Eleventh Circuit

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We previously covered the Eleventh Circuit’s decision in Johnson v. NPAS Solutions, LLC, 975 F.3d 1244 (11th Cir. 2020), in which the Eleventh Circuit relied on two Supreme Court decisions from the 1880s to prohibit courts from awarding incentive or service awards to class representatives in class settlements.  Id. at 1255 (citing Trustees v. Greenough, 105 U.S. 527 (1881), and Cent. R.R. & Banking Co. v. Pettus, 113 U.S. 116 (1885).  Although the Eleventh Circuit was the first federal appellate court to bar these awards in all circumstances, a recent Second Circuit decision agreed that these awards are “likely impermissible” under Supreme Court precedent, while observing that it would take the entire Second Circuit to overturn prior precedent upholding incentive awards.  See Fikes Wholesale, Inc. v. HSBC Bank USA, N.A., 62 F.4th 704, 721 (2nd Cir. 2023).  The Department of Justice has likewise implied that it agrees with the Eleventh Circuit’s position, relying on the Johnson decision in an effort to block incentive awards from a class settlement in a District of Columbia court. …

Continue Reading Supreme Court Denies Cert on Incentive Awards

The Eleventh Circuit recently addressed two aspects of Article III standing relevant to class action settlements: the standing of a class member to object, and the standing of class representatives to seek injunctive relief—and thus whether such injunctive relief should be given any weight as part of the approval process.…

Continue Reading Eleventh Circuit Analyzes Article III Standing in Class Action Settlement Context

The Eleventh Circuit is poised to reconsider recent standing decisions favorable for defendants seeking to invoke Article III’s standing requirements to defeat class certification.

At issue is the Eleventh Circuit’s July 2022 decision in Drazen v. Pinto, holding that (i) all class members must have Article III standing in order to receive individual damages (whether through a settlement or otherwise), and (ii) the standing determination is decided under Eleventh Circuit law, even where certain class members do not reside within the Eleventh Circuit’s geographic boundaries and may have standing under other circuit precedent.  41 F.4th 1354, 1360–61 (11th Cir. 2022). The dispute in Drazen arose in the context of the Telephone Consumer Protection Act (“TCPA”), and addressed both unwanted phone calls and text messages.  While a settlement in Drazen was pending, the Eleventh Circuit held in Salcedo v. Hanna, 936 F.3d 1162, 1168 (11th Cir. 2019), that, contrary to precedent in other circuits, a single unwanted text message was not sufficient to give rise to Article III standing under the TCPA.  Because the panel was bound by Salcedo, and because the proposed class definition in the Drazen settlement included individuals whose sole harm was an unwanted text message, those individuals did not have standing.  The panel therefore vacated the district court’s approval of the settlement.…

Continue Reading Eleventh Circuit to Reconsider Standing Decisions

An Alabama district court recently granted dismissal of a class action asserting Illinois Biometric Information Privacy Act (“BIPA”) claims brought by Illinois residents against ProctorU, Inc. in Thakkar v. ProctorU Inc., No. 2:21-cv-01565 (N.D. Ala.).  The district court concluded that a choice-of-law provision contained in the terms of service and which required the application of Alabama law precluded the application of BIPA to the conduct alleged.…

Continue Reading Alabama Federal Court Finds Choice-of-Law Provision Bars BIPA Privacy Lawsuit Against Online Examination Company

If a tree falls in the forest but no one is around to hear it, did it make a sound?  Philosophers disagree.  If a product contains a contaminant but no one gets sick, did it cause an injury?  Judges disagree.

In the 2000s, enterprising plaintiffs’ attorneys attempted to push the boundaries of existing tort law by arguing that plaintiffs are entitled to damages for defects even when they cause no physical injury.  These so-called “no-injury” theories of liability were largely rejected by courts.  E.g., Rivera v. Wyeth-Ayerst Lab’ys, 283 F.3d 315, 320–21 (5th Cir. 2002) (dismissing “no-injury products liability law suit”); Johnson v. Bankers Life & Cas. Co., 2014 WL 4494284, at *7 (W.D. Wis. Sept. 12, 2014) (recognizing that in the “consumer product context, courts routinely find lack of standing where—while a product may have been defective in the hands of others—the individual plaintiffs did not suffer the defect and, therefore, suffered no injury”).

