In Sprint Victory, Judge Posner and the Seventh Circuit Hold That Arbitration Is Required in a TCPA Class Action Even Though the Alleged Violation Occurred After the Termination of the Contract

On May 11, 2015, in an opinion written by Judge Posner, the Seventh Circuit reversed an order denying Sprint’s motion to compel arbitration in a class action allegation violations of the Telephone Consumer Protection Act (“TCPA”).  The thrust of the dispute was not whether there was a valid agreement to arbitrate between Sprint and the plaintiffs, but whether that agreement was broad enough to apply to conduct that occurred after the termination of the agreement.  In Andermann v. Sprint Spectrum L.P., __ F.3d __, 2015 WL 2167846 (7th Cir. May 11, 2015), the Seven Circuit said it was. Continue Reading

Baker v. Microsoft Corporation Revisited: Video Gaming Company Seeks to Stop Class Action Plaintiffs From Shortcutting the Appeals Process

We recently reported on a Ninth Circuit Court of Appeals opinion reversing a district court’s decision to strike class action allegations in a putative class action against Microsoft.  Baker v. Microsoft Corp., No. 12-35946, 2015 U.S. App. LEXIS 4317 (9th Cir. Mar. 18, 2015).  In Baker v. Microsoft Corporation, the Ninth Circuit panel of judges held that proof that individual class members were damaged by an alleged defect (here, a defect in Xbox 360 video game consoles resulting in scratched game discs) was not necessary for a class action to be certified.  Id. at *20.  You can read the full article here. Continue Reading

Recent Ninth Circuit Decisions in False Advertising Consumer Class Action Cases May Prevent Preemption and Relegate the Primary Jurisdiction Doctrine to Second-Class Status

In two recent decisions, Reid v. Johnson & Johnson, __ F.3d __, Case No. 12-56726 (9th Cir. March 13, 2015) and Astiana v. The Hain Celestial Group, Inc., __ F.3d __, Case No. 12-17596 (9th Cir. April 10, 2015), the Ninth Circuit either rejected or minimized the use of preemption and primary jurisdiction as defenses to allegations of false labeling of food and cosmetics.  Continue Reading

Baker v. Microsoft Corporation: Ninth Circuit Court of Appeals Decision in Class Action Against Video Gaming Company May Make It More Difficult to Defeat Class Actions

The Ninth Circuit Court of Appeals recently reversed a district court’s decision to strike the class action allegations in Baker v. Microsoft Corp., No. 12-35946, 2015 U.S. App. LEXIS 4317 (9th Cir. Mar. 18, 2015).  In Baker, the putative class alleged that a design defect in Xbox 360 video game consoles caused the consoles to malfunction and scratch game discs – although only 0.4% of Xbox console owners reported such problems.  Id. at *1-4.  The majority opinion held that the district court should have followed an earlier Ninth Circuit decision rejecting the notion that individual manifestations of a defect preclude resolution of claims on a class-wide basis.  Id., citing Wolin v. Jaguar Land Rover N. Am., LLC, 617 F.3d 1168 (9th Cir. 2010).  “[P]roof that [a alleged design defect] caused individual damages is not necessary . . . Rather, plaintiffs’ breach of express warranty claim presents a common factual question – is there a defect? – and a common mixed question of law and fact – does that defect breach the express warranty?”  Baker, 2015 U.S. App. LEXIS 4317 at *16-17.  Notably, the Ninth Circuit’s decision only determined that the district court misapplied the law in striking the class action allegations from the complaint.  Id. at *20.  The decision expressly disclaimed any determination of whether the issues would be best decided on a class-basis or whether class certification should be granted.  Id.  Continue Reading

Creative Construction: The Ninth Circuit Relaxes Removal Statute’s Timeliness Test in Class Action Fairness Act Cases

