TRANSCRIPT OF PROCEEDINGS

HERITAGE REPORTING CORPORATION

Official Reporters

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IN THE MATTER OF: )

 )

PUBLIC HEARING ON PROPOSED )

AMENDMENTS TO THE FEDERAL )

RULES OF CIVIL PROCEDURE ) )

JUDICIAL CONFERENCE )

 ) 

ADVISORY COMMITTEE ON CIVIL )

RULES )

Pages: 1 through 126

Place: Washington, D.C.

Date: November 3, 2016
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IN THE ADMINISTRATIVE OFFICE OF THE U.S. COURTS

IN THE MATTER OF: )

 )

PUBLIC HEARING ON PROPOSED )

AMENDMENTS TO THE FEDERAL )

RULES OF CIVIL PROCEDURE )

 )

JUDICIAL CONFERENCE )

) 

ADVISORY COMMITTEE ON CIVIL )

RULES )

 

Mecham Conference Center

Thurgood Marshall Federal

Judiciary Building

1 Columbus Circle, N.E.

Washington, D.C.

Thursday, 

November 3, 2016

The parties convened, pursuant to notice, at

9:01 a.m.

APPEARANCES:

HONORABLE JOHN D. BATES

Advisory Committee Chair

PROFESSOR EDWARD H. COOPER

Advisory Committee Reporter

PROFESSOR RICHARD L. MARCUS

Advisory Committee Associate Reporter

JOHN M. BARKETT, Esquire

Advisory Committee Member

ELIZABETH CABRASER, Esquire

Advisory Committee Member

HONORABLE ROBERT MICHAEL DOW, JR.

Advisory Committee Member
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APPEARANCES: (Cont'd.)

HONORABLE JOAN N. ERICKSEN

Advisory Committee Member

PARKER C. FOLSE, Esquire

Advisory Committee Member

PROFESSOR ROBERT H. KLONOFF

Advisory Committee Member

HONORABLE SARA LIOI

Advisory Committee Member

HONORABLE SCOTT M. MATHESON, JR.

Advisory Committee Member

HONORABLE BENJAMIN C. MIZER

Advisory Committee Member

HONORABLE BRIAN MORRIS

Advisory Committee Member

HONORABLE DAVID E. NAHMIAS

Advisory Committee Member

HONORABLE SOLOMON OLIVER, JR.

Advisory Committee Member

VIRGINIA A. SEITZ, Esquire

Advisory Committee Member

HONORABLE CRAIG B. SHAFFER

Advisory Committee Member

HONORABLE A. BENJAMIN GOLDGAR

Advisory Committee Liaison Member

PETER D. KEISLER, Esquire

Advisory Committee Liaison Member

LAURA A. BRIGGS

Clerk of Court Representative

REBECCA A. WOMELDORF

Secretary, Committee on Rules of Practice and 

Procedure

HONORABLE DAVID CAMPBELL

Chair, Committee on Rules of Practice and

Procedure
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APPEARANCES: (Cont'd.)

HONORABLE JEREMY D. FOGEL

Federal Judicial Center

EMERY G. LEE III, Esquire

Federal Judicial Center

LAUREN GAILEY, Esquire

JULIE WILSON, Esquire

JOSHUA GARDNER, Esquire

PROFESSOR DANIEL COQUILLETTE

Reporter, Committee on Rules of Practice and

Procedure
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I N D E X

PAGE

JEFFREY A. HOLMSTRAND 6

DRI, The Voice of the Defense Bar

MARK P. CHALOS 18

Lieff, Cabraser, Heimann & Bernstein

JOHN H. BEISNER 25

Skadden Arps

ALAN B. MORRISON 36

George Washington University Law School

JOHN PARKER SWEENEY 44

DRI, The Voice of the Defense Bar

STUART ROSSMAN 53

National Consumer Law Center and

National Association of Consumer Advocates

BRENT JOHNSON 66

Committee to Support Antitrust Laws (COSAL)

MARY MASSARON 70

Plunkett Cooney

BRIAN WOLFMAN 75

Georgetown University Law Center

HASSAN ZAVAREEI 93

Tycko & Zavareei

SAI 112
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1 P R O C E E D I N G S

2 (9:01 a.m.)

3 JUDGE BATES: All right. Good morning. 

4 We’re going to begin things on time this morning if we 

5 can keep on time and we’ll hope that everybody can 

6 stay awake who stayed up late last night watching the 

7 game.

8 But this is the first public hearing that 

9 we’re having on the proposed amendments to the Civil 

10 Rules that were published for comment in August of 

11 this year and those are proposed amendments to Rules 

12 5, 23, 62, and 65.1. I expect that the focus of the 

13 testimony that we’ll hear today from 11, I believe, 

14 witnesses will be on Rule 23, but it may include 

15 others.

16 And I would remind the witnesses that we 

17 have asked you to limit your comments to 10 minutes. 

18 There may be some questions from Members of the 

19 Committee, the Advisory Committee, after your 

20 comments, but if you could try to limit your comments 

21 to 10 minutes and then have time for some questions, 

22 that way we can keep things on schedule or relatively 

23 close to schedule this morning as we proceed.

24 We’ve received some helpful written 

25 submissions from many of you and we appreciate that 
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1 and we’ve reviewed those and we’ll continue to review 

2 those. The testimony of each witness and the comments 

3 will be valuable to us as we move forward with this 

4 process.

