# Amicus Curiae Brief — Microsoft Corp. v. Baker, 136 S. Ct. 890 (2016) (No. 15-457)

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URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385016_0621%3A17

## Record

- **Collection:** Supreme Court brief
- **Document type:** Amicus Curiae Brief
- **Published:** January 1, 2016

## Text

ARAI UASL, LO

AND
REFS MAR 17 206

No. 15-457 |__OFRICE OF THE CLERK

In the
Supreme Court of the Anited States

> ae

MICROSOFT
CORPORATION,

Petitioner,

Vv

SETH BAKER, et al.,
Respondents.

—~—

On Writ of Certiorari
to the United States Court of Appeals
for the Ninth Circuit

+

BRIEF AMICUS CURIAE OF
PACIFIC LEGAL FOUNDATION
IN SUPPORT OF PETITIONER

> 2

DEBORAH J. LA FETRA
Counsel of Record
Pacific Legal Foundation
930 G Street
Sacramento, California 95814
Telephone: (916) 419-7111
Facsimile: (916) 419-7747
E-mail: DLaFetra@pacificlegal org

Counsel for Amicus Curiae Pacific Legal Foundation

i
QUESTION PRESENTED

Whether a federal court of appeals has jurisdiction
under both Article III and 28 U.S.C. § 1291 to review
an order denying class certification after the named
plaintiffs voluntarily dismiss their individual claims
with prejudice.

Hy

TABLE OF CONTENTS

QUESTION PRESENTED ........ ee
TABLE OF AUTHORITIES ..........

IDENTITY AND
INTEREST OF AMICUS CURIAE

INTRODUCTION AND

SUMMARY OF ARGUMENT ....

I. A PLAINTIFF WHO DISMISSES
WITH PREJUDICE LACKS

ARTICLE II STANDING TO APPEAL
A CLASS CERTIFICATION DENIAL ...... 3

A. Denial of Class Certification

Has No Bearing on the Merits or
Plaintiffs Legal Ability to Proceed ...... 4

B. A Purported Class

Representative’s Claims Rise and

Fall with His Individual Claims

Il. POLICY CONSIDERATIONS FAVOR

EXTENSION OF LIVESAY TO
DISMISSALS WITH PREJUDICE

A. Procedural Rules
Should Not Encourage

Litigation Gamesmanship ....

B. The Interests of Plaintiffs’
Counsel Cannot Be Imputed

to the Plaintiffs Themselves ..
RE ae nme

TABLE OF AUTHORITIES
Page
Cases
Airframe Systems, Inc. v. Raytheon Co.,

ee I, ME gv onc cc cvcwecsives 13
Allen v. Bedolla,

787 F.3a 1218 (Oth Cir. 3015) ............2.. 16
Amchem Prods. v. Windsor,

rn st aidie ee ee 6 eeine's 17
American Express Co. v. Italian Colors

Restaurant, 133 S. Ct. 2304 (2013) ........... 6
Anderson v. CNH U.S. Pension Plan,

515 F.3d 823 (8th Cir. 2008)................ 11
Ariz. Christian Sch. Tuition Org. v. Winn,

ec Se eee beewes es 19
Arizonans for Official English v. Arizona,

ee ee ae oe iad oee'es ee Obs 3
AT&T Mobility LLC v. Concepcion,

ee 17
Bailey v. Patterson, 369 U.S. 31 (1962) .......... 9
Baker v. Microsoft Corp.,

797 F.3d GO7 (Oth Cir. 2015) ..............2... 2
Bennett v. Spear, 520 U.S. 154 (1997) ........... 1
Bode & Grenier, LLP v. Knight,

808 F.3d 852 (D.C. Cir. 2015) ............... 14
Bowles v. Russell, 551 U.S. 205 (2007) ......-.... 10

Budinich v. Becton Dickinson & Co.,
cia ve eceneennees 12

lV

TABLE OF AUTHORITIES—Continued

Page

Camesi v. Univ. of Pittsburgh Med. Ctr.,

729 F.3d 239 (@d Cir. 2013) .............. 9,13
Campbell-Ewald Co. v. Gomez,

oss kav ncmeseccees 3.7
Camreta v. Greene, 131 S. Ct. 2020 (2011)........ 3
Chapman v. Procter & Gamble Distributing, LLC,

766 F.3d 1296 (11th Cir. 2014).............. 13
Collins v. Miller,

Tee ae 10
Contractors Edge, Inc. v. City of Mankato,

863 N.W.2d 765 (Minn. 2015)............... 14
Coopers & Lybrand v. Livesay,

437 U.S. 463 (1978) ........... 2-3, 6, 10-11, 17
Dannenberg v. Software Toolworks,

16 P.3a 1073 (th Cir. 1904)................. S)
Daubert v. Merrell Dow Pharmaceuticals, Inc.,

EE ME, occ cc ccceseccccsccee 12-13
Deposit Guaranty Nat'l Bank v. Roper,

en wie wee ees 5, 7, 11
Dickinson v. Petroleum Conversion Corp.,

er 14
Empire Volkswagon, Inc. v.

