Appeals court overrules faulty class certification, finds district court failed to conduct "rigorous analysis" required by Wal-Mart v. Dukes (Fourth Circuit)
NCLC urged the Fourth Circuit to reverse the trial court's certification order because the court failed to conduct the "rigorous analysis" that the U.S. Supreme Court made clear in Wal-Mart Stores Inc. v. Dukes is required for class certification. In the Equifax case, the trial court certified a class of Virginians who allege Equifax violated the Fair Credit Reporting Act by failing to follow “reasonable procedures to assure maximum possible accuracy” with respect to reporting the judgments by Virginia courts on the class members’ credit reports. According to NCLC's amicus brief, the trial court abdicated its vital role in the class certification process by deferring to the named plaintiff's allegations and arguments. The district court's perfunctory approach to the class-certification inquiry resulted in erroneous findings that the plaintiff had satisfied the "commonality" and "predominance" requirements of Rule 23, the federal class certification rule. NCLC warned that the misapplication of Rule 23 by trial courts could provoke an avalanche of new class action litigation, dramatically increasing the business community's exposure to frivolous class actions. NCLC cited a body of researching demonstrating that plaintiffs use class certifications as illegitimate leverage to extract blockbuster settlements from defendants.
The Fourth Circuit reversed the District Court's class certification order and remanded for further proceedings. The court held that had the District Court performed the rigorous analysis required under Wal-Mart v. Dukes, it would have concluded that the class was not certifiable because the plaintiff-appellee could not show the "typicality" of the plaintiff and the putative class members required by FRCP 23(a).
NCLC's amicus brief filed 9/6/11. Decided 12/3/12.