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Three Cases in Supreme Court Could Have Big Impact on Class Actions

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by The Federalist Society
Posted December 21, 2010, 12:11 PM

Daniel Fisher at Forbes.com writes about the "trifecta" of cases that opponents of class actions have in the Supreme Court this Term. If these cases turn out in favor of the business defendants, Fisher writes, "plaintiff lawyers could have a much harder time convincing courts to certify lawsuits on behalf of large groups of consumers and employees."

The three cases are as follows:

  • In Smith v. Bayer, scheduled to be argued on Jan. 18, the issue is whether a federal court can reject a class action and then stop state courts from allowing a class action based on the same claims from proceeding.
  • In Dukes v. Wal-Mart, the Court will decide whether a class action on behalf of one million female employees of Wal-Mart who say Wal-Mart discriminated against them through pay and promotion can continue. While the plaintiffs say that the discrimination was based on a corporate culture that pervaded Wal-Mart, the defendants argue that such a large, nationwide class is not practicable, and that the claims against Wal-Mart among the members of the prospective class vary too greatly for the large class to be certified.
  • In AT&T v. Concepcion, argued in November, the question is whether corporations can use arbitration clauses in contracts with consumers to get out of class action suits based on the policy of the Federal Arbitration Act, which encourages arbitration over litigation. Commentators see this case as a potential end to consumer class actions, since, if the Court rules for AT&T, businesses will likely all include arbitration clauses in their consumer contracts and thus end the possibility of these suits.

Fisher points out that Justice Ruth Bader Ginsburg may be the key vote in all three of these cases, calling her a "class-action skeptic who has previously voted to rein in cases on behalf of asbestos claimants and insurance customers." Whatever the outcome of these cases, businesses and class action litigants alike have a great deal at stake in the Court.

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