law, but in a subsequent case the United States Supreme Court held that this California rule was preempted by the Federal Arbitration Act (FAA). Concluding that the parties had intended to apply the rule as it existed prior to the Supreme Court decision, California trial and appellate courts refused to enforce the arbitration provision. The question before the Supreme Court was whether the FAA permitted this outcome; namely, the application of state law that had since been preempted by the FAA.
By a vote of 6-3, the Supreme Court reversed the judgment of the California Court of Appeals and remanded the case. Justice Breyer delivered the opinion of the Court, holding that the arbitration provision must be enforced because the California appellate court’s interpretation was preempted by the FAA.
Justice Breyer’s opinion was joined by the Chief Justice and Justices Scalia, Kennedy, Alito, and Kagan. Justice Thomas filed a dissenting opinion. Justice Ginsburg filed a dissenting opinion, in which Justice Sotomayor joined.
To discuss the case, we have Cory Andrews, who is Senior Litigation Counsel at the Washington Legal Foundation. Labor & Employment Law Practice Group Podcast
Karen Harned November 17, 2015
On November 10 the Supreme Court heard oral arguments in the case of Tyson Foods, Inc. v. Bouaphakeo. In this case, Tyson Foods was ordered to pay $5.8 million in damages in a class action lawsuit brought by employees alleging violations of various federal and state labor laws. A class of employees sued Tysons for failing to properly compensate them for time they spent donning and doffing protective clothing and equipment and washing equipment. The 8th Circuit allowed the plaintiffs to use used statistical sampling to determine damage awards. The Eighth Circuit certified the class under Rule 23 despite a wide variance among class members of time spent donning, doffing and washing equipment. The outcome of the case could have a significant impact on the rules governing class certifications and whether statistical sampling can be used in the class action context.
- Karen Harned, Executive Director, National Federation of Independent Business Legal Center