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As reported by many, the Advisory Committee on Civil Rules is considering possible amendments to Rule 23 as proposed by the Rule 23 Subcommittee. Per the Subcommittee, the most salient issues concern class action settlements with possible limits to cy pres relief and greater clarity on what Rule 23(e)’s “fair, reasonable, and adequate” criteria for settlement approval. In addition, there may be additional review of settlement class certification. Professional "class action objectors" – purported class members who try to extract payments in exchange for dropping their objections and delaying a proposed settlement. The Rule 23 Subcommittee recognizes that safeguards to address this conduct may need to be created.

 

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With respect to non-settlement specific high priority issues, the Subcommittee notes the trend of court created "issue certifications" in some jurisdiction whereas other jurisdictions struggle with whether Rule 23(c)(4)’s provision for the maintenance of cases as class actions for “particular issues” can be reconciled with Rule 23(b)(3)’s requirements that common questions predominate over individual issues and a class action be the superior method of adjudication. The Subcommittee will explore how to resolve this tension. With respect to notice, the Subcommittee suggests revisiting required first class mail notice and that notice for 23(b)(1) classes (potentially inconsistent adjudications) and 23(b)(2) classes (seeking declaratory or injunctive relief) could be done more efficiently given modern communication.

 

While the Subcommittee considers the following to be lower priority issues than the aforementioned, the Subcommittee identified as being important for further consideration: (1) consideration of merits issues during class certification; (2) “picking off” potential class actions by settling with the named plaintiff; and (3) how to ascertain the class and adequacy of the class definition during certification.

 

There can be no question that class actions pose considerable risk to the business community. However, the efforts of the Rule 23 Subcommittee indicate that a better class of class action may be on the horizon.

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