Federal jurisdiction and due process in the era of the nationwide class action

University of Pennsylvania Law Review

Volumn 156, Issue 6, 2008, Pages 2035-2133

  Wolff, Tobias Barrington ^a  

^a UNIVERSITY OF PENNSYLVANIA LAW SCHOOL   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

EID: 54849415989     PISSN: 00419907     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Conference Paper

References (274)

1. Class Action Fairness Act of 2005 (CAFA), Pub. L. No. 109-2, 119 Stat. 4 (codified in scattered sections of 28 U.S.C.).
2. Congress has enacted more narrowly targeted legislation pertaining to class actions in the field of securities litigation. See Private Securities Litigation Reform Act of 1995 (PSLRA), Pub. L. No. 104-67, 109 Stat. 737 (imposing standards for securities litigation in federal court); see also Securities Litigation Uniform Standards Act of 1998, Pub. L. No. 105-353, 112 Stat. 3227 (extending the provisions of the PSLRA to state court litigation).
3. The most recent interim report of the Federal Judicial Center indicates that the rate of diversity class actions in the federal courts - including both original filings and removals - increased by approximately 100% between the last calendar year before CAFA was enacted and the twelve-month period between July 2005 and June 2006. See THOMAS E. WILLGING & EMERY G. LEE III, THE IMPACT OF THE CLASS ACTION FAIRNESS ACT OF 2005 ON THE FEDERAL COURTS: THIRD INTERIM REPORT TO THE JUDICIAL CONFERENCE ADVISORY COMMITTEE ON CIVIL RULES 14 fig.3 (2007), available at http://www.uscourts.gov/rules/CAFA_Third_Interim.pdf.
4. The changes to diversity jurisdiction are twofold. The statute loosens the normal requirement of complete diversity, authorizing jurisdiction whenever any plaintiff is diverse from any defendant; it also alters the ordinary rules on aggregation, authorizing jurisdiction over small-stakes claims provided that the total amount in controversy in the proceeding exceeds $5,000,000. See CAFA § 4(a), 28 U.S.C. § 1332(d)(2) (Supp. V 2005). This change is subject to an abstention provision that limits its effects somewhat, giving the district court discretion to decline jurisdiction if a sufficient proportion of the class and the "primary defendants" are all from the state in which the action was originally filed, and instructing the district court to dismiss if a supermajority of the class and at least one significant defendant are both from the forum state. See id. § 1332(d)(3)-(4). See generally LINDA J. SILBERMAN, ALLAN R. STEIN & TOBIAS B. WOLFF, CIVIL PROCEDURE: THEORY AND PRACTICE 1047-49 (2d ed. 2006) (describing CAFA's jurisdictional provisions).
5. The most significant limitation on settlement involves coupon settlements. The Act imposes strict constraints on the amount and the timing of the compensation that attorneys may receive for negotiating coupon-based settlements for the class. See 28 U.S.C. § 1712 (Supp. V 2005). It also prohibits awards that treat class members in certain geographic locations more favorably (to prevent bounties) and makes it difficult to secure approval of any class settlement that would require class members to pay money in order to obtain a benefit. See id. §§ 1713-1714. Finally, the Act requires the defendants to notify relevant state or federal authorities of any proposed class action settlement and imposes a mandatory waiting period prior to any approval of a settlement during which authorities may seek to intervene or object. See id. § 1715; see also SILBERMAN, STEIN & WOLFF, supra note 4, at 1050-52 (describing these provisions).
6. See, e.g., CAFA § 2(a)(1), 28 U.S.C. § 1711 note (Supp. V 2005) ("Class action lawsuits are an important and valuable part of the legal system when they permit the fair and efficient resolution of legitimate claims of numerous parties by allowing the claims to be aggregated into a single action against a defendant that has allegedly caused harm."); id. § 2(b)(1) (stating that a purpose of the Act is to "assure fair and prompt recoveries for class members with legitimate claims").
7. See, e.g., id. § 2(a)-(b) (identifying protection of absent class members from mistreatment as a primary purpose of the Act, along with protection of defendants against abusive litigation, safeguarding national economic interests, and preventing excessive exercises of state power).
8. Among the more prominent expositions of this problem are John C. Coffee, Jr., Class Wars: The Dilemma of the Mass Tort Class Action, 95 COLUM. L. REV. 1343 (1995);
9. Samuel Issacharoff, Class Action Conflicts, 30 U.C. DAVIS L. REV. 805 (1997);
10. Susan P. Koniak & George M. Cohen, Under Cloak of Settlement, 82 VA. L. REV. 1051 (1996);
11. and Jonathan R. Macey & Geoffrey P. Miller, The Plaintiffs' Attorney's Role in Class Action and Derivative Litigation: Economic Analysis and Recommendations for Reform, 58 U. CHI. L. REV. 1 (1991).
12. The Act identifies the following findings among the primary reasons for its enactment: (2) Over the past decade, there have been abuses of the class action device that have - (A) harmed class members with legitimate claims and defendants that have acted responsibly; . . . . (3) Class members often receive little or no benefit from class actions, and are sometimes harmed, such as where - (A) counsel are awarded large fees, while leaving class members with coupons or other awards of little or no value; (B) unjustified awards are made to certain plaintiffs at the expense of other class members; and (C) confusing notices are published that prevent class members from being able to fully understand and effectively exercise their rights. CAFA § 2(a)(2)-(3), 28 U.S.C. § 1711 note (Supp. V 2005).
13. As Professor Hensler has explained, "defendants facing large-scale exposure in mass product defect litigation, once they recognize and can quantify that exposure, will prefer a comprehensive settlement of all claims arising out of a single set of facts to individual case-at-a-time litigation." Deborah R. Hensler, Bringing Shutts into the Future: Rethinking Protection of Future Claimants in Mass Tort Class Actions, 74 UMKC L. REV. 585, 588 (2006).
14. Broad, comprehensive figures on class action practice are not readily available, in part because of the lack of consistency among state court systems in collecting and reporting data. See, e.g., Memorandum from Bob Niemic & Tom Willging, Fed. Judicial Ctr., to the Advisory Committee on Civil Rules 3 (Sept. 9, 2002) available at http://www.fjc.c.gov/public/pdf.nsf/ lookup/AmChem.pdf/$file/AmChem.pdf (describing limits on the availability of state court data). As a consequence, much of the information on state court abuses that has informed the debate has been anecdotal in nature, and respected advocates disagree strongly about the extent to which the scope of abuse has been accurately reported or, instead, overstated. Compare, e.g., NLJ Roundtable: Class Action Fairness Act, NAT'L L.J., May 16, 2005, at 18, 18 (reproducing the remarks of Elizabeth Cabraser, arguing that "the notion that there were class action abuses that cried out for the geographic or jurisdictional cure of transfer from state court to the federal court system will be exposed as basically baseless"),
15. with Susan P. Koniak, How Like a Winter? The Plight of Absent Class Members Denied Adequate Representation, 79 NOTRE DAME L. REV. 1787 (2004) (offering a much bleaker account of the representation received by absentees).
16. Professor Issacharoff takes this observation much further, suggesting that CAFA envisions the transfer into federal court of all national consumer class actions, and perhaps all national class actions under most state law regimes: [T]he concern about creating a dominion of exclusive federal oversight . . . raise[s] the question of what should serve as the baseline for measuring federal court fidelity to preexisting legal treatment. If federal courts are to be the only game in town for national market consumer cases, it is difficult to argue that they should handle them the way all other courts do. There are simply no other courts in the game anymore. Samuel Issacharoff, Settled Expectations in a World of Unsettled Law: Choice of Law After the Class Action Fairness Act, 106 COLUM. L. REV. 1839, 1864 (2006); see also id. at 1865 ("There is more than a touch of irony in holding fast to a doctrine honoring state autonomy in the context of a statute that takes away precisely the power of state courts to adjudicate nationwide class actions."); id. ("Congress has taken state courts out of the mix altogether."). Professor Issacharoff's characterization may be largely correct with respect to class actions that are filed with the expectation that they will or may be adjudicated, since in most cases either class counsel or the defendant, considering the matter ex ante, will likely see some significant benefit to invoking the federal forum. His observation clearly does not hold true in settlement-only class actions, as the reverse auction scenario makes clear. Professor Burbank levies a similar criticism.
17. See Stephen B. Burbank, Aggregation on the Couch: The Strategic Uses of Ambiguity and Hypocrisy, 106 COLUM. L. REV. 1924, 1940-43 (2006). The question remains whether the decision of class counsel and defendant to keep a settlement action in state court is always indicative of the kind of malfeasance that this Aticle examines, or whether class counsel and defendant might both choose to keep a settlement action in state court even in the absence of any sacrifice of the class members' interests. I take up that question briefly in Part II.A.3, infra.
18. The conventional wisdom that federal courts are stricter than state courts in administering class certification does not always hold true. In some state courts, judicial skepticism and constraining precedents make federal court a more attractive option for class plaintiffs. In New York, for example, state law prohibits the use of the class action to aggregate claims for statutory penalties or minimum recoveries, unless the law creating the penalty specifically provides for recovery via class action. See N.Y. C.P.L.R. 901(b) (McKinney 2006) ("Unless a statute creating or imposing a penalty, or a minimum measure of recovery specifically authorizes the recovery thereof in a class action, an action to recover a penalty, or minimum measure of recovery created or imposed by statute may not be maintained as a class action."); Rudgayzer & Gratt v. Cape Canaveral Tour & Travel, Inc., 799 N.Y.S.2d 795, 796 (N.Y. App. Div. 2005) (holding that C.P.L.R. 901(b) prohibits class action under the federal Telephone Consumer Protection Act); cf. Richard A. Nagareda, Aggregation and Its Discontents: Class Settlement Pressure, Class-Wide Arbitration, and CAFA, 106 COLUM. L. REV. 1872, 1885-88 & n.57 (2006) (discussing C.P.L.R. § 901(b) and the "amplification effect" that it seeks to redress). Even so, the suggestion that faithless class counsel will ordinarily seek to file suit in state court is an acceptable generalization. Class counsel will usually have the opportunity to shop for a highly permissive state forum in suits against large corporate entities - an option made possible by the frequent amenability of such entities to general jurisdiction around the country.
19. Professors Kahan and Silberman (among others) make this point in their important treatment of collateral attacks. See Marcel Kahan & Linda Silberman, The Inadequate Search for "Adequacy" in Class Actions: A Critique of Epstein v. MCA, Inc., 73 N.Y.U. L. REV. 765, 776 (1998) ("[B]oth class counsel and defendant may prefer a forum that rubberstamps any settlement they reach."); see also, e.g., Reynolds v. Beneficial Nat'l Bank, 288 F.3d 277, 282 (7th Cir. 2002) (Posner, J.) ("The ineffectual lawyers are happy to sell out a class they anyway can't do much for in exchange for generous attorneys' fees, and the defendants are happy to pay generous attorneys' fees since all they care about is the bottom line - the sum of the settlement and the attorneys' fees - and not the allocation of money between the two categories of expense.").
20. In the Senate, the provision last appeared in the version of the bill that was placed on the calendar on October 17, 2003. The relevant portions read: IN GENERAL - A class action may be removed to a district court of the United States in accordance with this chapter, without regard to whether any defendant is a citizen of the State in which the action is brought, except that such action may be removed - (1) by any defendant without the consent of all defendants; or (2) by any plaintiff class member who is not a named or representative class member without the consent of all members of such class. S. 1751, 108th Cong. § 5(a) (2003). Absent plaintiffs were given thirty days to remove an action from the time that they received notice, "through service or otherwise, of the initial written notice of the class action." Id.
21. See S. REPUBLICAN POLICY COMM., 108TH CONG., S.2062 - THE CLASS ACTION FAIRNESS ACT 3 (2004) (noting the deletion of a provision allowing plaintiffs to remove class actions); see also 28 U.S.C. § 1453(b) (Supp. V 2005) (containing no provision for removal by absent class plaintiffs); S. 2062, 108th Cong. § 5(a) (Feb. 11, 2004) (same). The deletion, which occasioned little comment in the legislative record, was justified at the time as a necessary step for preventing rogue class members from extorting payments from defendants and class counsel, the stated concern being that they might threaten to disrupt ongoing state court proceedings through the guerilla use of removal. See S. REPUBLICAN POLICY COMM., supra, at 3-5. I discuss the cogency of this concern, and the virtues of various mechanisms for policing malfeasance in state court proceedings, in Part III, infra.
22. In re Bridgestone/Firestone, Inc., Tires Prods. Liab. Litig. (Bridgestone/Firestone II), 333 F.3d 763, 769 (7th Cir. 2003).
23. 28 U.S.C. § 1651 (2000).
24. Id. § 2283.
25. See id. § 2072(b).
26. 472 U.S. 797 (1985).
27. 339 U.S. 306 (1950).
28. 407 U.S. 225 (1972).
29. 28 U.S.C. § 2283.
30. One of the most striking examples of this tendency to focus only on generic jurisdictional concerns may be found in Amalgamated Clothing Workers of America v. Richman Bros., the Court's first AIA decision following the 1948 Act, in which it said the following in rejecting a request for an antisuit injunction to give effect to a grant of exclusive federal jurisdiction under the Taft-Hartley Act: The assumption upon which the argument [that a grant of exclusive federal jurisdiction might warrant broad intervention under the AIA] proceeds is that federal rights will not be adequately protected in the state courts, and the "gap" complained of is impatience with the appellate process if states go wrong. But during more than half of our history Congress, in establishing the jurisdiction of the lower federal courts, in the main relied on the adequacy of the state judicial systems to enforce federal rights, subject to review by this Court. Amalgamated Clothing Workers of Am. v. Richman Bros., 348 U.S. 511, 518 (1955). As the Court saw it. Amalgamated Clothing involved the "rather subtle line of demarcation between exclusive federal and allowable state jurisdiction over labor problems," id. at 519, and not a clear usurpation of federal exclusive jurisdiction by a state tribunal. The case was also made more complicated by the fact that the primary authority to enforce the provisions of the Act lay with the National Labor Relations Board (NLRB), not private plaintiffs, and that the NLRB did possess jurisdiction to enjoin state proceedings. Thus, when the Court was specifically asked to analyze the AIA's "in aid of jurisdiction" language in the case, it briskly dismissed the argument, explaining: Under no circumstances has the District Court jurisdiction to enforce rights and duties which call for recognition by the [NLRB]. Such nonexistent jurisdiction therefore cannot be aided. . . . Since the very presupposition of this proceeding is that jurisdiction of the subject matter of which the employer complained was in the Board and not in the state court, any aid that is needed to protect jurisdiction is the aid which the Board may need . . . . Such aid only the Board could seek . . . . Id. at 519-20; see also Vendo Co. v. Lektro-Vend Corp., 433 U.S. 623, 642 (1977) (plurality opinion) (explaining, in a case involving an exclusively federal antitrust claim, that the Court "ha[s] never viewed parallel in personam actions as interfering with the jurisdiction of either court").
