Rule 23 Subcommittee Drops or Postpones Several Proposed Amendments to Rule 23

Following its September 11, 2015 mini-conference in Dallas, the Rule 23 Subcommittee has decided to abandon or postpone consideration of several proposals to amend Rule 23. According to the subcommittee, these proposals no longer warrant immediate attention. Here are the proposals which have been put off.

The subcommittee had been considering whether to amend the class action rules to make clear that an “issue class” may be certified under Rule 23(c)(4) even when Rule 23(b)(3)’s predominance requirement is not satisfied for the claim as a whole. It had also been considering amending Rule 23(f) to authorize discretionary immediate appellate review of any issue class certification. The subcommittee has now concluded that “there is no significant need for such a rule amendment[]” because the “various circuits seem to be in accord about the propriety of such treatment ‘[w]hen appropriate,’ as Rule 23(c)(4) now says.”

Also, the subcommittee had been discussing an amendment to Rule 23(e) which would set standards for approval of settlements which include cy pres relief. This proposal generated opposition from the defense bar, which expressed concern that such an amendment would “enshrine” cy pres remedies in Rule 23 itself. Such an amendment would have made it more difficult for the defense bar to mount sweeping attacks on cy pres relief, such as the argument that cy pres awards violate due process. The subcommittee will no longer be taking up this proposal.

In addition, the subcommittee has put “on hold” its consideration of a proposal that would have made explicit an “ascertainability” requirement which courts have found to be implicit in the class action rules. According to the subcommittee, the law on this topic is “too unsettled” and the “concerns addressed under the heading ascertainability” are too complicated and myriad for it to address. The subcommittee signaled, however, that it may return to this topic in the near future.

Finally, the subcommittee had been considering proposed amendments to Federal Rule of Civil Procedure Rule 68, which concerns offers of judgment. One proposal would have amended Rule 68 so that it does not apply to class or derivative actions. Another proposal would have allowed a settlement offer to moot a class action only when class certification is denied. The subcommittee has put these proposals on hold out of deference to the U.S. Supreme Court, which is considering, in Campbell-Ewald Company v. Gomez, No. 14-857, “whether a case becomes moot, and thus beyond the judicial power of Article III, when the plaintiff receives an offer of complete relief on his claim,” and whether the answer to that question is any different in a class context.