5 Supreme Court Class Action Decisions Worth Tracking in 2019

The U.S. Supreme Court is poised to rule this year on several class action cases that are worthy of class action practitioners’ attention.

1. Merck Sharp & Dohme Corp. v. Doris Albrecht et al.

This case has the potential to impact product liability class action cases in the pharmaceutical industry. The question on the table is whether it’s a judge that can decide that the state law failure-to-warn claims are null if the U.S. Food and Drug Administration rejects a medical warning the plaintiffs argue was necessary, or if that should be decided by a jury.

The MDL surrounds the Merck osteoporosis drug Fosamax, which the plaintiffs argue should have included a warning about the risk of bone fractures. The warning was rejected by the FDA, but plaintiffs argue the warning wouldn’t have been rejected if it was worded differently.

A district court ruled that state law is preempted If the FDA does not approve the warning, but the Third Circuit ruled to put the issues in front of a jury. Merck took the case to the Supreme Court, and arguments are scheduled for Jan. 7.

Merck Sharp & Dohme Corp. v. Doris Albrecht et al., case number 17-290

2. Apple Inc. v. Robert Pepper et al.

Is Apple controlling a monopoly through its app store? And do phone owners’ have the right to bring an antitrust lawsuit against the company, even if it’s actually third-party app developers who are suffering?

The suit alleges that the act of barring app developers who use the Apple store from selling the app in other online stores and threatening to void warranties of users who download from those platforms creates a monopoly.

After the suit was dismissed in district court, the Ninth Circuit ruled iPhone users do have a standing to sue the tech giant because they are direct buyers of the phone and Apple acts as an app distributor through its store.

The Supreme Court heard oral arguments in November, and several justices questioned the right of the users to sue Apple based on the structure of the app store business. Others supported the right of the users because their money goes directly to Apple after a purchase in the app store.

Apple Inc. v. Robert Pepper et al., case number 17-204

3. Lamps Plus Inc. et al. v. Frank Varela

Update: the Supreme Court ruled on this decision in April, 2019. Find out more.

The Supreme Court will answer the question of whether the Federal Arbitration Act overrules a state-law interpretation of arbitrations agreements that authorize class arbitration based solely on the general language commonly used in agreements.

According to Scotus Blog, the conservative majority on the court is skeptical of the argument that consumers who agreed to bring claims in arbitration have a right to do so together. According to research conducted by the University of North Carolina School of Law, removing language that allows for collective arbitration makes it less likely a consumer or employee will move forward with a claim.

 In this case, the question is whether the language in the contract in question allows for aggregated arbitration.  Lamps Plus employee Frank Varela filed suit against the company when a digital phishing incident allegedly led to a breach of employee data. The Supreme Court will review the Ninth Circuit’s decision that the arbitration agreement in employee contracts could be used to authorize class arbitration.

Lamps Plus Inc. et al. v. Frank Varela, case number 17-988

4. Gary Varjabedian v. Emulex Corp et al.

The Supreme Court will hear a petition regarding the shareholder class action site brought against technology company Emulex for allegedly concealing that a $606 million offer to merge was low for the market at the time. The court will decide if the Ninth Circuit was correct in ruling that the Securities Exchange Act of 1934 allows for a private right of action based on a negligent misstatement or omission in connection with a monetary offer.

According to Law 360, the Ninth Circuit broke away from five other circuits in its finding that shareholders only had to show Emulex’s negligence. The U.S. Chamber of Commerce has argued this finding could bring forth more securities class action filings. The court will decide if the Securities and Exchange Act of 1934 sets up the grounds for private litigation in these circumstances.

Gary Varjabedian v. Emulex Corp. et al., case number 18-459

5. PDR Network LLC et al. V. Carlton & Harris Chiropractic Inc.

How much authority does the Federal Trade Commission (FTC) have over the Telephone Consumer Protection Act (TCPA)? The Supreme Court may decide this year. This case questions whether courts have leeway when interpreting agency decisions (the Chevron Doctrine) or the court must defer to agency decisions (the Hobbs Act).

Carlton & Harris, a chiropractic firm, claims PDR Network violated the TCPA because of an FCC rule that labels unsolicited faxes as advertisements. A district judge dismissed the claim, saying the TCPA’s definition of an advertisement wasn’t met. But the Fourth Circuit ruled the district judge was required by the Hobbs Act to follow the FCC’s definitions and guidance.

PDR Network LLC et al. v. Carlton & Harris Chiropractic Inc., case number 17-1705

Contact Heffler Claims for all settlement administration needs.

Lori Castaneda
Lori Castaneda, who has more than 20 years of experience in the legal industry, serves as Senior Director of Heffler Claims Group (Heffler). As a highly-skilled strategist with a consultative approach to client service delivery, Ms. Castaneda has been involved in the successful administration of hundreds of high-profile class action settlements

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