World Wide Volkswagon Corp.,

SD oc cccccceccescs 4-5

Espenscheid v. DirectSat USA, LLC,
688 F.3d 872 (7th Cir. 2012)................ 16

Vv

TABLE OF AUTHORITIES—Continued

Page

Fairley v. Andrews,

S76 F.34a GIS (7th Cir. 2008)... we ccc ccc 9
First American Financial Corp. v. Edwards,

ee On acids bee ee. 1
FTC v. Garvey, 383 F.3d 891 (9th Cir. 2004) ..... 13
Genesis Healthcare Corp. v. Symczyk,

eee ee soe whee 4,7
Gerstein v. Pugh, 420 U.S. 103 (1975) ........... 8
Grupo Dataflux v. Atlas Global Grp., L.P.,

ee ec cows scenes seven 12
Hackett v. General Host Corp.,

455 F.2d 618 (3d Cir.),

cert. denied, 407 U.S. 925 (1972) ............ 15
Hall v. State Farm Mut. Auto. Ins. Co.,

215 Fed. Appx. 423 (6th Cir. 2007) .......... 15
Himler v. Comprehensive Care Corp.,

790 F. Supp. 114 (E.D. Va. 1992),

appeal dismissed,

993 F.2d 1537 (4th Cir. 1993).............. 7-8
Hollingsworth v. Perry,

Is ok dccscsescoveses 3-4
In re Community Bank of Northern Virginia,

418 F.3d 377 (6d Cir. 3006) ................ 15
Laczay v. Ross Adhesives,

855 F.2d 351 (6th Cir. 1988),

cert. denied, 489 U.S. 1014 (1989) ............ 4

Laird v. Tatum, 408 U.S. 1 (1972) .............. 4

v1

TABLE OF AUTHORITIES—Continued

Page
Lewis v. Casey, 518 U.S. 343 (1996) ............. 5
Lewis v. Contl Bank Corp.,

ia aes 17
Local No. 438 Constr. and General

Laborers’ Union, AFL-CIO v. Curry,

RE 4
Lujan v. Defenders of Wildlife,

ean wba nn es sk eee eenaee 1
Maguire v. Sandy Mac, Inc.,

GE, ED onc cc owe ccccccce 7
Massachusetis v. E.P.A., 549 U.S. 497 (2007) ..... 1
Mohawk Indus., Inc. v. Carpenter,

ogc ecccveveccees 10
Muro v. Target Corp.,

580 F.3d 485 (7th Cir. 2009)................ 11
Newton v. Merrill Lynch,

259 F.3d 154 (8d Cir. 2001) ................ 17
Pastor v. State Farm Mut. Auto. Ins. Co.,

487 F.8d 1042 (7th Cir. 2007) ................ 7
Phillips v. Asset Acceptance, LLC,

736 F.3d 1076 (7th Cir. 2013) ............... 16
Potter v. Norwest Mortgage, Inc.,

329 F.3d 608 (8th Cir. 2003)................. 8
Raceway Properties, Inc. v. Emprise Corp.,

613 F.3a G56 (th Cir. 1960)... .. 2... ecw a es 5

Raines v. Byrd, 521 U.S. 811 (1997) ........-..... 2

vii

TABLE OF AUTHORITIES—Continued

Page

Rhodes v. E.I. du Pont de Nemours & Co.,

636 F.3d 66 (4th Cir. O11) ...........2.2200. 8
Ruppert v. Principal Life Ins. Co.,

706 P34 GSO Gtk Cir. BOIS)... ee eee 7
Schlesinger v. Reservists Comm. to Stop the War,

ne eee eeeneeveecee Gg
Sears, Roebuck & Co. v. Butler,

ec ccucces 1
Sosna v. Iowa, 419 U.S. 393 (1975) ............ 10
Spokeo v. Robins,

No. 13-3339 (U.S. filed May 1, 2014) .......... 1
State Treasurer of State of Michigan v. Barry,

168 F.3d 8 (11th Cir. 19908) .............. 11-12
Summers v. Earth Island Institute,

nar ae 1
Toms v. Allied Bond & Collection Agency, Inc.,

179 F.3d 108 (4th Cir. 1999)................. 4
Tyrues v. Shinsecki,

783 F.3d 1861 (Ped. Cir. 3013) .............. 14
U.S. Parole Comm'n v. Geraghty,

ck s ees ee se 7-9, 15
United States v. Procter & Gamble Co..,

eS ey sw a &¥ wee wi 8
Van Cauwenberghe v. Biard,

EOC TET TTT eee 11

TABLE OF AUTHORITIES—Continued

Page
Wal-Mart Stores, Inc. v. Dukes,
ee ge aaa er 1, 5-6
White v. Baptist Mem Health Care Corp.,
699 F.3d 869 (6th Cir. 2012)................. 7
United States Constitution
8 ES rat en 3, 8-9, 17, 19
ee ee WN, Be EE boo onc vaskccivk eee 3
Rules of Court
8 8 rrr eer 5-6
PL COE os vc pn wtoves saves baw ee en 9
EE DEE aay +04 sone dy ah ee eek ebee eee 1
ee EE «cc esctevevesieeaek eeeenaee 1
DED . sc cutibneeesckeeeeenblenseaneaae 1
Miscellaneous
Barnette, William P.,

The Limits of Consent: Voluntary

Dismissals, Appeals of Class Certification

Denials, and Some Article IT Problems,

56 S. Tex. L. Rev. 451 (2015) ...... 5-6, 9-10, 17

Comment, Continuation and
Representation of Class Actions
Following Dismissal of the Class
Representative, 1974 Duke L.J. 573 .......... 15

ix

TABLE OF AUTHORITIES—Continued

Page
Dixon, Lloyd & Gill, Brian, RAND Inst.
for Civil Justice, Changes in the
Federal Standards for Admitting
Expert Evidence in Federal Civil Cases
Since the Daubert Decision (2001) ........ 12-13

