The Federalist Society

Summary of Survey

Class Action Watch Spring 2001

April 2, 2001

In the previous issue of the Federalist Society’s Class Action Watch, we reported the preliminary results of our "Class Actions Opinions Survey." This survey asked class action attorneys from the plaintiff and defense bars to express their level of agreement or disagreement with a series of twelve statements on issues affecting the course of class action litigation. These statements deal with issues such as attorney fees, the impact of class certification, the incidence of state court class action filings, Rule 23 standards for certification in the federal courts, and the appropriate scope of settlement class actions.

The Federalist Society’s Class Action Watch Project mailed copies of the survey to those lawyers who designate their practice as "class actions" or "class action defense" in the Martindale-Hubbell Directory. The survey reached 1,884 class action plaintiff lawyers and 300 class action defense counsel. We have tabulated the responses to the survey, and report a 24 percent overall response rate.

Both categories of counsel received the same survey, except in one respect. Lawyers who identified their practice as "class actions" received a survey reproduced on color paper, enabling us to differentiate defense counsel and thereby contrast their responses from a more general pool containing mostly plaintiff counsel. In the end, 464 of the 1,884 class actions plaintiff lawyers and 61 of the 300 class action defense counsel responded to the survey. An analysis of their responses follows. Please note that all percentages are approximations, having been rounded to the nearest whole number where applicable.

 

Results of the Survey

Statement #1 reads: "Class actions result in a net savings of judicial resources." Not surprisingly, the majority of class action trial lawyers (79 percent) agreed or strongly agreed with this statement, while the majority of class action defense counsel (57 percent) disagreed or strongly disagreed.

Statement #2: "As the federal courts of appeals have tightened the requirements for class certification, there is a greater incentive to file class actions in state court." Both class action plaintiff lawyers and class action defense counsel were in agreement with this statement. Approximately 58 percent of plaintiff class action lawyers and about 73 percent of defense counsel agreed or strongly agreed that there is greater incentive to file class actions in state court. Interestingly, this is the only one of the twelve statements with which both plaintiff and defense counsel agreed. Only 25 percent of class action plaintiff lawyers and 15 percent of defense counsel disagreed or strongly disagreed with this statement.

Statement #3 provides: "State courts are appropriate forums for nationwide class actions." The two groups of attorneys had differing opinions on this statement. While about 57 percent of the plaintiff lawyers agreed or strongly agreed, 74 percent of defense counsel disagreed or strongly disagreed that state courts are appropriate forums for nationwide class actions.

Statement #4: "It should be easier to remove nationwide class actions to federal court." Defense counsel had a stronger opinion on this statement and there was no majority consensus of the plaintiff class action lawyers. Approximately 63 percent of defense counsel agreed or strongly agreed while only 27 percent of the defense counsel disagreed or strongly disagreed. Forty-nine percent of plaintiff lawyers, on the other hand, disagreed or strongly disagreed with easier removal while 49 percent of the same group agreed or strongly agreed.

An analysis of the results from Statements #2, 3, and 4 provides strong evidence of the division among members of the class action bar. It is clear that while plaintiff counsel and defense counsel agree that there is a greater incentive to file class actions in state court, defense counsel overwhelmingly favor federal courts as the appropriate forum for nationwide class actions. The results of Statement #4 demonstrate that plaintiff counsel have mixed feelings whether it should be easier to remove nationwide class actions to federal court.

Statement #5 suggests: "It should be easier to appeal orders granting or denying class certification." Again, plaintiff class action lawyers were not unified in their response, but defense counsel had a clear majority agreeing with facilitating appeals. Forty-five percent of plaintiff lawyers agreed or strongly favored easier appeal, but 39 percent disagreed or strongly disagreed. Defense counsel agreed or strongly agreed with the idea of interlocutory appeal by 66 percent while only 18 percent of that same group disagreed or strongly disagreed with easing the rules for appealing orders granting or denying certification.

