The Hard Stop On 'Adventurous Innovation' In Class Action Litigation: The United States Supreme Court's Decision In Comcast v. Behrend, Remand Of Whirlpool v. Glazer And The Probable Return Of Defect Manifestation To Class Certification Determination

1. Comcast v. Behrend: The Class Action Mechanism Under Scrutiny

   Comcast v. Behrend is the latest opinion issued by the U.S. Supreme Court interpreting and applying the procedural rules governing class actions set out in Federal Rule Civil Procedure 23. Writing for a 5-4 majority, Justice Antonin Scalia tags the class action mechanism as an ''exception to the usual rule that litigation is conducted by and on behalf of the individual named parties,'' which should only be utilized when circumstances clearly warrant its application.1

   Rule 23 governs class actions in federal court. In order to obtain certification of a class under Rule 23, a plaintiff has to demonstrate that all of the factors enumerated in Rule 23(a) are satisfied (e.g., numerosity) and also meet at least one of the criterion identified in Rule 23(b) (e.g., that common issues of fact and law predominate).2

   In Behrend, the Court expressly stated that the ''rigorous analysis'' that must be undertaken by a trial court to determine whether plaintiffs have met the Rule 23(a) factors also applies to the Rule 23(b) prerequisites. Further, the Court held the predominance criterion set forth in Rule 23(b)(3) includes the question of whether damages are capable of measurement on a classwide basis. If they are not, the ''adventuresome innovation'' of Rule 23(b)(3) is not available to plaintiffs, and a class may not be certified on that basis.3

2. Do Merits Matter For Purposes Of Rule 23(b)(3)?

   The plaintiffs in Behrend sought class treatment of claims grounded in antitrust. Plaintiffs' proposed class included more than 2 million current and former Comcast subscribers, and plaintiffs sought certification under Rule 23(b)(3). In determining whether to certify the class, the trial court addressed whether any of plaintiffs' four theories of antitrust impact were viable such that damages were measurable on a classwide basis.4 Ultimately, although the trial court rejected three of the four theories put forth by plaintiffs, it certified a class based on the theory that Comcast's actions purportedly lessened competition from so-called ''overbuilders,'' companies that build competing networks in areas where an incumbent cable company already operates.

   The trial court then determined that the damages suffered by the proposed class as a result of overbuilder deterrence could be determined on a classwide basis.5 In support of this finding, the trial court relied on the damages model prepared by Plaintiffs' expert that compared actual cable prices in the Philadelphia market area with hypothetical prices that purportedly would have prevailed but for petitioners' allegedly anticompetitive activities. This model, however, did not identify the damages that were separately attributable to each of respondents' four theories of...