31. As the Court has put it, "The Act, which has existed in some form since 1793, is a necessary concomitant of the Framers' decision to authorize, and Congress' decision to implement, a dual system of federal and state courts." Chick Kam Choo v. Exxon Corp., 486 U.S. 140, 146 (1988) (citation omitted) (interpreting the AIA's "protect or effectuate" language narrowly in deference to the concurrent jurisdiction principle); see also Atl. Coast Line R.R. Co. v. Bhd. of Locomotive Eng'rs, 398 U.S. 281, 295 (1970) ("In short, the state and federal courts had concurrent jurisdiction in this case, and neither court was free to prevent either party from simultaneously pursuing claims in both courts."); id. at 296 ("[L]ower federal courts possess no power whatever to sit in direct review of state court decisions."). To clarify, when I use the term "federal claims" in the text above, I mean any claim that could potentially be filed as an original matter in federal court, not merely claims that arise under federal law.
32. Most notable among these commentators is Professor Redish, who has argued for a system of "zero tolerance." See Martin H. Redish, Intersystemic Redundancy and Federal Court Power: Proposing a Zero Tolerance Solution to the Duplicative Litigation Problem, 75 NOTRE DAME L. REV. 1347, 1349 (2000). Professor Redish's model "would require that in every instance the assertion of federal jurisdiction automatically precludes the continued conduct of the parallel state litigation, while the refusal of a federal court to enjoin such state litigation would automatically lead to the federal court's abstention." Id.;
33. see also Diane P. Wood, Fine-Tuning Judicial Federalism: A Proposal for Reform of the Anti-Injunction Act, 1990 BYU L. REV. 289, 319-20 (calling for reform of the AIA in order to permit federal courts to enjoin state proceedings whenever necessary to prevent irreparable harm to party interests, so long as they take state prerogatives into account).
34. See, e.g., Atl. Coast Line, 398 U.S. at 297 ("Any doubts as to the propriety of a federal injunction against state court proceedings should be resolved in favor of permitting the state courts to proceed in an orderly fashion to finally determine the controversy."); Amalgamated Clothing, 348 U.S. at 514 (opining that it is "clear beyond cavil that the prohibition [of the AIA] is not to be whittled away by judicial improvisation"); Kline v. Burke Constr. Co., 260 U.S. 226, 230 (1922) ("[An in personam action brought in state court] does not tend to impair or defeat the jurisdiction of the court in which a prior action for the same cause is pending. Each court is free to proceed in its own way and in its own time, without reference to the proceedings in the other court."). I will be calling into question the broad application that many courts and commentators have given to this rhetoric. Professor Redish has done the same, and quite sharply so, rejecting as incorrect and ill-considered the Court's interpretation of the AIA as broadly tolerating the inefficiency of parallel state-federal litigation. Observing that such inefficiency is inconsistent with other levers of litigation policy that aim to prevent relitigation and wasted effort, Professor Redish writes: This counterintuitive and often inefficient result flows not from a carefully considered legislative or judicial choice following a thorough examination of all relevant competing social, political, and constitutional considerations. It flows, rather, from a wholly coincidental and unintended combination of common law and statutory jurisdictional doctrines, each of which focuses myopically upon different jurisdictional galaxies far, far away from each other. Redish, supra note 27, at 1348. I am broadly sympathetic with these observations. Nonetheless, I find the consistent core of interpretive practice surrounding the AIA - to which Congress appears to have acquiesced in its 1948 revision, even if somewhat carelessly so - more difficult to dismiss in those cases where federal jurisdiction is based on a general-purpose statute.
35. Timothy Kerr gives a good summary of the problem in a recent article. See Timothy Kerr, Cleaning Up One Mess To Create Another: Duplicative Class Actions, Federal Courts' Injunctive Power, and the Class Action Fairness Act of 2005, 29 HAMLINE L. REV. 218, 224-28 (2006).
36. The 1948 revisions to the AIA operated to overrule the decision of the Supreme Court in Toucey v. New York Life Insurance Co., 314 U.S. 118 (1941). Prior to Toucey, the Court had crafted various exceptions to the apparently unyielding prohibition of the AIA, including an exception permitting federal courts to enjoin state court proceedings that sought to relitigate issues already decided in a federal judgment. The Court overruled its precedents and disapproved this practice in Toucey. The 1948 revisions explicitly reinstated the relitigation exception and added the "in aid of jurisdiction" language. For the standard account of this doctrinal history, see Martin H. Redish, The Anti-Injunction Statute Reconsidered, 44 U. CHI. L. REV. 717 (1977). A "Reviser's Note" accompanying the amendment, which explains that the revisions "restore[] the basic law as generally understood and interpreted prior to the Toucey decision," 28 U.S.C. § 2283 Reviser's Note (1948), is often read as suggesting a narrow ambit for the new amendments, reinstating the specific exceptions that had been recognized at the time, but authorizing no further interpretive growth. This narrow reading clearly is not the best one. The Note indicates that the amendments restore the basic law "as generally understood and interpreted" prior to Toucey. Id. It is restoring the interpretive practice that preceded that decision, under which the Court crafted sensible exceptions to the Act's broad prohibition, not merely the particular repertoire of exceptions that Toucey had disapproved.
37. See generally Samuel Issacharoff & Catherine M. Sharkey, Backdoor Federalization, 53 UCLA L. REV. 1353, 1416 (2006) (analyzing features of modern class action practice that have national economic implications despite being based on state law).
38. 260 U.S. 226, 235 (1922).
39. See Vendo Co. v. Lektro-Vend Corp., 433 U.S. 623, 641-42 (1977) (plurality opinion) (appearing to reaffirm Kline's sharp distinction between in rem and in personam actions in the administration of the "in aid of jurisdiction" exception).
40. In re Baldwin-United Corp., 770 F.2d 328, 337 (2d Cir. 1985); see also id. at 337 (explaining that "the need to enjoin conflicting state proceedings [when a complex federal proceeding is on the verge of settlement] arises because the jurisdiction of a multidistrict court is analogous to that of a court in an in rem action or in a school desegregation case, where it is intolerable to have conflicting orders from different courts" (internal quotation marks omitted)). In re Baldwin involved an interpretation of the All Writs Act's authorization for the issuance of writs by federal courts "in aid of their respective jurisdictions," 28 U.S.C. § 1651(a) (2000), rather than the related language in the AIA. A noted above, the two passages have been interpreted in tandem, and In re Baldwin is regularly cited as authority in AIA cases.
41. Atl. Coast Line R.R. Co. v. Bhd. of Locomotive Eng'rs, 398 U.S. 281, 295 (1970).
42. The Third Circuit, in particular, has produced a highly developed set of doctrines in this regard. See, e.g., In re Diet Drugs Prods. Liab. Litig., 282 F.3d 220, 234-39 (3d Cir. 2002) (setting forth detailed factors for consideration in the issuance of an AIA injunction).
43. See generally Andrew S. Weinstein, Note, Avoiding the Race to Res Judicata: Federal Antisuit Injunctions of Competing State Class Actions, 75 N.Y.U. L. REV. 1085 (2000) (describing methods employed by lower federal courts to avoid waste and strategic behavior and advocating more aggressive injunctive intervention).
44. The rare exceptions prove the rule. See, e.g., James v. Bellotti, 733 F.2d 989, 993 (1st Cir. 1984) (recognizing the authority of federal district courts to enjoin any form of state proceeding, "whether purporting to exercise concurrent jurisdiction in rem or in personam," that would interfere with district court's disposition of Indian land claim cases (citations omitted)).
45. Ascribing great doctrinal or constitutional significance to the in rem quality of a proceeding is inconsistent with the established modern trend toward analyzing the impact of judicial actions upon individual or state interests, regardless of the form of the proceeding in which those actions are taken. The Court embraced this proposition in a little-noticed passage in the Mullane case and later made it the centerpiece of its analysis in the watershed case, Shaffer v. Heitner. See Mullane v. Cent. Hanover Bank & Trust Co., 339 U.S. 306, 312-13 (1950) (holding that the formal in rem quality of trust accounting does not control personal jurisdiction analysis); Shaffer v. Heitner, 433 U.S. 186, 212 (1977) (stating that all exercises of personal jurisdiction, including in in rem actions, must satisfy the minimum contacts standard of International Shoe and its progeny). See also Redish, supra note 27, at 1359 (criticizing the Court's distinction between in rem and in personam cases in AIA doctrine as "little more than a metaphysical relic of a very different epistemological age" that "no longer plays a significant role, even in its originating context of personal jurisdiction").
46. See Stephen B. Burbank, Judicial Equilibration, the Proposed Hague Convention and Progress in National Law, 49 AM. J. COMP. L. 203 (2001).
47. Professor Redish is certainly correct when he describes this area of federal jurisdiction law as suffering from "a kind of doctrinal myopia." Redish, supra note 27, at 1347; see also id. ("The product of such [poorly coordinated, case-by-case] doctrinal development, not surprisingly, is often a doctrinal synthesis that either defies common sense, ignores or undermines sound policies of federalism or litigation practice, or both.").
48. Two examples stand out most strikingly. In Chisholm v. Georgia, 2 U.S. (2 Dall.) 419 (1793), the majority found in the state diversity prong of Article III an intention to abrogate any immunity from suit that states might have retained following nationhood in their roles as quasi-sovereigns - an alteration in status that several members of the Court identified as part of a larger repudiation of the concept of royal sovereign prerogatives that was inconsistent with a democratic system of government. See id. at 469-73 (holding that state sovereignty does not require sovereign immunity). Sixty-four years later, in Dred Scott v. Sandford, 60 U.S. (19 How.) 393 (1856), the majority undertook a perversely similar interpretive exercise, this time finding antidemocratic principles of white supremacy to be inherent in Article III's citizen diversity prong and hence to exclude black people entirely from invoking that element of federal court jurisdiction. See also Martin v. Hunter's Lessee, 14 U.S. (1 Wheat.) 304, 314 (1816) (interpreting the definition of "judicial power" in Article III of the Constitution to define the powers and purpose of the federal judiciary in our coordinate system of government in a dispute over section 25 of the Judiciary Act); Cohens v. Virginia, 19 (6 Wheat.) U.S. 264, 378-80 (1821) (reaffirming the power and purposes of Supreme Court appellate review even in light of the Eleventh Amendment); Osborn v. Bank of the United States, 22 U.S. (9 Wheat.) 738, 760 (1824) (giving broad interpretation to the Article III extension of judicial power to cases "arising under" federal law and thereby reinforcing the power of Congress to establish a national bank); cf. Marbury v. Madison, 5 U.S. (1 Cranch) 137, 147 (1803) (using a dispute over the original jurisdiction of the Supreme Court to articulate the principle of judicial review).
49. Section 25 read, in pertinent part: And be it further enacted, That a final judgment or decree in any suit, in the highest court of law or equity of a State in which a decision in the suit could be had, where is drawn in question the validity of a treaty or statute of, or an authority exercised under the United States, and the decision is against their validity; or where is drawn in question the validity of a statute of, or an authority exercised under any State, on the ground of their being repugnant to the constitution, treaties or laws of the United States, and the decision is in favour of such their validity, or where is drawn in question the construction of any clause of the constitution, or of a treaty, or statute of, or commission held under the United States, and the decision is against the title, right, privilege or exemption specially set up or claimed by either party, under such clause of the said Constitution, treaty, statute or commission, may be re-examined and reversed or affirmed in the Supreme Court of the United States upon a writ of error . . . . Judiciary Act of 1789 § 25, 1 Stat. 73, 85-86 (footnote omitted).
50. Id. § 9(b), 1 Stat. 73, 85-86 (current version at 28 U.S.C. § 1350 (2000)).
51. See Sosa v. Alvarez-Machain, 542 U.S. 692, 720 (2004) (holding that Congress intended to empower courts to articulate and enforce "a relatively modest set of actions alleging violations of the law of nations").
52. See EDWARD A. PURCELL, JR., BRANDEIS AND THE PROGRESSIVE CONSTITUTION: ERIE, THE JUDICIAL POWER, AND THE POLITICS OF THE FEDERAL COURTS IN TWENTIETH-CENTURY AMERICA 77-91 (2000) (discussing congressional debates in the 1920s and 1930s over the elimination of diversity jurisdiction as a progressive reform); see also id. at 19-26 (describing congressional attitudes toward expanding the federal courts and altering their structure in response to the increased caseloads of Prohibition).
53. Herbert Wechsler, Federal Jurisdiction and the Revision of the Judicial Code, 13 LAW & CONTEMP. PROBS. 216, 225 (1948).
54. Vendo Co. v. Lektro-Vend Corp., 433 U.S. 623, 638-39 (1977).
55. Wechsler, supra note 47, at 229.
56. Id. at 229 & n.65. Professor Wechsler made this observation with specific reference to the relitigation problem that was most actively under discussion at the time in light of the Supreme Court's decision in Toucey. Id.
57. In a narrow and odd line of cases, the Supreme Court has given strong voice to this proposition by identifying statutes in which Congress's expressed desire to preempt state law is so "complete" that it warrants an exception to the well-pleaded complaint rule and authorizes removal on the basis of a preemption defense. See Beneficial Nat'l Bank v. Anderson, 539 U.S. 1, 6-8 (2003) (describing the development of the complete preemption doctrine).
58. See 28 U.S.C. § 1738 (2000); see also Matsushita Elec. Indus. Co. v. Epstein, 516 U.S. 367, 374 (1996) ("Further, § 1738 is not irrelevant simply because the judgment in question might work to bar the litigation of exclusively federal claims.").
