Hunton Employment & Labor Perspectives

When a party receives an adverse order on a motion for class certification, whether the court of appeals grants permission to appeal under Rule 23(f) can be a crucial turning point in the case.  If the appellate court will not hear this interlocutory appeal, the only way to obtain review of that decision is to take the case through trial, to a final judgment.  But, due to the high stakes and large costs involved, few class actions are tried and cases often settle after the class certification order is issued by the trial court.

Despite this crucial step in a class action case, the Rule provides a short turnaround time (14 days from the trial court’s order), which may make it more burdensome for the party requesting the relief.  The short timeframe could result in filing a petition that is focused only on why a party believes the trial court got it wrong.  But the court of appeals will also be focused on other factors, such as whether there are significant questions of law involved (as opposed to merely application of established law to the facts of your case), why the issues presented matter for other cases or the development of the law, and why the appeal cannot wait until after a final judgment.

In most instances, a court of appeals’ decision on whether to grant the petition will be a one-line order without explanation.  Indeed, this is because most Rule 23(f) petitions are decided quickly by a motions panel, which will not delve deeply into the case.  However, in In re Marietta Memorial Hospital, 17-312 (6th Cir. Jan. 8, 2018), the Sixth Circuit wrote a short but insightful opinion providing valuable guidance to parties looking to proceed under Rule 23(f).  The Court set forth key factors it considers as follows:

We may, in our discretion, permit an appeal from an order granting class certification.  Fed. R. Civ. P. 23(f). This “unfettered” discretion is akin to the discretion of the Supreme Court in considering whether to grant certiorari; thus, we may consider any relevant factor we find persuasive. See Fed. R. Civ. P. 23, advisory committee’s note (1998 amendment); In re Delta Air Lines, 310 F.3d 953, 959 (6th Cir. 2002) (per curiam).  Typically, however, we consider (1) whether the petitioner is likely to succeed on appeal under a deferential abuse-of-discretion standard; (2) whether the cost of continuing the litigation for either the plaintiff or the defendant presents such a barrier that subsequent review is hampered; (3) whether the case presents a novel or unsettled question of law; and (4) the procedural posture of the case before the district court.

In explaining why it declined to grant review, the Court noted that the defendant “has not identified any novel legal question raised by the petition,” and that the defendant’s “mere ‘general assertion[s]’ that certification is dispositive of the litigation” were insufficient.  Accordingly, the Court advised that, in order to demonstrate that the costs of litigation would likely preclude review after a final judgment, “the defendant should provide insight into the potential expenses and liabilities.”  The Court further noted that the defendant failed to address whether the district court might reexamine the class certification decision, and noted that both parties had filed dispositive motions, which weighed against interlocutory review.

Although the opinion is short, it provides valuable insight as to what should be addressed in a Rule 23(f) petition.  Certainly, a party will often be best served by highlighting, where possible, the importance of the issues presented and why immediate review is necessary under the four part test espoused in Marietta.