|  | | 2004 News and Press Releases | | |
HEADLINE NEWS:
Tolling Ok When Class Action Stopped Due To Inadequate Representatives
Shannon P. Duffy – The Legal Intelligencer
Law.com. December 17, 2004
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EXCERPT: When certification of a proposed class action is rejected due only to deficiencies in the named class representatives, courts must toll the statutes of limitations to allow different plaintiffs to bring identical claims, the 3rd U.S. Circuit Court of Appeals has ruled. In its 40-page opinion in Yang v. Odom, the court revived securities claims against former officers of World Access Inc., finding that a New Jersey federal judge erred in holding that the claims were filed too late. Third Circuit Judge D. Brooks Smith found that the lower court should have tolled the statute of limitations for two of the three proposed subclasses since a prior suit was rejected by a judge in the Northern District of Georgia only because of deficiencies in the proposed lead plaintiffs for those subclasses. "Tolling allows litigants whose individual lawsuits would have been timely with the benefit of tolling due to an earlier class action to aggregate their claims in a substantively identical class suit so long as the denial of certification in the earlier action was based solely on Rule 23 deficiencies of the putative representative," Smith wrote in an opinion joined by visiting Senior U.S. District Judge Jan E. DuBois of the Eastern District of Pennsylvania. But in a partial dissent, 3rd Circuit Judge Samuel A. Alito said he would have revived the claims for only one of the three proposed subclasses because he believed that two of the subclasses were rejected by the Georgia judge for "defects in the class itself." Alito warned that tolling must be strictly limited to instances in which class certification was denied solely on the basis of the adequacy of the named class representative lest the courts open the door to a potentially endless loop of litigation. "Without this restriction on tolling, lawyers seeking to represent a plaintiff class could extend the statute of limitations almost indefinitely until they find a district court judge who is willing to certify the class," Alito wrote. |
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