While these cases closed the door on “no-injury” product liability claims, they left open the possibility of other “no-injury” claims, such as claims that a manufacturing defect breached a warranty or constituted fraud.  E.g., Cole v. Gen. Motors Corp., 484 F.3d 717, 723 (5th Cir. 2007) (“Notably in this case, plaintiffs may bring claims under a contract theory based on the express and implied warranties they allege.”).

Whether and when “no-injury” claims are viable is a hotly debated question.  As more fully discussed below, courts disagree on whether a plaintiff who has purchased a contaminated or defective product—but who has successfully used the product for its intended purpose while suffering no physical injury—can maintain a claim.…

Continue Reading A Closer Look: Does Purchasing a Defective or Contaminated Product Always Cause an Article III Injury?

The Eleventh Circuit, sitting en banc, recently applied TransUnion to hold that a plaintiff lacked Article III standing to bring claims under the Fair Debt Collection Practices Act.  Hunstein v. Preferred Collection & Mgmt. Servs., Inc., No. 19-14434, 2022 WL 4102824 (11th Cir. Sept. 8, 2022)(en banc).  The en banc decision reversed a controversial panel decision allowing a plaintiff to sue a collection agency for disclosing information about his debt to the agency’s mail vendor.…

Continue Reading Eleventh Circuit, Sitting En Banc, Reverses Panel Decision And Holds FDCPA Plaintiff Lacks Standing

On the heels of the Ninth Circuit’s recent decision in Bowerman—which held that questions concerning the “existence of damages” for each class member can prevent certification—the Eleventh Circuit became the latest in a growing number of courts to conclude that class certification should be denied when plaintiffs cannot prove that each individual class member actually suffered damages.…

Continue Reading Individualized Damages Issues Preclude Class Certification in Eleventh Circuit

In Drazen v. Pinto, the Eleventh Circuit vacated a class settlement and held that in order to receive individual damages (whether through a settlement or otherwise), all class members must have Article III standing under Circuit precedent.  2022 WL 2963470, at *6 (11th Cir. July 27, 2022).  The decision gives defendants another tool to defeat class certification, while at the same time makes it more difficult to include class members that lack standing in classwide settlements. …

Continue Reading Eleventh Circuit Holds that All Class Members Must Have Standing Under Circuit Law to Recover Individual Damages

The en banc Eleventh Circuit recently denied a petition to rehear the case of Johnson v. NPAS Solutions, LLC (Johnson II).  See 2022 WL 3083717 (11th Cir. Aug. 3, 2022).  The initial opinion in Johnson relied on two Supreme Court decisions from the 1880s to hold that district courts can never, under…

The Class Action Fairness Act (“CAFA”) includes a “local controversy” exception, requiring federal district courts to decline jurisdiction over classes where, amongst other things, more than “two-thirds of the members of all proposed plaintiff classes in the aggregate are citizens of the State in which the action was originally filed.”  28 U.S.C. § 1332(d)(4)(A)(i)(I).  In Simring v. Greensky, LLC, — F.4th —, 2022 WL 894206 (11th Cir. Mar. 28, 2022), the Eleventh Circuit addressed, where plaintiffs have not submitted actual evidence on the residency of putative class members, whether courts are confined to the class definition in a class action complaint to determine if this exception’s two-thirds citizen requirement is met, or if courts can look at other statements in the complaint. The Eleventh Circuit answered that the review is limited to the class definition itself in the absence of independent evidence of class members’ citizenship.…

Continue Reading Eleventh Circuit Narrowly Construes CAFA’s “Local Controversy” Exception, Ruling that State Residency of Putative Class Members Must Either be Limited by Class Definition or Proven With Evidence