5 Without further delay, therefore, I want to 

6 get right into the witnesses, and our first witness --

7 we’ve changed the schedule just slightly by moving the 

8 person we had scheduled for first down to last at his 

9 request. So our first witness will be Jeffrey 

10 Holmstrand from DRI. Mr. Holmstrand.

11 MR. HOLMSTRAND: Thank you. My name is Jeff 

12 Holmstrand and I’m delighted to be here today to 

13 testify on behalf of DRI’s views. DRI, The Voice of 

14 the Defense Bar, is an organization of 22,000 lawyers 

15 who primarily represent American businesses in civil 

16 litigation. I’m also the past president of our State 

17 Defense Organization and I have a significant amount 

18 of experience in West Virginia, which is where I’m 

19 from, defending class actions both in state and in 

20 federal court.

21 I’d like to thank the Committee for allowing 

22 me to present DRI’s views on this. I’d also like to 

23 mention that 30 years ago I sat in a class on the 

24 other side while Professor Cooper showed me just how 

25 little I knew about antitrust law. I’m hoping I know 
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1 a little bit more about Rule 23 than I did about that.

2 I know that a significant amount of work has 

3 gone into the Committee’s work. We were involved in 

4 one of the speaking tours for the Rule 23 Subcommittee 

5 and I think generally speaking the amendments that the 

6 Committee has under consideration are addressing 

7 issues that are of concern that as the Advisory 

8 Committee notes note are issues that have emerged 

9 since 2003 when the last amendments were made.

10 My testimony today is going to focus on two 

11 areas of concern, both of which are issues that have 

12 emerged since the last amendment to the rules. The 

13 first is the Committee’s proposed amendment to Rule 

14 23(f) and the second is an issue that is not within 

15 there but I wanted to talk about a little bit, which 

16 is the ascertainability issue.

17 The proposed amendments to Rule 23(f) do two 

18 things as I understand it. One is to make clear that 

19 the so-called preliminary approval process is not 

20 subject to the interlocutory review that’s available 

21 under Rule 23(f). I think that that’s very 

22 supportable. We believe that that should have been 

23 implicit, but to make it explicit makes complete sense 

24 to us.

25 The second portion is the amendment to allow 
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1 the government additional time to seek review of a 

2 class certification decision from the 14 days that’s 

3 generally available under Rule 23(f) to Rule 40 to 45 

4 days in recognition of the needs of the government.

5 While we support that provision as well, we 

6 don’t believe as we’ve said in our submissions 

7 previously that that goes far enough, and the reason 

8 for that is is that we believe that Rule 23(f) should 

9 be amended to provide for immediate mandatory or at 

10 least appellate review as of right of class 

11 certification decisions either granting or denying 

12 certification and we have proposed language that would 

13 affect that result.

14 The class certification decision, as 

15 everybody recognizes, is the seminal legal decision in 

16 most cases that are brought under Rule 23, and Rule 

17 23(f) was added, as we understand it, in order to 

18 allow the settlement pressure that comes from a 

19 certification decision to at least potentially be 

20 reviewed.

21 And the promise was is that defendants or 

22 plaintiffs who were aggrieved by an erroneous 

23 certification decision would have the ability to seek 

24 review, but they wanted to set an expedited process 

25 for it and that happened to some extent.
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1 Included in our papers are the data that 

2 Institute of Legal Reform and Skadden Arps had put 

3 together addressing exactly what’s been happening with 

4 23(f) petitions since 2006 and it covers a seven-year 

5 period and what the data show is that while there were 

6 initially more grants of review, as time passed and as 

7 the manual for complex litigation explicitly 

8 recognizes, the circuit courts have set standards that 

9 effectively limit the ability of a party to seek 

10 review of an erroneous certification decision unless 

11 it’s an abuse of discretion, for example, or a novel 

12 legal issue or there is sort of a death knell 

13 provision that some circuits recognize, but it’s just 

14 not being applied.

15 And we fully appreciate the workload that 

16 our federal appellate judges already face, but this is 

17 in our view the single most important decision that 

18 most defendants and most plaintiffs face in class 

19 action litigation because it’s going to determine 

20 whether or not they can go forward.

21 From the defendants’ side, for example, I

22 defend a lot of TCPA class actions and in those cases 

23 there are often millions and millions of calls that 

24 are at issue. At even $500 per call, which is the 

25 statutory minimum that’s recoverable for a violation 
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1 of the TCPA, you’re talking hundreds of millions or 

2 billions of dollars for companies that can’t afford to 

3 take that risk, so an erroneous certification decision 

4 effectively deprives them of any ability to seek 

5 review of what has happened below and oftentimes in 

6 our view an erroneous decision.

7 So we would propose and, again, we propose 

8 specific language that the court return to what the 

9 ALI had suggested in the original drafts of the 

10 proposed restatement on aggregate litigation and 

11 recognize that there ought to be a right to appellate 

12 review after certification and prior to anything else 

13 of the -- of a certification decision, whether it’s 

14 from the plaintiffs or defendants’ side.

15 The other issue that I wanted to talk about 

16 that has emerged somewhat since 2003 is the issue of 

17 ascertainability, and we have proposed an amendment to 

18 Rule 23(a)(1) that would adopt a specific provision 

19 that permits or requires the district court to make an 

20 ascertainability determination.

