In just the first week since the U.S. Supreme Court rejected a class action lawsuit by more than 2 million Comcast costumers, the decision is already having major repercussions in several other cases alleging malfeasance by major corporations.
On Monday, the U.S. Supreme Court kicked two other class action challenges back to the lower court in light of its ruling in Comcast v. Behrend. In both cases, the plaintiffs had secured hard-fought wins just to establish that they could sue as a class. Now, they will have to argue that threshold question yet again — using the new harsher standard imposed by the Court’s five conservative justices — before they even have a chance to make the case that the defendants are liable. And in another case decided just two days after Comcast, a federal trial judge relied upon the decision to reject several claims of a class suing Applebee’s for wage-and-hour law violations.
In the Comcast ruling issued last Wednesday, five justices sided with Comcast in a significant but little-noticed ruling that denied consumers the opportunity to challenge alleged monopolistic practices and further eviscerated the class action, the mechanism that enables multiple individuals to band together with the necessary resources to take on corporate behemoths. The four dissenting justices who fumed at the audacity of the decision took solace in the fact that it should have limited application to other cases. But early indications are that the decision has legs.
In each of the three cases already affected by the ruling, Comcast was the basis for rejecting rulings in favor of the class and instead siding with the defending companies. In one, a class of consumers alleging particular washing machine models were defective will have to re-litigate the claim that individuals can join the class even if their faulty appliance hasn’t yet developed mold and foul odors. In another, a group of RBS Citizens employees will have to invest even greater resources into merely arguing that they should not have to challenge the company’s widespread denial of overtime pay one case at a time.
The plaintiffs in both of these cases won the right to sue as a class both at trial and before the federal appeals panel. In the appeals court decision ruling against Whirlpool, the court cited Judge Richard Posner, a pioneer of the conservative law and economics movement, who upheld a class lawsuit in a case alleging the exact same washer defect. In that case, he rejected claims that each plaintiff had to prove individual damages at such an early stage in order to certify the class, since plaintiffs must later prove their own damages before they can be compensated. Posner explains:
A class action is the more efficient procedure for determining liability and damages in a case such as this involving a defect that may have imposed costs on tens of thousands of consumers, yet not a cost to any one of them large enough to justify the expense of an individual suit. If necessary, a determination of liability could be followed by individual hearings to determine the damages sustained by each class member . . . The class action procedure would be efficient not only in cost, but also in efficacy, if we are right that the stakes in an individual case would be too small to justify the expense of suing, in which event denial of class certification would preclude any relief.
This is precisely the reason why the class mechanism exists, and why it is such a blow to consumers’ rights, employees’ rights, and corporate accountability, that the Supreme Court is steadily eroding its viability. As Reuters reports, several other lawyers are already citing the decision in major lawsuits against the corporations they represent.