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Class Actions & Derivative Suits

Class-Representative Adequacy: Preparing for and Responding to Attacks on Plaintiffs

By Anna P. Prakash – June 3, 2014


A class action can be maintained if, among other things, “the representative parties will fairly and adequately protect the interests of the class.” Fed. R. Civ. P. 23(a)(4). In opposing class certification, defendants frequently argue that Rule 23(a)(4)’s adequacy requirement is not met with respect to the plaintiffs proffered as class representatives. Accordingly, starting with selection of the class representative and continuing through the certification and possible decertification phase of class litigation, plaintiff’s counsel should be mindful of potential attacks on the plaintiff’s adequacy and the plaintiff’s potential responses to these assaults.


Selecting the Class Representative
Before deciding to pursue class claims, plaintiff’s counsel should take a serious look at the plaintiff to determine whether he or she can satisfy Rule 23’s adequacy requirement. The class representative “need not be the best representative of the class,” Byes v. Telecheck Recovery Serv., Inc., 173 F.R.D. 421, 428 (E.D. La. 1997), but he or she must (1) have the interest and ability to represent the claims of the class vigorously and (2) be free of interests that are antagonistic to the interests of other class members (i.e., conflicts). In re Cmty. Bank of N. Va., 622 F.3d 275, 291 (3d Cir. 2010).


Evaluating interest. Generally speaking, plaintiffs who are responsive to counsel, interested in righting the alleged wrong at issue, and willing to devote time to the litigation tend to be good class representatives who will vigorously represent the class. Typically, plaintiff’s counsel will be able to recognize these qualities in a plaintiff in the normal course of intake interviews and follow-up conversations. Plaintiff’s counsel should also be sure to take the time to thoroughly explain the duties of a class representative—including discovery and depositions—so that the plaintiff knows what he or she is getting into. Counsel and the plaintiff can then decide whether it makes sense for the plaintiff to serve as a class representative.


Evaluating potential conflicts. When evaluating a potential class representative for conflicts with the putative class, plaintiff’s counsel should keep in mind that “not every potential disagreement between a class representative and the class members will stand in the way of a class suit.” 1 Alba Conte & Herbert B. Newberg, Newberg on Class Actions § 3:26 (4th ed. 2002). Rather, “only a conflict that goes to the very subject matter of the litigation will defeat a party’s claim of representative status. . . .” 7A Charles A. Wright, Arthur R. Miller & Mary K. Kane, Federal Practice & Procedure § 1768 (3d ed. 2005).


Therefore, plaintiff’s counsel should examine the facts surrounding the plaintiff’s specific situation and determine whether and how those facts relate to the legal claims at the heart of the litigation. Plaintiff’s counsel should pay close attention to whether the plaintiff’s factual situation differs markedly from what counsel knows of the class members’ situations to determine whether the plaintiff and the class suffered injury in a similar enough way to give rise to the same legal claims. In short, the plaintiff’s claims must be typical. See Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 626 n.20 (1997) (“The adequacy-of-representation requirement ‘tend[s] to merge’ with the commonality and typicality criteria of Rule 23(a), which ‘serve as guideposts for determining whether . . . maintenance of a class action is economical and whether the named plaintiff’s claim and the class claims are so interrelated that the interests of the class members will be fairly and adequately protected in their absence.’”) (internal citations omitted).


Addressing Common Attacks on the Plaintiff’s Adequacy

 

Class member satisfaction with the alleged unlawful practice. In defending against class certification, some defendants argue that the class representative is inadequate because he or she is challenging a practice that some class members agree with and do not want changed. In response, plaintiffs have successfully argued that any class member who would rather remain the victim of an unlawful practice does not have a recognizable “conflict” with the class representative. See, e.g., In Re Potash Litig., 159 F.R.D. 682, 692–93 (D. Minn. 1995) (“Assuming, as we must, that the allegations in the Plaintiffs’ Complaint are true, the fact that an illegally controlled potash market tends to favor the long-term interests of several large members of the putative class is not sufficient to prevent class certification. This is not an interest the law is willing to protect.”) (emphases added).


In addition, in the context of class actions under Rule 23(b)(3), the rule’s “opt out” mechanism provides a convincing argument against such attacks on adequacy. See, e.g., White v. Imperial Adjustment Corp., 2002 WL 1809084, at *13 (E.D. La. Aug. 6, 2002) (“[S]ince this is a 23(b)(3) class, dissatisfied class members have a right to opt out of the class”).


