In response to my recent post about the Seventh Circuit’s decision in the Aqua Dots litigation, law professor Eric Voigt of Faulkner University alerted me to a draft article he’s written entitled “A Company’s Voluntary Refund Program for Consumers Can Be a Fair and Efficient Alternative to a Class Action to Warrant the Denial of Class Certification.” He argues that the Seventh Circuit got it wrong in Aqua Dots when it concluded that the superiority prong of Rule 23(b)(3), which requires that a court find that “a class action is superior to other available methods for fairly and efficiently adjudicating the controversy,” only allows a court to compare class action litigation to other methods of litigation, not other methods of resolving the dispute (such as a voluntary refund program). Prof. Voigt has studied the history of the proceedings of the Advisory Committee that drafted this portion of the rule in 1966, and the writings at that time by Professor Charles Alan Wright, who was a member of that Advisory Committee, and other scholars. He finds that the original intent was to allow a comparison between class action litigation and other non-judicial methods of resolution. Prof. Voigt also notes that early court decisions after the 1966 adoption of the superiority requirement understood the rule as allowing a comparison between class litigation and non-judicial resolution, including administrative proceedings. He also argues that a voluntary refund program can be the sole basis for denying class certification in appropriate cases, and provides some thoughts on desirable features of such a program.
So if you are a defendant that has provided voluntary relief to a putative class, you may want to argue both a lack of superiority and a lack of adequacy of representation. On superiority you may want to push back against Judge Easterbrook’s opinion, particularly if you are outside of his Circuit, and perhaps cite Prof. Voigt’s article once it is published. I don’t know the whole history of the Aqua Dots case and have not read the briefs, but it strikes me as potentially an instance where a court decided an issue (the meaning of “adjudicating” in Rule 23(b)(3)) without the benefit of thorough briefing and historical research on it. Perhaps the Seventh Circuit might have reached a different result if they had the benefit of Prof. Voigt’s research and analysis.