The U.S. Supreme Court added another class action case to its argument docket on Friday, agreeing to determine the fate of an “end run” tactic used by plaintiffs to appeal the denial of class certification.
The court granted certiorari in Microsoft v. Baker, a dispute over a class action brought by Xbox 360 purchasers who blame the company for scratched discs. In 2012, the U.S. District Court for the Western District of Washington struck down the class allegations. That would ordinarily leave plaintiffs with the option of pursuing individual claims until final judgment, before the denial of class certification could be appealed.
Instead, the plaintiffs moved to dismiss their claims with prejudice, a motion that would create a final judgment far more quickly, allowing a speedier appeal of the denial of class certification. The U.S. Court of Appeals for the Ninth Circuit granted the motion and said the appeal could proceed.
Microsoft Corp. appealed to the Supreme Court, arguing that the issue is “immensely important to the proper administration of the class action device.” Under a 1978 Supreme Court precedent, appeals of class denials are not immediately appealable, and circuit courts have split over the propriety of the tactic the plaintiffs used. Davis Wright Tremaine partner Stephen Rummage is counsel of record on the petition.
Business groups filed briefs urging the high court to take up the case. Noting that “a disproportionate number of class actions are filed in California,” the U.S. Chamber of Commerce said the Ninth Circuit ruling should be overturned. Since only plaintiffs can dismiss their claims, the chamber brief argues that the tactic used by plaintiffs to speed review gives plaintiffs “an unfair advantage” over defendants. Mark Mosier of Covington & Burling is counsel of record on the chamber brief.
A separate brief by Cory Andrews of the Washington Legal Foundation states that allowing the Ninth Circuit ruling to stand “will seriously undermine judicial administration by effectively providing plaintiffs an absolute right to immediate review of a district court order denying a motion to certify a plaintiff class.”
The Supreme Court has granted review in three other class action-related cases this term: Tyson Foods v. Bouaphakeo, Campbell-Ewald v. Gomez and Spokeo v. Robins.