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Complex Civil Litigation
Rutgers University, Newark School of Law
Noll, David

Complex Litigation
Spring 2015
Rush v City of Maple Heights BB
Facts: P was in an accident – city’s fault. Filed 2 separate cases for personal injury and property damage. Won on property damages, then claimed res judicata win on personal injury.
Rationale: No RJ – barred. Should have been one action with 2 claims. Easier/cost effective to make one suit.
Law: Single tort = single action.
Parklane Hoisery v Shore pg 6
Facts: 2 cases – SEC v Parklane and Parklane v Shore – both claimed P issued a materially false and misleading proxy statement in connection with a merger. DC in SEC case found for SEC. S moved for partial SJ claiming P couldn’t litigate issues that had already been decided in SEC case. Claims 7th A violation.
Rationale: no 7th violation if same issues.
Law: Preferable approach = grant TC’s broad discretion in determine whether to apply, rather than to wholly preclude. General Rule = if the P could have easily joined the earlier action OR the application of collateral estoppel would be unfair to a D, the use should not be allowed.
Notes: Ps can use a prior judgment that they weren’t a part of offensively to prevent D from relitigating the same factual issues.
Taylor v Sturgell pg12
Facts: H wanted plane blueprints. Sued under Freedom of Info Act – lost (D claimed trade secrets). T (H’s friend) sued for the same thing but included everything Ct said H missed. D claimed dismissal b/c T was virtually represented by H.
Rationale: Parties must be designated and served to be bound. Certain exceptions – one of which is adequate representation. But under AR – P1 must know they are acting as a rep for future parties – not the case here. VR allows judges to make de facto CA’s = bad. 
Law: In certain circumstances adequate representation can bind a non-party if P1 knows they are acting as a rep for future parties.
Hansberry v Lee pg 45
Facts: D bought a house which had a racially restrictive covenant. Neighbors sued to void the sale. D says covenant never became effective b/c 95% didn’t sign. Ct found for neighborhood b/c bound by Burke (case which said covenant was valid).
Rationale: D = absent party à in order to be bound, must have been represented. If not à DPC violation. Parties in each case were conflicting à no representation.
Law: representation is necessary. Otherwise DPC violation.
Class Actions
Rhone-Poulenc v Rorer pg56
Facts: Blood supply was contaminated with HIV. Ps (those infected) brought a CA against D (drug Co suppliers). Class was certified for 23(c)(4) – particular issues. D’s petitioned for Writ of Mandamus to decertify.
Rationale: If no cert – D’s facing 300+ suits = irreparable harm. CA’s do push settlement but not outweighed by benefits of CA. Particular issues could result in inconsistency = bad.
Law: Conditions for granting writ of mandamus – (1) the challenged ruling of the DC must have inflicted irreparable harm and (2) the ruling be described as an abuse of judicial discretion. Must balance benefits of CA with pressure on D to settle.
Notes: Worried about having D risk everything on one action.
General Telephone v Falcon  pg 71
Facts: F hired by GT – promoted twice and offered a third. Applied for another position but turned down. F claims GT has a discriminatory process. GT denies, and claims no proof of anyone else being denied b/c of race.
Rationale: F proved his own discrimination claim and then tried to blanket it. F was only looking out for himself. Need class reps to be looking out for all class members.
Law: disparate treatment theory – Need to show: (1) pattern; (2) that the pattern was motivated by discrimination; and (3) that the pattern was present in both their hiring and promotion practices
Phillips Petroleum v Shutts****  pg 93
Facts: Ps were royalty owners that D owed. P located in 11 states. S brought a CA in Ka. Class was certified – notice sent out with opt out provision. 99% of leases and 97% of class members had no tie to Ka. Trial Ct applied Ka law. D claims DPC violation b/c FF&C prohibited Ka law from being applied to all transactions.
Rationale: absent P’s did not have to hire counsel or appear, are not subject to counter claims and can opt out à no DPC violation. If there is a conflict with Ka law and P’s home state à home state applies b/c P had no reason to think Ka law would apply to them. Ct can use all laws.
Law: To certify Min contacts test does NOT apply with absent Ps; instead look at adequacy of representation, the common nature of the named P’s and absent P’s, the jurisdictional basis, and any other matters concerning representation of absent members. In order for the law of Ka to apply, Ka must have contacts or a significant aggregation of contacts that creates a significant interest in the litigation so applying Ka law would not be arbitrarily unfair (Noll says this is useless). Law that applies is where the injury occurred. 
Notes: Noll said most important case. Min conditions for jurisdiction is useless. CA’s can’t allow P’s to choose substantive law à encourage forum shopping.
Amchem Products v Windsor  pg 110
Facts: asbestos case. Inventory P’s = filed a claim. Other P’s = haven’t yet filed. Settlement – 1.3bil to pay vics. Inventory P’s have 200k pot to pay vics. Chart to determine how much money you get. Lower ct certified based on fairness test – over-ruled.
Rationale: (b)(3) cert = predom of common questions and CA is superior method. CA’s help small P’s to bring a claim against big Ds. To determine efficiency of class look at the class-qualifying criteria that protects absent class members. Fair isn’t enough ß no limit. Categories of health consequences make predom impossible. No adequate representation for future Ps. P’s have present interest which means future P’s aren’t protected.
Law: no predom if individual stakes are high and disparities among class members are great

he seriousness of illness (catching tumor sooner rather than later, e.g.). It’s not just bad news sooner.
Rationale:       No cert: too many individual issues involved.
Law:   As above, also Problems w/Tobacco (i.e. too many different defends based on different people within the class):  1) Exposure to cigarettes was VOLUNTARY—contra asbestos  2) If you’re not “wired” for addiction (or less wired), theory doesn’t work. P’s cannot prove causation merely by showing they got cancer. Need to show D’s used/manipulated nicotine levelsàcausing addiction. 3) Affirmative D’s: E.g. comparative negligence, assumption of risk, S of L &ct.
Notes:              Also … likely Ps were just looking to line up for future damages.
Ortiz v Fibreboard Corp SCOTUS (1999) p219
Facts:  “Limited Fund Theory” 23(b)(1)(B) -> initially approves settlement (limited fund settlement). Like Amcem, also asbestos case. Fibreboard settles, can it be certified?
Rationale:       For now, no cert: “Show that the fund is limited by more than the agreement of the parties.
Law: Pre-Settlement meeting among attorneys: In ALL historical examples of limited funds being approved, lawyers met b/c of a limited fund issue. Here, lawyers convened to “create” a limited fund. Circular Reasoning/Bootstrapping: As in Dukes (common question can’t be “is there a common question), and Amchem (common question can’t be “is settlement fair”), here limited fund is created b/c lawyers conceived of one. Faux-Limited Fund—only labeled as such. Equity-Holders Untouched: Opposite of bankruptcy. Here, deal structured so as to not harm SH’s. FB’s value essentially remains untouched.
Notes:  Since Ortiz, courts have generally not certified “limited fund” CAs involving unliquidated damages (p233 n5).  Also, look to the “constitutional limit” for a tort action.
In re Simon 2nd Cir (2005) p235
Facts:  Tobacco case (again). Tobacco appeals, and wins. P’s seek punitive damages only under Pennsylvania state law for harm from smoking. Some history: Law limits how much you can award in punitive damages (DP clause). Constitutional cap creates a limited fund. History: Phillips Morris v. Williams, 549 U.S. 346 (2007): One could conclude DP clause put limit on the amount of punitive damages against a D (e.g. State-Farm, Gore). Violates fairness/ fair notice. Bars punitive damages for harm caused to individuals not in the litigation.