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Once the class has been certified, the defendants’ lawyers may not communicate directly with class members because the plaintiff’s lawyer represents all class members.⁸⁵ State rules of professional responsibility based on the American Bar Association’s (ABA) Rule of Professional Conduct 4.2⁸⁶ invariably prohibit counsel from communicating with a party known to be represented by a lawyer, and class members must be treated as parties represented by a lawyer.⁸⁷

Complaints are often the first document that judges and law clerks review in order to familiarize themselves with the case. A well-written and persuasive complaint can set the framework for positive court consideration of the case.¹ The complaint should educate the judge about the context of the particular violation that the class has alleged—and persuade the judge that the facts and law support class certification and the merits of the claims.

A class action complaint should be drafted to withstand the judicial scrutiny that will be undertaken according to the standards applied by the forum court. The pleading should contain a complete statement of all facts and the legal elements necessary to show entitlement to class certification and relief on the merits of the claims. It should be written in anticipation of an immediate motion to dismiss by the defendants.

Federal Rule of Civil Procedure 8(a)(2) requires “a short and plain statement of the claim showing that the pleader is entitled to relief” so that defendants will have “fair notice of what the plaintiff’s claim is and the grounds upon which it rests.”¹⁵ Under the Supreme Court decision in Conley v.

In 2016, the Supreme Court decided Spokeo, Inc. v. Robins,²⁸ which considered whether the plaintiff had Article III standing to redress a bare procedural violation of the Fair Credit Reporting Act (FCRA). The violation in Spokeo involved a credit reporting agency publishing inaccurate information about the consumer on its website. The Court decided that, to have standing, a plaintiff must have suffered or faced a material threat of a concrete, particularized injury—a bare procedural violation does not suffice.

Class complaints generally have the following sections:

Because the complaint will serve as the basis for class certification, it must carefully address each of the specific requirements set forth under Rule 23. Given that, at least in federal court, the allegations in the complaint will not be presumed to be true for the purposes of class certification, it is important to provide sufficient factual bases for establishing Rule 23 elements. As discussed above, these issues usually fit naturally in the “Class Action Allegations” section of the complaint.

1. Class Definition

The Class Action Fairness Act of 2005 (CAFA)⁶⁰ relaxed the requirements for removal of class actions from state court to federal court.⁶¹ As a result, more class actions either originate in federal court or are removed to federal court.⁶²

“Claim-splitting” refers to the general requirement that all claims for relief arising from a single transaction or occurrence must be brought in one action.⁶⁷ A subsequent suit, arising from the same transaction or events underlying a previous suit would be barred under the doctrine of res judicata.⁶⁸

There are a variety of special pleading techniques that may be used in conjunction with class litigation. This section contains some of them.

1. Pleading Based on Information in the Possession of the Defendants

If there is information that is in the possession of only the defendant, such as a class list, then the appropriate allegations may be made based upon that information. This pleading may be important to verify that the defendant has the information, such as the proposed class list.

2. Pleading on Information and Belief

Conduct a thorough review of the underlying facts with the potential class representative before the complaint is filed. Make sure that the class representative understands the factual allegations that form the basis of the defendant’s wrongful conduct. To the extent possible, educate the class representative on the basic legal theories under which the case will be prosecuted.

Prior to completing and filing the complaint, counsel should consider reviewing the complaint for potential trouble areas:

Once the complaint is answered, make sure to go through the answers and cross-reference them to a copy of the complaint. What paragraphs have been admitted, what paragraphs have been denied, and what paragraphs have the defendants purported not to have sufficient information to provide an answer for? Does the defendant’s failure to admit uncontroverted facts give counsel the opportunity to serve a request to admit and then recover fees and costs for proving the denied admission?

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Federal Rule of Civil Procedure 23(e) provides that class actions may be “settled, voluntarily dismissed, or compromised only with the court’s approval.” Obtaining final approval of a class action settlement is a multi-step process. It can take anywhere from a few months to more than six months to complete, depending on the complexity and size of the case.

Although Rule 23 did not explicitly require preliminary approval of the settlement prior to the 2018 amendments, most experienced class counsel believed strongly that seeking it was wise or necessary or both. Some circuits strongly endorsed preliminary approval prior to notice being given. As amended, Rule 23 effectively codifies this practice, while not denominating it as “preliminary approval,” except in the Advisory Committee Notes.²⁴

As discussed in depth in Chapter 13, supra, the Rule 23(e) notice given to class members must inform them of the nature of the claims being settled, the release of claims that will be agreed to by class members if they do not opt out, deadlines to opt out or object, the date of the fairness hearing, the provision for attorney fees, how to get more information regarding the settlement (including websites or links

Experienced class counsel differ on how much time should be given to class members to decide whether to opt out or object. Some prefer a shorter amount of time³⁸—for example, forty-five days—after the date notice is given, whereas others prefer up to ninety days or longer.³⁹ Among the relevant considerations are whether the class is comprised of a mobile group, such as low-income consumers, and whether the subject of the lawsuit involves accounts from a number of years ago.

A proposed class action settlement arrived at by counsel experienced in the type of litigation involved, following arm’s length negotiations, based on sufficient information concerning the claims at issue, and with few objectors, generally has been viewed as being entitled to a presumption of fairness.⁴⁹ The 2018 amendment to Rule 23(e)(2),⁵⁰ however, sets forth more specific guidelines for a finding that a settlement is “fair, reasonable, and adequate.” The amended rule provides that, after a heari

The First Circuit has held that, although the case law offers “laundry lists of factors” regarding reasonableness, “the ultimate decision by the judge involves balancing the advantages and disadvantages of the proposed settlement as against the consequences of going to trial or other possible but perhaps unattainable variations on the proffered settlement.”⁵⁹ Furthermore, it has held that, if the parties negotiated at arm’s length and sufficient discovery was conducted, the district court must presume the settlement is reasonable.

In the Second Circuit, approval is appropriate when the settlement “is the result of serious, informed, and non-collusive negotiations, where there are no grounds to doubt its fairness and no other obvious deficiencies . .

The Third Circuit applies “an initial presumption of fairness in reviewing a class settlement when: ‘(1) the negotiations occurred at arms length; (2) there was sufficient discovery; (3) the proponents of the settlement are experienced in similar litigation; and (4) only a small fraction of the class objected.’”⁶⁴ Apart from such an initial presumption, the court has considered nine factors: (1) the complexity, expense, and likely duration of the litigation; (2) the reaction of the class to the settlement; (3) the state of the proceedings and t

The Fourth Circuit has identified four factors that must be evaluated to determine if a settlement is fair: “(1) the posture of the case at the time settlement was proposed; (2) the extent of discovery that had been conducted; (3) the circumstances surrounding the negotiations; and (4) the experience of counsel in the area of [the] class action litigation.”⁷⁹ In addition, five factors must be assessed to determine a settlement’s adequacy: (1) the relative strength of the plaintiffs’ case on the merits; (2) the existence of any difficulties of p

Six factors have guided the Fifth Circuit’s review of a decision to approve a class action settlement: (1) evidence that the settlement was obtained by fraud or collusion; (2) the complexity, expense, and likely duration of the litigation; (3) the stage of the litigation and available discovery; (4) the probability of plaintiffs prevailing on the merits; (5) the range of possible recovery and certainty of damages; and (6) the opinions of class counsel, class representatives, and absent class members.⁸²