59. See, e.g., Sycuan Band of Mission Indians v. Roache, 54 F.3d 535, 540 (9th Cir. 1994, amended 1995) (noting that where federal law provides for exclusive jurisdiction over claims, "state court proceedings [on those claims are] in derogation of federal jurisdiction" and a federal antisuit injunction is "necessary to preserve federal jurisdiction"); see also, e.g., AT&T Mgmt. Pension Plan v. Tucker, 902 F. Supp. 1168, 1173 (C.D. Cal. 1995) (interpreting a grant of exclusive jurisdiction over ERISA claims, and statutory' authorization for injunctive relief against "any act or practice" that violates ERISA provisions, as together satisfying AIA exceptions relating to jurisdiction and express authorization); Cartledge v. Miller, 457 F. Supp. 1146, 1151-52 (S.D.N.Y. 1978) (arriving at similar conclusion as to ERISA and antisuit orders, but resting solely on AIA exception for "expressly authorized" injunctions). The plurality's skepticism in Vendo over the relevance of a grant of exclusive jurisdiction to the issuance of an AIA injunction, in particular, is entitled to limited precedential weight. That opinion conspicuously represented the views of only three members of the Court. Six members of the Court found that the statute at issue in that case (the Clayton Act) contained an express exception to the AIA's prohibition and did not reach the exclusive jurisdiction question. See Vendo, 433 U.S. at 64344 (Blackmun, J., concurring in the judgment) (concluding that the Clayton Act contains an express exception to the AIA but holding that an injunction was inappropriate in the case at bar, hence joining the plurality's disposition, albeit "for reasons that differ significantly"); id. at 660 (Stevens, J., dissenting) (explaining that agreement of six Justices on express exception under the Clayton Act "establishes that proposition as the law for the future").
60. See, e.g., 1975 Salaried Ret. Plan for Eligible Employees of Crucible, Inc. v. Nobers, 968 F.2d 401, 407-08 (3d Cir. 1992) (finding that exclusive federal jurisdiction is relevant to the availability of an AIA injunction, but that the Supreme Court's discouraging statements limit federal district courts to determining whether an antisuit injunction is necessary to prevent frustration of the court's jurisdiction in "the very case before it").
61. As Professor Redish has trenchantly pointed out, the Supreme Court has not developed its AIA and abstention doctrines in harmony, nor even fostered an active dialogue between the two, despite their obvious connection: At no point has the Court ever considered the problem of duplicative litigation from a holistic perspective. Instead, it has developed its Anti-Injunction Act interpretation . . . without regard to its abstention analysis, and it has developed its abstention analysis without any meaningful discussion of the relevance of its Anti-Injunction Act construction. Redish, supra note 27, at 1360.
62. Younger v. Harris, 401 U.S. 37 (1971).
63. See, e.g., Int'l Ass'n of Entrepreneurs of Am. v. Angoff, 58 F.3d 1266, 1271 (8th Cir. 1995) ("There is no need for abstention unless the state and federal courts have concurrent jurisdiction of an issue or case."); Sycuan Band, 54 F.3d at 541 (finding that the grant of exclusive jurisdiction in the federal courts obviated Younger abstention); Levy v. Lewis, 635 F.2d 960, 967 (2d Cir. 1980) (holding that abstention applies "only where concurrent federal state jurisdiction exists"); see also Silberkleit v. Kantrowitz, 713 F.2d 433, 435-36 (9th Cir. 1983) (holding that, where no special abstention doctrine applies, abstention under Colorado River's "wise judicial administration" doctrine is inappropriate in claims subject to exclusive federal jurisdiction); cf. Arizona v. San Carlos Apache Tribe, 463 U.S. 545, 559-60 (1983) (noting that a stay of a federal suit would "clear[ly]" be "improper" under Colorado River where "there was no jurisdiction in the concurrent state actions to adjudicate the claims at issue in the federal suits").
64. See, e.g., Sycuan Band, 54 F.3d at 540-41 (recognizing the availability of an anti-suit injunction and the inapplicability of Younger abstention as complementary expressions of congressional purpose in grants of exclusive federal jurisdiction). Sycuan Band involved the rights of an Indian tribe, and subsequent courts have interpreted its holding and that of similar cases as giving voice to the distinctive congressional purpose of protecting Indian rights that is embodied in the grant of exclusive jurisdiction over such claims. See, e.g., Bowen v. Doyle, 880 F. Supp. 99, 130-31 (W.D.N.Y. 1995) (emphasizing the importance of "the well-established rules protecting Indian tribes' interests in their sovereignty and property, and the primacy of federal authority in Indian affairs" in considering AIA injunctions).
65. See Act of Dec. 1, 1980, Pub. L. No. 96-486, 94 Stat. 2369 (amending 28 U.S.C. § 1331 to eliminate the amount-in-controversy requirement).
66. Winstead v. J.C. Penney Co., 933 F.2d 576, 580 (7th Cir. 1991).
67. See, e.g., Califano v. Sanders, 430 U.S. 99, 105-07 (1977) (interpreting the statute eliminating the amount-in-controversy requirement in federal question actions brought against federal agencies as defining jurisdictional policy in the agency context, to the exclusion of arguments about implied purposes contained in the APA itself).
68. Winstead, 933 F.2d at 580.
69. Mitchum v. Foster, 407 U.S. 225 (1972) (defining the inquiry and finding the "expressly authorized" exception satisfied in the case of § 1983 actions).
70. Id. at 237-38.
71. Id. at 238.
72. See, e.g., Redish, supra note 27, at 1357-58 (describing the Court's treatment of the "expressly authorized" exception in Mitchum as "unjustifiably broad" and suggesting that much of the work that the Court has assigned to that provision would fit better into an analysis of jurisdictional policy).
73. The Court readily recognized the interplay between the two provisions when it construed the jurisdictional statute, now codified at 28 U.S.C. § 1343, to reach actions brought against state officials in Puerto Rico: The federal civil rights legislation, with which we are here concerned, was enacted nearly 30 years before the conflict with Spain and the resulting establishment of the ties between Puerto Rico and the United States. Both § 1343(3) and § 1983 have their origin in the Ku Klux Klan Act of April 20, 1871, § 1, 17 Stat. 13. That statute contained not only the substantive provision protecting against "the deprivation of any rights, privileges, or immunities secured by the Constitution" by any person acting under color of state law, but, as well, the jurisdictional provision authorizing a proceeding for the enforcement of those rights "to be prosecuted in the several district or circuit courts of the United States." Jurisdiction was not independently defined; it was given simply to enforce the substantive rights created by the statute. The two aspects, seemingly, were deemed to coincide. Exam'g Bd. of Eng'rs, Architects & Surveyors v. Flores de Otero, 426 U.S. 572, 581-82 (1976) (footnote omitted).
74. In that instance, the grant of jurisdiction aimed to prevent overenforcement of legal norms against government officials, rather than underenforcement. More specifically, as Professor Mishkin observed, the apparent purpose of Congress in expanding removal jurisdiction for that highly prioritized class of cases was to provide a tribunal that would produce reliable and unbiased resolutions of contested factual disputes: The importance of trying factual issues in the federal courts tends to be highlighted by the continuance of specific jurisdictional grants to the district courts in situations where reliance on the Supreme Court would mean at most a negligible increase in the latter's business. Consider, for example, the provisions for removal to a federal trial forum of civil actions or criminal prosecutions brought in a state court against a federal officer for acts done under color of office. The possibility of misconstruing the national law involved in these cases would not, at least in present times, seem to require their trial in a federal tribunal; Supreme Court policing of that law would apparently be sufficient and feasible on the few occasions on which such cases arise nowadays. Yet in the 1948 revision of Title 28, United States Code, this head of trial jurisdiction was not only retained but extended. That action certainly implies the existence of some consideration in addition to a desire for the uniform construction of national law. Paul J. Mishkin, The Federal "Question" In the District Courts, 53 COLUM. L. REV. 157, 172 (1953) (footnotes omitted).
75. Wechsler, supra note 47, at 220-21.
76. Recall Justice Blackmun's separate opinion in Vendo, for example. See Vendo Co. v. Lektro-Vend Corp., 433 U.S. 623, 643 (1977) (Blackmun, J., concurring) (finding that an antisuit injunction, though not categorically prohibited, was inappropriate in the case at bar).
77. See DAVID SCHOENBROD ET AL., REMEDIES: PUBLIC AND PRIVATE 51-55 (1990) (discussing the nature of and requirements for an injunction).
78. See, e.g., Hecht Co. v. Bowles, 321 U.S. 321, 329 (1944) (adopting a narrow interpretation of a federal statute so as to avoid a construction that would have imposed constraints upon the equitable discretion of the federal court).
79. See generally SCHOENBROD ET AL., supra note 71 at 97-100 (discussing the issue of enforceability and exploring concerns that often lead judges to craft injunctions narrowly and with caution).
80. Rule 22 of the Federal Rules of Civil Procedure also provides for joinder of an interpleader action, but the provision is largely superfluous in light of the statutory provisions - except, perhaps, in the unusual case where the claimants in an interpleader action would exhibit complete diversity with the stakeholder but no diversity among themselves. See generally SILBERMAN, STEIN & WOLFF, supra note 4, at 978-79 (discussing Rule 22 in light of statutory interpleader provisions).
81. See 28 U.S.C. § 1335(a)(1) (2000).
82. Vendo Co. v. Lektro-Vend Corp., 433 U.S. 623, 640 (1977); see also Mitchum v. Foster, 407 U.S. 225, 234 n.14 (1972) (noting the ability of a district court to prevent suits affecting an interpleading action).
83. Compare Law of June 25, 1948, ch. 646, § 1335, 62 Stat. 931 (reflecting the changes made by the amendment), with Law of May 24, 1949, ch. 139, § 117, 63 Stat. 105 (broadening the statute to include suits "in the nature of interpleader" and to include cases "prosecuted" under § 1335). Interpleader already constituted a recognized and express exception under the AIA at the time the Toucey decision was handed down. See Toucey v. N.Y. Life Ins. Co., 314 U.S. 118, 134-35 (1941) (discussing the Interpleader Act of 1926 and the express provision for injunctions); see also Interpleader Act of 1926, ch. 273, § 2, 44 Stat. 416 ("Notwithstanding any provision of the Judicial Code to the contrary, [a federal district] court shall have power to issue its process for all such claimants and to issue an order of injunction against each of them, enjoining them from instituting or prosecuting any suit or proceeding in any State court or in any other Federal court . . . ."). That statute amended a previous version that was more vague in the authority it granted district courts to issue antisuit injunctions. See Interpleader Act of 1917, 39 Stat. 929 (repealed 1926) (providing that a district court in an interpleader action "shall have the power to make such orders and decrees as may be suitable and proper and to issue the necessary writs usual and customary in such cases for the purpose of carrying out such orders and decrees").
84. In its first major decision on the AIA following the 1948 amendment, the Court suggested that the express exception in the 1948 interpleader statute was recodified and expanded in order to bring interpleader clearly within the new exception to the AIA. See Amalgamated Clothing Workers of Am. v. Richman Bros., 348 U.S. 511, 514 (1955) ("In lieu of the bankruptcy exception of [the old version of the AIA], Congress substituted a generalized phrase [in the 1948 amendment] covering all exceptions, such as that of the [amended] Interpleader Act, to be found in federal statutes." (citation omitted)).
85. 28 U.S.C. § 2361 (2000).
86. See, e.g., Francis I. du Pont & Co. v. Sheen, 324 F.2d 3, 4-5 (3d Cir. 1963) (relying upon § 2361's invitation to "make the injunction permanent" in issuing a broad, permanent antisuit injunction); id. at 5 (interpreting compliance with interpleader procedures by the stakeholder as presumptive indication of responsible behavior as warranting an antisuit injunction to prevent harassment).
87. In Vendo, for example, the sequence of events in the lower courts appears to suggest that the parties who were seeking an antisuit injunction to effectuate the grant of exclusive jurisdiction over federal antitrust claims deliberately sat on their rights, attempting to pursue every possible avenue in state court before seeking a federal order to interdict enforcement of the state judgment. See Vendo, 433 U.S. at 628-29 ("During the entire nine-year course of the state-court litigation, respondents' antitrust suit in the District Court was, in the words of the Court of Appeals, allowed to lie 'dormant.' But the day after [all avenues of appeal were exhausted in the state proceedings], respondents moved in District Court for a preliminary injunction against collection of the Illinois judgment." (citation omitted)). A more proper basis for denying relief in that case might thus have been that the course of behavior followed by the party seeking the antisuit injunction failed to satisfy ordinary requirements for the intervention of equity. But see id. at 662-65 (Stevens, J., dissenting) (offering an account of litigation delays in Illinois courts and strategic considerations that suggest an innocuous interpretation of this period of delay).
88. See State Farm Fire & Cas. Co. v. Tashire, 386 U.S. 523, 530 (1967).
89. The Court adopted this "logical relationship" approach in Moore v. New York Cotton Exchange, finding that jurisdiction is permissible - over a counterclaim, in that case - where "[e]ssential facts alleged by [the claimant with the independent federal claim] enter into and constitute in part the cause of action set forth in the [jurisdictionally insufficient claim]." 270 U.S. 593, 610 (1926).
90. See United Mine Workers of Am. v. Gibbs, 383 U.S. 715, 725 (1966) (holding that federal jurisdiction over pendent state claims is constitutionally permissible where they share a "common nucleus of operative fact" with the federal claim). Consider, for example, the asbestos cases. To be sure, asbestos claimants share elements of commonality in the scientific proof of general causation tying their injuries to asbestos exposure. But the circumstances surrounding an individual's exposure and the extent of her damages will generally share little or no factual nexus with the circumstances of other claimants. See, e.g., Georgine v. Amchem Prods., Inc., 83 F.3d 610, 626-30 (3d Cir. 1996) (detailing the vast array of individual circumstances that characterize asbestos exposure and the concomitant difficulty of establishing commonality and predominance in class certification), aff'd in part and modified in part sub nom. Amchem Prods., Inc. v. Windsor, 521 U.S. 591 (1997). If diversity jurisdiction over such a case depended upon satisfying the Gibbs standard, it is far from clear that the federal courts would have power to resolve it. Even in cases involving a denial of certification, as in Georgine, note the important difference between a dismissal for lack of federal jurisdiction and an order resolving the certification issue and denying class treatment. In the one case, the federal courts disclaim any power to adjudicate. In the other, they issue an order forbidding the case, as filed, to proceed as a class. This difference takes on added significance in light of the analysis in Part III of this Article.