Donaldson, Jr., David H., Comment,
A Search for Principles of Mootness in the
Federal Courts: Part Two—Class Actions,
Ee 15

Fisher, Daniel, $7.8 Million Fee for Lawyers,
7-Cent Check for One Lucky Class Member,
FORBES, Jan. 8, 2016, http://www.forbes.com/
sites/danielfisher/2016/01/08/7-8-million-
fee-for-lawvers-7-cent-check-for-one-

lucky-class-member/#246210ee6c61 ......... 16
Frank, Theodore D., Requiem for

the Final Judgment Rule,

re 14

Hines, Laura J., Mirroring or
Muscling: An Examination of State
Class Action Appellate Rulemaking,
58 U. Kan. L. Rev. 1027 (2010) .............. 6

Nagareda, Richard A., The Preexistence
Principle and the Structure of the Class
Action, 103 Colum. L. Rev. 149 (2003) ........ 18

Redish, Martin H. & Kiernan, Megan B.,
Avoiding Death by a Thousand Cuts:
The Relitigation of Class Certification
and the Realities of the Modern Class Action,
99 Iowa L. Rev. 1659 (2014) ............. 16-17

x

TABLE OF AUTHORITIES—Continued
Page

Redish, Martin H., Class Actions and the
Democratic Difficulty: Rethinking the
Intersection of Private Litigation and Public
Goals, 2003 U. Chi. Legal F.71 ............. 18

Schwartz, Joanna C.,
Gateways and Pathways in Civil Procedure,
60 UCLA L. Rev. 1662 (2013) ............... 12

Skitol, Robert A., The Shifting Sands of Antitrust
Policy: Where It Has Been, Where It Is Now,
Where It Will Be in Its Third Century,
9 Cornell J.L. & Pub. Pol’y 239 (1999) ........ 18

Trask, Andrew J., The Roberts Court
and the End of the Entity Theory,
48 Akron L. Rev. 831 (2015) ................. 7

1

IDENTITY AND
INTEREST OF AMICUS CURIAE

Pursuant to Supreme Court Rule 37, Pacific Legal
Foundation (PLF) respectfully submits this brief
amicus curiae in support of Petitioner, Microsoft Corp.’
PLF was founded in 1973 and is widely recognized as
the most experienced nonprofit legal foundation of its
kind. PLF litigates matters affecting the public
interest at all levels of state and federal courts and
represents the views of thousands of supporters
nationwide. PLF advocates for limited government,
individual rights, and free enterprise. PLF has
litigated numerous cases involving Article III standing,
see, e.g., Spokeo v. Robins, No. 13-3339 (U.S. filed
May 1, 2014); First American Financial Corp. v.
Edwards, 132 S. Ct. 2536 (2012); Summers v. Earth
Island Institute, 555 U.S. 488 (2009); Massachusetts v.
E.P_A., 549 U.S. 497 (2007); Bennett v. Spear, 520 U.S.
154 (1997); Lujan v. Defenders of Wildlife, 504 U.S. 555
(1992), as well as cases involving class actions in
federal court. See, e.g., Sears, Roebuck & Co. v. Butler,
134 S. Ct. 1277 (2014); Wal-Mart Stores, Inc. v. Dukes,
131 S. Ct. 2541 (2011).

* Pursuant to this Court’s Rule 37.3(a), all parties have consented
to the filing of this brief. Letters evidencing such consent have
been filed with the Clerk of the Court.

Pursuant to Rule 37.6, Amicus Curiae affirms that no counsel
for any party authored this brief in whole or in part, and no
counsel or party made a monetary contribution intended to fund
the preparation or submission of this brief. No person other than
Amicus Curiae, its members, or its counsel made a monetary
contribution to its preparation or submission.

2

INTRODUCTION AND
SUMMARY OF ARGUMENT

Washington-based plaintiffs sued in a purported
class action alleging a design defect in Microsoft’s
manufacture of Xbox game consoles. The district court
denied class certification and the plaintiffs filed an
interlocutory appeal which, in its discretion, the Ninth
Circuit denied. Rather than pursuing their individual
claims, the plaintiffs voluntarily dismissed their claims
with prejudice for the purpose of appealing the
certification denial. Baker v. Microsoft Corp., 797 F.3d
607, 609-11 (9th Cir. 2015).

In Coopers & Lybrand v. Livesay, 437 U.S. 463,
466 (1978), this Court held that plaintiffs seeking
review of interlocutory orders denying class
certification typically must wait until after final
judgment, even if the order sounds the “death knell”
for the plaintiffs’ claims. Since Livesay, five circuit
courts of appeals have held that plaintiffs cannot evade
Livesay by voluntarily dismissing their lawsuits with
prejudice to force a final judgment that then becomes
immediately appealable. In this case, the Ninth
Circuit held to the contrary: that the plaintiffs’ tactic
of voluntary dismissal sufficed to create a final
judgment such that the appellate court had jurisdiction
to decide whether certification was properly denied or
should have been granted. Baker, 797 F.3d at 615.

“No principle is more fundamental to the
judiciary’s proper role in our system of government
than the constitutional limitation of federal-court
jurisdiction to actual cases or controversies.” Raines v.
Byrd, 521 U.S. 811, 818 (1997) (citation omitted). The
plaintiffs’ voluntary dismissal resulted in no remaining
“case or controversy” necessary for jurisdiction under

3

Article II of the U.S. Constitution. This Court should
not countenance the tactical end-run around Livesay.

