Next Term, the U.S. Supreme Court will decide whether, or under what circumstances, a lawsuit brought by a state attorney general as a parens patriae action is removable as a “mass action” under the Class Action Fairness Act (CAFA).  This week the Supreme Court granted certiorari in Mississippi ex rel. Hood v. AU Optronics Corp., No. 12-1036 (see SCOTUSblog page), a case emanating from the Fifth Circuit.  The Fifth Circuit’s opinion, 701 F.3d 796, held that the case was removable as a “mass action.”  The key question was whether the suit involved the claims of “100 or more persons,” because individual citizens of the state are real parties in interest, or whether the state itself was the sole real party in interest. Based on the allegations of the complaint and applicable state law, the Fifth Circuit concluded that the individual citizens were real parties in interest.  The Fifth Circuit also addressed the provision in CAFA that provides an exception to jurisdiction where “all of the claims in the action are asserted on behalf of the general public (and not on behalf of individual claimants or members of a purported class) pursuant to a State statute specifically authorizing such action.” 28 U.S.C. § 1332(d)(11)(B)(ii)(III) (emphasis added).  The Fifth Circuit found that exception inapplicable based on the allegations in this case because the individual consumers, not merely the general public, were real parties in interest.  In a concurring opinion, Judge Elrod agreed that the court’s approach was consistent with circuit precedent in Louisiana ex. rel Caldwell v. Allstate Ins. Co., 536 F.3d 418 (5th Cir. 2008), but expressed some doubts about whether the Fifth Circuit’s approach was correct.  She noted that the Fourth, Seventh and Ninth Circuits had disagreed with the Fifth Circuit’s approach.  See AU Optronics Corp. v. South Carolina, 699 F.3d 385 (4th Cir.2012); Nevada v. Bank of Am. Corp., 672 F.3d 661 (9th Cir.2012); LG Display Co., Ltd. v. Madigan, 665 F.3d 768 (7th Cir. 2011). 

Conventional wisdom by Court watchers here might suggest that the Supreme Court is granting review in this case with at least a tentative inclination to bring the Fifth Circuit in line with the several other circuits that have reached a different conclusion.  But you never know how the Supreme Court will come out on this when it takes a fresh look at the issue, and it seems possible to me that the answer might not be black or white – the answer could conceivably depend in part on applicable state law governing parens patriae proceedings and how that interacts with CAFA.  Given that the Supreme Court would be unlikely to itself take up issues of state law, its approach might be to take the Fifth Circuit’s conclusions of state law as established in this case and then apply it to CAFA.

So how is this case important for the insurance industry?  The most common example of this kind of state attorney general lawsuit against insurers is one focusing on claim handling after a catastrophic event, such as the Caldwell case, which arose from Hurricane Katrina.  There are various obstacles to attorneys general bringing that kind of litigation, but it is often important for insurers to try to achieve a federal forum.  Allowing a state attorney general to bring a case that is, for all intents and purposes, equivalent to a class action, and keep it in state court, seems to create a large loophole in CAFA.  Distinguishing between a lawsuit “on behalf of the general public” and one “on behalf of individual claimants” could be the focal point here.

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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 at Skadden.  Being in the insurance capital of Hartford, we have a national insurance litigation practice and I was fortunate to have the opportunity to work on some prominent class actions arising from the 2004 hurricanes in Florida and later Hurricane Katrina, including cases involving the applicability of the flood exclusion, statutes known as valued policy laws, and various other issues.  My interest and experience in class actions gradually led me to focus on that area.

In Connecticut courts I’ve defended various kinds of class actions that go beyond insurance, including cases involving products liability, securities, financial services and consumer contracts.

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 my desk or flying around the country trying to save insurance companies from the plaintiffs’ bar, or attending a conference on class actions or insurance litigation (for more on those, see the Seminars/Programs page of this blog), I often can be found playing or reading with my young daughter, helping my wife with her real estate and mortgage businesses, reading a book about history or politics, or watching the Boston Red Sox (I managed to find bleacher seats for Game 2 of the 2004 World Series when Curt Schilling pitched with the bloody sock).  When the weather is good I also love to take the ferry to Block Island, Rhode Island and ride a bike or walk the trails there. If you go, I highly recommend the Clay Head Trail.