91. Professor Floyd has offered one such challenge in a thorough article. See C. Douglas Floyd, The Limits of Minimal Diversity, 55 HASTINGS L.J. 613, 652-71 (2004) (discussing the minimal diversity provisions of the proposed Class Action Fairness Act). I must admit that I find his discussion of the issue unsatisfying in some ways. Floyd articulates his arguments about CAFA and minimal jurisdiction primarily as an exercise in discerning the purposes ascribed to the Diversity Clause by "the Framers of the Constitution." Id. at 652. Whatever views the Framers may have held about the purpose of the Diversity Clause, they lived within a legal arena in which the legislative authority of states and the adjudicatory authority of courts were both conceptualized in strictly territorial terms. The broad extension of statutory and adjudicatory jurisdiction by states that sometimes characterizes modern class action litigation was not a problem that an eighteenth-century lawyer would have had any reason to consider. From this fact, one could fairly say that the Framers did not have the expansive joinder scenarios of CAFA affirmatively in mind when they drafted the Diversity Clause, but that says little about the propriety of Congress's decision to invoke the Clause today to respond to a new problem. Asessing the constitutionality of CAFA in light of a late-eighteenth-century conception of the forms and function of litigation thus seems particularly inapposite.
92. But cf. Shoshone Mining Co. v. Rutter, 177 U.S. 505, 507-09 (1900) (interpreting a federal "arising under" jurisdictional statute not to reach federal land grant claims where federal law arguably "creates" a cause of action but leaves state law in place to provide the rule of decision).
93. See 61 Stat. 156 (codified at 29 U.S.C. § 185(a)) (allowing for suits in federal court "without regard to the citizenship of the parties"). See generally Carole E. Goldberg-Ambrose, The Protective Jurisdiction of the Federal Courts, 30 UCLA L. REV. 542, 559-64 (1983) (describing the Taft-Hartley Act and the debate over protective jurisdiction that it provoked).
94. See Mishkin, supra note 68, at 191-93 (arguing that Article III allows for "protective" jurisdiction); Wechsler, supra note 47, at 224-25 (adopting Marshall's view that federal jurisdiction should extend "to every case that might involve an issue under federal law").
95. Textile Workers Union of Am. v. Lincoln Mills of Ala., 353 U.S. 448, 457 (1957); see also Alexander M. Bickel & Harry H. Wellington, Legislative Purpose and the Judicial Process: The Lincoln Mills Case, 71 HARV. L. REV. 1, 6-14 (1957) (criticizing Lincoln Mills for using federal common law as a means of avoiding the difficult questions surrounding protective jurisdiction, though allowing for the possibility that protective jurisdiction might be appropriate).
96. Mishkin, supra note 68, at 184; see also Wechsler, supra note 47, at 224-25 ("Where, for example, Congress by the commerce power can declare as federal law that contracts of a given kind are valid and enforceable, it must be free to take the lesser step of drawing suits upon such contracts to the district courts without displacement of the states as sources of the operative, substantive law.").
97. Professor Goldberg-Ambrose makes similar observations in her treatment of the protective jurisdiction debate. See, e.g., Goldberg-Ambrose, supra note 87, at 569 ("It is instructive to observe how federal jurisdiction by itself can become an instrument of federal policy insofar as it permits the use of federal rather than state procedures."); id. at 569-72 (discussing how jurisdictional statutes can be used as tools for effectuating substantive policies).
98. See CAFA § 2(a)(2)-(3), 28 U.S.C. § 1711 note (Supp. V 2005) (summarizing the purposes of the Act). Professor Issacharoff makes a similar "greater-includes-the-lesser" observation in describing CAFA, arguing that the case for uniform federal choice of law rules is bolstered by the power that Congress presumably has to impose national standards for most forms of common law commercial liability. See Issacharoff, supra note 12, at 1867.
99. Cf. Wood, supra note 27, at 319-20 (describing the general principles embodied in AIA doctrine).
100. See supra Part I.B.
101. See 11 U.S.C. § 362 (2000).
102. See, e.g., Epstein v. MCA, Inc., 126 F.3d 1235, 1248-51 (9th Cir. 1997), withdrawn, 179 F.3d 641 (9th Cir. 1999) (discussing the structural danger of malfeasance in cases where class counsel appear to be using a state court proceeding as a vehicle for generating a classwide settlement that will release exclusively federal claims); see also infra text accompanying notes 245-246 (discussing the propriety of an antisuit injunction in the Epstein litigation).
103. Or, put another way, if the court is convinced that the absentees would surely remove to the federal forum were they able to do so.
104. See Stephen B. Burbank, The Class Action Fairness Act of 2005 in Historical Context: A Preliminary View, 156 U. PA. L. REV. 1439, 1527-28 (2008) ("It suffices to note that none of the exceptions permits a state court to retain (if the defendant chooses to remove) a class action brought on behalf solely of the citizens of that state, alleging injuries sustained in the state as a result of the in-state activities of an out-of-state corporation doing substantial business in the state. Such a case is, therefore, defined as of 'national importance.'" (emphasis omitted)); see also SILBERMAN, STEIN & WOLFF, supra note 4, at 1052-53 (questioning the propriety of federal jurisdiction in a similar scenario).
105. The most frequently cited example of this phenomenon is the General Motors pick-up truck litigation. The named plaintiffs and defendant in that case obtained a certification order for a nationwide class action in the Eastern District of Pennsylvania that was reversed on appeal by the Third Circuit, which ruled that certification of a nationwide class was inappropriate. The parties then moved their litigation to the state courts of Louisiana, which certified the class, approved the settlement, and entered a final judgment. Objecting class members returned to the original federal forum, seeking an injunction to prevent Louisiana's interference with the original denial of certification, but the Third Circuit held that the AIA prohibited such an order. See In re Gen. Motors Corp. Pick-Up Truck Fuel Tank Prods. Liab. Litig., 134 F.3d 133, 137-40 (3d Cir. 1998) (GM III) (detailing the history of the litigation and denying the requested injunction).
106. In re Bridgestone/Firestone Tires Prods. Liab. Litig. (Bridgestone/Firestone II), 333 F.3d 763, 769 (7th Cir. 2003).
107. See CAFA §§ 2(a)(3)-(3)(a), 28 U.S.C. § 1711 note (Supp. V 2005) (finding that class members often receive little benefit from certain types of class settlement and placing limitations on coupon settlements and other disfavored practices).
108. 28 U.S.C. § 2283 (2000). A denial of certification does not itself constitute a final judgment in the formal sense of the term, since the named plaintiffs theoretically retain the option of proceeding with their individual claims. See id. §§ 1291-1292 (setting forth the final judgment rule and exceptions for certain interlocutory appeals); Coopers & Lybrand v. Livesay, 437 U.S. 463, 469-70 (1978) (rejecting the "death knell" theory for immediate appeals of denials of certification). Nonetheless, such orders are effectively final for most purposes, and have been treated as such. See, e.g., FED. R. CIV. P. 23(f) (providing for immediate discretionary appeals of certification orders); cf. 28 U.S.C. § 2072(c) (2000) (authorizing the Supreme Court to promulgate rules that "define when a ruling of a district court is final for the purposes of appeal under section 1291 of this title"); Bridgestone/Firestone II, 333 F.3d at 767 ("'[F]or purposes of issue preclusion . . . , "final judgment" includes any prior adjudication of an issue in another action that is determined to be sufficiently firm to be accorded conclusive effect.' Our decision that no nationwide class is tenable is 'sufficiently firm' for this purpose." (quoting RESTATEMENT (SECOND) OF JUDGMENTS § 13 (1982)). The Third Circuit has ruled that a denial of certification is not a sufficiently final order to trigger the AIA's "protect or effectuate" exception. See, e.g., GM III, 134 F.3d at 146 ("[D]enial of class certification under these circumstances lacks sufficient finality to be entitled to preclusive effect."). This is one of many incorrect rulings in this important line of Third Circuit cases, as I will argue later in this Section.
109. Timothy Kerr offers a good account of the due process objection. See Kerr, supra note 29, at 240-43.
110. 472 U.S. 797 (1985).
111. See Stephen B. Burbank, Jurisdiction To Adjudicate: End of the Century or Beginning of the Millennium?, 7 TUL. J. INT'L & COMP. L. 111, 117-18 (1999) (describing the origins of this confusion in the Court's International Shoe opinion).
112. Professor (now Judge) Wood has referred to this as the "extreme reading" of Shutts. See Diane P. Wood, Adjudicatory Jurisdiction and Class Actions, 62 IND. L.J. 597, 605-06 (1987). If anything, Professor Wood's early account of the potential for misreading Shutts understated the case.
113. Shutts, 472 U.S. at 799-801. Because the plaintiffs in Shutts sought damages based on a statutorily determined interest rate, their cause of action is frequently characterized as an action at law in discussions of the case. In fact, however, the Kansas Supreme Court had relied on equitable principles of unjust enrichment in determining, in an earlier case involving the same parties, that leaseholders were entitled to interest on withheld royalty payments. See Shutts v. Phillips Petroleum Co., 567 P.2d 1292, 1298 (Kan. 1977) (describing the plaintiffs' damages theory in terms of unjust enrichment); id. at 1321 (holding "on equitable principles" that plaintiffs are entited interest payments). In a much-noted footnote, the Shutts Court expressly limited its holding to "class actions which seek to bind known plaintiffs concerning claims wholly or predominately for money judgments." Shutts, 472 U.S. at 811 n.3. The Court itself contributed to this potential confusion in the text immediately preceding this footnote when it offered the ambiguous observation that its holding described the procedures that a state like Kansas must employ if it "wishes to bind an absent plaintiff concerning a claim for money damages or similar relief at law." Id. at 811 (emphasis added).
114. Out of necessity, I gloss over much complexity in saying that the Court's choice of law ruling is "not relevant" to the present discussion. At a metadoctrinal level, limits on choice of law and on personal jurisdiction operate in a complementary fashion in restricting the range of burdens and outcomes that people can expect to encounter as a result of their primary activities. Professor Silberman's work has explored this relationship most profitably. See, e.g., Linda Silberman, Reflections on Burnham v. Superior Court: Toward Presumptive Rules of Jurisdiction and Implications for Choice of Law, 22 RUTGERS L.J. 569, 583-90 (1991). In most cases, relatively strict constitutional rules on personal jurisdiction operate to counterbalance relatively lax constitutional standards on choice of law. This limits the range of fora in which a plaintiff can bring suit and, indirectly thereby, the range of state laws that are likely to apply to the dispute (given the conventional wisdom that most state courts prefer to apply the law of the forum). In Shutts, this relationship was reversed: the permissive rule that the Court adopted on personal jurisdiction counterbalanced with a stricter constitutional standard on the choice of applicable law. A with many standards, however, this one has proven highly malleable, giving rise to some of the adventuresome nationwide state court class actions that are one of the stated targets of CAFA.
115. Shutts, 427 U.S. at 802.
116. Professors Miller and Crump made this basic observation in their early account of the Shutts decision, although they offered very little in the way of further analysis to explore its implications: If all class members have an affiliation with the forum, the court can compel appearance, and the inference of consent is unnecessary. Notice and an opportunity to be heard probably still would be required as independent due process guarantees, but the right to opt out presumably could be denied. It is even conceivable that cheaper notice, such as the substitutes provided by some state class action rules, would be acceptable in an action in which traditional jurisdictional requirements are met. Arthur R. Miller & David Crump, Jurisdiction and Choice of Law in Multistate Class Actions After Phillips Petroleum Co. v. Shutts, 96 YALE L.J. 1, 31-32 (1986) (internal citations omitted);
117. see also David L. Shapiro, Class Actions: The Class as Party and Client, 73 NOTRE DAME L. REV. 913, 954-55 (1998) (suggesting that the holding of Shutts relating to opt-out notice "may well be limited . . . to cases in which the members of the class are beyond the territorial jurisdiction of the forum");
118. Tobias Barrington Wolff, Preclusion in Class Action Litigation, 105 COLUM. L. REV. 717, 787 (2005) (making the basic point in the context of preclusion analysis).
119. See, e.g., Jahn ex rel. Jahn v. ORCR, Inc., 92 P.3d 984, 988-91 (Colo. 2004) (en banc) (erroneously reading Shutts and other authorities to stand for the proposition that class actions certified pursuant to Rule 23(b)(2) can never have claim-preclusive effects on damages claims because of their failure to provide opt-out rights, even though class members were all in-state residents).
120. See, e.g., Jefferson v. Ingersoll Int'l Inc., 195 F.3d 894, 897-99 (7th Cir. 1999) (suggesting that 23(b)(2) class actions cannot compromise damages claims through preclusive effect, despite the presence of a nationwide service provision in a federal statute that eliminates personal jurisdiction problems).
121. Federal Rule of Civil Procedure 4(k)(1)(A) establishes the default territorial limits on service of a summons to establish jurisdiction: (1) Serving a summons or filing a waiver of service establishes personal jurisdiction over a defendant: (A) who is subject to the jurisdiction of a court of general jurisdiction in the state where the district court is located . . . . FED. R. CIV. P. 4(k)(1)(A); cf. FED. R. CIV. P. 4(k)(1)(C) (service of summons is effective to establish jurisdiction "when authorized by a federal statute"); FED. R. CIV. P. 4.1(b) ("An order committing a person for civil contempt of a decree or injunction issued to enforce federal law may be served and enforced in any district.").
122. Professor Monaghan is most forceful in staking out this position in his article discussing antisuit injunctions and the collateral attack question. See Henry Paul Monaghan, Antisuit Injunctions and Preclusion Against Absent Nonresident Class Members, 98 COLUM. L. REV. 1148 (1998). Monaghan insists that "Shutts was all about the conditions necessary for the existence of in personam jurisdiction sufficient to preclude the claims of absent, nonresident class members" and that the decision had no bearing upon more traditional notions of procedural due process. Id. at 1162; see also, e.g., id. at 1167-68 ("[W]e must clearly identify what Shutts is about: the existence of in personam jurisdiction sufficient to preclude the substantive claims of nonresident class members."); id. at 1166 (arguing the same point). A will become apparent, I disagree with Professor Monaghan's approach, which I believe elides much of importance in Shutts.
123. See, e.g., Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 807 (1985) ("The purpose of [the International Shoe test] is to protect a defendant from the travail of defending in a distant forum, unless the defendant's contacts with the forum make it just to force him to defend there."); Int'l Shoe Co. v. Washington, 326 U.S. 310, 320 (1945) (reframing the personal jurisdiction inquiry in terms of the "traditional conception of fair play and substantial justice"). The extent of a court's adjudicatory jurisdiction also has a profound de facto impact on the law that is likely to apply in multijurisdictional disputes. See Silberman, supra note 108, at 589-90 (explaining that permissive or vague personal jurisdiction standards, combined with permissive choice of law standards, lead to ex ante uncertainty as to the law that is likely to apply to primary activity if a dispute arises).