The decision below should be reversed.
ARGUMENT
I

A PLAINTIFF WHO DISMISSES
WITH PREJUDICE LACKS ARTICLE III
STANDING TO APPEAL A CLASS
CERTIFICATION DENIAL

Article LI of the Constitution limits federal-court
jurisdiction to “cases” and “controversies.” U.S. Const.
art. [I], § 2. This constitutional boundary functions as
an “essential limit on [judicial] power: It ensures that
[courts] act as judges, and do not engage in
policymaking properly left to elected representatives.”
Hollingsworth v. Perry, 133 S. Ct. 2652, 2659 (2013).
In so doing, the standing doctrine furthers the
separation of powers defined by the Constitution. Jd.
at 2661.

A case or controversy exists when both the
plaintiff and the defendant have a “personal stake” in
the lawsuit. Camreta v. Greene, 131 S. Ct. 2020, 2028
(2011) (citation omitted). This requirement extends
through the course of the entire litigation; it is not a
snapshot in time, relevant only when the complaint is
filed. Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663,
669 (2016); Arizonans for Official English v. Arizona,
520 U.S. 43, 67 (1997). When “an intervening
circumstance deprives the plaintiff of a ‘personal stake
in the outcome of the lawsuit,’ at any point during
litigation, the action can no longer proceed and must be

4

dismissed as moot.” Genesis Healthcare Corp. v.
Symczyk, 133 S. Ct. 1523, 1528 (2013).

Whether a plaintiff has standing is a matter that
courts must determine objectively. If a court’s
assessment of constitutional standing defers to the
plaintiffs subjective assessment of the value of his
case, no case would ever be dismissed on such grounds.
See Laird v. Tatum, 408 U.S. 1, 13-14 (1972)
(“Allegations of a subjective ‘chill’ are not an adequate
substitute for a claim of specific present objective harm
or a threat of specific future harm; ‘the federal courts
established pursuant to Article ITI of the Constitution
do not render advisory opinions.”) (citation omitted);
Hollingsworth, 133 S. Ct. at 2661. Cf. Toms v. Allied
Bond & Collection Agency, Inc., 179 F.3d 103, 107 (4th
Cir. 1999) (“No party can create jurisdiction merely by
agreement; the Constitution vests authority in the
courts only where a concrete interest is present.”).

A. Denial of Class Certification
Has No Bearing on the Merits or
Plaintiffs Legal Ability to Proceed

Article III requires that the only type of voluntary
dismissal with prejudice that can be appealed is that
which “effectively” dismisses a case. See Laczay uv.
Ross Adhesives, 855 F.2d 351, 354 (6th Cir. 1988)
(citation omitted), cert. denied, 489 U.S. 1014 (1989);
Empire Volkswagon, Inc. v. World Wide Volkswagon
Corp., 814 F.2d 90, 94 (2nd Cir. 1987). An order
“effectively” dismisses a case when it affects the merits
of the case or imposes a significant legal burden on the
plaintiffs ability to proceed with the litigation. See
Local No. 438 Const. and General Laborers’ Union,
AFL-CIO v. Curry, 371 U.S. 542, 548-49 (1963) (courts
may consider jurisdictional determination whether

5

state courts may review a controversy within the
allegedly exclusive domain of the National Labor
Relations Board, a matter wholly independent of the
merits that is subject to no further review in the state
courts); Empire Volkswagon, 814 F.2d at 94 (partial
summary judgment dismissing most of plaintiffs
claims); Raceway Properties, lic. v. Emprise Corp., 613
F.2d 656, 657 (6th Cir. 1980) (district court’s
determination of relevant market for antitrust claim
effectively disposed of the case because the plaintiffs
could not proceed with evidence regarding the relevant
market outlined by the district court).

By definition, a ruling denying class certification
is procedural in nature and does not resolve the merits
of the named plaintiffs individual claim. See generally
Fed. R. Civ. P. 23 (discussing the procedural
requirements for class certification); Lewis v. Casey,
518 U.S. 343, 357 (1996) (“That a suit may be a
class action . . . adds nothing to the question of
standing... .”) (citation and internal quotation marks
omitted); Deposit Guaranty Natl Bank v. Roper, 445
U.S. 326, 336 (1980) (“We view the denial of class
certification as an example of a procedural ruling,
collateral to the merits of a litigation, that is
appealable after the entry of final judgment.”);
William P. Barnette, The Limits of Consent: Voluntary
Dismissals, Appeals of Class Certification Denials, and
Some Article III Problems, 56 S. Tex. L. Rev. 451, 477
(2015). Class certification decisions remain procedural
in nature even though the analysis of whether a class
should be certified will frequently “entail some overlap
with the merits of the plaintiffs underlying claim.”
Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2551
(2011). The “necessity of touching aspects of the merits
in order to resolve preliminary matters,” such as

6

certification, does not mean that the merits are
conclusively determined one way or the other by the
resolution of the preliminary matters. Jd. at 2552.

A court order denying class certification,
therefore, has no effect on the merits of the plaintiffs
claim, nor does it impose any constitutionally relevant
legal impediment. See Livesay, 437 U.S. at 464-66 (A
district court’s order denying class certification is not
“appealable as a matter of right,” even if denial of class
status sounds the “death knell” of the litigation
because the named plaintiffs find it uneconomical to
proceed on their individual claims.); American Express
Co. v. Italian Colors Restaurant, 133 S. Ct. 2304,
2309-10 (2013) (Federal Rule of Civil Procedure 23
does not establish any entitlement to class proceedings
for vindication of statutory rights, ever when the costs
of proceeding individually are “prohibitively high.”)
(citation omitted). The plaintiffs individual claims
remain just as they were prior to filing a motion for
certification.

