Whether the presence of uninjured class members can defeat class certification is a hot-button topic in class action litigation.  Just four days after the Supreme Court dismissed the appeal in Laboratory Corporation of America Holdings v. Davis regarding whether class certification is permissible under Rule 23(b)(3) when some members of the putative class are uninjured (we described this case here), the Sixth Circuit affirmed class certification in Pickett v. City of Cleveland, Ohio, despite defendant’s argument that up to twenty percent of the class did not suffer an economic injury.  — F. 4th —-, 2025 WL 1622110 (6th Cir. June 9, 2025).

In Pickett, defendant the City of Cleveland appealed the district court’s decision to certify under Rules 23(b)(2) and 23(b)(3) a “water lien class,” which consisted of 943 African American individuals in Cuyahoga County who were assessed a water lien by the City.  The plaintiffs allege that Cleveland’s water policy disproportionately harms Black homeowners in violation of the federal Fair Housing Act (FHA) and the Ohio Civil Rights Act (OCRA).  On appeal, the City argued that because up to twenty percent of the class did not suffer any economic injury as a result of water liens, the class fails the predominance requirement of Rule 23(b)(3) and that plaintiffs do not have Article III standing. 

The Sixth Circuit held that the district court did not abuse its discretion by certifying the class.  Id. at *3.  With respect to predominance, the court held that a common issue—“whether the City’s disproportionate placement of water liens on Black homeowners and residents of Cuyahoga County violates the FHA”—predominates, since the question “impacts the whole of the Water Lien Class.”  Id. at *5.  In other words, “Plaintiffs’ alleged injury, disparate impact through the City’s assessment of water liens, is the same for all class members.”  Id.  According to the court, the fact that some class members may not be eligible for economic damages did not defeat predominance, because the common question of whether there was a disparate impact “can be proven through evidence common to the Class,” and any individualized damages award could be calculated later, using a classwide methodology.  Id. at *6.

The court also found that class members had standing despite the City’s argument that up to twenty percent of the class suffered no economic injury traceable to a water lien.  See id.  The court explained that class members still suffered an alleged injury in fact even if they were not economically harmed because their “disparate impact claim falls squarely within the FHA’s scope and is thus comparable to traditional harms found in the Constitution.”  Id. at *8.

Judge Gibbons issued a concurring opinion in which she agreed with the majority holding but set forth her view on a separate issue: whether the City could have forfeited a challenge to certifying an injunctive-relief class under Rule 23(b)(2).  The City did not contest certification under Rule 23(b)(2) before the district court or in its petition for review, and the City did not offer an argument against certification on those grounds in its appellate brief.  See id. at *4 n.6.  The majority had noted that “such skeletal treatment of an issue usually results in its waiver,” id., although it nonetheless analyzed and affirmed the district court’s decision to certify the class under Rule 23(b)(2).  See id. at *5.  Judge Gibbons explained her view that the City could not forfeit a challenge to a Rule 23(b)(2) class and in fact “lacks the ability to do so,” because plaintiffs—not the defendant—have the burden to satisfy the prerequisites of Rules 23(a) and 23(b).  See id. at *9–10.  Judge Gibbons nevertheless agreed with the majority that a Rule 23(b)(2) class was proper in this case.  See id. at *10. 

Pickett is only the most recent entry in the growing circuit split about whether a “damages class consisting of both injured and uninjured members” meets the requirements of Rule 23.  Lab’y Corp. of Am.Holdings v. Davis, 2025 WL 1583302, at *3 (U.S. June 5, 2025) (Kavanaugh, J., dissenting).  Although the Supreme Court declined to address this issue in the recent Davis appeal, we expect that the Court may look for another opportunity to address this question in the near future.