124. The Court has occasionally suggested, usually by negative implication, that forcing a defendant to respond in a highly inconvenient forum might impede its ability to develop evidence and secure the testimony of witnesses, in derogation of the concern for accuracy and equal treatment, or might even lead a defendant to choose to default rather than to appear, with obvious adverse consequences for the value of individual participation and the overall integrity of the proceedings. See, e.g., McGee v. Int'l Life Ins. Co., 355 U.S. 220, 224 (1957) ("Of course there may be inconvenience to the insurer if it is held amendable to suit in California where it had this contract but certainly nothing which amounts to a denial of due process. There is no contention that respondent did not have adequate notice of the suit or sufficient time to prepare its defenses and appear." (citations omitted)). Such concerns are very much the exception and do not drive the personal jurisdiction doctrine.
125. See World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 294 (1980) ("Even if the defendant would suffer minimal or no inconvenience from being forced to litigate before the tribunals of another State . . . , the Due Process Clause, acting as an instrument of interstate federalism, may sometimes act to divest the State of its power to render a valid judgment.").
126. See Ins. Corp. of Ir. v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 702 n.10 (1982) ("The restriction on state sovereign power described in World-Wide Volkswagen Corp. . . . must be seen as ultimately a function of the individual liberty interest preserved by the Due Process Clause."). The Shutts Court conspicuously reiterated this proposition when describing the purposes underlying the personal jurisdiction doctrine. Shutts, 472 U.S. at 807.
127. Shutts, 472 U.S. at 802 ("[Petitioner] first asserted that the Kansas trial court did not possess personal jurisdiction over absent plaintiff class members as required by International Shoe Co. v. Washington and similar cases." (citation omitted)); id. ("Related to this first claim was petitioner's contention that the 'opt-out' notice to absent class members . . . was insufficient to bind class members who were not residents of Kansas . . . .").
128. See id. at 806 ("Reduced to its essentials, petitioner's argument is that unless out-of-state plaintiffs affirmatively consent, the Kansas courts may not exert jurisdiction over their claims.").
129. See id. at 806-08 (discussing purposes underlying personal jurisdiction doctrine, as articulated in International Shoe and other cases); id. at 808 (accentuating the Court's earlier reliance on Pennoyer v. Neff, 95 U.S. 714 (1877), in the key class action precedent of Hansberry v. Lee, 311 U.S. 32 (1940)); id. at 809-12 (discussing lesser burdens on class action plaintiffs, as compared to defendants, as a key factor in defining the level of "protection from state-court jurisdiction" that the Fourteenth Amendment affords absentees); id. at 812-13 (citing Keeton v. Hustler Magazine, Inc., 465 U.S. 770 (1984), and reiterating that its analysis concerns actual or constructive consent to the adjudicatory jurisdiction of the court).
130. See id. at 808 & n.1, 812. The Court also invokes Mullane's due process standard for notice once, and it drops a desultory "cf." cite to its opinion in Eisen v. Carlisle & Jacquelin, 417 U.S. 156 (1974), in discussing the issues of small-stakes class actions and individualized notice. Id. at 812.
131. See, e.g., Keeton, 465 U.S. at 779 (noting that a plaintiff can invoke the jurisdiction of the state court and consent to have her claims decided there, irrespective of her lack of contacts with the forum).
132. See, e.g., Ins. Corp. of Ir. v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 703 (1982) ("Because the requirement of personal jurisdiction represents first of all an individual right, it can, like other such rights, be waived."); McDonald v. Mabee, 243 U.S. 90, 91 (1917) (stating the same rule).
133. See, e.g., Bremen v. Zapata Off-Shore Co., 407 U.S. 1 (1972) (finding a choice-of-forum clause enforceable, even though neither the plaintiff nor the defendant had any contacts with the chosen forum).
134. Shutts, 472 U.S. at 811-12; see also id. at 803-06 (holding that the defendant has standing to invoke the rights of the plaintiffs due to the distinctive procedural posture of a class action).
135. See, e.g., FED. R. CIV. P. 12(h)(1) (specifying conditions under which a defense of lack of jurisdiction over a person is waived); see also, e.g., Continental Bank, N.A. v. Meyer, 10 F.3d 1293, 1296-97 (7th Cir. 1993) (affirming a finding that the course of litigation conduct pursued by the defendant constituted a waiver of personal jurisdiction); Yeldell v. Tutt, 913 F.2d 533, 538-39 (8th Cir. 1990) (same).
136. In the key case on the point, the Court said the following with respect to jurisdiction over independent counterclaims: There is nothing in the Fourteenth Amendment to prevent a state from adopting a procedure by which a judgment in personam may be rendered in a cross-action against a plaintiff in its courts, upon service of process or of appropriate pleading upon his attorney of record. The plaintiff having, by his voluntary act in demanding justice from the defendant, submitted himself to the jurisdiction of the court, there is nothing arbitrary or unreasonable in treating him as being there for all purposes for which justice to the defendant requires his presence. It is the price which the state may exact as the condition of opening its courts to the plaintiff. Adam v. Saenger, 303 U.S. 59, 67-68 (1938).
137. See York v. Texas, 137 U.S. 15, 20-21 (1890) (ruling that a state may adopt a system that declines to offer the opportunity to make a special appearance and treats even an appearance solely to contest jurisdiction as a procedural consent that waives the defense).
138. See, e.g., Hess v. Pawloski, 274 U.S. 352, 356-57 (1927) (finding out-of-state service on a nonresident motorist to be a sufficient basis for establishing jurisdiction on the basis of implied consent, since the motorist could assertedly have been excluded from the roads of the state altogether had he declined to give his consent); see also Int'l Shoe Co. v. Washington, 326 U.S. 310, 318-20 (1945) (characterizing this notion of consent as a "legal fiction" and reframing the analysis in terms of fairness and substantial justice).
139. See Shaffer v. Heitner, 433 U.S. 186, 207 (1977) (holding that all exercises of personal jurisdiction, whatever their form or pedigree, must satisfy the minimum contacts standard set forth in International Shoe). But cf. Burnham v. Superior Court, 495 U.S. 604, 619 (1990) (plurality opinion) (suggesting that the International Shoe standard is limited to the extraterritorial exercises of jurisdiction and has no application to a state's exercise of sovereign authority over people or property located within its borders).
140. See, e.g., Perkins v. Benguet Consol. Mining Co., 342 U.S. 437, 448-49 (1952) (upholding the exercise of general jurisdiction over a foreign corporation in Ohio where in-state activities were extensive and foreign offices were shut down due to foreign occupation, making Ohio the only available forum); Goforit Entm't LLC v. Digi-Media.com L.P., 513 F. Supp. 2d 1325, 1331-33 (M.D. Fla. 2007) (relying upon this feature of Milliken v. Meyer, 311 U.S. 457 (1940), to distinguish between various concepts of " citizenship" in determining the proper treatment of a limited liability partnership); see also Blackmer v. United States, 284 U.S. 421, 438-39 (1932) (holding that amenability to a suit in one's country of citizenship flows directly from the relationship between the citizen and the sovereign); United States v. Lansky, 496 F.2d 1063, 1067-68 (5th Cir. 1974) (reaffirming the Blackmer doctrine).
141. Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 801 (1985). Specifically, the Court reported that the certified class ultimately consisted of 28,100 members, with 3400 of the original 33,000 executing the opt-out form and 1500 being excluded because notice could not be delivered to them successfully. This makes a total of 31,500 to whom notice was actually delivered, of whom 3400, or about 10.8%, executed opt-out forms. Id. If one were to assume that 33,000, 3400, and 1500 are rounded numbers, which seems likely, then 11% is the most precise percentage of opt-outs that one could legitimately report.
142. Id.
143. While there was variation in the interest amounts to which each class member would be entitled in the action, depending upon the value of the royalties they owned, those variations do not appear to have been so large that owners at the top of the curve would have possessed economically viable individual claims. The point is addressed briefly in the opinion of the Kansas Supreme Court, which reproduces the following finding made by the trial court during certification: "The claims of plaintiffs are typical of the claims of all the members of the class except that each owner may be entitled to a different amount of interest and the interest to each owner, if allowed, would be too small to enable each to file a separate action." Shutts v. Phillips Petroleum Co., 679 P.2d 1159, 1166 (Kan. 1984), rev'd in part, 472 U.S. 797 (1985) (emphasis added). Even allowing for the possibility that the trial court was speaking somewhat imprecisely here, it is clear that there was no material number of class members with substantial claims.
144. Theodore Eisenberg & Geoffrey Miller, The Role of Opt-Outs and Objectors in Class Action Litigation: Theoretical and Empirical Issues, 57 VAND. L. REV. 1529, 1532 (2004). The authors report similar results in assessing the rate at which class members appear at fairness hearings to object to proposed settlements: Only in commercial cases does the objection rate rise to nontrivial levels, but this case type has only four cases in the sample. No other case type displays a mean objection rate of even 5 percent of class members. Like opt-outs, objectors are rare and this result varies little across the vast majority of case types. Id. at 1549.
145. THOMAS E. WILLGING, LAURAL L. HOOPER & ROBERT J. NIEMEC, FED. JUDICIAL CTR., EMPIRICAL STUDY OF CLASS ACTIONS IN FOUR FEDERAL DISTRICT COURTS: FINAL REPORT TO THE ADVISORY COMMITTEE ON CIVIL RULES 10 (1996) ("Across all four districts, the median percentage of members who opted out of a settlement was either 0.1% or 0.2% of the total membership of the class . . . .").
146. One is left to wonder what the cause was for this astonishing level of engagement among class members. I have been unable to find any obvious explanation. Class members may have been unusually attentive to the litigation given their likely awareness of the underlying dispute about royalties that preceded the Shutts case. But still, why should negative-value claimants opt out when they could not afford to pursue their own actions, especially given that the earlier Shutts decision seemingly made victory a sure thing in the second litigation so long as the case could be certified?
147. Shutts, 472 U.S. at 813.
148. Id.
149. Id. (emphasis added).
150. Id. (emphasis added).
151. Even in such high-stakes cases, one should be cautious in making assumptions about the level of consent or other state of mind that an individual exhibits by failing to execute an opt out. For any but the most sophisticated or trained person, the practical and legal implications of an opt-out notice may be utterly opaque. See, e.g., Debra Lyn Bassett, Implied "Consent" to Personal Jurisdiction in Transnational Class Litigation, 2004 MICH. ST. L. REV. 619, 626-28 (detailing these and other limitations on class action notice). A I have argued elsewhere: While it is probably true that most individuals who suffer serious injury or harm would consider pursuing litigation on their own, it is quite another matter to assume breezily that all those individuals will in fact exercise their right to opt out and hence require no further consideration by the certifying court. Many people do not pay attention to the notices that they receive, and some people who do receive a notice may make unwise or uninformed decisions, either from a failure to understand the consequences of not opting out or from a simple lack of good judgment. Wolff, supra note 110, at 775 n.174.
152. Professor Monaghan makes a similar observation. See Monaghan, supra note 114, at 1185 ("Indeed, it is[] beyond the experience or expectation of reasonable citizens that the failure to respond to what looks like a slightly unusual piece of junk mail constitutes assent to the solicitation . . . ." (internal quotation marks omitted) (quoting Paul D. Carrington & Derek P. Apanovitch, The Constitutional Limits of Judicial Rulemaking: The Illegitimacy of Mass-Tort Settlements Negotiated Under Federal Rule 23, 39 ARIZ. L. REV. 461, 467-68 (1997))).
153. One can draw a useful comparison to the efforts that counsel make in high-stakes class litigation to contact individual class members. Whether it is class counsel or competing lawyers doing the work (which will vary with the structure and posture of the proceeding), attorneys in high-stakes class actions often create websites, undertake elaborate advertising campaigns, and make individual contact (where permissible) in order to ensure the highest possible level of voluntary participation or exclusion from such proceedings. See, e.g., Abestos Class Action, http://asbestosclassaction.100491.free-press- release.com (last visited Jan. 31, 2008);
154. Official Pennsylvania and New Jersey Fen Phen Class Action Website, http://www.leflaw.net/fenphen/01311999.html (last visited Jan. 31, 2008);
155. cf. KENNETH R. FEINBERG, WHAT IS LIFE WORTH? THE UNPRECEDENTED EFFORT TO COMPENSATE THE VICTIMS OF 9/11, at 48-63 (2005) (detailing the elaborate efforts that were required to communicate with known victims of the defining tragedy of the present generation in order to give confidence that victims were making informed decisions about their participation in the compensation fund).
156. Professors Eisenberg and Miller agree: The results reported above also undermine the idea that absent class members may be taken to consent to the court's jurisdiction over their person by virtue of their failure to opt out of the action. The overwhelming inaction displayed by class members in the reported cases suggests that a class member's failure to opt out should not readily be equated to an affirmative consent to jurisdiction. Common sense indicates that apathy, not decision, is the basis for inaction. Eisenberg & Miller, supra note 136, at 1561.
157. Shutts, 472 U.S. at 808-11.
158. Id. at 808.
159. Id. at 809-11. The Court's reasoning becomes much more problematic in the case of personal injuries or other high-value claims. A claim for personal injuries may well be the single most valuable asset that some class members own, even discounting for the possibility that individual litigation will fail to produce any recovery. What is more, individuals who have suffered serious injury will typically have a much greater level of personal and psychic investment in the disposition of their claims, making the due process concern for individualized consideration and treatment all the more acute - a species of concern that generally finds expression in the "superiority" prong of a certification analysis, when it finds expression at all. See, e.g., Castano v. Am. Tobacco Co., 84 F.3d 734, 748 (5th Cir. 1996) (finding "[t]he most compelling rationale for finding superiority in a class action - the existence of a negative value suit - . . . missing" in a case with high-value claims); In re Rhone-Poulenc Rorer Inc., 51 F.3d 1293, 1299 (7th Cir. 1995) (making a similar finding).
160. Shutts, 472 U.S. at 812 (citing Hansberry v. Lee, 311 U.S. 32, 42-43, 45 (1940)).
161. See Shapiro, supra note 110, at 937-38 (discussing Hansberry and Supreme Tribe of Ben-Hur v. Cauble, 255 U.S. 356 (1921)).