Moreover, denial of class certification does not
necessarily render it “economically imprudent” for
individual plaintiffs to pursue their case further.
Barnette, supra, at 478 (citing Laura J. Hines,
Mirroring or Muscling: An Examination of State Class
Action Appellate Rulemaking, 58 U. Kan. L. Rev. 1027,
1032 (2010)). The cost of litigation will not always
lead an unsuccessful class representative to stop
litigating. See Livesay, 437 U.S. at 470, 471 & n.15
(“the litigation will often survive an adverse class
determination .. . [given the plaintiffs] prospect of
prevailing on the merits and reversing an order
denying class certification.”). Im cases where a
successful plaintiff is entitled to recover fees, the

7

individual litigation may well be worth pursuing. And,
for those truly small dollar cases, small claims court
efficiently and inexpensively fits the bill. See Pastor v.
State Farm Mut. Auto. Ins. Co., 487 F.3d 1042, 1047
(7th Cir. 2007); Maguire v. Sandy Mac, Inc., 145 F.R.D.
50, 54 (D.N.J. 1992) (denying class certification while
cautioning against “the transformation of the federal
court system into a veritable small claims court”).

B. A Purported Class
Representative’s Claims Rise
and Fall with His Individual Claims

Prior to class certification, a purported class
representative presents only his individual substantive
claims. Campbell-Ewald, 136 S. Ct. at 667; Andrew J.
Trask, The Roberts Court and the End of the Entity
Theory, 48 Akron L. Rev. 831, 860 (2015) (“[A] class
action is nothing more than an individual lawsuit until
the time that a court certifies it as a class
action.”). Courts have found a secondary interest in
the existence of the purported class itself, but only
when the named plaintiffs substantive claims are
mooted involuntarily. See Genesis Healthcare, 153 S.
Ct. at 1530; U.S. Parole Comm'n v. Geraghty, 445 U.S.
388, 403 (1980); Roper, 445 U.S. at 330; Ruppert v.
Principal Life Ins. Co., 705 F.3d 839, 843 (8th Cir.
2013) (Ruppert’s voluntary dismissal (relinquishment)
of his individual claims renders the case moot,
eliminating any party before the court with a sufficient
personal stake in challenging the district court’s denial
of class certification.); White v. Baptist Mem’ Health
Care Corp., 699 F.3d 869, 878 (6th Cir. 2012) (“[A] lead
plaintiff cannot be similarly situated and represent
opt-in plaintiffs without a viable claim.”); Himler v.
Comprehensive Care Corp., 790 F. Supp. 114, 116 (E.D.

8

Va. 1992), appeal dismissed, 993 F.2d 1537 (4th Cir.
1993) (“By employing this procedure to appeal the
denial of their motion for class certification, plaintiffs
are in effect attempting to sidestep the rule that
interlocutory orders are not appealable as well as the
rule that voluntary dismissals with prejudice by
plaintiffs are not appealable.”).

These holdings are consistent with the general
rule that a party who voluntarily dismisses a claim
with prejudice lacks both an injury and adversity
within the meaning of Article III. United States v.
Procter & Gamble Co., 356 U.S. 677, 680 (1958). There
is nothing unique about the role of an unsuccessful
class representative that should change the application
of the general rule. See, e.g., Rhodes v. EI. du Pont de
Nemours & Co., 636 F.3d 88, 100 (4th Cir. 2011)
(‘[W]hen a putative class plaintiff voluntarily
dismisses the individual claims underlying a request
for class certification, as happened in this case, there
is no longer a ‘self-interested party advocating’ for class
treatment in the manner necessary to satisfy
Article II standing requirements.”); Potter v. Norwest
Mortgage, Inc., 329 F.3d 608, 611-13 (8th Cir. 2003)
(courts should normally dismiss an action as moot
when the named plaintiff settles its individual claim
and the class has not been certified).’

* The normal rules regarding mootness also continue to apply.
Geraghty, 445 U.S. at 399 (“inherently transitory” claims may
continue beyond the mootness of the individually named plaintiffs
claim); Gerstein v. Pugh, 420 U.S. 103, 110-11 n.11 (1975) (holding
that the claims of the unnamed members of the class are not
mooted by the termination of the class representative’s claims
when the case addressed inherently transitory challenges to
probable cause procedures).

9

Within the meaning of Article III there is only the
class representative’s individual claim that she is
seeking to prove on behalf of the class. See Fed. R. Civ.
P. 23(a) (“One or more members of a class may sue...
as representative parties on behalf of all
members... .”); Schlesinger v. Reservists Comm. to
Stop the War, 418 U.S. 208, 216 (1974) (“To have
standing to sue as a class representative it is essential
that a plaintiff must be part of that class, that is, he
must possess the same interest and suffer the same
injury shared by all members of the class he
represents.”); Bailey v. Patterson, 369 U.S. 31, 32-33
(1962) (per curiam) (“[Plaintiffs] cannot represent a
class of whom they are not a part.”). When a plaintiff
dismisses claims with prejudice, they “are gone
forever—they are not reviewable by [an appellate
cjourt and may not be recaptured at the district court
level.” Camesi v. Univ. of Pittsburgh Med. Ctr., 729
F.3d 239, 247 (3d Cir. 2013) (citing Fairley v. Andrews,
578 F.3d 518, 522 (7th Cir. 2009)) (a litigant’s
voluntary dismissal of a portion of their claims in order
to secure an appeal, extinguishes those dismissed
claims forever); Dannenberg v. Software Toolworks, 16
F.3d 1073, 1077 (9th Cir. 1994) (a party may not revive
claims dismissed for the purposes of establishing a
final appealable order). That is, there is no amorphous
“class” claim floating free of the named plaintiffs
individual claim. Barnette, supra, at 480.° As such,

* Only once certified does a class acquire a limited legal status
that may be separated from the interests of the named plaintiff,
that allows the class to continue with a new representative should
the original named plaintiffs claim be rendered moot. See
Geraghty, 445 U.S. at 405, 407 (the question of who would
represent the class on remand is different from whether the class
claim was moot). However, “that separate legal status does not

(continued...)

