ConAgra, Ascertainability, and the Fundamental Purpose of Class Actions
On September 25, the Supreme Court will decide whether to hear ConAgra Brands v. Briseño, a case out of the Ninth Circuit. ConAgra presents the contentious question of whether Fed. R. Civ. P. 23 contains an implied requirement that class members’ identities be “ascertainable” — and, if so, what that requirement entails. Lower courts now apply a jumble of conflicting ascertainability standards when deciding motions for class certification. In ConAgra, the Justices may resolve that conflict.
The parties’ cert-stage papers in ConAgra make various arguments sounding in text, precedent, and public policy. But underlying the whole dispute is a deeper question that the parties only hint at: why do class actions exist? What purpose are they fundamentally meant to serve? Whether a tough ascertainability requirement is crucial for ensuring that class actions do their intended job, or is instead an impediment to that job, depends on what that job is. Is Rule 23 just a special form of claim joinder, meant to advance the efficient resolution of similar claims? Or is it a tool meant to empower consumer Davids to punish and/or deter corporate Goliaths? See generally David Marcus, The History of the Modern Class Action, Part I: Sturm und Drang, 1953–1980, 90 Wash. U. L. Rev. 587 (2013) (discussing at length these two overarching conceptions of Rule 23, which Marcus terms the “adjectival” and “regulatory” views, respectively).
The answer to this question largely dictates the resolution of the ascertainability dispute. If you believe that Rule 23 is a mere procedural tool for efficient aggregation of claims, you will naturally be wary of permitting class certification where it is apparent at the outset that class members’ identities are likely unknowable. As ConAgra explains in its cert petition, unless those identities are capable of ascertainment, the claims of absent class members can never be tested adversarially, and effective compensation of absent class members is impossible. How could a class action ever be worth the candle under such circumstances?
On the other hand, if you believe that Rule 23 is a regulatory tool for advancing substantive goals of punishment and deterrence, then these issues probably do not concern you. Even if most class members’ claims could never be tested, and even if class members will never see a dime, certification would still be worthwhile for its punitive and deterrent effect. See Martin H. Redish, Rethinking the Theory of the Class Action: The Risks and Rewards of Capitalistic Socialism in the Litigation Process, 64 Emory L.J. 451, 457–59 (2014) (noting that this view of class actions — a.k.a. the “Private Attorney General Model” — is “often relied upon to justify use of the class action device even when absent class members are unlikely to receive [any] compensation”).
Courts and jurists that have rejected a meaningful ascertainability requirement have expressly or implicitly adopted the regulatory view of Rule 23. For example, the Seventh Circuit wrote that an ascertainability test with bite would undercut the “important policy objective” of Rule 23 — namely, “punishing and deterring corporate wrongdoing.” Mullins v. Direct Digital, 795 F.3d 654, 668 (7th Cir. 2015). Likewise, Judge Rendell of the Third Circuit complained that “rigorous application of the ascertainability requirement translates into impunity for corporate defendants.” Byrd v. Aaron’s Inc., 784 F.3d 154, 176 (3d Cir. 2015) (Rendell, J., concurring). If punishing and deterring corporate malfeasance is really the driving concern behind Rule 23, then indeed, why concern ourselves with such niceties as whether class members can be located or compensated?
Wisely, the plaintiffs in ConAgra have retained as Supreme Court counsel Professor Samuel Issacharoff, a prominent advocate of the regulatory view of Rule 23. See, e.g., Issacharoff, Governance and Legitimacy in the Law of Class Actions, 1999 Sup. Ct. Rev. 337, 354 (1999) (asserting that class actions “accomplish some of the same [regulatory] functions as performed by the state, particularly in those situations in which the state has not or cannot perform its regulatory function”). In the plaintiffs’ brief in opposition to cert, Issacharoff unsurprisingly argues that a strong ascertainability requirement would permit “companies to commit … harm to individual consumers with impunity,” while giving short shrift to concerns such as efficiency and compensation. (These questions, Issacharoff argues, should be put off until “subsequent phases of [the] litigation” — which, in practical terms, means that they will never be asked.)