21 As you know, that is now a subject of a 

22 circuit split. Some courts recognize that the ability 

23 to objectively and reliably identify class members is 

24 something that is implicit in the rules as part of the 

25 typicality analysis, for example, and what we’re 
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1 suggesting is is that that’s an issue that ought to be 

2 resolved at the rule level and not on a circuit-by3 circuit basis.

4 So what we would propose is that the court 

5 adopt -- or excuse me, that the Committee adopt a 

6 provision that simply states that the members of the 

7 class are objectively identifiable by reliable and 

8 feasible means without individual testimony from 

9 putative class members and without substantial 

10 administrative burden.

11 We believe that there’s a number of benefits 

12 to adopting this approach to ascertainability. 

13 Primarily at a fundamental fairness level, we all 

14 recognize that class actions are the exception, the 

15 exception to the typical American model of one 

16 plaintiff and one defendant or one party, one side, 

17 plaintiff’s side, one defendant’s side, and the 

18 defendant knows who’s suing them, the defendant knows 

19 what they’re being sued for, and the defendant knows 

20 what the claims are.

21 And without an ascertainability requirement,

22 something that happens upfront as part of the 

23 certification decision, you’re put in a place where 

24 the defendants and the courts don’t know who the 

25 parties are, don’t know who the claims are, and it 
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1 impacts the fundamental fairness of the process.

2 The ultimate point and I think some of the 

3 other testimony that you’re going to hear today will 

4 touch on this. Lawyers love process and class action 

5 lawyers love procedure. I mean, it’s just kind of who 

6 we are and the way we think.

7 But Rule 23, as a rule of procedure, isn’t 

8 intended to affect substantive rights of the parties, 

9 either the plaintiffs, the absent class members or the 

10 defendants. We feel that keeping that in mind, 

11 keeping in mind that it’s a rule of procedure drives a 

12 lot of the suggestions that we’ve made.

13 The ascertainability is not a huge leap. 

14 It’s what some circuits already concede is included in 

15 the rule. The amendment to Rule 23(f) that we’ve 

16 proposed is simply a matter of ensuring that, again, 

17 the single most important decision, oftentimes legal 

18 decision that’s made in a case that is capable of 

19 appellate review.

20 I have a bit of time left, but unless there 

21 are questions I’m happy to stand down.

22 JUDGE BATES: Thank you, Mr. Holmstrand. 

23 Questions? Professor Marcus.

24 PROF. MARCUS: Mr. Holmstrand, I think you 

25 mentioned that you handled cases in both state and 
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1 federal court in West Virginia?

2 MR. HOLMSTRAND: That is correct.

3 PROF. MARCUS: And that includes class 

4 actions in both court systems?

5 MR. HOLMSTRAND: That’s correct.

6 PROF. MARCUS: How would you compare the 

7 practice in West Virginia state courts with the 

8 federal courts? Is it better in some ways? Does it 

9 have the features you would like to see added to the 

10 federal rule?

11 MR. HOLMSTRAND: West Virginia is sort of a 

12 pre-amend -- pre-2003 amendment Rule 23. I’ll say 

13 that we make significant use of CAFA in West Virginia,

14 which you can take from that what you will as to which 

15 court I would prefer to be in.

16 I will mention just in passing that West 

17 Virginia is currently -- the Supreme Court is 

18 currently considering an amendment to Rule 23 in West 

19 Virginia to address unclaimed settlement funds in a 

20 way that is a little bit different than what’s been 

21 done in the past that -- and you may hear some people 

22 talk about cy-prés issues today, I don’t know.

23 But one of the concerns that the West 

24 Virginia Supreme Court has is what’s happening with 

25 all of these unclaimed settlement funds, especially 
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1 when there isn’t a reversion provision in the 

2 agreement, and how that’s going to play out.

3 I would say that the federal courts are 

4 stronger on issues like Daubert from a defense 

5 perspective. I can’t speak for my colleagues on the 

6 other side of the V, but certainly the Daubert issue 

7 is much more well defined in West Virginia.

8 The other issue is that West Virginia’s Rule 

9 23, there aren’t a significant number of class 

10 actions. They’re spread around the state. We now 

11 have a mass litigation panel that has a little bit 

12 more experience with those. I think that if you ask 

13 me this question in five years I may have a 

14 significantly different answer as our courts develop 

15 an expertise that currently doesn’t exist.

16 JUDGE BATES: Professor Klonoff.

17 PROF. KLONOFF: On the ascertainability 

18 issue, first of all, you would acknowledge that the 

19 trend in the case law seems to be against you. You 

20 have Mullins, you’ve got some other cases. The Third 

21 Circuit in Byrd has backed off to some extent some of

22 its earlier cases.

23 As I read your proposal, it seems to go 

24 beyond what any circuit now requires in terms of 

25 ascertainability, so can you explain how you justify a 
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1 proposal that really from my reading no court has 

2 followed?

3 MR. HOLMSTRAND: I think, Your Honor, going 

4 to the first point is that we believe that you should 

5 have the ability to know who is suing you, and if 

6 we’re going to adopt a procedural model that allows 

7 for representative litigation, that that 

8 representative litigation ought to as near as possible 

9 and as efficiently as possible track what would happen 

10 if this were not a representative suit.

