Wednesday, March 30, 2005

Consumer Cause v. Mrs. Gooch's Natural Food Markets (Cal. Ct. App. - March 30, 2005)

It's rare that you find an opinion that was fine when initially published but subsequently "corrected" in a way that is just plain wrong. This case, however, is apparently the exception that proves the rule.

Justice Perluss initially writes a good opinion that rightly holds that an objector who convinces a court not to certify a class can't obtain fees (since, at least in a case like the one here, there's no one from whom to obtain such fees). There are some higher level arguments that might suggest that a fee award might be proper, but these arguments apparently aren't made, so Justice Perluss reaches the right result.

But then the objector moves for a rehearing, which -- as usual -- is promptly denied. But the Court of Appeal, as it sometimes does, responds to the request by making a minor change in the opinion in order to respond to a particular argument made in the motion; here, by adding a single footnote. Usually that's just fine. But the problem here is that this footnote is not only wrong, but affirmatively embarrassing, since it clearly misreads the holding of a seminal Supreme Court case (here, Phillips Petroleum v. Shutts).

The added footnote contends that the objector didn't add anything of value by decertifying the class since the class members would not have been bound anyway since there was only minimal notice to the class, and cites (and quotes at length) from Shutts as the exclusive basis for such a holding. But we read Shutts every year in my Civil Procedure class, and the error made by Justice Perluss is one that even my first-year students rarely make. First, Shutts doesn't apply because -- as Justice Perluss' own quotation reveals -- the due process limits articulated therein expressly only apply "to claims for money damages or similar relief at law," whereas in the present case the predominant (indeed, virtually exclusive) claim was for injunctive relief. This is a critical distinction, as footnote 3 of the opinion in Shutts expressly reaffirms. Second, as nearly all of my first-year students would be able to tell you, Shutts also may not apply because the Supreme Court expressly limits the constitutional holding therein to "absent" plaintiffs. Justice Perluss appears to believe that by "absent" the Court is merely referring to "unnamed" plaintiffs, but since Shutts is all about the ability to bind nonresident unnamed plaintiffs without minimium contacts with the forum state, the better view is that this holding only applies to such plaintiffs, and hence would be inapplicable to the present case (which involved a California class under California law).

In short, Justice Perluss misreads Shutts. Which is somewhat surprising, since he's definitely a smart guy. Regardless, the opinion was better without the footnote than with it.