Statement #6 reads: "The incidence and magnitude of excessive class action attorney fee awards are exaggerated." There is deep division in the responses by the two groups of attorneys. Approximately 75 percent of plaintiff class action lawyers agreed or strongly agreed that the incidence of excessive attorney fee awards is exaggerated while about 64 percent of defense counsel disagreed or strongly disagreed.

Statement #7: "Certification of a nationwide class action all but guarantees that the case will settle." Defense counsel reported strong agreement with this statement (62 percent agreed or strongly agreed) while a majority of class action lawyers disagreed with the statement (52 percent disagreed or strongly disagreed).

Statement #8 reads: "A regulatory agency’s ongoing examination of a defendant’s conduct should counsel against certification of a class action." A strong majority of plaintiff class action lawyers (77 percent) disagreed or strongly disagreed with this statement while only 12 percent of this same group agreed or strongly agreed. Eleven percent of plaintiff class action lawyers had no opinion, nearly the same number as those who had expressed agreement or strong agreement with the statement. Defense counsel, however, had no clear position on duplicative proceedings in court and before a regulatory agency. Approximately 34 percent of defense counsel disagreed or strongly disagreed that an ongoing agency proceeding counsels against certification, 33 percent agreed or strongly agreed that certification would be unwise, and 33 percent had no opinion on the effect of a regulatory agency’s ongoing examination. Unlike defense counsel, class action lawyers have a strong disagreement with this statement.

Statement #9 provides: "The existing Rule 23 factors provide a sufficient basis for screening out cases that are not appropriate for class treatment." The majority of both plaintiff class action lawyers (82 percent) and defense counsel (51 percent) agreed or strongly agreed with this statement. Approximately 15 percent of plaintiff class action lawyers disagreed or strongly disagreed and a relatively significant block of defense counsel (41 percent) disagreed or strongly disagreed.

Statement #10 reads: "Cases seeking medical monitoring are particularly strong candidates for class action treatment." Forty-one percent of plaintiff class action lawyers agreed or strongly agreed, and 49 percent of defense counsel disagreed or strongly disagreed that medical monitoring cases should receive class action treatment. A high number of attorneys had "no opinion." Approximately 41 percent of plaintiff class action lawyers and 36 percent of defense counsel responded with "no opinion."

Statement #11 provides: "It is appropriate for state courts or legislatures to modify the elements of a cause of action to make it easier to seek class action treatment." Defense counsel (67 percent) disagreed or strongly disagreed while a majority of plaintiff class action lawyers (52 percent) agreed or strongly agreed that state courts or legislatures should be permitted to make it easier for cases to receive class action treatment. There was a 20 percent "no opinion" response by plaintiff class action lawyers while only 8 percent of defense counsel responded with "no opinion."

Statement #12: "A settlement class action should be permitted even if the putative class could not be certified for litigation purposes under Rule 23." Plaintiff class action lawyers strongly agreed with this statement. Approximately 62 percent of them agreed or strongly agreed and only 26 percent disagreed or strongly disagreed with a non-certifiable settlement class. Defense counsel were not as unified in their response. An even amount (46 percent) of defense counsel agreed and disagreed with the statement.

Conclusion

From this data, some significant trends in relation to current legislative debates regarding state court removal of class actions to federal court can be detected:

  1. Both class action plaintiff counsel and defense counsel agree that state courts are becoming the primary center of class action activity. A majority of both groups agree that there is a greater incentive to file class actions in state courts, although they differ on whether this is the best forum to file the suits.
  2. Plaintiff counsel believe that state courts are appropriate forums for nationwide class actions, but, interestingly, they do not have a consensus position regarding making it easier to remove class actions to federal court – less than a majority believed that removal should remain tougher, and 37% supported the idea of making it easier. 64% of defense counsel favor removal.
  3. Regarding interlocutory appeal of class action certification, one can see some pattern from the data collected. Defense counsel are strongly behind the idea of easing the rules for appealing orders granting certification. But plaintiff counsel appear more ambivalent. About 45% would favor relaxing rules for appealing class action certification.


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