Reversing a Denial of Class Certification

Abstract

Commentary and analysis of a decision from the Eleventh Circuit Court of Appeals reversing the denial of a class certification by the lower federal district court in a RICO-based class action. Most appellate decisions relating to district court orders granting class certification result in reversals, effectively ending the class litigation. It is a rare event, then, when an appellate court reverses a district court's denial of class certification, in essence signaling that the court should allow the class litigation to proceed.  

The U.S. Court of Appeals for the Eleventh Circuit did precisely that when it ruled that a Georgia federal district court erred in misapplying class certification standards to determine whether employees could maintain a class action for injunctive and compensatory relief. Williams v. Mohawk Industries Inc., 2009 WL 1476702 (11th Cir. May 28, 2009). The Eleventh  Circuit reversed the denial of class certification and remanded to the district court for further proceedings.

In reversing the district court's denial of class certification, the Eleventh Circuit reaffirmed its prior precedents indicating that conspiracy class claims under the federal Racketeer Influenced and Corrupt Organizations Act (RICO) are more easily susceptible to common proof that will support class certification, citing Klay v. Humana Inc., 382 F.3d 1241, 1257 (11th Cir. 2004). Hence, in a federal environment increasingly restrictive of class certification, the Eleventh Circuit has a firm jurisprudence supporting class certification based on conspiracy allegations under RICO and state conspiracy statutes. 

Moreover, the Eleventh Circuit has resuscitated the "hybrid" class action that combines the possibility of class certification under Rule 23(b)(2) for injunctive relief and (b)(3) for compensatory relief. The court believed that the district court failed to give sufficient consideration to the possibility of a hybrid class in denying class certification.