Moral character and credibility. A defendant may also attack the plaintiff’s credibility in attempt to argue inadequacy. When responding to these types of attacks, plaintiff’s counsel should not hesitate to push back on arguments that focus on conduct unrelated to the issues in the litigation or speculation as to dishonesty. In fact, generally, “to show that a class representative is not adequate, credibility problems must relate to issues directly relevant to the litigation or there [must be] confirmed examples of dishonesty, such as a criminal conviction for fraud.” Keegan v. Am. Honda Motor Co., 2012 WL 2250040, at *14 (C.D. Cal. June 12, 2012) (internal citations and quotation marks omitted); Stanich v. Travelers Indem. Co., 259 F.R.D. 294, 314–15 (N.D. Ohio 2009) (“[T]he general rule . . . is that unrelated unethical or even criminal conduct is not sufficient to support a finding of inadequacy.”). In other words, the mere fact that a plaintiff may engage in distasteful behavior in his or her personal life or have a criminal history does not automatically render the plaintiff inadequate. Cf. Schleicher v. Wendt, 2009 WL 761157 (S.D. Ind. Mar. 20, 2009) (“[A] criminal fraud conviction is extremely troubling for someone who seeks to serve as a fiduciary for absent class members asserting they are the victims of a fraudulent scheme.”).


Plaintiff’s lack of knowledge. Some defendants attempt to attack adequacy based on a plaintiff’s inability to answer certain questions asked at his or her deposition. This type of attack is likely to gain traction only in extreme circumstances, such as where the plaintiff is so ignorant of or uninvolved in the litigation that he or she would be not be able to adequately protect the class. See Kirkpatrick v. J.C. Bradford & Co., 827 F.2d 718, 727 (11th Cir. 1987). However, there is no requirement that the plaintiffs know every detail of the case in order to be adequate class representatives; in fact, plaintiffs are allowed to rely on the expertise of counsel. See, e.g., Iglesias-Mendoza v. La Belle Farm, Inc., 239 F.R.D. 363, 372 (S.D.N.Y. 2007) (“Rule 23 requires that the named plaintiffs have adequate personal knowledge of the essential facts of the case” and “[f]or the legal underpinnings of their claims, plaintiffs are entitled to rely on the expertise of their counsel.”) (emphasis added). See also Surowitz v. Hilton Hotels Corp., 383 U.S. 363, 373 (1966) (“We cannot construe Rule 23 . . . as compelling courts to summarily dismiss . . . cases like this where grave charges of fraud are shown by the record to be based on reasonable beliefs. . . .  These rules were designed in large part to get away from . . . prevent[ing] unsophisticated litigants from ever having their day in court.). Thus, while plaintiff’s counsel should carefully prepare the plaintiffs for depositions, counsel should also accept the reality that most plaintiffs will not know the answer to every question asked and that, generally, that will not make those plaintiffs inadequate class representatives.


Inconsistent testimony and misstatements. Plaintiffs may also make mistakes at their depositions. Again, plaintiff’s counsel should accept this as a normal part of the litigation process. Minor mistakes or small inconsistencies not render a plaintiff an inadequate class representative. See, e.g., Lapin v. Goldman Sachs & Co., 254 F.R.D. 168, 177 (S.D.N.Y. 2008).
 
Further, if necessary and appropriate given the circumstances of the case, plaintiff’s counsel could seek to correct any mistakes or inconsistencies. This could be done through redirect examination at the deposition or by obtaining and producing a supplemental clarifying affidavit from the plaintiff following the deposition.


Substituting a Class Representative
In the event the court determines that a plaintiff would be an inadequate class representative or plaintiff’s counsel concludes that the court is likely to make such a determination, it may be possible to offer another plaintiff as the class representative. This is typically done through a motion to substitute and/or motion to amend the complaint. See, e.g., Hull v. Viega, Inc., 2014 WL 896621, at *2–3 (D. Kan. Mar. 6, 2014); see also Birmingham Steel Corp. v. Tenn. Valley Auth., 353 F.3d 1331 (11th Cir. 2003) (holding that the district court erred in not allowing class counsel a reasonable period of time, prior to decertifying the class, to find a new class representative).


Conclusion
Rule 23’s adequacy requirement serves the important purpose of protecting the class and requires careful attention, but it does not impose a requirement of perfection on the proffered class representative. Rather, a class representative must be committed to the litigation and the class and must not have the type of conflict with the class that goes to the heart of the claims. By keeping this in mind when selecting a plaintiff to be the class representative and when responding to attacks on that plaintiff, plaintiff’s counsel can effectively build and defend their arguments on adequacy and, ultimately, class certification.


Keywords: litigation, class actions, adequacy, class representative, credibility, class conflict, Federal Rule of Civil Procedure 23(a)(4)


Anna P. Prakash is an associate at Nichols Kaster, PLLP, in Minneapolis, Minnesota.


 
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