The Fifth Circuit recently upheld certification of a Rule 23(b)(2) class where the plaintiffs sought only injunctive relief, and the court squarely rejected a rule against “fail-safe” class definitions that other circuits have adopted.  Although this case involved relatively unique issues, this decision is significant in that it is a relatively plaintiff-friendly decision from a circuit that is generally regarded by commentators as one of the more conservative and defense-leaning circuits. 

In re Rodriguez, No. 11-40056, 2012 U.S. App. LEXIS 19372 (5th Cir. Sept. 14, 2012) was a class action brought in bankruptcy court by former debtors with mortgages serviced by Countrywide.  The debtors claimed that, after they emerged from bankruptcy, Countrywide sought to charge them fees incurred during the pendency of their bankruptcy cases which were not approved in accordance with Fed. R. Bank. P. 2016(a).  The bankruptcy court certified a class under Rule 23(b)(2), seeking exclusively injunctive relief prohibiting Countrywide from collecting or attempting to collect fees that were subject to Rule 2016(a) and not authorized by the bankruptcy court pursuant to that rule.  Id. at *5.  The Fifth Circuit affirmed, making two significant rulings: 

  • Rule 23(b)(2):  The court found class certification appropriate under Rule 23(b)(2) because “Countrywide charged every class member purportedly unauthorized fees in contravention of Rule 2016(a),” which the court found was sufficient “common behavior towards all members of the class . . . .”  Id. at *10.  The court further explained that an individualized analysis was not required because “[t]he bankruptcy court made factual findings based on multiple days of testimony and the fifty volume record and concluded therefrom that many of the factors cited by Countrywide as requiring an individualized assessment of claims are readily identifiable in Countrywide’s AS-400 database.”  Id. at *16.  The court further concluded that certification of a Rule 23(b)(2) class was appropriate because “[s]ince no monetary relief is sought, monetary relief cannot be more than incidental to injunctive relief.”  Id. at *22.  The court did not address the fact that the type of injunctive relief being sought in this case would appear to be equivalent to monetary relief, to the extent that the injunction would prevent the collection of monetary fees.  Does seeking this kind of injunctive relief constitute an improper end-run around the general rule that monetary damages claims belong in Rule 23(b)(3)? 
  • Fail-Safe Classes:  A fail-safe class is one defined such that identifying class members would determine liability on the merits.  The Fifth Circuit explained that it had previously “rejected a rule against fail-safe classes” in two prior cases, and reaffirmed that conclusion.  Id. at *24-26.  As I’ve explained in prior posts, other circuits disagree and do not allow fail-safe classes, including the Sixth Circuit and Seventh Circuit.
Tags: Failsafe Classes, Injunctions, Rule 23(b)(2)
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Photo of Wystan Ackerman Wystan Ackerman

I am a partner at the law firm of Robinson+Cole in Hartford, Connecticut, USA.  My contact information is on the contact page of my blog.  I really enjoy receiving questions, comments, suggestions and even criticism from readers.  So please e-mail me if you…

I am a partner at the law firm of Robinson+Cole in Hartford, Connecticut, USA.  My contact information is on the contact page of my blog.  I really enjoy receiving questions, comments, suggestions and even criticism from readers.  So please e-mail me if you have something to say.  For those looking for my detailed law firm bio, click here.  If you want a more light-hearted and hopefully more interesting summary, read on:

People often ask about my unusual first name, Wystan.  It’s pronounced WISS-ten.  It’s not Winston.  There is no “n” in the middle.  It comes from my father’s favorite poet, W.H. (Wystan Hugh) Auden.  I’ve grown to like the fact that because my name is unusual people tend to remember it better, even if they don’t pronounce it right (and there is no need for anyone to use my last name because I’m always the only Wystan).

I grew up in Deep River, Connecticut, a small town on the west side of the Connecticut River in the south central part of the state.  I’ve always had strong interests in history, politics and baseball.  My heroes growing up were Abraham Lincoln and Wade Boggs (at that time the third baseman for the Boston Red Sox).  I think it was my early fascination with Lincoln that drove me to practice law.  I went to high school at The Williams School in New London, Connecticut, where I edited the school newspaper, played baseball, and was primarily responsible for the installation of a flag pole near the school entrance (it seemed like every other school had one but until my class raised the money and bought one at my urging, Williams had no flag pole).  As a high school senior, my interest in history and politics led me to score high enough on a test of those subjects to be chosen as one of Connecticut’s two delegates to the U.S. Senate Youth Program, which further solidified my interest in law and government.  One of my mentors at Williams was of the view that there were far too many lawyers and I should find something more useful to do, but if I really had to be a lawyer there was always room for one more.  I eventually decided to be that “one more.”  I went on to Bowdoin College, where I wrote for the Bowdoin Orient and majored in government, but took a lot of math classes because I found college math interesting and challenging.  I then went to Columbia Law School, where I was lucky enough to be selected as one of the minions who spent their time fastidiously cite-checking and Blue booking hundred-plus-page articles in the Columbia Law Review.  I also interned in the chambers of then-Judge Sonia Sotomayor when she was a relatively new judge on the Second Circuit, my only connection to someone who now has one-ninth of the last word on what constitutes the law of our land.  I graduated from Columbia in 2001, then worked at Skadden Arps in Boston before returning to Connecticut and joining Robinson+Cole, one of the largest Connecticut-based law firms.  At the end of 2008, I was elected a partner at Robinson+Cole.

I’ve worked on class actions since the start of my career.  Being in the insurance capital of Hartford, we have a national insurance litigation practice and most of the class actions I’ve defended have been brought against insurance companies. I’ve also handled some involving products liability, managed care, health care, utilities, financial services, higher education and environmental issues.

My insurance class action practice usually takes me outside of Connecticut.  I’ve had the pleasure of working on cases in various federal and state courts and collaborating with great lawyers across the country.  While class actions are an increasingly large part of my practice, I don’t do exclusively class action work.  The rest of my practice involves litigating insurance coverage cases, often at the appellate level.  That also frequently takes me outside of Connecticut.  A highlight of my career thus far was working on Standard Fire Ins. Co. v. Knowles, the U.S. Supreme Court’s first Class Action Fairness Act case.  I was Counsel of Record for Standard Fire on the cert petition, and had the pleasure of working with Ted Boutrous on the merits briefing and oral argument.

I started this blog because writing is one of my favorite things to do and I enjoy following developments in class action law, writing about them and engaging in discussion with others who have an in interest in this area.  It’s a welcome break from day-to-day practice, keeps me current, broadens my network and results in some new business.

When I’m not at work, you might find me running lines or watching a musical with my teenage daughter who hopes to be a Broadway star (or taking her to voice or dance lessons) or reading a good book.

Read more about Wystan Ackerman
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