The Rule of Law Problem: Unconstitutional Class Actions and Options for Reform
Posted: 5 May 2005
Legal reformers have seized on federal diversity jurisdiction as a mechanism for reining in bad class actions. This article poses an impertinent question for these reformers: What if class actions were, in some contexts, not simply bad as a policy matter, but unconstitutional?
Some class action defendants have made this argument: They claim that certifying a class action violates due process when the certification order unsettles expectations about the content of substantive rights - for example, where the certification order eliminates defendants' ability to raise certain individualized substantive defenses against particular class members' claims.
Outside of the securities litigation context, legal reformers have ignored federal question jurisdiction as a basis for removing state class actions into federal court. But, if due processs arguments against class certification are taken seriously, federal question removal is revealed as a supple, far-reaching mechanism for targeting problematic state-level class actions as a general matter.
The article begins by sketching the basic intuitions that drive the due process defense to class certification. This is not meant as a final word on the merits of the due process argument - only a sketch of the colorability of that defense. I then tease out the interesting procedural ramifications of taking this defense seriously.
Keywords: Due process, separation of powers, federalism, class actions, tort reform
JEL Classification: K10, K20, K40, K41
Suggested Citation: Suggested Citation