In Jordan v. Nationstar Mortgage LLC, No. 14-35943 and 15-35113, 2015 WL 1447217 (Apr. 1, 2015 9th Cir.), a Ninth Circuit panel held that cases subject to the Class Action Fairness Act (“CAFA”) become “removable” only when removal under CAFA is first ascertainable even if the initial pleading earlier disclosed a separate non-CAFA basis for removal which the defendant chose not to pursue.  This holding changes Ninth Circuit law which ordinarily requires courts to strictly construe removal statutes against removal and to generally treat as untimely any notice of removal filed more than 30 days after receipt of an initial pleading disclosing a removal basis.  The panel considered itself no longer bound to this circuit precedent given the U.S. Supreme Court’s recent decision in Dart Cherokee Basin Operating Co., LLC v. Owens, 135 S. Ct. 547 (2014), which recognized Congress’s strong preference that federal courts adjudicate certain interstate class actions.  A significant Ninth Circuit shift, Jordan opens the door for more lenient and less technical applications of removal requirements in CAFA cases. Continue Reading

Court Severs Term But Otherwise Enforces Arbitration Provision With A Class Action Waiver

In a victory for Sheppard Mullin and its client, in Trabert v. Consumer Portfolio Serv., Inc., __ Cal. App. 4th. __, 2015 WL 880949 (4th Dist. Mar. 3, 2015), the California Court of Appeal compelled arbitration and enforced a class action waiver after severing an arbitration term. Continue Reading

California Court of Appeal Lowers the Bar on Ascertainability Requirement in Consumer Class Actions

In Aguirre v. Amscan Holdings, Inc., Case No. 073059, 2015 Cal. App. LEXIS 214 (Cal. Ct. App. Feb. 11, 2015), a California Court of Appeal reversed the denial of certification of a putative class alleging violation of Civil Code Section 1747.08 of California’s Song Beverly Credit Card Act.  The trial court had denied certification because the plaintiff did not show the ability to identify, locate, and notify class members.  The court of appeal rejected that standard, and found that the class was, in fact, ascertainable because (1) the class definition contained a set of “common characteristics” that would allow class members to self-identify themselves, and (2) because the plaintiff had suggested an objective method for identifying class members.  This decision clarifies the standard for ascertainability in California state court class actions. Continue Reading

Not So Small After All: CallFire Uses Common Carrier Defense to Defeat Rinky Dink TCPA Class Action Case

Last month, in Rinky Dink, Inc. v. Electronic Merchant Systems, et al., No 13-cv-01347, 2015 WL 778065 (W.D. Wash. Feb. 24, 2015), online voice and text provider CallFire became one of the first (if not the first) TCPA defendants to avoid liability for pre-recorded calls through the common carrier defense. Continue Reading

Court Finds that Class Action Plaintiffs’ False Advertising Claims are Stripped Bayer Based on Federal Preemption

In the recent case of Gallagher v. Bayer AG, Case No. 14-cv-04601-WHO (N.D. Cal. March 10, 2015), the plaintiffs asserted that the defendants Bayer AG and related entities (collectively, “Bayer”) engaged in false advertising under California, New York, and Florida law.  The products in question were 20 varieties of One-A-Day vitamins that each included advertising on their labels stating that they supported “heart health,” “immunity” and “physical energy.”  On behalf of a putative class of purchasers, the plaintiffs alleged that the statements were false, misleading, and constituted illegal advertising under state law based on the regulations of the Food & Drug Administration (the “FDA”).  Bayer moved to dismiss the complaint on multiple grounds, including the argument that the claims satisfied federal law, thereby preempting the plaintiffs’ state law claims. Continue Reading

Ascertainability Saps Plaintiffs’ Energy in Dietary Supplement Class Action

In the recent decision Mirabella v. Vital Pharmaceuticals, Inc., Case No. 12-62086-CIV-ZLOCH (S.D. Fl. Feb. 27, 2015) the plaintiffs attempted, but failed, to certify a nationwide class of all purchasers of an energy drink that allegedly caused harmful side-effects.  The plaintiffs brought claims under Florida’s consumer protection statute, known as the Deceptive and Unfair Trade Practices Act, as well as federal and common law breach of warranty claims.  The Plaintiffs sought to certify a class composed of all purchasers of the “Redline Extreme Energy Drink” (the “Product”) since 2008, a drink that retailed for approximately $3.00 per bottle. Continue Reading

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