Second Circuit Holds Named Plaintiffs In Class Action Must Be Named In Every Notice To Court Or Risk Losing Right To Appeal

• Published date: 24 August 2021
• Subject Matter: Litigation, Mediation & Arbitration, Class Actions, Trials & Appeals & Compensation
• Law Firm: Cahill Gordon & Reindel LLP
• Author: Mr Joel Kurtzberg, Lauren Perlgut and John Overlander

Rule 3 of the Federal Rules of Appellate Procedure ("FRAP") sets forth the requirements for filing an appeal in federal court. Recently, the U.S. Court of Appeals for the Second Circuit clarified that FRAP Rule 3(c)(1)(A) requires individual named plaintiffs to indicate their intent to appeal, even if members of a putative class, and "not merely rely on a notice of appeal filed by the lead plaintiffs or other persons qualified to represent the class." Cho v. BlackBerry Ltd., 991 F.3d 155, 159 (2d. Cir. 2021).

I. Background and Procedural History

In 2013, Blackberry released the Z10, a smartphone that became a commercial failure. Later that year, several individuals filed separate putative securities class actions, alleging material misrepresentations and omissions relating to the release of the Z10.

In October 2013 the actions were consolidated in the U.S. District Court for the Southern District of New York, and the court appointed lead plaintiffs and counsel. A consolidated amended complaint was signed by the law firm Kahn Swick & Foti as "Lead Counsel for Lead Plaintiffs and the Class," and by the firm Brower Piven as "Counsel for Additional Plaintiffs Yong M. Cho and Batuhan Ulug and the Class."

After the district court granted a motion to dismiss the complaint, the plaintiffs moved for reconsideration and for leave to amend the complaint, with identical language in the signature blocks. The district court denied the motion.

The lead plaintiffs then appealed on behalf of the class to the Second Circuit. The notice of appeal stated "Lead Plaintiffs Todd Cox and Mary Dinzik hereby give notice, on behalf of themselves and all others similarly situated..." and was signed by Kahn Swick & Foti as "Lead Counsel for Lead Plaintiffs and the Class" and Brower Piven as "Additional Counsel for Lead Plaintiffs and the Class." Cho and Ulug were not mentioned in the caption, the signature block, nor anywhere in the notice of appeal. On August 24, 2016, the Second Circuit affirmed the district court's dismissal, but remanded because the district court "erred in denying leave to amend without explanation."²

Following the remand, the plaintiffs filed a second amended complaint that again identified Cho and Ulug as plaintiffs. The defendants moved for judgment on the pleadings, asserting that the claims of Cho and Ulug should be dismissed, inter alia, because they failed to appeal the district court's dismissal of the first amended complaint without leave to amend and...