The trouble for the ConAgra plaintiffs is that the regulatory conception of Rule 23 draws little support from the Rule’s text, its history, or Supreme Court caselaw. As Professor Redish has noted, “the class action was never designed to serve as a free-standing device for the purpose of ‘doing justice,’ nor is it a mechanism intended to serve as a roving policeman of corporate misdeeds or as a mechanism by which to redistribute wealth. Both its structure and description, rather, make clear that it is nothing more than an elaborate procedural device….” Redish, Class Actions and the Democratic Difficulty: Rethinking the Intersection of Private Litigation and Public Goals, 2003 U. Chi. Legal F. 71, 74–75 (2003).
For starters, Rule 23’s text and accompanying commentary say nothing about punishment or deterrence (of corporations or otherwise). The commentary to the Rule’s seminal 1966 amendments stated that damages class actions should proceed where they “would achieve economies of time, effort, and expense, … without sacrificing procedural fairness or bringing about other undesirable results.” This sure sounds like the drafters viewed Rule 23 as a procedural tool to permit the efficient and fair litigation of multiple claims at once, and not as a regulatory tool for advancing any particular substantive agenda, such as the punishment or deterrence of corporate wrongs.
The Rules Enabling Act, too, seems incompatible with the regulatory view of Rule 23. That Act provided the statutory authority for the Supreme Court’s adoption of Rule 23. It provides, among other things, that the Rules of Civil Procedure “shall not abridge, enlarge, or modify any substantive right.” The Supreme Court has repeatedly explained that the Rules Enabling Act prohibits courts from tinkering with the underlying substantive law in order to facilitate class treatment. See, e.g., Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 612–13 (1997); Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2561 (2011); Tyson Foods v. Bouaphakeo, 136 S. Ct. 1036, 1046, 1048 (2016). As Professor Redish notes, the regulatory model of class actions “improperly transforms the underlying substantive law” in violation of the Rules Enabling Act “by transforming that law from a compensation framework into either a bounty-hunter or civil-fine framework….” Rethinking the Theory of the Class Action, supra, at 458; see also Redish, Class Actions and the Democratic Difficulty, supra, at 124 (“The Rules Enabling Act’s restriction of the [Federal] Rules to procedural matters, then, surely does not authorize a rule that both permits and condones the creation of a form of litigation that completely transforms the remedial model established in the underlying substantive law.”).
For these reasons, it seems likely that a majority of the current Supreme Court would reject the regulatory view of class actions in favor of the procedural view. Indeed, a number of the Justices have arguably done so already. In Shady Grove Orthopedic Assocs., P.A. v. Allstate Insurance Co., 130 S. Ct. 1431 (2010), a four-Justice plurality (Scalia, Roberts, Thomas, Sotomayor) stated that Rule 23 is “merely” “a species” of “joinder” that “enables a federal court to adjudicate claims of multiple parties at once,” while “leav[ing] … legal rights and duties intact and the rules of decision unchanged.” More recently, in Microsoft Corp. v. Baker, the concurring Justices (Thomas, Roberts and Alito) opined that Rule 23 is “simply a procedural mechanism that enables a plaintiff to litigate his individual claims on behalf of a class.” Justice Kennedy may well espouse this procedural view, given his usual leanings in closely decided class-action cases. And from the scant data points available, it seems that Justice Gorsuch would, as well.
Once it is acknowledged that Rule 23 is simply a joinder tool, with no substantive policy agenda, then the central arguments against a stringent ascertainability rule fall away. In particular, gone is the argument that a strong ascertainability rule would make consumer class actions difficult (or even impossible) to certify, thereby allowing corporate wrongdoing to run rampant. This claim is factually debatable — but, more importantly, under the procedural view of Rule 23, it is irrelevant. Courts may not start from the assumption that class treatment must be available to achieve certain regulatory goals and reason backwards from there. They must start from the principle that class actions are limited to scenarios where aggregation of claims would “achieve economies of time, effort, and expense, … without sacrificing procedural fairness,” as the Rule’s drafters envisioned, and then let the analysis lead wherever it leads.
In sum, ConAgra is an important case not only because it would settle the question du jour of ascertainability, but because it could also shed light on the long-running debate about the fundamental purpose of Rule 23 and the class-action device. The answer to that question could affect the course of federal litigation for decades to come. If cert is granted, watch closely.
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This article is for general informational purposes only and should not be construed as specific legal advice. This may constitute attorney advertising in some jurisdictions. Prior results do not guarantee a similar outcome.