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Prominent Services Contractors Ensnared in No-Poach Class Action | Vinson & Elkins LLP
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SCOTUS Grants Certiorari to Decide Whether Automatic Discovery Stay Applies to Securities Act Cases in State Court | Goodwin
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Based on the facts before it, the Supreme Court in
American Pipe limited the tolling of absent class member claims in at least two ways: (1) to cases in which class certification had been denied and (2) to cases in which the denial of class certification was
not for lack of standing by the named plaintiff.
American Pipe, 414 U.S. at 552–53. While
American Pipe noted these limitations, courts have struggled with both restrictions because they can appear to lead to inequitable results and be inconsistent with the reasoning behind
American Pipe. This has led some courts to allow tolling in both exceptions: cases without denial of class certification and case in which dismissal was based on the named plaintiff’s lack of standing. This has created conflict among lower courts.
In
Olean Wholesale, litigation related to the long-running tuna price-fixing saga, purchasers of packaged seafood alleged a price-fixing conspiracy against the three largest domestic producers of packaged tuna. At class certification, the parties’ experts disagreed on whether a sufficient portion of the proposed class had been harmed by the alleged scheme. The plaintiffs’ expert “relied on statistical evidence in the form of a regression model which purports to prove that the price-fixing conspiracy harmed all, or nearly all, of the Class members.” The defendants’ expert challenged this methodology, arguing that this “model incorrectly assumed every direct purchaser was injured and necessarily in the same way.” Under these competing models, the plaintiffs’ expert concluded that a