11 So our proposal was simply a way to try to, 

12 one, identify the appropriate litigants, identify who 

13 those class members are, put the burden on that 

14 upfront because we believe that should be part of the 

15 representative litigation. And, finally, when you 

16 devolve down into litigation over who’s a class 

17 member, you lose some of the efficiencies that Rule 23 

18 was initially intended to address.

19 PROF. KLONOFF: No, I’m just wanting to make 

20 sure I’m understanding your proposal correctly and 

21 that you would acknowledge that what you’re proposing 

22 is really beyond what any court as of now has done.

23 MR. HOLMSTRAND: I would say that it’s 

24 certainly worded slight -- well, two points. One, 

25 you’re right about the recent trends seem to be moving 
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1 away from that or at least not continuing to follow 

2 cases that had originally recognized ascertainability 

3 as an explicit or, excuse me, as an implicit element 

4 of it.

5 In terms of whether I feel like it’s going 

6 further, I feel like we’re more succinctly defining 

7 what the court needs to find in order to find that the 

8 membership in the class is ascertainable.

9 JUDGE BATES: John Barkett.

10 MR. BARKETT: Is this on? Yes. So I’m

11 wondering from a procedural standpoint whether it’s 

12 your view that we have the ability even to consider 

13 your two suggestions without going back through the 

14 rulemaking process that we’ve followed and so the 

15 basic question is, do we keep going with what we’ve 

16 proposed and then take these under consideration? Is 

17 that your proposal, or are you suggesting that we stop 

18 doing what we’ve planned to do here depending upon how 

19 the public process ends up turning out and take up 

20 these ideas even if it means starting over a little 

21 bit?

22 MR. HOLMSTRAND: Well, certainly the 

23 ascertainability issue is something that’s not even 

24 within the current scope of the proposed amendments 

25 and to that extent, you know, we’ve proposed that 
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1 before. Certainly that would need to go through the 

2 rulemaking process.

3 With respect to the Rule 23(f) issue, that’s 

4 already under consideration and we feel that we’re 

5 simply suggesting a different path for an amendment to 

6 Rule 23(f), so I’m not convinced that you would need 

7 to redo everything at this point in order to get to 

8 there.

9 Certainly there’s other provisions in this, 

10 the settlement provisions, the objector provisions 

11 that I think pretty much everyone will agree are, you 

12 know, kind of middle of the road provisions that --

13 this is why I wanted to recognize all the work because 

14 there were so many proposals out there and everybody 

15 was submitting so many comments, and to winnow out to 

16 come down to the ones that are at least in our view 

17 pretty uncontroversial is a heck of a task.

18 But to answer your question, the 23(a)(1), I 

19 think, would need further work. I think the 23(f) is 

20 within the scope of the Committee’s work because it’s 

21 a comment on a rule that the Committee is proposing to 

22 amend.

23 JUDGE BATES: I’m going to try to keep us 

24 relatively on schedule, but we have time for one more 

25 question. Professor Cooper.
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1 PROF. COOPER: I can’t let you go without 

2 one question after 30 years. This is one you can 

3 answer quickly. Your written statement suggests that 

4 we recommend superseding Shady Grove and the question 

5 is, how often do members of DRI encounter federal 

6 class actions seeking to bypass state rules that say 

7 you cannot maintain a class action for this sort of 

8 statutory penalty?

9 MR. HOLMSTRAND: I don’t have that specific 

10 number available, but I’ll certainly have it when we 

11 make our final comments. However, it’s an increasing 

12 issue for us.

13 PROF. COOPER: Right. Thank you.

14 MR. HOLMSTRAND: Thank you. I appreciate 

15 the time.

16 JUDGE BATES: The next witness will be Mark 

17 Chalos from Lieff, Cabraser, Heimann & Bernstein. Mr. 

18 Chalos.

19 MR. CHALOS: Thank you very much. I am here 

20 today presenting comments on behalf of the Tennessee 

21 Trial Lawyers Association and not on behalf of my law 

22 firm, so I’m speaking for myself and for our trial 

23 lawyer organization.

24 First of all, I’d like to echo the comments, 

25 I thank the Committee for the opportunity to be here 
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1 today and I want to echo that the roadshow was 

2 particularly helpful. I have spoken with lawyers on 

3 both sides of the bar and they felt that that 

4 opportunity to be heard and the opportunity to 

5 interact with the Subcommittee Members and Committee 

6 Members was valuable and gave us a real sense that 

7 we’re part of the process and that our voices and our 

8 clients’ voices were being heard. So thank you for 

9 that and know that it’s appreciated by the 

10 practitioners. 

11 Overall, the Tennessee Trial Lawyers 

12 Association supports the proposed amendments. I find 

13 myself in a different position from the last time I 

14 was in front of this Committee and we had some issues 

15 with some of the proposals that I think were largely 

16 addressed in the final version.

17 But here we’re expressing our support. We 

18 also are expressing our support for the Committee’s 

19 decision to defer some of these other issues, for 

20 example, ascertainability and the so-called pick off 

21 issue until the courts have had an opportunity to 

22 fully address both of those issues and allow the 

23 Article III process to work its way to a conclusion or 

24 at least until we get to a uniform standard that the 

25 Committee then may take up if necessary.
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1 I have three suggestions and they all relate 

2 to the objector, the proposed amendments relating to 

3 objectors and which is 23(e)(5). It’s clear from the 

4 May 2016 memo and the Committee notes that the 

5 objector rule amendments are designed to address a 

6 particular issue, which is one of serial or 

7 professional objectors objecting not for the purpose 

8 of making a settlement better or for adjudicating any 

9 particular rights but rather for their own personal 

10 financial gain or some other improper motive.

