Welcome to Critical Mass, Law.com’s new briefing on class actions and mass torts. I’m Amanda Bronstad in Los Angeles. A federal judge who has pushed hard to settle the opioid cases is allowing lawyers to litigate in hopes of resolving a bucket of legal issues. The 9th Circuit revived a data breach class action that had been tossed on standing grounds. And find out what makes today’s appellate arguments in a class action against VCA Animal Hospitals a milestone for Akin Gump’s Rex Heinke.
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A ‘Bucket List’ in Opioid MDL
After two months of settlement talks in the opioid litigation, a federal judge is allowing the lawyers some discovery, motion practice and even bellwether trials. Here’s my story on a minute order that U.S. District Judge Dan Polster issued this week asking lawyers to come up with a plan for a “litigation track.” It’s a marked change for Polster, who has focused all his energies on a settlement in 2018. (see here.)
So what’s the impasse about? I spoke with Yale Law School Professor Abbe Gluck. She said there could be some strong legal defenses at stake that come in two buckets:
Bucket 1: Causation. “There are so many different defendants, such a large chain between the manufacturer to the user,” Gluck said. “So it’s really going to be difficult to attach blame just to one for any particular harm.”
Bucket 2: Preemption. Gluck said: “The Controlled Substances Act places a duty on companies that handle controlled substances to monitor the movement of those substances,. That’s a federal statute. What many of the states and localities are arguing now is by virtue of violating that federal duty they’ve also violated some aspect of state law…But the defendants are saying that duty is only to the federal government.”
What about the plaintiffs? Gluck told me there could be issues about damages – specifically, who gets what, and who pays how much. She said:
“A lot of the plaintiffs have complained they don’t know all the details of what happened and want to litigate precisely to get discovery to figure out how this happened and who’s to blame.”
Data Breach Case, Once Zapped, Is Revived
The 9th Circuit has reversed dismissal of a data breach class action against online shoe retailer Zappos.com. Law.com’s Ross Todd has this story. In 2012, hackers stole the personal information of 24 million people, but a judge in Nevada dismissed the case because plaintiffs hadn’t shown instances of identity theft. The Ninth Circuit reversed, finding that the “imminent” risk of identity theft was enough to establish standing.
Here’s why this ruling is important: It’s the first time the 9th Circuit has addressed its own 2010 ruling in Kettner v. Starbucks since the U.S. Supreme Court’sClapper v. Amnesty International USA’s decision came down in 2013. Clapper, which held that “an objectively reasonable likelihood” of future harm was not enough to establish standing, has wiped out many data breach cases at the dismissal stage.
Ross told me that Judge Michelle Friedland, the opinion’s author, wrote in a footnote “that its post-Clapper analysis jibed with decisions coming out of the D.C. and 7th Circuits.”
“They also noted that the Eighth Circuit did find that allegations of credit card information theft don’t get you standing, but in that decision there was no allegation that any other personally identifying info—like addresses, telephone numbers, or passwords—was stolen,” Ross said.
Akin Gump’s Rex Heinke Hits No. 151
It happens to be the 151st appellate argument of his career.
That’s a lot of talking. So I figured Heinke, who is a partner in the firm’s Los Angeles office, might have a lot to say about the most prevalent appellate arguments in class actions. He told me that arbitration, attorney fees and standing in cybersecurity cases all come up — and the issue of how rigorously a judge needs to follow the guidelines of Federal Rule 23 of Civil Procedure. “That whole area has changed radically,” he said.
Heinke, who argued his first appeal in 1980, also had this advice for those making their first appellate arguments:
“Be prepared to answer their questions, especially the ones that probe your weaknesses. There aren’t many appeals we have where there isn’t something to be said for the other side. And you can pretty much count on appellate judges and justices to be well prepared and smart and ask you hard questions pretty much from the outset.”
Equifax Pumps Profits at King & Spalding
King & Spalding topped the $2.5 million per-partner profit mark last year — helped in part by its retention as Equifax’s lead defense counsel. Here’s my colleagueMeredith Hobbs’ article on the firm’s 2017 financial results.
The Atlanta-based firm was retained last year to handle legal issues stemming from Equifax’s data breach (see here). That work is only expected to get bigger, according to this Law.com story, as Equifax this month expanded the initial 145 million people affected by the hack by another 2.4 million.
King & Spalding also brought in a group last year from Reed Smith led by John Hooper, who represented Toyota in the Takata airbag MDL and in its $1.6 billion settlement of sudden acceleration litigation.
Here’s more you need to know today:
Blooming Budd: Dallas-based Baron & Budd has opened a Washington D.C.office. Here’s Law.com’s story. The new office, with three lawyers from Simmer Law Group, including founder Scott Simmer, will focus on antitrust, qui tam and third-party payor litigation. Founder Russell Budd told Law.com that the move will give the firm an opportunity to work with the likes of Motley Rice, Hagens Berman, Robbins Geller and Lieff Cabraser, among others. “Really, to be in that club, you need to have the skill set that Scott [Simmer] has,” he said in the article.
Fee Forecast: A special master looking into overbilling in a $75 million fee requestby three plaintiffs firms has delayed his final report to April 23. According to Law.com’s story, retired Eastern District of Michigan Chief Judge Gerald Rosen asked that a March 15 deadline be extended. But here’s the interesting part: In a letter to the court, Rosen said the plaintiffs firms – Lieff Cabraser, Labaton Sucharow and Thornton Law Firm – needed more time since “there could potentially be serious and far-reaching adverse ramifications [for] at least some of the firms, and even beyond this investigation for the practice of the plaintiffs’ class action bar and even for courts in class actions.”
Zombies Go Bust: Nothing in life is free–even for the dead. Law.com reported this week that a federal judge has dismissed a class action brought by the producers of “Zombie Go Boom” over YouTube’s ad changes (see here). YouTube, owned by Google, made changes last year following reports about ads showing up on videos supporting Nazi causes and ISIS. But “Zombie Go Boom” creators described their show as “a live-action zombie series that is essentially a combination of ‘Mythbusters’ and ‘The Walking Dead.’” U.S. District Judge Edward Chen found that even though its ad revenue fell, the producers still got a benefit. “In particular, YouTube allowed Zombie to post videos on its forum free of charge in exchange for getting a license to its content,” he said in the story.
(Don’t) Set Those Clocks! A federal judge has granted certification of a class of American Airlines baggage handlers and maintenance workers in Newark Liberty International Airport in New Jersey (repped by McLaughlin & Stern) who allege the company programmed time clocks to round down and reduce the amount of time employees got paid for work. Here’s Law.com’s story. Apparently, Chief Judge Jose Linares didn’t buy the argument from American’s lawyers at O’Melveny & Myers that employees who clocked in early or clocked out late had spent time “socializing, drinking coffee, watching television or reading.”
And with those activities in mind, have a great weekend…and don’t forget to change your clocks for Daylight Savings Time!