10

the plaintiff has no standing remaining to appeal the
results of interlocutory motions such as a denial of
class certification.

i

POLICY CONSIDERATIONS FAVOR
EXTENSION OF LIVESAY TO
DISMISSALS WITH PREJUDICE

A. Procedural Rules Should Not
Encourage Litigation Gamesmanship

The general rule is that “a party is entitled to a
single appeal, to be deferred until final judgment has
been entered,” and exceptions must “never be allowed
to swallow” it. Mohawk Indus., Inc. v. Carpenter, 558
U.S. 100, 106 (2009) (citation omitted). An appeal may
not proceed “in fragments.” Collins v. Miller, 252 U.S.
364, 370 (1920). In the appellate-jurisdiction context,
the Court “has no authority to create equitable
exceptions to jurisdictional requirements.” Bowles v.
Russell, 551 U.S. 205, 214 (2007). The final judgment
rule

emphasizes the deference that appellate
courts owe to the trial judge as the individual
initially called upon to decide the many
questions of law and fact that occur in the
course of trial .... In addition, the rule is in
accordance with the sensible policy of
avoid[ing] the obstruction to just claims that
would come from permitting the harassment
and cost of a succession of separate appeals

* (...continued)

somehow untether the substantive rights of the class members
from the claim of the class representative.” Barnette, supra,
at 480 n.226 (citing Sosna v. Iowa, 419 U.S. 393, 399 (1975)).

11

from the various rulings to which a litigation
may give rise, from its initiation to entry of
judgment.

Van Cauwenberghe v. Biard, 486 U.S. 517, 521 n.3
(1988) (citations and internal quotation marks
omitted).

A plaintiff has no right to an interlocutory appeal
of a denial of class certification even when the plaintiff
perceives that denial to be the “death knell” of his
lawsuit. Livesay, 437 U.S. 463. The policy reasons
underlying that decision justify its broad application.
Courts have refused to permit various attempts to
avoid the final judgment rule with regard to class
certification denials. For example, a plaintiff cannot
use a settlement agreement as a springboard to appeal
a class certification denial. See Anderson v. CNH U.S.
Pension Plan, 515 F.3d 823, 827 (8th Cir. 2008)
(recitation in settlement agreement that plaintiff
reserves right to appeal denial of class certification not
sufficient to create concrete interest in class
certification issue required by Roper, 445 U.S. 326);
Muro v. Target Corp., 580 F.3d 485, 491 (7th Cir. 2009)
(“A voluntary settlement by the prospective class
representative often means that, as a practical] matter,
the settling individual has elected to divorce himself
from the litigation and no longer retains a community
of interests with the prospective class.”). In these
cases, the plaintiff must proceed with his claims and
appeal the denial of class certification once the court
has entered final judgment on the merits.

“Policy matters, too, in sculpting the final
judgment rule.” State Treasurer of State of Michigan
v. Barry, 168 F.3d 8, 19 (11th Cir. 1999) (Cox, J.,
concurring). For “operational consistency and

12

predictability in the overall application of § 1291,” this
Court should adopt a bright-line rule to determine
whether jurisdiction exists or not when a purported
class action representative dismisses his lawsuit with
prejudice for the sole purpose of creating a “final
judgment.” Jd. at 21 (quoting Budinich v. Becton
Dickinson & Co., 486 U.S. 196, 202 (1988)); Grupo
Dataflux v. Atlas Global Grp., L.P., 541 U.S. 567, 582
(2004) (“Uncertainty regarding the question of
jurisdiction,” is “particularly undesirable.”).

The plaintiffs proposed exception to the final
judgment rule in this case violates all established
policies favoring the final judgment and avoiding
piecemeal litigation. He argues that the exception is
necessary to prevent his abdication of the lawsuit as
uneconomical to pursue. But the potential effects of a
denial of class certification are not unique to that
procedural aspect of a case. An analogous situation
arises when a trial court refuses to allow a party’s
expert witness to testify, pursuant to its gatekeeping
function under Daubert v. Merrell Dow
Pharmaceuticals, Inc., 509 U.S. 579, 597 (1993) (A
court must ensure that the expert testimony at issue
“both rests on a reliable foundation and is relevant to
the task at hand.”). Like class certification denials, the
exclusion of a plaintiff's expert may cause the plaintiff
to “narrow the case, drop the case altogether, or accept
a reduced settlement” and may cause the defendant to
move for summary judgment; while exclusion of a
defendant’s expert may cause the defendant to “accept
certain allegations by plaintiffs” or settle. Joanna C.
Schwartz, Gateways and Pathways in Civil Procedure,
60 UCLA L. Rev. 1652, 1664 n.40 (2013) (citing Lloyd
Dixon & Brian Gill, RAND Inst. for Civil Justice,
Changes in the Federal Standards for Admitting Expert

13

Evidence in Federal Civil Cases Since the Daubert
Decision 55 (2001)). And yet plaintiffs may not
circumvent the need for a final judgment to appeal.
See Chapman v. Procter & Gamble Distributing, LLC,
766 F.3d 1296, 1302 (11th Cir. 2014) (dismissing
appeal of Daubert order for lack of standing, after
parties agreed to a joint dismissal with prejudice,
including a provision purportedly reserving the right to
appeal the Daubert ruling).