11 And I reference the May 12 memo where it 

12 says that there’s a widespread concern about the 

13 behavior of some objectors or objector counsel and 

14 also the Committee notes at page 229, which is also 

15 page 27 that says “some objectors may be seeking only 

16 personal gain and using objections to obtain benefits 

17 for themselves rather than assisting in the settlement 

18 review process and they’ve sought in some cases to 

19 exact a tribute to withdraw their objections.”

20 So, with those goals in mind of the 

21 amendments, I have three suggestions and I’ll also be 

22 following this up with a written submission. But, 

23 first, the -- and this is -- this relates to 25 --

24 sorry, 23(e)(5)(A), the disclosures.

25 One challenge for parties and for courts 
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1 facing objections is to determine whether the objector 

2 and the objector’s counsel fits into this, you know, 

3 bucket of an improperly motivated objection and 

4 whether this is something they do as part of how they 

5 earn a living versus somebody who is coming along with 

6 a legitimate objection.

7 And district courts fairly routinely allow 

8 discovery into the notion of whether this is somebody 

9 that is a serial objector, have they done this lots of 

10 other times, is the result of their objections in 

11 other cases one that makes the settlements better or 

12 is this somebody who is filing the objection for the 

13 purpose of getting a payout to withdraw his or her 

14 objection.

15 So I would suggest in 23(e)(5)(A) including 

16 explicitly a requirement that the objector and the 

17 objector’s counsel, if there is counsel, must list 

18 among the pieces of information by case name, court 

19 and docket number all other cases in which he or she 

20 interposed an objection, class cases. This is 

21 information that may or may not be dispositive, but 

22 certainly it’s information that would be helpful, I 

23 think, to a court and to the parties in evaluating the 

24 objection that’s presented.

25 Secondly, a second suggestion, and 
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1 Suggestions 2 and 3 are kind of flipsides of the same 

2 coin. They relate to 23(e)(5)(A) and (B). Taken 

3 together, (A) and (B) remove the requirement that the 

4 objection -- withdrawal of an objection be approved by 

5 the court unless there is payment or other 

6 consideration made to the objector or to the 

7 objector’s counsel.

8 So Proposal No. 2 would be to close a 

9 potential loophole and I think this is a fairly minor 

10 wording issue, but right now, as the rule is proposed,

11 it only applies to payments made to the objector or 

12 objector’s counsel. We have seen in practice where 

13 objectors say don’t pay me, pay some other third 

14 party. Pay, for example, a nonprofit or a think tank.

15 So what I would propose to avoid that 

16 potential loophole and these objectors are clever 

17 would be to say it’s a payment directly or indirectly 

18 made to the objector or objector’s counsel, so it’s 

19 anticipating where they may go next and being explicit 

20 about that.

21 And, thirdly, this is addressing the 

22 striking of the requirement that an objection being 

23 withdrawn must be approved by the court and it’s sort 

24 of striking middle ground where an objector 

25 withdrawing an objection has an affirmative obligation 
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1 under the rule as I’ve proposed the language to file a 

2 notice with the court that they are withdrawing their 

3 objection and affirmatively state that no payment or 

4 other consideration has been made directly or 

5 indirectly to the objector or objector’s counsel.

6 And what we’re anticipating here is an 

7 objector who withdraws his or her objection and is 

8 silent as to whether payment is made. Now maybe 

9 that’s an implicit certification that no payment has 

10 been made because they are not seeking court approval 

11 of the payment in connection with the withdrawal.

12 But if we make explicit that they have a 

13 requirement to give notice to the court to 

14 affirmatively state no payment has been made or other 

15 consideration directly or indirectly, that would give 

16 the court explicitly and expressly the power under 

17 both Rule 11 and the other court’s powers to address 

18 somebody who may not be fully disclosing the 

19 circumstances.

20 So those are the three proposals we have all 

21 relating to 23(e)(5) and I have a little bit of time,

22 but I’ll stop there and thank you again for the 

23 opportunity to be here today.

24 JUDGE BATES: Thank you, Mr. Chalos. 

25 Questions for Mr. Chalos? Professor Marcus.
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1 PROF. MARCUS: Mr. Chalos, you mentioned 

2 that you agree with the idea of deferring attention to 

3 the pick off issue. The Supreme Court made a decision 

4 in the Campbell-Ewald case in January that was about 

5 the same general subject, but are you aware of 

6 significant pick off issues that have emerged since 

7 then from your side? I guess you’re more often on the 

8 plaintiff’s side than defendant’s side?

9 MR. CHALOS: I am on the plaintiff’s side 

10 and, no, I’m not aware of any sort of new tactics in 

11 light of Campbell-Ewald. You know, the decision, you 

12 know, I think clearly left some room for certain 

13 defendants to attempt some maneuvers and, you know, 

14 that may play out, I don’t know.

15 And I’m not suggesting by our support of 

16 deferring that that it ever needs to be addressed. 

