A recent decision by the U.S. Court of Appeals for the Sixth Circuit provides an important reminder that if defendants want absent class members to be bound by a summary judgment ruling in their favor, generally they must insist that notice be given to the class before that ruling is made.
In Faber v. Ciox Health, LLC, No. 18-5896, 2019 WL 6596501 (6th Cir. Dec. 5, 2019), the plaintiffs sued a medical-records provider, alleging that it overcharged them for providing copies of their records. Because HIPAA does not provide a private right of action, the plaintiffs brought common-law claims under Tennessee law, and a claim under a Tennessee medical records statute. The plaintiffs moved for class certification and the parties cross-moved for summary judgment, with all three motions pending at the same time. The district court certified a class and then, before ordering notice to the class, granted summary judgment in favor of the defendant. The Sixth Circuit affirmed the district court’s summary judgment ruling, finding that none of the causes of action were viable under state law. But it also ruled that the class certification ruling in effect was a nullity due to the failure to give notice, and the judgment would apply only to the named plaintiffs. The Sixth Circuit rejected the defendant’s suggested approach of remanding so that post-judgment notice could be provided to the class because “post-judgment notice would present no meaningful opportunity for class members to make their case”; rather, it “would only invite parties to enter a fight that they already lost.” Id. at *7. But what if the district court (or the Sixth Circuit) had vacated the summary judgment ruling too, and then let the class members make whatever additional arguments they wanted to make? It might be difficult to change the district judge’s mind, but the issue could still have gone either way on appeal at that point.
The practice pointer for defendants and their counsel here, in my view, is that if there is both a motion to certify a class and motions for summary judgment pending, you may need to provide a strong recommendation for the district court as to which order the motions should be decided in. If the plaintiff moves for summary judgment, the defendant often will want to invoke the rule against one-way intervention, so the ruling is not binding as to the class unless a class is certified first. With respect to a defendant’s motion for summary judgment, it’s a strategy call as to whether you want to push for class certification to be decided first. And if class certification is granted before your motion for summary judgment is decided, it might make sense to request that notice be given promptly, and your motion be held in abeyance, so it if it is granted you have a judgment against the whole class. But that might not be the best strategy if your argument on the merits is a longshot. And here the ruling in favor of the defendant might well have been perceived as a longshot, given that the Sixth Circuit departed from a Tennessee Court of Appeals decision on the state statutory claim, predicting that the Tennessee Supreme Court would not follow it. These are the kinds of tough calls that defendants in class actions must make in deciding whether to use the class action mechanism as a sword, or just fend it off.