Courts routinely halt attempts to circumvent
fundamental procedural rules. In Camesi v. Univ. of
Pittsburgh Med. Ctr., 729 F.3d at 245, the Third
Circuit held that voluntary dismissal of individual
claims constituted an impermissible attempt to
manufacture finality for purposes of appeal. The court
spoke of the “procedural sleight-of-hand” in harsh
terms: “Appellants have attempted to short-circuit the
procedure for appealing an interlocutory district court
order that is separate from, and unrelated to, the
merits of their case.” Allowing such a maneuver, the
court continued, would leave no obstacle to “prevent
litigants from employing such a tactic to obtain review
of discovery orders, evidentiary rulings, or any of the
myriad decisions a district court makes before it
reaches the merits of an action. This would greatly
undermine the policy against piecemeal litigation.” Jd.
at 245-46. See also Airframe Systems, Inc. v. Raytheon
Co., 601 F.3d 9, 14 (1st Cir. 2010) (doctrine of claim
preclusion “protect|s] litigants against gamesmanship
and the added litigation costs of claim-splitting, and
preventing scarce judicial resources from being
squandered in unnecessary litigation”); FTC v. Garvey,
383 F.3d 891, 900 (9th Cir. 2004) (courts discourage
strategic gamesmanship in litigation that hinders case
development and imposes unnecessary costs).

14

“Strategic or merely lazy circumventions of a legal
process grounded in a sound policy have the effect of
eroding the regularized, rational character of litigation
to the detriment of practitioners and clients alike.”
Bode & Grenier, LLP v. Knight, 808 F.3d 852, 861
(D.C. Cir. 2015) (citation omitted).

One ironic but inevitable by-product of the
plaintiffs’ proposed flexible approach to finality is that
litigants face the undesirable risk that failure to
appeal from a particular ruling at the time of its entry
could constitute a waiver of the right to appeal at the
conclusion of the case. See Dickinson v. Petroleum
Conversion Corp., 338 U.S. 507, 516 (1950) (proposed
intervenor “could have appealed” and the “failure to [do
so] forfeits its right of review”). Lawyers unsure of the
finality of the decision would appeal as a precautionary
measure, even though the result is added costs and
unwanted delay, disrupting the judicial process and
undermining confidence in the trial court. Theodore D.
Frank, Requiem for the Final Judgment Rule, 45 Tex.
L. Rev. 292, 317 (1966). Cf. Tyrues v. Shinsecki, 732
F.3d 1351, 1358 (Fed. Cir. 2013) (a veteran must
appeal decision of Board of Veterans’ Appeals on a
partial claim to avoid being barred by a rule requiring
an appeal within 120 days of decision); Contractors
Edge, Inc. v. City of Mankato, 863 N.W.2d 765, 775,
781 (Minn. 2015) (Lillehaug, J., dissenting) (a holding
ostensibly to “discourage piecemeal appeals” by
creating a “new, murky category of ‘mostly final’
judgments” will “encourage litigation over late

appeals”).

Moreover, if an individual plaintiff voluntarily
dismisses his case with prejudice, for the purpose of
appealing denial of class certification, is that plaintiffs

15

individual claim revived if the appellate court holds
that the class should have been certified? See, e.g.,
Hall v. State Farm Mut. Auto. Ins. Co., 215 Fed. Appx.
423, 427 (6th Cir. 2007) (“[U]nnamed putative class
members are not technically parties to an action prior
to class certification and . . . as a consequence, [the
substituted named plaintiff] was not a true party at
the time that [the originally named plaintiff] filed
suit.”). If not, does class counsel have a right to
substitute another named plaintiff of his or her
choosing? See In re Community Bank of Northern
Virginia, 418 F.3d 277, 313 (3d Cir. 2005) (“[Clourts
have recognized that class counsel do not possess 4
traditional attorney-client relationship with absent
class members.”). Geraghty, 445 U.S. at 407 (Even if a
case or controversy continues to exist after denial of
class certification, the “question of who is to represent
the class is a separate issue.”) (citing David H.
Donaldson, Jr., Comment, A Search for Principles of
Mootness in the Federal Courts: Part Two—Class
Actions, 54 Tex. L. Rev. 1289, 1331-32 (1976));
Comment, Continuation and Representation of Class
Actions Following Dismissal of the Class
Representative, 1974 Duke L.J. 573, 602-08).

B. The Interests of Plaintiffs’
Counsel Cannot Be Imputed
to the Plaintiffs Themselves

The Third Circuit held in Hackett v. General Host
Corp., 455 F.2d 618, 625 (3d Cir.), cert. denied, 407
U.S. £25 (1972):

Realistically, when we are asked to grant
interlocutory appellate review of an adverse
class action deterniination we are asked to
recognize a separate interest of the attorney

16

sufficient to bring the class action
determination within the “collateral order”
doctrine, or to recognize the standing of the
attorney’s client to assert such an interest on
his behalf. We decline to do either.