17 I’m not suggesting that. But I think the Committee 

18 has chosen the appropriate course, which is to do 

19 nothing right now and let’s see where that ends up.

20 JUDGE BATES: Other questions?

21 (No response.)

22 JUDGE BATES: Mr. Chalos, thank you very 

23 much.

24 MR. CHALOS: Okay. Thank you.

25 JUDGE BATES: The next witness will be John 
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1 Beisner from Skadden Arps. Good morning.

2 MR. BEISNER: Good morning. I appreciate 

3 the opportunity to appear before this group today and 

4 I also wanted to also note appreciation as the prior 

5 testifier noted to the members of the Committee for 

6 the process that was used here. I think that many of 

7 us have concluded that whenever five attorneys over 

8 the last two years have gathered anywhere to talk 

9 about class actions you were bound to find a member of 

10 this Committee there, especially a member of the class 

11 action Subcommittee, and for those of us practicing, I 

12 think everyone is very appreciative of the time that’s 

13 been invested in developing these proposed amendments.

14 I think that my fundamental view is that the 

15 amendments that are proposed here are all 

16 directionally correct. I think like any practitioner 

17 you’d have some preferences of ways of doing things,

18 but I think that the Committee has found the right 

19 spot on these issues as a general matter, and for that 

20 reason my comments I fear may be a bit more in the 

21 weeds, but they really go to the text of some of the 

22 Advisory Committee notes.

23 I apologize to the Committee for not having 

24 my written comments in before the hearing today and do 

25 intend to submit them, but let me go through the 
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1 several thoughts that I wanted to offer.

2 The first thought that I wanted to offer is 

3 on the comment to Subdivision C-2, this is on page 219 

4 of the master book I believe that you have, and it’s 

5 the provision that speaks to the information that the 

6 court should be gathering and, in particular, to the 

7 sentence in the first full paragraph on page 219 that 

8 says, “In providing the court with sufficient 

9 information to enable it to decide whether to give 

10 notice to the class of a proposed class action 

11 settlement, it may be important to include a report 

12 about the proposed method of giving notice to the 

13 class.”

14 My suggestion to the Committee is to make 

15 that more emphatic and more mandatory. I think that 

16 many settlements, there’s a real question that the 

17 court must confront as to whether the efforts that the 

18 parties envision to achieve distribution of the 

19 benefits is adequate, and that is really to my mind in 

20 many of these settlements the key issue.

21 The defendant may have agreed to create a 

22 fund of $10 million to benefit the class members, but 

23 it becomes sort of a de facto cy-prés settlement 

24 providing little or no benefit to the class unless the 

25 parties have a decent plan to achieve distribution.
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1 And I think the court needs to know what 

2 that plan is at this juncture to make an assessment as 

3 to whether this is just a de facto cy-prés settlement 

4 that isn’t necessarily going to benefit the class or 

5 whether the parties to the settlement really do have a 

6 plan that would achieve distribution or at minimum 

7 make available the knowledge that the compensation is 

8 available there to the class members.

9 And so I think that this should be beefed up 

10 to say that this is something the court should be 

11 asking for, that there should be considerable detail 

12 about the distribution plan at that juncture.

13 The next comment I had is in the commentary 

14 on Subdivision E-1, this is on page 222 of the books I 

15 believe you were referencing, and this is the sentence 

16 at the end of the first full paragraph on that pages 

17 that said, “If the settlement is not approved and 

18 certification for purposes of litigation is later 

19 sought, the parties’ earlier submissions in regard to 

20 the proposed certification for settlement should not 

21 be considered in deciding on certification.”

22 I simply wanted to say that I think that 

23 sentence is extremely important because I do believe 

24 that with this frontloading process in particular, I 

25 think defendants are going to be particularly or 
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1 increasingly nervous about engaging in settlements of 

2 class actions. 

3 The reason a defendant usually engages in a 

4 settlement is to create some certainty about the 

5 outcome of the litigation, but I think especially with 

6 the frontloading aspect of this and the, I think, 

7 increasing scrutiny that courts are correctly giving 

8 to class settlements, there will be a greater 

9 hesitancy to go down that path if there’s any feeling 

10 of a residual adverse effect of proposing a 

11 settlement, proposing a settlement class that is 

12 ultimately rejected and the parties go forward with 

13 litigation, and I think therefore that sentence is of 

14 critical importance.

15 Another concern I wanted to express is this 

16 full discussion of Subdivision E-1 I think is very 

17 thorough and commendably so with respect to the 

18 information that the court should be gathering to make 

19 this determination as to whether notice should be 

20 issued regarding the proposed settlement.

21 What I fear is lacking in the notes, though,

22 is if the court concludes that this is not a proposed 

23 settlement that the court is likely able to approve, 

24 what should the court do? And I think that it would 

25 be helpful to have some further explication of that. 
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1 Obviously, the court should not approve the notice at 

2 that point, but I think it would be helpful to have 

3 some discussion here of what the court should do at 

4 that juncture.

5 Obviously, the court is not going to say to 

6 the parties the court is not approving the settlement,

7 but I’m not going to tell you why. I think obviously 

8 the court, as many have done recently, provides some 

9 explanation. But I think there’s a tension there 

10 between the court explaining its concerns about the 

11 proposed settlement and the line of cases that have 

12 been out there for many years indicating that the 

13 court ought to either approve or reject the proposal 

14 that is placed before it and not get involved in 

15 dictating terms.

