The Future Of ERISA Litigation — Sleeper Supreme Court Case Worth Watching — Part II

On May 12, 2015, we reported at here on a non-ERISA case accepted for review by the Supreme Court in the 2015-16 Supreme Court Term that has ERISA Litigation implications. Now, as that Term is set to begin on October 5, 2015, we report on a second non-ERISA case with ERISA Litigation implications that soon will be decided by the Court.

On June 8, 2015, the Supreme Court agreed to hear Tyson Foods Inc. v. Bouaphakeo, No. 14-1146, which presents these questions for review:

Whether differences among individual class members may be ignored and a class action certified under Federal Rule of Civil Procedure 23(b)(3), or a collective action certified under the Fair Labor Standards Act (FLSA), where liability and damages will be determined with statistical techniques that presume all class members are identical to the average observed in a sample.2. Whether a class action may be certified or maintained under Rule 23(b)(3), or a collective action certified or maintained under the Fair Labor Standards Act, when the class contains hundreds of members who were not injured and have no legal right to any damages. Oral argument will be heard in Bouaphakeo on November 10, 2015. A number of amicus curiae briefs have been filed in the case addressing the likely impact of the Bouaphakeo decision well beyond its unique facts and the FLSA legal context.

The first question presented for decision might not have direct application to putative ERISA class actions as ERISA class counsel do not have a history of proving damages based on statistical samples. But the second question presented for decision could have far-reaching application to putative ERISA class actions. Many courts do not now require that a class definition exclude the possibility that a class member suffers no injury. For example, the Court of Appeals for the Seventh Circuit will certify classes for liability purposes under Fed. R. Civ. P. 23(c)(4) without regard to any consideration of damages. See e.g., McReynolds v. Merrill Lynch, 672 F. 3d 482 (7th Cir. 2012) (Title VII disparate impact context). And, while ERISA class action filings are in decline, Courts still allow ERISA certifications that address damages in a hypothetical fashion. See e.g., Spano v. Boeing Co., 633 F.3d 574 (7th Cir. 2011), where the Court allowed certification even...