Public Citizen’s Scott Nelson outlined three Supreme Court cases to the Real News that threaten the consumer and employee protection tool known as class action litigation

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Story Transcript

THOMAS HEDGES, TRNN: Last week marked the beginning of the Supreme Court’s term for the year, and many are anticipating a number of weighty decisions on Obamacare, voting rights laws, and affirmative action, to name a few. But a lesser-known theme to this year’s Supreme Court term will be the welfare of what’s known as class action. Corporations have launched a number of challenges to a tool that’s mostly used by consumers and employees who band together against wrongful treatment and sue as a collective rather than as individuals.

In what looks like a nod to the corporate world, the Supreme Court has taken up a handful of appealed cases that corporations lost in lower courts around the country. While these class actions reach all sectors of the economy, from tech to farming to finance, their nexus is this: corporations want to narrow and restrict the requirements for legal standing until it becomes either impractical or impossible for class actions to survive in court.

We asked Public Citizen’s Scott Nelson, an attorney who’s argued several times before the Supreme Court, to pick three cases in particular that threaten the health of class actions.

SCOTT NELSON: The first of these is a case called Spokeo v. Robins.

HEDGES: The data aggregator Spokeo is challenging the Fair Credit Reporting Act, which allows people to go to court and seek statutory damages when their rights to have accurate credit reports are violated.

NELSON: In this case the corporate defendant is urging the court to rule that Congress really lacks the authority to create these kinds of statutory remedies and is really only limited to allowing damages when a consumer can come in and prove the amount by which they were damaged.

This theory, if accepted, would pretty much limit it to cases where an individual consumer could go in and prove the amount of monetary damages that they suffered when their credit was misreported.

HEDGES: The second case is Campbell-Ewald v. Gomez, which stems from a dispute under the Telephone Consumer Protection Act, which allows people to sue for junk calls, emails, texts, and other forms of messaging. The question here is can a company shut down a class action completely by settling with the lead plaintiff.

NELSON: The plaintiff turned it down, said no, I want to pursue this as a class action, in the way I have brought it. The defendant then said, well, since we offered you all you could get, your case is moot and you can’t pursue it anymore either on your own behalf or on behalf of the class.

HEDGES: If the Supreme Court were to accept this theory, Nelson says, it wouldn’t only depart from the older definition of what makes a case valid, but make class actions impractical because the defendant would be able to buy off the class representative for a nominal sum.

The third and final important case, Nelson says, is Tyson Foods v. Bouaphakeo, in which workers in Iowa who sued Tyson Foods for overtime violations under the Fair Labor Standards Act are being told they might not have standing, because each employee was affected differently and therefore can’t band together in their class action complaint.

NELSON: The defendant in the cases is arguing that this case couldn’t proceed as a class action at all because of the, the individual variations among the members of the class regarding the amount of overtime to which they were entitled, and because of the presence of a few members of the class who weren’t entitled to overtime at all.

HEDGES: Tyson Foods is essentially saying that if a class action is to be brought, each and every member of that class action must be able to prove not only that he or she was affected, but that they were all affected equally.

NELSON: And again, this would basically make proceeding as a class action in this type of case, or nearly any kind of case because there’s almost always some variation as to the amount of damages class members suffer, basically impractical.

So these three cases together are part of a broad effort on behalf of corporate defendants to get the Supreme Court to impose obstacles in the way of, of class actions on the part of consumers and workers that would render class actions almost unavailable in a large number of cases, and relegate people only to individual remedies if they could pursue them practically on their own. And even there, the mootness theory that’s being pursued in the second case would allow defendants to escape liability just by offering a nominal sum of damages.

End

DISCLAIMER: Please note that transcripts for The Real News Network are typed from a recording of the program. TRNN cannot guarantee their complete accuracy.