In order to certify a class action, it is the plaintiff’s burden to prove that all of the requirements of Rule 23 of the Federal Rules of Civil Procedure are satisfied. In some class actions, plaintiffs cannot proceed without expert testimony that can prove, at a minimum, that issues can be addressed based on common evidence. In those types of cases, courts cannot take a “wait-and-see” approach to shaky expert opinions. As the Seventh Circuit had made clear, courts must decide Daubert challenges to “conclusively rule on any challenge to [an] expert’s qualifications or submissions prior to ruling on a class certification motion.” And in Haley v. Kolbe & Kolbe Millwork, Inc., the lower court was listening. Its decision, which the Seventh Circuit affirmed in full last week, reminds class action defense counsel of the important role pursuing Daubert challenges can play when opposing class certification.
On July 12, 2017, a federal district court in Kentucky issued a summary judgment ruling for the defense in the ongoing Borders & Borders case1 brought by the Consumer Financial Protection Bureau (CFPB or Bureau). In this long-running case, the Bureau alleged that profit distributions paid to joint venture partners constituted illegal kickbacks in violation of Section 8(a) of the Real Estate Settlement Procedures Act (RESPA),2 and that the defendants could not rely on the safe harbor provision for “affiliated business arrangements” (ABAs) in Section 8(c)(4) of RESPA.3
The court, however, ruled that the defendants were entitled the protection of the ABA exemption as a matter of law, and dismissed the Bureau’s case.
On July 10, 2017, in a surprise move, the Consumer Financial Protection Bureau (CFPB or Bureau) issued its long awaited final rule on arbitration (Final Arbitration Rule). This rule-making has been a lightning rod issue for the Bureau, and its Final Arbitration Rule is likely to face serious political and legal challenges in the weeks and months to come. Even if the rule survives those challenges – and that if a big if – it does not become mandatory until early March 2018 and its provisions are not necessarily as sweeping as some press accounts may suggest. Here is what real estate settlement service and other consumer financial services providers need to know about the Final Arbitration Rule, at a glance.
Defense counsel facing potential multimillion-dollar judgments from the threat of class action proceedings—particularly class actions brought under statutes providing for treble damages and attorney’s fees, such as the Racketeer Influenced Corrupt Organizations (RICO) Act, the Real Estate Settlement Procedures Act (RESPA), and the Telephone Consumer Protection Act (TCPA) —have gotten creative in their attempts to end class litigation before certification. For example, in Campbell-Ewald Company v. Gomez, 136 S. Ct. 663 (2016), the Supreme Court considered whether an unaccepted offer to satisfy the named plaintiff’s individual TCPA claim, made pursuant to Federal Rule of Civil Procedure 68, renders the plaintiff’s (and the purported class’) case moot. The Court held that it did not, reasoning that under basic principles of contract law, an unaccepted offer is a legal nullity, did not bind either party, and therefore did not moot the parties’ dispute. Id. at 670. The Supreme Court held open, however, the question whether “the result would be different if a defendant deposits the full amount of the plaintiff’s individual claim in an account payable to the plaintiff, and the court then enters judgment for the plaintiff in that amount.” Id. at 672.
Websites may constitute “public accommodations” under the Americans with Disabilities Act (ADA), according to one court. On June 12, 2017, in a case of first impression, a federal district court in Gil v. Winn-Dixie Stores Inc. held that a website that is heavily integrated with physical store locations and operates as “a gateway to the physical store locations” constitutes a service of a public accommodation covered by the ADA. This decision comes in the midst of a trend, as we have previously reported, of increasing legal challenges to businesses on the theory that their websites are allegedly inaccessible to disabled persons, in violation of Title III of the ADA. Although the Gil v. Winn-Dixie decision is not binding on courts in other jurisdictions, other courts may consider it and find it persuasive. Businesses with consumer-facing websites should make web accessibility a priority.