New 9th Circuit Opinion on Appealing Class Certification Rulings

Six months ago, the US Supreme Court appeared to end a controversy.  In the Ninth Circuit, at least, there had been growing confusion over how and when plaintiffs could appeal certification denials.  Rule 23(f) allows either party to request interlocutory review of a certification ruling.  But what happens when Rule 23(f) review is denied or not requested?  Can a plaintiff dismiss her case and then appeal?

In Baker v. Microsoft, that’s what the plaintiff tried.  After the district court struck all of the class allegations from the complaint, the plaintiff petitioned for review under 23(f) and the Ninth Circuit declined review.  The plaintiff then voluntarily dismissed his claims with prejudice so as to manufacture a final decision subject to appellate review.  The Ninth Circuit then agreed to hear the case (and ultimately ruled in plaintiff’s favor).

After a subsequent Ninth Circuit decision appeared to undermine that ruling, the Supreme Court reversed, holding that “Plaintiffs in putative class actions cannot transform a tentative interlocutory order … into a final judgment … simply by dismissing their claims with prejudice.”

Now, the Ninth Circuit has allowed appellate review of a certification denial under different – but not wholly unrelated – circumstances.

In Brown v. Cinemark USA, the district court denied class certification and, it appears, plaintiffs declined to seek 23(f) review.  Instead, they at least temporarily continued to litigate on an individual basis.  After the district court granted partial summary judgment, the parties settled the individual claims and reserved plaintiffs’ right to appeal (both the certification and the summary judgment rulings).

Plaintiffs appealed and defendant moved to dismiss, citing Baker.  In a brief, published opinion, the Ninth Circuit distinguished Baker, ruling that the plaintiffs in Brown had not “engaged in sham tactics to achieve an appealable final judgment.”  Nor was the “resolution of the present case … a unilateral dismissal of claims.”  Thus, the case was “unlike Baker, where the plaintiffs openly intended to sidestep Rule 23(f).”

One wonders how bright the line is between the facts of Baker and Brown.  Certification denials often functionally terminate consumer class actions, so plaintiffs in those cases typically have a strong desire for appellate review.  Whereas previously that review might only have been possible upon a successful 23(f) petition or litigating the individual case through judgment, it’s possible that those cases will increasingly end up before the Ninth Circuit simply by virtue of an agreement between the parties.