A Review Of Fourth Circuit Class-Action Opinions Of The Past Year

• Published date: 30 May 2022
• Subject Matter: Litigation, Mediation & Arbitration, Class Actions
• Law Firm: Ellis & Winters
• Author: Andrew Parks Carter and Scott Hazelgrove

As the calendar approaches the middle of the year, it is a good time to review the Fourth Circuit's recent class-action decisions'and there have been a number of them.

These opinions offer guidance on five key topics in class-action litigation, including numerosity, ascertainability, commonality, the rights and burdens of objectors, and how to calculate attorneys' fees with a coupon settlement. Read on for the highlights.

Numerosity

The prerequisites to class certification, as any class-action practitioner knows, are outlined in Federal Rule of Civil Procedure Rule 23(a). The requirements are numerosity, commonality, typicality, and adequacy of representation. It is the named plaintiff's burden to establish all prerequisites for class certification.

Rule 23(a)(1), the numerosity requirement, states that the class must be so numerous that joinder of all members is impracticable. Joinder involves bringing each plaintiff into the suit as a party, so that each may pursue his or her individual claim in the suit'whereas class actions allow the named plaintiff to pursue the claims of all class members in a representative capacity.

The Fourth Circuit grappled with the numerosity requirement in In re Zetia (Ezetimibe) Antitrust Litig.,7 F.4th 227, 234 (4th Cir. 2021). It explained that, generally, there is no magic number of class members needed to show that a class action is appropriate. However, classes with fewer than 20 members are rarely certified, and classes with more than 40 members usually are certified because that number of plaintiffs is usually too impracticable for joinder. The Fourth Circuit emphasized, however, that the "grey area" between 20 and 40 class members should be examined with all the circumstances of the case taken into consideration, including judicial economy.

In In re Zetia, plaintiff pharmaceutical buyers brought a putative class action against two pharmaceutical manufacturers, alleging an anticompetitive settlement in a patent dispute. The district court certified the class action, reasoning that, if a class were not certified, multiple individual trials would result, and this would be impractical from a judicial-economy perspective.

The Fourth Circuit reversed and remanded, holding that the district court incorrectly analyzed the judicial-economy factor. The district court had assessed whether multiple individual suits would waste judicial resources. The Fourth Circuit explained that the district court should instead have considered...