16 And there’s a tension there that I think 

17 needs to be addressed. And I think it perhaps is in 

18 the form of suggesting to the court that what it ought 

19 to be doing is indicating the areas of deficiencies in 

20 the settlement to allow the parties an opportunity to 

21 improve the settlement to a form that the court 

22 perhaps might view itself in the position to approve 

23 or at least at the notice stage, but perhaps provide 

24 some warning about being overly specific in that 

25 regard.
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1 The court gets involved in saying here’s the 

2 specific dollar amount that needs to be provided here, 

3 I think that may cross the line and get the court into 

4 the realm of dictating terms that I think the case law 

5 suggests that courts should not do, but obviously, if

6 it finds that the compensation levels are 

7 insufficient, it needs to provide that. But I think 

8 some guidance in that regard, it seems to me that is a 

9 void in the notes and that some discussion of what the 

10 court should do if it finds itself unable to approve 

11 notice would be beneficial.

12 The last comment that I wanted to raise is 

13 with respect to the discussion of paragraphs C and D 

14 on page 227 and this involves the discussion of the 

15 criteria that the court should be looking at in giving 

16 final approval to the settlement.

17 I wanted to focus on the second paragraph on 

18 page 227, which is the paragraph that says that the 

19 relief actually delivered to the class can be an 

20 important factor in determining the appropriate fee 

21 award. I think that’s a very important point to be 

22 made here and I’m very happy to see that that 

23 observation has been included in the discussion.

24 My concern is that there may be a little bit 

25 of a disconnect, though, between that paragraph and 
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1 the paragraph I believe that it links to in the rule

2 itself, which is the paragraph that indicates that one 

3 of the criteria that the court may consider are the 

4 terms of any proposed award of attorney’s fees,

5 including timing of payment.

6 I think it would be helpful to more 

7 explicitly in this note indicate that when the rule 

8 speaks about timing of payment what it’s getting at is 

9 the question whether the court will pause in making 

10 the fee award until it has knowledge about the 

11 distribution to class members. I don’t think that’s 

12 entirely clear what that timing reference in the rule 

13 means with respect to this paragraph.

14 I also think the Committee may want to 

15 consider the ordering of these paragraphs because I 

16 believe the paragraph I was just referencing refers to 

17 Subpart 3(i), but then the following one speaks about 

18 double i, which is the preceding paragraph. And so I 

19 think that part of the confusion here may be the 

20 ordering of the paragraph in the notes, but I think it 

21 would be useful to more explicitly link this 

22 discussion, these paragraphs to the provisions in the 

23 rule itself that they are intended to consider. And 

24 thank you for the opportunity to offer those comments.

25 JUDGE BATES: Thank you, Mr. Beisner. 
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1 Questions for Mr. Beisner? Professor Klonoff.

2 PROF. KLONOFF: John, I just want to make 

3 sure on your second point dealing -- we’ll call it the 

4 no judicial estoppel point, you’re not suggesting any 

5 change in the language. You just wanted to point out 

6 that it’s important?

7 MR. BEISNER: Yes. I just wanted to 

8 emphasize that I am very happy to see that there and I 

9 hope that no change is made to that during this 

10 process.

11 PROF. KLONOFF: Okay.

12 JUDGE BATES: Others? Professor Marcus.

13 PROF. MARCUS: Mr. Beisner, you mentioned on 

14 your first point the need to make certain that the 

15 parties have got a plan for giving notice. More 

16 generally, we have received some reports about 

concerns that the change to encompass 21st 17 century 

18 electronic means and not insist or emphasize first

19 class mail is an unwise move. 

20 I wonder if you have views on what’s 

21 actually going on and whether first class mail might 

22 still be the preferred means of giving notice?

23 MR. BEISNER: I am smiling because my 

24 daughter who is in college and who is certainly a 

25 person of the electronic age recently got in the mail 
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1 a notice about a class action settlement and this was 

2 sort of the event of the year because she gets nothing 

3 by mail and it sort of emphasized to me that maybe 

4 first class mail isn’t so bad because we’ve all 

5 migrated so thoroughly to the electronic age that the 

6 important stuff still comes by first class mail.

7 JUDGE BATES: And now you know how you can 

8 get in touch with your daughter.

9 (Laughter.)

10 MR. BEISNER: Yes, right. She won’t answer 

11 my texts or my emails, but now I know how to get her 

12 attention. I think, Professor, that the Committee has 

13 that about right. I think that the rule and the 

14 explanation of it has it right.

15 I think the court’s got to look at, as the 

16 commentary suggests here, who’s in the class, what are 

17 they most likely to respond to, and really make that 

18 assessment and make some judgments. Some classes 

19 first class mail is best. You have other classes 

20 where you need a combination.

21 I think what worries me a little bit here,

22 though, is that the focus of a lot of this is on the 

23 formal notice process, and a lot of the settlements 

24 that we have now in classes are of individuals where 

25 you don’t know who is in the class. You’re going out 
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1 and trying to find them to let them know that the 

2 settlement is available. And so you have advertising, 

3 you have other mechanisms going on to try to get the 

4 class members aware that they need to look at the 

5 formal notice and look at the other information that 

6 is being provided.

7 And that’s what I -- I worry a little bit 

8 that that plan I think needs to be spelled out to the 

9 court and I also think the court ought to explicitly 

10 approve it so that it is part of the overall deal. 

