class certification – Consumer Financial Services Watch

COVID-19: Echoes Don’t Fade: Lessons Learned From the Home Affordable Modification Program for the Next Wave of Mortgage Class Action Litigation

May 18 2020

By Brian M. Forbes and Robert W. Sparkes, III

As the country grapples with the impacts of the COVID-19 pandemic, financial service providers should hold fast to the adage that those who forget the past are destined to repeat it. The last financial crisis centered in large part on the mortgage industry, both in its inception and its slow climb to stabilization. Like the last crisis, a growing percentage of homeowners are not able to make their mortgage payments, requiring loan servicers to employ various loss mitigation tools to reduce individual’s financial hardships. While the COVID-19 pandemic is impacting nearly all sectors of the economy, the mortgage industry can look back to past experiences to help mitigate present and future risks. If past is prologue, one risk likely to increase in the coming months is class action litigation.

COVID-19: Defending Class Actions in Massachusetts in the Wake of COVID-19

Apr 14 2020

By Brian M. Forbes, Robert W. Sparkes, III, and Michael R. Creta

The novel coronavirus (“COVID-19”) has caused severe business disruptions throughout Massachusetts. Many companies doing business in Massachusetts have been forced to indefinitely shut their doors, while others are facing supply problems or decreased product demand. In addition to navigating these choppy economic waters, business leaders must also consider the risks likely to follow the current crisis.

No Rubber Stamp: Ninth Circuit Reverses Certification of Nationwide Class Settlement Due to Failure to Account for Variations in State Law

Feb 06 2018

By David D. Christensen and Matthew N. Lowe

The Ninth Circuit recently clarified in In re Hyundai and Kia Fuel Economy Litigation that district courts must carefully scrutinize class settlements to ensure that they satisfy each of the prerequisites of Rule 23, especially for Rule 23(b)(3) classes, and that courts cannot substitute the fairness of a settlement for the proper certification analysis. Of particular note, the court emphasized the need to analyze whether potential material differences in the applicable states’ laws preclude certification of a nationwide settlement class.

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Step by Step: Stricter Requirements for Class Certification Inch Closer to Legislative Enactment

Jan 21 2016

By: Brian M. Forbes, Jennifer J. Nagle

Just over 10 years after the passage of the federal Class Action Fairness Act (“CAFA”), Congress is again considering further legislative reform to class action litigation. Among other reforms, CAFA opened additional avenues for defendants to remove class action litigation to federal court (often viewed by the defense bar as a more favorable venue than state court) and placed additional limitations on class-wide settlements. Now, legislative attention is being paid to class actions that are certified absent a showing of common injury among all class members. On January 8, 2016, the U.S. House of Representatives passed the Fairness in Class Action Litigation and Furthering Asbestos Claim Transparency Act of 2016 (“the Act” or “H.R. 1927”). If enacted into law, H.R. 1927 would represent a significant change to the standard that a class action plaintiff must satisfy for a court to certify his or her proposed class.

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S.D.N.Y. Judge Denies Class Certification in Fair Housing Act Suit against Morgan Stanley

May 20 2015

By: Andrew C. Glass, Roger L. Smerage, Eric W. Lee

The United States District Court for the Southern District of New York recently denied class certification in a Fair Housing Act disparate-impact case in which plaintiffs attempted to hold Morgan Stanley liable for investing in subprime mortgage loans that another entity originated. Adkins v. Morgan Stanley, No. 12-CV-7667, 2013 WL 3835198 (S.D.N.Y. May 14, 2013).

Class Certification Trends in Consumer Data Breach Litigation—Individualized Damages Theories May Preclude Certification

Dec 16 2014

By: Nicholas Ranjan and James P. Angelo

In the last two years, there has been a proliferation of class action lawsuits filed in response to high-profile data breaches compromising the personally identifiable information of customers of various companies. Major corporations including Target, Coca-Cola, and Michaels have all fallen victim to such suits. In many cases, a single data breach event has spawned dozens of class action lawsuits (for example, Target, at one point, faced over 100 such suits in a number of jurisdictions, which have since been consolidated in an MDL).

Although a number of class actions in the data-breach context have been filed, there have been relatively few class certification decisions at this point. However, as the pending cases make their way to the class certification stage, two recent decisions may prove useful for defendants in attempting to defeat class certification—principally, on the basis of Federal Rule of Civil Procedure 23(b)(3)’s “predominance” requirement. That is, In re Hannaford Bros. Co. Customer Data Sec. Breach Litig., 293 F.R.D. 21 (D. Me. 2013) and Comcast v. Behrend, 133 S.Ct. 1426 (2013), suggest that class certification may be difficult in certain types of data breach cases due to the existence of individualized damages issues, which may undercut the predominance of common questions necessary to pursue a class action.

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