162. Shutts, 472 U.S. at 810.
163. Cf. Shapiro, supra note 110, at 924-27 (discussing deterrence as a justification supporting certain legal fictions in the administration of class action litigation).
164. See Shutts, 472 U.S. at 813-14.
165. See Mathews v. Eldridge, 424 U.S. 319, 332-49 (1976) (holding that, as a general matter, a claim that due process requires a certain adjudicatory procedure should be analyzed by measuring the state's interest in proceeding without the requested procedure against the likely effect of the procedure on the accuracy, reliability, and fairness of the proceeding in which the complainant's interests have been placed at risk).
166. Shutts, 472 U.S. at 813-14 (emphasis added).
167. An increasing number of federal statutory causes of action include provisions authorizing nationwide service of process, as does the interpleader statute, which extends to claims based on state law. See, e.g., 18 U.S.C. § 1965(d) (2000) (authorizing nationwide service of process in federal securities actions); see also 28 U.S.C. § 2361 (2000) (authorizing nationwide service of process in statutory interpleader actions); FED. R. CIV. P. 4(k)(1)(C) (authorizing service of process for any person subject to the federal interpleader statute). And, of course, Rule 4(k)(2) authorizes worldwide service of process on federal question claims as a backup option when a plaintiff could not otherwise sue the defendant in any state, provided that the defendant has sufficient aggregate contacts with the nation as a whole. See, e.g., Graduate Mgmt. Admission Council v. Raju, 241 F. Supp. 2d 589, 596-600 (E.D. Va. 2003) (applying Rule 4(k)(2)). Federal appeals courts have uniformly upheld the constitutionality of these provisions. See, e.g., Pinker v. Roche Holdings Ltd., 292 F.3d 361, 369-70 (3d Cir. 2002) (embracing the "national contacts" standard for federal nationwide service provision and citing cases from other circuits that have reached a similar result). The Supreme Court has never addressed the issue squarely, though it has assumed arguendo the propriety of nationwide service in issuing a holding that disfavored interpretations of federal statutes that would find such service provisions to exist by implication. Omni Capital Int'l v. Rudolf Wolff & Co., 484 U.S. 97, 106-07 (1987).
168. 339 U.S. 306 (1950).
169. Professor Shapiro touches upon this observation without exploring it at length. See Shapiro, supra note 110, at 937 (acknowledging the broader and more flexible notions of due process in Mullane); see also, e.g., Geoffrey C. Hazard, Jr., John L. Gedid & Stephen Sowie, An Historical Analysis of the Binding Effect of Class Suits, 146 U. PA. L. REV. 1849, 1945-46 (1998) (discussing the adequacy of representation requirement and observing that "[e]ncouraging or requiring notice to absentee class members was one obvious device, and the Court in Mullane v. Central Hanover Bank & Trust Co. and Phillips Petroleum Co. v. Shutts later embraced this approach" (footnotes omitted)). But even Professor Shapiro, who clearly hopes to make use of Mullane in articulating a more flexible constitutional jurisprudence of representative litigation, nonetheless makes a point of noting that Mullane was "not in form a class action." Shapiro, supra note 110, at 937 n.61. The observation is technically correct, but it is a distracting reminder, as it seems to reinforce the view that Mullane operated in a separate juridical category and so has limited direct relevance to the administration of formal class actions. See Mullane, 339 U.S. at 319 (approving notice only to some identifiable beneficiaries because "[t]he individual interest does not stand alone but is identical with that of a class"). A good note in the Texas Law Review acknowledges some of the important parallels between Shutts and Mullane, though it treats the analytical significance of those parallels only lightly.
170. See Kurt A. Schwarz, Note, Due Process and Equitable Relief in State Multistate Class Actions After Phillips Petroleum Co. v. Shutts, 68 TEX. L. REV. 415, 430-31 (1989).
171. It bears noting that the interests of these two groups were in fact adverse parties in the Supreme Court appeal: the guardian for the income beneficiaries (Mullane) was the sole appellant challenging the judgment of the New York Court of Appeals, and the guardian for the principal beneficiaries (Vaughn) joined the trust company in defending the judgment. See Mullane, 339 U.S. at 310 (identifying the guardians and their respective roles in the appeal).
172. Mullane, 339 U.S. at 315; see also id. at 307-10 (describing the manner in which notice was required to be, and was, given).
173. At least, that was the assumption under which both Courts operated. Neither considered the broader potential implications of preclusion doctrine for the interests of class members. See generally Wolff, supra note 110, at 722 (discussing the potential impact of the preclusion doctrine on the unlitigated claims of class members).
174. The trustee in Mullane also bore a fiduciary duty to the trust beneficiaries, but, as the Court points out, the special circumstance of the accounting places the trustee temporarily at odds with the beneficiaries and hence requires the intercession of a representative loyal only to the latter. See Mullane, 339 U.S. at 316 ("[T]hese beneficiaries do have a resident fiduciary as caretaker of their interest . . . [b]ut it is their caretaker who in the accounting becomes their adversary.").
175. As the court writes in Mullane: Common trust fund legislation is addressed to a problem appropriate for state action. Mounting overheads have made administration of small trusts undesirable to corporate trustees. In order that donors and testators of moderately sized trusts may not be denied the service of corporate fiduciaries, [many jurisdictions] have permitted pooling small trust estates into one fund for investment administration. Id. at 307-08. In Shutts, the Court exhibits an unfortunate lack of attention to the source of the substantive policies that inform its analysis, apparently assuming that any of the laws that might be applied to the proceeding on remand would take the same view about the particular desirability of aggregating small-stakes claims. That is probably a safe assumption, but the careless treatment of the issue is particularly inapt in light of the Court's holding on choice of law in the same decision.
176. See id. at 311-13 (discussing the in rem pedigree of trust accountings and finding that such formal classifications do not control the question of a state's power to administer such a scheme).
177. Id. at 313.
178. Int'l Shoe Co. v. Washington, 326 U.S. 310 (1945).
179. As it turned out, however, the Court did just that eight years later in Hanson v. Denckla, 357 U.S. 235, 254-55 (1958), resolving a complicated trust dispute involving competing judgments from Florida and Delaware courts with a holding on personal jurisdiction to which it would later give much broader application by incorporating it into its first major decision on jurisdiction and products liability. See World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 295 (1980) (applying the principle from Hanson). Surprisingly, the Hanson majority does not even address the personal jurisdiction holding in Mullane (though Justice Black invokes it favorably in dissent), perhaps further indicating the limited precedential significance of that part of the opinion. Hanson, 357 U.S. at 260-61 (Black, J., dissenting).
180. Mullane, 339 U.S. at 314-15.
181. Id. at 319.
182. Id. at 317-19.
183. Id.
184. See Pennoyer v. Neff, 95 U.S. 714, 734 (1877) (discussing the "larger and more general" idea of in rem jurisdiction as a means of reaching property owned by the parties to allow for comprehensive adjudication).
185. See Mullane, 339 U.S. at 317-18 ("[W]e have no doubt that such impracticable and extended searches are not required in the name of due process.").
186. Id. at 312-13.
187. Id. at 317.
188. Id.
189. Id. at 318-19.
190. See Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 173-76 (1974). Eisen is one of the important occasions on which the Court misread its own opinion in Mullane, conflating the standard governing the type of notice required with the standard governing who must be provided with notice in a class or representative proceeding.
191. Mullane, 339 U.S. at 319.
192. Id.
193. See id. ("[N]otice reasonably certain to reach most of those interested in objecting is likely to safeguard the interests of all . . . .").
194. Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 812 (1985); see also id. at 811-12 (describing various protections that allow a state to exercise jurisdiction over the claim of an absent class action plaintiff without violating the Due Process Clause).
195. See id. at 812 ("[T]he procedure followed by Kansas . . . with an explanation of the right to 'opt out,' satisfies due process.").
196. This assumption will prove warranted, as I explain below. See infra text accompanying note 213.
197. Both Restatements set forth this principle clearly. See RESTATEMENT OF CONFLICT OF LAWS § 585 (1934) ("All matters of procedure are governed by the law of the forum.") id. § 585 cmt. a ("Matters of procedure include access to courts, the conditions of maintaining or barring action, the form of proceedings in court, the method of proving a claim, the method of dealing with foreign law, and proceedings after judgment."); RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 127 (1971) ("The local law of the forum governs rules of pleading and the conduct of proceedings in court."); id. § 127 cmt. a ("The local law of the forum governs, among other things, . . . the joinder of causes of action .. . ."); see also, e.g., Travenol Labs., Inc. v. Turner, 228 S.E.2d 478, 483 (N.C. Ct. App. 1976) (applying North Carolina standards for administering an injunction to a contract dispute governed by California law). Statutes of limitations are the most prominent exception to this rule. Some states have enacted "borrowing statutes" that apply the limitations period of the forum whose law will govern the dispute if that forum considers its limitations period to constitute a substantive constraint on the parties' rights and would want other jurisdictions to enforce that constraint.
198. There are exceptions, of course. Laws that might be regarded as "procedural" in common parlance can sometimes embody state interests that have legitimate force in multistate disputes, and courts will sometimes look past the "procedural" designation to subject such provisions to interest-based choice of law analysis. See, e.g., Boyd Rosene & Asocs., Inc. v. Kan. Mun. Gas Agency, 174 F.3d 1115, 1118-26 (10th Cir. 1999) (concluding that Oklahoma's approach to the Restatement (Second) of Conflict of Laws calls for the performance of a choice of law analysis on a provision regarding the availability of attorneys' fees and finding an out-of-state rule applicable to the dispute).
199. See, e.g., Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 778 n.10 (1984) (recognizing "traditional choice-of-law principles" according to which "the law of the forum State governs on matters of procedure").
200. Professor Issacharoff makes a similar point in his discussion of statutes of limitations and Sun Oil Co. v. Wortman, 486 U.S. 717 (1988): The Court . . . [in Wortman] found that longstanding common law principles would allow for the application of lex fori rather than lex loci to the determination of the statute of limitations for claims brought in Kansas, even if the underlying dispute bore no relation to Kansas whatsoever. Accordingly, the fact that Shutts liberalized personal jurisdiction for nationwide class actions did not require, as a constitutional matter, trying the underlying claims as if they were still in their home courts. Unlike the Guaranty Trust outcome-determinative formalism of the early Erie line of cases, the Court in Wortman drew a different line around whether the application of one or another decisional rule violated preexisting substantive commitments. Issacharoff, supra note 12, at 1863-64 (footnote omitted).
201. As the Supreme Court has memorably written, "[l]egal obligations that exist but cannot be enforced are ghosts that are seen in the law but that are elusive to the grasp." De La Rama S.S. Co. v. United States, 344 U.S. 386, 390 (1953) (internal quotation marks omitted) (quoting In re The Western Maid, 257 U.S. 419, 433 (1922)).
202. See, e.g., Landgraf v. USI Film Prods., 511 U.S. 244, 275 (1994) ("Changes in procedural rules may often be applied in suits arising before their enactment without raising concerns about retroactivity."). For a discussion of circumstances in which the procedure/substance distinction produces less clear answers in retroactivity analysis, see David Frisch, Rational Retroactivity in a Commercial Context, 58 ALA. L. REV. 765, 785-87 nn.101-06 (2007).
203. See, e.g., Boyd Rosene, 174 F.3d at 1119-21 (finding that the treatment of an attorneys' fee provision as "procedural" by Oklahoma courts for retroactivity purposes does not control the designation of the provision for choice of law purposes).
204. Enforcement by public authorities will sometimes be possible in theory, of course, but in practice such enforcement is the exception even in those cases where there is an agency tasked with enforcing the provisions of a particular statutory scheme.
205. In re Bridgestone/Firestone, Inc., Tires Prods. Liab. Litig. (Bridgestone/Firestone II), 333 F.3d 763, 769 (7th Cir. 2003).
206. In re Bridgestone/Firestone, Inc., Tires Prods. Liab. Litig. (Bridgestone/Firestone I), 288 F.3d 1012, 1018 (7th Cir. 2002) (holding that the multiplicity of applicable state laws renders a class action unmanageable); id. at 1018-19 (holding that the multiplicity of product lines captured in the class definition also prevents certification).
207. See infra notes 204-225 and accompanying text.
208. See 414 U.S. 538, 561 (1974) (holding that the statute of limitations is tolled following the denial of certification when putative class members seek to intervene in an original action to press individual claims); see also Chardon v. Fumero Soto, 462 U.S. 650, 662 (1983) (holding that, in the case of a § 1983 action where a federal statute calls for a reference to state law for statute of limitations issues, the American Pipe tolling rule must track state law unless doing so would undermine a federal interest); Crown, Cork & Seal Co. v. Parker, 462 U.S. 345, 352 (1983) (extending American Pipe to cases where putative class members file their own independent lawsuits following the denial of certification rather than seeking to intervene in the original suit). The potential relevance of the American Pipe rule only became clear to me when I read a draft of Professor Wasserman's recent article on tolling in successive class actions, which contains a very fine exposition of American Pipe and the Rule 23 policies it implicates. See Rhonda Wasserman, Tolling: The American Pipe Tolling Rule and Successive Class Actions, 58 FLA. L. REV. 803 (2006). I drank Professor Wasserman for sharing her work with me.
209. There is, I think, an argument to be made that the tolling rule imposes cognizable burdens on class members as well. Participating in a lawsuit can carry immense psychological costs, and the decision whether or not to initiate litigation can be a difficult and troubling one. While the repose that a statute of limitations offers is usually identified as a benefit for defendants, I think it reasonable to believe that many potential plaintiffs - at least those who are aware that they possess potential claims and would consider asserting those claims - also receive an important measure of psychological peace when they know for certain that the time to initiate litigation has passed, and hence that they no longer need to revisit the difficult decision of whether to file a claim. The American Pipe doctrine has the effect of delaying repose for these potential plaintiffs as well.
210. Am. Pipe, 414 U.S. at 546-47 (quoting 3B JAMES WM. MOORE ET AL., MOORE'S FEDERAL PRACTICE ¶ 23.10[1], at 23-2603 (2d ed. Supp. 1973)).
