Keywords: class certification, second circuit, Rule 23(f),
One oddity of the law in the Second Circuit is the unbalanced standard of review that the court sometimes applies to class certification decisions. On a dozen or so occasions over the last twenty years, the Second Circuit has proclaimed that it is "noticeably less deferential when the district court has denied class status than when it has certified a class." Shahriar v. Smith & Wollensky Restaurant Group, Inc., 659 F.3d 234, 250 (2d Cir. 2011); see also, e.g., Brown v. Kelly, 609 F.3d 467, 485 (2d Cir. 2010). But the Second Circuit has never explained why orders granting class certification should receive privileged treatment. In reality, the Second Circuit's approach arises out of a misreading of the court's earlier precedents. And developments in the law since the introduction of Rule 23(f) leave no room for courts of appeals to place a thumb on the scale in favor of class certification.
The "noticeably less deferential" standard first appears in Lundquist v. Security Pacific Automotive Financial Services Corp., 993 F.2d 11, 15 (2d Cir. 1993). Lundquist attributed the unbalanced standard of review exclusively to Robidoux v. Celani, 987 F.2d 931 (2d Cir. 1993). But Robidoux held only that "abuse of discretion can be found more readily on appeals from the denial of class status than in other areas, for the courts have built a body of case law with respect to class action status." Id. at 935 (emphasis added). Robidoux was not saying that denials of certification should be reversed more readily than grants; it was explaining that class certification decisions are more readily reversed than other discretionary rulings. The sole case cited in Robidoux confirms that understanding: "Abuse of discretion can be found far more readily on appeals from the denial or grant of class action status than where the issue is, for example, the curtailment of cross-examination or the grant or denial of a continuance." Abrams v. Interco, Inc., 719 F.2d 23, 28 (2d Cir. 1983) (emphasis added).
Rule 23(f), which authorizes permissive interlocutory appeals from class certification rulings, likewise says nothing that would authorize a court of appeals to review a grant of class status more deferentially than a denial. And the advisory committee notes are clear that the need for appellate review is no less pressing for rulings denying class certification than for those granting certification. If anything, a grant of class certification should receive closer scrutiny than a denial, given the Supreme Court's recent reaffirmation that a "class action is an exception to the usual rule" and that plaintiffs "must affirmatively demonstrate . . . compliance with" Rule 23. Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2550-51 (2011).
Accordingly, defendants in Rule 23(f) appeals in the Second Circuit should resist the notion that greater deference is due to a ruling granting class certification than to one denying it.
Originally published on November 29, 2012.
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