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The Good, the Bad, and the Unconstitutional: State Attempts to Solve the Defendant Class Action Problem

By Tyler Blackmon. Full Text.

While the overwhelming majority of class action lawsuits filed in this country are plaintiff class actions—with named plaintiffs representing larger classes of plaintiffs—Rule 23 of the Federal Rules of Civil Procedure technically permits plaintiffs to sue a named defendant representing a class of defendants as well. However, such suits are exceptionally rare—so much so that they have been described as “as rare as unicorns.” Still, when defendant classes emerge, they create two distinct problems. First, defendant classes cause both federal district courts and their state counterparts severe administrative headaches. Second, defendant classes trample on the due process rights of the defendants who are bound by their judgments.

At least partially in response to these administrative and due process concerns, states have experimented with fixes to the defendant class action device in their equivalent class action rules. This Note categorizes and analyzes those variations on Federal Rule 23. It shows that Maryland’s solution of plaintiff-only classes is good; Mississippi and Virginia’s solution of nixing class actions altogether is bad; and Iowa, New Hampshire, and North Dakota’s solution of barring opt-outs from defendant class actions is quite clearly unconstitutional.

Ultimately, this Note concludes that—given the due process issues deeply embedded in the defendant class action device—other states and the federal judiciary should follow the lead of Maryland and abrogate defendant classes altogether. However, in the alternative, it argues that, at the very least, state statutes and rules barring a defendant from opting out of a defendant class violate the Fourteenth Amendment’s Due Process Clause, and the Supreme Court should intervene as soon as a case comes to its attention.