211. Id. at 547.
212. Id. at 551.
213. See id. at 550-56. In American Pipe itself, the district court had determined that the requirements of adequacy and typicality were satisfied but that the class was not numerous enough to warrant certification. Id. at 543. That finding of adequacy and typicality gave the Supreme Court greater comfort in treating the class members as "parties" for purposes of the tolling rule (a consideration that would have been irrelevant had the tolling rule been viewed as "binding" only defendants). Id. at 550-53. As I explain in the pages that follow, the satisfaction of a similar requirement with respect to the certification decision itself (i.e., a finding that there was an adequate representative urging certification upon the court) should be a prerequisite to any antisuit injunction enforcing a denial of certification. This feature of the American Pipe litigation has not, however, been adopted by the Supreme Court in subsequent cases as a prerequisite for class members to enjoy the benefit of tolling. See, e.g., Crown, Cork & Seal Co., 462 U.S. at 348-354 (applying the American Pipe rule to a proceeding in which class certification was denied for lack of adequacy, typicality, and numerosity).
214. Thus, Justice Scalia's strongly stated complaint to the contrary in his Devlin v. Scardelletti dissent is, at the very least, overstated. See Devlin v. Scardelletti, 536 U.S. 1, 16 n.1 (2002) (Scalia, J., dissenting) ("Not even petitioner . . . is willing to advance the novel and surely erroneous argument that a nonnamed class member is a party to the class-action litigation before the class is certified." (emphasis omitted)).
215. 28 U.S.C. § 2283 (2000).
216. Id.
217. See Chick Kam Choo v. Exxon Corp., 486 U.S. 140, 147-48 (1988) (providing Atlantic Coast Line Railroad Co. v. Brotherhood of Locomotive Engineers, 398 U.S. 281 (1970), as an example of how the relitigation exception "permit[s] a federal court to prevent state litigation of an issue that previously was presented to and decided by the federal court").
218. Professor Issacharoff has made a much more aggressive argument in this vein, urging a reading of CAFA that would audiorize federal courts to jettison the doctrine of Klaxon Co. v. Stentor Electric Manufacturing Co., 313 U.S. 487 (1941), and adopt their own choice of law approach to nationwide state law disputes with an eye toward adopting a uniform liability standard to go along with the uniform treatment of certification standards. See Issacharoff, supra note 12, at 1865-66. But see Burbank, supra note 12, at 1942-44 (rebutting Professor Issacharoff's position).
219. The Act's findings and purposes say the following about the proper treatment of class actions of national scope: (4) Abuses in class actions undermine the national judicial system, the free flow of interstate commerce, and the concept of diversity jurisdiction as intended by the framers of the United States Constitution, in that State and local courts are - (A) keeping cases of national importance out of Federal court; (C) making judgments that impose their view of the law on other States and bind the rights of the residents of those States. CAFA § 2(a), 28 U.S.C. § 1711 note (Supp. V 2005).
220. Denials of certification under CAFA thus warrant treatment under the AIA different from the treatment that the Court found appropriate for a dismissal on forum non conveniens grounds, where the federal standard governs access to the federal forum without purporting to speak to the propriety of state courts providing a forum. The Court gave a broader explanation for its oft-cited ruling on the relitigation exception, however, finding that an argument about the preemptive effect of federal forum non conveniens doctrine in the maritime context was irrelevant to its analysis where the preemption question was not litigated in the initial federal forum. See Chick Kam Choo, 486 U.S. at 148-50; see also Kerr, supra note 29, at 239-40 (concluding that Chick Kam Choo forecloses use of the relitigation exception in denial-of-certification cases). The statutory framework of CAFA, and the clarified understanding of the sources of preemptive authority for federal judgments that the Court embraced in Semtek International, Inc. v. Lockheed Martin Corp., 531 U.S. 497 (2001), both warrant stepping away from this feature of the Chick Kam Choo holding.
221. Semtek, 531 U.S. at 508-09.
222. Id. at 509. A an example of such a situation, the Court posited a case where "state law did not accord claim-preclusive effect to dismissals for willful violation of discovery orders" and "federal courts' interest in the integrity of their own processes might justify a contrary federal rule." Id.
223. FED. R. CIV. P. 4(k)(1)(A).
224. The Supreme Court made this proposition clear in Hanna v. Plumer, 380 U.S. 460 (1965). The Hanna Court put to rest the false constitutionalization of procedural questions under the Erie line of cases, explaining that Erie set forth no broad constitutional command regarding the applicable procedures in federal court. Rather, Erie created a default jurisdictional policy - "the twin aims of the Erie rule: discouragement of forum-shopping and avoidance of inequitable administration of the laws" - to govern in the absence of an applicable federal rule or statute. Id. at 468. Rejecting the doctrine that Justice Harlan urged in his noted concurrence, the Court found that Congress and the federal rulemakers could create divergences between federal and state procedural practice, even when doing so would violate Erie's "twin aims," without violating any constitutional principle of federalism. Id. at 471-74.
225. The provision reads, in relevant part, "The Supreme Court and all courts established by Act of Congress may issue all writs necessary or appropriate in aid of their respective jurisdictions and agreeable to the usages and principles of law." 28 U.S.C. § 1651(a) (2000).
226. See United States v. Swift & Co., 286 U.S. 106, 114-15 (1932) (finding that a court in which a consent decree is entered retains jurisdiction over the parties for the purposes of modifying the decree); Leman v. Krentler-Arnold Hinge Last Co., 284 U.S. 448, 452 (1932) ("The respondent could not escape the decree by removing from, or staying without, the District [in which it was issued]. Wherever it might conduct its affairs, it would carry with it the prohibition. Disobedience constituted contempt of the court which rendered the decree, and was none the less contempt because the act was committed outside the district, as the contempt lay in the fact, not in the place, of the disobedience to the requirement."); see also Pac. Reins. Mgmt. Corp. v. Fabe, 929 F.2d 1215, 1218 (7th Cir. 1991) (explaining that injunctions generally cannot be registered under 28 U.S.C. § 1963, the provision for the cross-district enforcement of federal judgments, "because that would be poindess: they act in personam nationwide").
227. Waffenschmidt v. MacKay, 763 F.2d 711, 717 (5th Cir. 1985).
228. The Seventh Circuit essentially arrives at this conclusion in Bridgestone/Firestone II, though the course of its analysis is haphazard at best. See In re Bridgestone/Firestone, Inc., Tires Prods. Liab. Litig. (Bridgestone/Firestone II), 333 F.3d 763, 768-69 (7th Cir. 2003) (discussing the jurisdictional objection).
229. I am speaking here only of the jurisdictional and geographic considerations surrounding an antisuit order. There are more purely "procedural" considerations that will attend the enforcement of such an order, which I set forth in the paragraphs that follow.
230. 10 F.3d 189 (3d Cir. 1993).
231. The court wrote: International Shoe arose in the state court system and the opinion expressed the due process guarantees of the Fourteenth Amendment; nonetheless, the [same] minimum contacts requirement for personal jurisdiction applies to federal courts having subject matter jurisdiction on the basis of diversity of citizenship as well as cases brought on the basis of a federal claim. Id. at 199. The inaccuracy of this statement is astonishing. If taken at its word, the court appears to be saying that exercises of nationwide jurisdiction in federal question cases are unconstitutional, even when authorized by Congress, if class plaintiffs (or defendants) do not have "minimum contacts" with the state where the judicial district hosting the suit is located. The Third Circuit itself obviously does not believe any such thing. See Pinker v. Roche Holdings Ltd., 292 F.3d 361, 369 (3d Cir.
232. See supra Part II.A.1.
233. See Carlough, 10 F.3d at 200 ("Thus, with neither express or inferred consent, nor minimum contacts, and prior to notice and the commencement of the opt out period, the district court did not have personal jurisdiction over the [objecting] plaintiffs and did not have authority to bind their actions when it issued the injunction."); id. at 201 ("Thus, prior to notice and the opt out period, and absent minimum contacts with the Pennsylvania forum or consent to its jurisdiction, a federal injunction enjoining state action would violate due process.").
234. See In re Gen. Motors Corp. Pick-Up Truck Fuel Tank Prods. Liab. Litig., 134 F.3d 133, 141 (3d Cir. 1998) (Becker, J.).
235. FED. R. CIV. P. 65(d).
236. One consequence of this nationwide enforceability of federal antisuit injunctions is that absentees who wish to contest such an order will be forced to travel to the issuing forum to do so, a requirement that some commentators might find objectionable. See Monaghan, supra note 114, at 1166-68 (arguing that a class member should enjoy the prerogative to challenge the binding effect of a class judgment in the forum of her choice). Nonetheless, such a result flows directly from a proper analysis of the injunctive powers of the federal courts.
237. See Matsushita Elec. Indus. Co. v. Epstein, 516 U.S. 367, 383-86 (1996) (ruling that state courts do have the power to release exclusively federal claims in class action settlements and that the grant of exclusive federal jurisdiction does not constitute an exception under the Full Faith and Credit Act); Epstein v. MCA, Inc. (Epstein II), 126 F.3d 1235, 1255-56 (9th Cir. 1997) (finding that representation in state court proceedings was inadequate, both as a per se structural matter and on the facts, and permitting collateral attack), vacated on reh'g, 179 F.3d 641, 648 (9th Cir. 1999) (permitting collateral attack only in extremely narrow cases of complete process failure). I should disclose that I come to the question of collateral attacks under the influence of some personal history. I served as one of the last judicial clerks for Judge William A. Norris, the audior of the Epstein II opinion that was vacated following his retirement from the bench, and I worked extensively with the Judge and another coclerk on the case. Although the approach that Judge Norris took in his opinion was not the one that I would have chosen in many respects, the experience of working closely on the issue with a distinguished jurist who believed strongly that an injustice had been done in the state court proceeding and that some form of federal remedy was appropriate and necessary has left a lasting impression.
238. See, e.g., William T. Allen, Response, Finality of Judgments in Class Actions: A Comment on Epstein v. MCA, Inc., 73 N.Y.U. L. REV. 1149, 1159-61 (1998) (arguing that a state class action judgment should have final preclusive effect when class members do not exercise a proffered opt-out option and the initial forum adjudicates compliance with Rule 23 in an adversarial proceeding); Kahan & Silberman, supra note 14, at 786-92 (urging a restrained approach to collateral attack that would not permit relitigation of the adequacy question in the absence of a process failure or other compelling circumstance in the initial forum);
239. Susan P. Koniak & George M. Cohen, In Hell There Will Be Lawyers Without Clients or Law, 30 HOFSTRA L. REV. 129, 156-67 (2001) (emphasizing the desirability of broad and unrestricted collateral attacks in cases where representation appears to have been inadequate in the initial proceeding); Monaghan, supra note 114, at 1153-54 (arguing for the availability of broad collateral attacks by class members who have no minimum contacts with the initial forum);
240. William B. Rubenstein, Finality in Class Action Litigation: Lessons from Habeas, 82 N.Y.U. L. REV. 790, 792-801 (2007) (employing post-conviction habeas practice as a point of comparison in exploring the collateral attack question);
241. Patrick Woolley, The Availability of Collateral Attack for Inadequate Representation in Class Suits, 79 TEX. L. REV. 383, 388 (2000) ("The argument for limiting collateral attack contradicts two fundamental principles: first, a court has no jurisdiction over absent class members who have not been adequately represented; second, a judgment entered without jurisdiction may be collaterally attacked if the party bound by the judgment did not appear and had no obligation to do so.").
242. The Stephenson litigation involved the recovery fund established by Judge Weinstein in resolving the Agent Orange litigation, and the accompanying release of claims. The fund provided a schedule of payments for individuals exposed to Agent Orange, but provided that payment was available only to those who filed claims within twenty years of exposure. Despite this limitation on recovery, the settlement bound all class members, including those whose injuries turned out not to manifest until after the expiration of the recovery period and who would thus be denied any recovery. In essence, the settlement traded off the likelihood that most class members who developed symptoms would enjoy some recovery against the possibility that some class members (unidentifiable at the time of settlement) would suffer long-delayed injury for which they could obtain no relief. The Second Circuit found that the initial proceeding did not afford adequate representation to the "future plaintiffs" whose injuries had not manifested at the time of settlement, and hence that individuals who manifested injuries outside the recovery period could escape the release of their claims and bring suit. See Stephenson v. Dow Chem. Co., 273 F.3d 249, 257-59 (2d Cir. 2001), aff'd by an equally divided Court, 539 U.S. 111 (2003) (per curiam).
243. Professor Monaghan is unfair to Professors Silberman and Kahan when he suggests otherwise. See Monaghan, supra note 114, at 1195-99. In fact, Professors Kahan and Silberman recognize the appropriate role of the collateral attack in a limited range of class action scenarios, where the circumstances in F-1 give no confidence in the ability of the court to safeguard adequacy: We . . . do not take issue with the holding in Gonzales [v. Cassidy] that a collateral attack on adequacy can be brought challenging the conduct of class counsel when that conduct is no longer in the purview of the court in F-1. Moreover, in making its finding of adequacy, the court in F-1 necessarily relies on the accuracy of factual representations made in the fairness hearing. Those representations include the nature of the investigation undertaken by class counsel to ascertain the status of a competing class action or the likelihood that such claims will be filed as well as representations about the litigation value of to-be-released claims and the basis for counsel's assessment. To the extent these representations are materially false, some avenue must be provided to reassess the finding of adequate representation. Kahan & Silberman, supra note 14, at 782 (citation omitted). Professor Rubenstein also obscures the issue somewhat when he characterizes the debate as polarized between those who would never permit a collateral attack (whom he terms "preclusionists") and those who would always permit relitigation of adequacy questions by absentees (whom he terms "constitutionalists"). Rubenstein, supra note 227, at 795. While there are some who have adopted such categorical positions - Professor Monaghan, for example, adopts the strong "constitutionalist" position that absentees with no minimum contacts to F-1 must always be allowed to relitigate adequacy in the forum of their choice - most prominent commentators, including Professors Kahan and Silberman, have articulated more nuanced views. See also Allen, supra note 227, at 1159-66 (apparently adopting a "preclusionist" approach to class action settlements, but speaking only to cases in which "(1) [class members were] afforded notice of and a right to opt-out of the action and chose not to opt-out, and (2) the rendering court has, after a hearing on notice, adjudicated compliance with the terms of Rule 23 in an adversary proceeding"). On the "choice" that class members exercised to opt out, however, see supra Part II.A.1.