The lawyerly howls that greet the suggestion of a
separate interest reveal one of the not-so-hidden truths
about many class action cases: the instigators and
most interested parties are not the consumers or
employees or other individuals who suffered some
small-dollar loss; the instigators and interested parties
are the attorneys who seek to represent them for a
significant cut of the settlement or eventual judgment.‘
See Allen v. Bedolla, 787 F.3d 1218, 1223-24 (9th Cir.
2015) (vacating settlement of uncertified class action
and cautioning district court on remand to be wary of
class counsels’ self-interest and possible collusion);
Phillips v. Asset Acceptance, LLC, 736 F.3d 1076, 1080
(7th Cir. 2013) (“[C}lass action attorneys are the real
principals and the class representative/clients their
agents ... .”) (internal q «tation marks omitted);
Espenscheid v. DirectSat USA, LLC, 688 F.3d 872, 876
(7th Cir. 2012) (“It is true that class actions are almost
always the brainchild of lawyers who specialize in
bringing such actions.”); Martin H. Redish & Megan B.
Kiernan, Avoiding Death by a Thousand Cuts: The

* See Daniel Fisher, $7.8 Million Fee for Lawyers, 7-Cent Check
for One Lucky Class Member, FORBES, Jan. 8, 2016,
http://www.forbes.com/sites/danielfisher/2016/01/08/7-8-million-f
ee-for-lawyers-7-cent-check-for-one-lucky-class-member/#24621
Oee6c61 (multiple law firms representing class action against
Bank of America settled for fees equal to a quarter of the
$31 million the bank agreed to pay for improper flood insurance
solicitations and shared commissions; class members received only
2.28% of the improperly paid insurance premiums).

17

Relitigation of Class Certification and the Realities of
the Modern Class Action, 99 Iowa L. Rev. 1659, 1662
(2014) (“For all practical purposes, class attorneys
function as far more than class members’ legal
representative: [Instead,] they act as quasi-guardians
or trustees on behalf of the absent class members.”).
The fact that plaintiffs frequently abandon cases
following the denial of certification likely says more
about the putative class lawyer’s fee,” rather than the
individual plaintiffs potential recovery. Barnette,
supra, at 478 n.216 (citing Amchem Prods. v. Windsor,
521 U.S. 591, 617 (1997) (“A class action ...
aggregate[es] the relatively paltry potential recoveries
into something worth someone's (usually an attorney’s)
labor.”)).

Few class actions actually proceed _ to
judgment—the vast majority settle. “[W]hen damages
allegedly owed to tens of thousands of potential
claimants are aggregated and decided at once, the risk
of an error will often become unacceptable. Faced with
even a small chance of a devastating loss, defendants
will be pressured into settling questionable claims.”
AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 350
(2011). This Court and others acknowledge “the risk of
‘in terrorem’ settlements that class actions entail.” Jd.
(citations omitted). For this reason, counsel on both
sides of class action litigation recognize the decision to
certify as the most defining moment in the litigation.
See Livesay, 437 U.S. at 476; Newton v. Merrill Lynch,
259 F.3d 154, 164 (8d Cir. 2001) (Once the class is
certified, defendant companies are under “hydraulic

° A mere interest in obtaining attorneys’ fees without an
underlying claim does not satisfy Article III. Lewis v. Contl Bank
Corp., 494 U.S. 472, 480 (1990).

18

pressure’ to settle.). “In short, class actions today
serve as the procedural vehicle not ultimately for
adversarial litigation but for dealmaking on a mass
basis.” Richard A. Nagareda, The Preexistence
Principle and the Structure of the Class Action, 103
Colum. L. Rev. 149, 151 (2003).

Such litigation is thus used not primarily to
redress injury but as a mechanism to “line lawyers’
pockets despite the absence of any substance to the
underlying allegations.” Robert A. Skitol, The Shifting
Sands of Antitrust Policy: Where It Has Been, Where It
Is Now, Where It Will Be in Its Third Century, 9
Cornell J.L. & Pub. Pol’y 239, 266 (1999). These “suits
are not, in any realistic sense, brought either by or on
behalf of the class members,” but by “private attorneys
who initiate suit and who are the only ones rewarded
for exposing the defendants’ law violations.” Martin H.
Redish, Class Actions and the Democratic Difficulty:
Rethinking the Intersection of Private Litigation and
Public Goals, 2003 U. Chi. Legal F. 71, 77. Class
members “neither make the decision to sue. . . nor
receive meaningful compensation.” Jd. Rather, the
prospect of significant attorneys’ fees “provide[ | the
class lawyers with a private economic incentive to
discover violations of existing legal restrictions on
corporate behavior.” Id.

The plaintiffs’ attorneys’ interest in recovering
fees cannot therefore be sufficient reason for creating
a broad exception to the general rule that class
certification denials may be appealed only when the
courts exercise their discretion to permit it.

19

+

CONCLUSION

“In an era of frequent litigation [and] class
actions, .. . courts must be more careful to insist on the
formal rules of standing, not less so.” Ariz. Christian
Sch. Tuition Org. v. Winn, 563 U.S. 125, 146 (2011). In
this case, Article III’s demands and _ policy
considerations both lead to the same result.

The decision below should be reversed.
DATED: March, 2016.

Respectfully submitted,

DEBORAH J. LA FETRA
Counsel of Record
Pacific Legal Foundation
930 G Street
Sacramento, California 95814
Telephone: (916) 419-7111
Facsimile: (916) 419-7747
E-mail: DLaFetra@pacificlegal.org

Counsel for Amicus Curiae Pacific Legal Foundation

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385016_0621%3A17. Public record. Not legal advice.