244. The seminal statement of the Court's position on this point, the one that opened the door to the collateral attack, came in the second Williams decision: As to the truth or existence of a fact, like that of domicil, upon which depends the power to exert judicial authority, a State not a party to the exertion of such judicial authority in another State but seriously affected by it has a right, when asserting its own unquestioned authority, to ascertain the truth or existence of that crucial fact. Williams v. North Carolina (Williams II), 325 U.S. 226, 230 (1945). The Court soon placed limits on the doctrine, disallowing collateral challenges in cases where the complaining party had made an appearance and participated in the initial action: [T]he requirements of full faith and credit bar a defendant from collaterally attacking a divorce decree on jurisdictional grounds in the courts of a sister State where there has been participation by the defendant in the divorce proceedings, where the defendant has been accorded full opportunity to contest the jurisdictional issues, and where the decree is not susceptible to such collateral attack in the courts of the State which rendered the decree. Sherrer v. Sherrer, 334 U.S. 343, 351-52 (1948); see also Coe v. Coe, 334 U.S. 378, 383-84 (1948) (stating the same limit). This much-noted line of cases appears never to have been discussed in conjunction with the class action question in any serious way, and it warrants closer examination. Not surprisingly, some litigants have raised this line of cases in arguing in favor of collateral attack, but no court appears to have offered an extended analysis of their relevance. See, e.g., Hospitality Mgmt. Asocs., Inc. v. Shell Oil Co., 591 S.E.2d 611, 617 n.8 (S.C. 2004) ("Appellants also argue that South Carolina precedent supports the proposition that the courts of this state may review the jurisdictional underpinnings of a foreign judgment before granting full faith and credit. We note, however, that nationwide class action lawsuits clearly raise very particularized due process issues, and we therefore focus our analysis on case law in that context." (citation omitted)).
245. Professor Hensler adopts a similar approach in discussing the proper treatment of "future" claimants in class action litigation, rejecting modes of analysis that frame the issue as an abstract question of due process and instead considering the treatment of future class action claimants in light of the treatment they are likely to receive in the other remedial arenas currently available to them. See Hensler, supra note 10.
246. See, e.g., Koniak, supra note 11, at 1787-94 (urging the importance of a collateral attack as check on irresponsible representation). Professor Monaghan asserts that existing doctrine clearly establishes the broad right of out-of-state absentees to attack a judgment collaterally in the forum of their choice whenever they claim that there has been a lack of adequate representation in the initial proceeding, pointing to the Court's decisions in Hansberry v. Lee, 311 U.S. 32 (1940), Phillips Petroleum Co. v. Shutts, 472 U.S. 797 (1985), and Richards v. Jefferson County, 517 U.S. 793 (1996), in support of that proposition. See Monaghan, supra note 114, at 1149-50 & n.4, 1172-73. That position rests on an incorrect reading of these cases. Hansberry, of course, permitted a collateral attack to a collusive proceeding that did not even purport to represent the interests of the objectors who later attacked the judgment. The opinion establishes an important constitutional principle of adequate representation in the absence of individual party status, but does not speak at all to the proper remedy when a proceeding that does purport to represent the interests of absentees is claimed to have fallen short. Richards is a variation on the same theme. In that case, the Court applied Hansberry to invalidate a broad application of preclusion doctrine by the Alabama Supreme Court. The Alabama court had precluded one group of citizens from challenging the constitutionality of a tax law on the grounds that another group of citizens had already brought a similar challenge unsuccessfully and had judgment entered against them. Those earlier litigants, however, "did not sue on behalf of a class; their pleadings did not purport to assert any claim against or on behalf of any nonparties; and the judgment they received did not purport to bind any county taxpayers who were nonparties," Richards, 517 U.S. at 801-02, and it was for that reason that the Court found the extension of preclusion to violate due process. Again, the Court did not speak at all to the proper treatment of a proceeding that does purport to bind a properly represented class. Shutts does not address the issue at all, explaining only that absent class members are entitled to adequate representation "at all times," but saying nothing about how and where to administer a remedy when such representation is claimed to be lacking. Shutts, 472 U.S. at 812. Whatever the virtues of Professor Monaghan's position - a position that the Ninth Circuit largely adopted in Epstein II before that decision was reversed on rehearing - it is not settled law. See also Koniak & Cohen, supra note 227, at 156-57 (overreading the adequacy of representation cases in a similar fashion).
247. See, e.g., Fine v. Am. Online, Inc., 743 N.E.2d 416, 421-22 (Ohio Ct. App. 2000) (characterizing collateral attack as contrary to the form of relief that class actions aim to provide to "our judicial system nationwide"); Hospitality Mgmt., 591 S.E.2d at 619 ("Without limited review, a nationwide class action could be vulnerable to collateral actions in the 49 other states in which it was not litigated initially."); Kahan & Silberman, supra note 14.
248. See Linda S. Mullenix, Abandoning the Federal Class Action Ship: Is There Smoother Sailing for Class Actions in Gulf Waters?, 74 TUL. L. REV. 1709, 1756-78 (2000) (detailing increasingly tight controls that state legislatures and courts in some "magnet" jurisdictions have imposed upon class action litigation); see also, e.g., Avery v. State Farm Mut. Auto. Ins. Co., 835 N.E.2d 801, 820-21 (111. 2005) (requiring trial courts to perform a careful analysis of key issues at the certification stage rather than waiting until trial to resolve them); Sw. Ref. Co. v. Bernal, 22 S.W.3d 425, 435 (Tex. 2000) (rejecting the "approach of certify now and worry later" and requiring trial courts to perform a careful certification analysis).
249. See Hensler, supra note 10 (discussing the distinctive features of the "futures" problem).
250. A common sense would suggest, sophisticated plaintiffs' attorneys respond to the doctrinal landscape in making judgments about which cases are likely to be financially viable, just as they do when deciding where to file suit. For example, Willging and Lee write in their interim report that their findings suggest that plaintiff attorneys may be anticipating the removal of class actions on the basis of CAFA's minimum diversity provisions and are filing them in federal court as original proceedings. In that way, plaintiff attorneys retain a choice of forum at least to the extent that, in a given case, jurisdiction and venue rules allow filing in more than one federal forum. WILLGING & LEE, supra note 3, at 17; see also id. at 16 ("[CAFA's] changes in the law would be as clear to plaintiff attorneys as to anyone. A removal becomes more predictable, plaintiff attorneys might decide to file actions initially in federal court to avoid the costs and delays associated with removal.").
251. Epstein II, 126 F.3d at 1250.
252. The jurisdictional provisions of CAFA do not apply to "any class action that solely involves a claim . . . that relates to the internal affairs or governance of a corporation or other form of business enterprise and that arises under or by virtue of the laws of the State in which such corporation or business enterprise is incorporated or organized . . . ." CAFA § 4, 28 U.S.C. § 1332(d)(9) (Supp. V 2005).
253. Epstein II, 126 F.3d at 1252 (quoting In re MCA, Inc. S'holders Litig., 598 A.2d 687, 689 (Del. Ch. 1991)).
254. Id. at 1253 n.17 (quoting In re MCA, Inc. S'holders Litig., No. 11740, 1993 WL 43024, at *5 (Del. Ch. Feb. 16, 1993)).
255. Id. at 1251-55.
256. See Matsushita Elec. Indus. Co. v. Epstein, 516 U.S. 367, 373-75 (1996).
257. See Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 621 (1997) ("[T]he standards set for the protection of absent class members serve to inhibit appraisals of the chancellor's foot kind - class certifications dependent upon the court's gestalt judgment or overarching impression of the settlement's fairness."). The problem of adequacy here was not one of conflicting interests within the class, as with Amchem, but rather the diligence and loyalty with which class counsel approached its representation in toto. But the imperative to keep the adequacy and fairness inquiries separate remains important nonetheless. A the Ninth Circuit explained, the district court's dismissal of the federal claims in the Epstein litigation was at odds with decisions of the Second and Third Circuits that had recognized the plaintiffs' cause of action. Class counsel did not point out those precedents to the Delaware court, instead embracing the district court's dismissal and insisting that the federal claims were worthless. The Vice Chancellor apparendy did not go behind class counsel's briefs to do its own legal research, but rather relied upon the representations of the settlement proponents in approving the settlement. A a result, the court's judgment about the fairness of the settlement and the propriety of releasing the exclusively federal claims was compromised.
258. Of course, in light of the previous discussion concerning the limited efficacy of opt-out notice in cases where class members may not have focused attention upon their claims and may not have much at stake, the significance of the opt-out notice to the analysis here may be limited.
259. Sycuan Band of Mission Indians v. Roache, 54 F.3d 535, 540-41 (9th Cir. 1995). Sycuan Band involved Indian law and the claims of Indian tribes, which may present a particularly urgent case for exclusive federal jurisdiction, as noted above. See supra note 53 (discussing the ruling in this case in the context of exclusive federal jurisdiction) .
260. See Wolff, supra note 110, at 746-51 (discussing the range of strategic choices that class counsel can make that may have binding consequences for absentees). Ironically, Epstein II makes this point by negative implication when it rejects the proposition that the appearance of objectors in the Delaware fairness hearing could operate to constrain the options of class members in the federal proceeding: [O]bjectors are objectors, not class representatives. The individual objectors who voluntarily appeared at the fairness hearing were not authorized by the absentees to represent their interests, nor were they certified by the state to do so. Their appearance at the hearing did not bind anyone but themselves to an adjudication of adequacy of representation. 126 F.3d 1235, 1242 (9th Cir. 1997) (internal citations omitted), withdrawn, 179 F.3d641 (9th Cir. 1999).
261. 474 F.2d 67 (5th Cir. 1973).
262. Id. at 70-71.
263. Id. at 71.
264. Id.
265. Id. at 73-75.
266. Id. at 77.
267. See FED. R. APP. P. 4(a)(1)(A) (requiring an appealing party to file a notice of appeal in district court within thirty days of an entry of final judgment).
268. Since the named plaintiff in the first lawsuit no longer wished to participate, the request to intervene for purposes of appealing would presumably have required the lead plaintiff and counsel in Gonzales to take over that lawsuit altogether. This would have been a highly irregular turn of events - switching both plaintiff and counsel between the final judgment at trial and the subsequent appeal. Compare, for example, the Court's recent holding in Devlin v. Scardelletti, 536 U.S. 1, 10 (2002), that those who appear as objectors to a fairness hearing have standing to appeal, even if they do not formally intervene. In such a case, the original lead plaintiff and counsel would still be in the lawsuit, defending the settlement that they negotiated before the trial court. More broadly, where the structure of a class action provides ample opportunity for class members to participate, voice their concerns, and protect their interests, then the obligation to pursue that course rather than attempting a collateral attack becomes concomitantly greater - pace the Epstein II court's excessive reliance upon the Shutts dictum that a class member "is not required to do anything" but "may sit back and allow the litigation to run its course, content in knowing that there are safeguards provided for his protection." Epstein II, 126 F.3d at 1242-43 (quoting Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 810 (1985) (emphasis omitted)).
269. For starters, the parallel actions here were both in federal court, and federal district courts generally do not exercise injunctive authority against their sibling tribunals. Moreover, any such injunction would have been mandatory in nature rather than prohibitory (i.e., an order directing the named representative to remain in the first proceeding, file the notice of appeal, and continue prosecuting the case), a use of equity that would be highly inadvisable and might even be unconstitutional under the First and Thirteenth Amendments.
270. See Kahan & Silberman, supra note 14, at 782 ("We . . . do not take issue with the holding in Gonzales that a collateral attack on adequacy can be brought challenging the conduct of class counsel when that conduct is no longer in the purview of the court in F-1."); see also Rubenstein, supra note 227, at 837 (characterizing the collateral attack in Gonzales as "perform[ing] a necessary corrective function").
271. Cf. Reynolds v. Beneficial Nat'l Bank, 288 F.3d 277, 283 (7th Cir. 2002) (Posner, J.) (characterizing as remarkable the decision by a federal district judge to issue an antisuit injunction halting a parallel state class action "in view of the progress and promise of the Texas suit relative to the half-hearted efforts of the [federal] settlement class counsel" and reversing the approval of the federal settlement for failure to make a sufficient inquiry into adequacy and fairness).
272. The only other opportunity that class members are likely to have to police their representatives while an action is still pending is to appear as objectors at a fairness hearing, a step that cannot be relied upon to have any significant impact on the outcome. See William B. Rubenstein, The Fairness Hearing: Adversarial and Regulatory Ap preaches, 53 UCLA L. REV. 1435, 1467-81 (2006) (discussing structural and institutional limitations on the efficacy of the fairness hearing and suggesting reform proposals); see also Rubenstein, supra note 227, at 807-08 (summarizing procedural and practical impediments to developing a challenge to a settlement at a fairness hearing). Class members also have the right to enter an appearance in the lawsuit, but that appearance-as-of-right generally stops well short of an intervention that will allow them to influence the proceedings, and the cases where true intervention by class members has been permitted are few.
273. See Burbank, supra note 12, at 1939-42 (offering a detailed description of the shift in jurisdictional policy, away from York and Klaxon, that GAFA represents). In the years following Erie, the Court adopted a policy of federal jurisdiction according to which the choice of the federal forum should not have any predictable ex ante impact upon the outcome of a lawsuit based on state law. In Guaranty Trust Co. v. York (a case that was not based on the Rules of Decision Act), the Court suggested that a diversity action in equity should conform judge-made procedures to the contours of state practice in order to discourage vertical forum shopping. 326 U.S. 99, 109-10 (1945). In Klaxon Co. v. Stentor Electric Manufacturing Co., the Court relied upon the same principle - discouragement of vertical forum shopping - in denying federal courts the authority to develop an independent body of choice of law rules. 313 U.S. 487, 496-97 (1941). CAFA, of course, offers vertical forum shopping as the primary mechanism for altering outcomes in class proceedings.
274. Professor Nagareda has expressed skepticism at the suggestion that CAFA invites an overruling of Klaxon, as Professor Issacharoff has argued that it does. To say that CAFA turns off Klaxon when the statutory text says no such thing, when the legislative history actually speaks of preserving Erie, and when the Senate rejected a much more modest amendment on choice of law, is to press hard at the boundaries of statutory inference." Richard A. Nagareda, Aggregation and Its Discontents: Class Settlement Pressure, Class-Wide Arbitration, and CAFA, 106 COLUM. L. REV. 1872, 1919 n.198 (2006) (discussing S. Amendment 4 to S. 5, 109th Cong., 151 CONG. REC. S1215 (daily ed. Feb. 9, 2005)). While the ultimate impact of CAFA on Klaxon is a difficult question as to which I do not yet have a firm view, I think that Professor Nagareda underplays the shift in jurisdictional policy that the statute represents, legislative history notwithstanding.