11 One of the things that worries me in some cases is 

12 that you have the settlement approved and then it 

13 comes to time for attorney’s fees, the claim rate is 

14 very low, and the plaintiff’s counsel say well, that’s 

15 because the notice program -- you know, the defendant 

16 didn’t provide enough money for that or whatever or 

17 ought to provide more now.

18 And I think that needs to be part of the 

19 deal that the court approves upfront very explicitly, 

20 very specifically what is going to be done in terms of 

21 making class members aware that this opportunity to 

22 make a claim is available to them.

23 JUDGE BATES: We have time for one more 

24 question. John Barkett?

25 MR. BARKETT: And this actually is a follow-
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1 up to what you just said. Your point related to page 

2 219 of the submission to the public for public 

3 comment. My notes read that you suggest that there be 

4 a decent plan to achieve distribution, and I know you 

5 haven’t submitted your written comments yet and it’ll 

6 be much more elegant when you submit your comments.

7 But I’m tying up, tying to what you just 

8 said about figuring out who’s in the class, how does a 

9 court determine whether or not this distribution plan 

10 is one that rises to the level of approval on a pre11 certification basis anyway of the proposed class 

12 action settlement.

13 MR. BEISNER: What I’ve seen in some cases, 

14 which I think is what the court ought to be looking 

15 for, is that the parties, and usually this is at the 

16 behest of plaintiff’s counsel, retain an expert that 

17 is really a marketing, advertising expert that is 

18 looking at the demographics of the class, what they 

19 use in terms of being aware of what’s going on in the 

20 world and what’s most likely to reach them and provide 

21 some expert views on that subject and a recommendation 

22 as to an overall plan to make the public aware and 

23 specifically to make the class members aware that this 

24 settlement is available to them out there.

25 And it’s usually beyond just, you know, 
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1 here’s the formal notice and here’s how we’re going to 

2 mail it to them or email it to them. If it’s a class 

3 that is difficult to identify, that plan will talk 

4 about how we reach the consumers who may have bought a 

5 particular product, for example.

6 MR. BARKETT: When you submit your written 

7 comments, would you submit some examples along the 

8 lines to start?

9 MR. BEISNER: Yes, be happy to do that, be 

10 happy to do that.

11 MR. BARKETT: Thank you.

12 JUDGE BATES: Thank you again.

13 MR. BEISNER: Thank you very much.

14 JUDGE BATES: The next witness will be Alan 

15 Morrison from George Washington University Law School. 

16 Professor Morrison.

17 PROF. MORRISON: Good morning and thank you 

18 for allowing me to appear here today. You have my 

19 written comments; some of them are quite detailed. 

20 I’m going to talk about two main issues. Just for the 

21 record, I have generally been class actions --

22 representing objectors to class settlements, although 

23 I have on occasion represented the plaintiffs in class 

24 actions as well.

25 So I want to make two main points here 
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1 today, first about the early submission changes and 

2 the second the standards for determining when notice 

3 can and should be sent.

4 So on the first, the early submission on 

5 Rule 23(e)(1)(A), I very strongly support this

6 approach. I think it’s important for the judges to 

7 get this information upfront. I think it’s important 

8 that it be in the record at an early stage.

9 I was recently involved in the NFL 

10 concussion class settlement where 1,000 pages of 

11 affidavits were submitted a week before the hearing, 

12 six weeks after objectors had to file. That’s simply 

13 backwards, and this is a very important matter for 

14 objectors. All this information should be in the 

15 record for the judge at the time of the determination 

16 as to whether to send out notice, and it needs to be 

17 available well before the time for objections and opt

18 outs in that regard, so I strongly support that.

19 I have two suggestions in this regard, both 

20 I think can be done and comments I’m mindful that the 

21 rule is getting bigger and bigger all the time and I 

22 think these things can be put in comments and 

23 appropriate for it given the text.

24 The first one is, and this issue arose in 

25 the NFL concussion settlement not by me but by 
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1 somebody else, and that is whether the application for 

2 attorney’s fees has to be submitted at the time of the 

3 settlement hearing -- I would say yes, but before --

4 regardless of whether the judge is actually going to 

5 pass on the attorney’s fees application at that time, 

6 I agree that the court can decide at the hearing or 

7 can postpone it on the question of attorney’s fees.

8 But the reason that the application ought to 

9 be in is because applications tell class members a lot 

10 about what the plaintiffs have done, how the 

11 negotiations have gone, whether all the time after 

12 settlement has been reached.

13 There are just many things that you can see 

14 at that time. There’s no reason why it shouldn’t be 

15 in at the time at least 21 days or so, as I put in my 

16 proposal, before any objections are due. I do not 

17 think it has to be available for the judge before the 

18 judge decides whether to send out notice. Seems to me 

19 to be unnecessary. Typically there will be a 

20 statement in the settlement as to the amount of fees 

21 and how it’s going to be sought, and I think that’s 

22 enough.

23 But a second step of requiring the 

24 application to be filed, it’s going to have to be 

25 filed sometime, it shouldn’t have to be filed at the 
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1 time of the settlement notice, but it should be time 

2 to be filed before objections and determinations of 

3 opt outs are due. So that’s my first suggestion.

4 The second suggestion is that efforts be 

5 made to bring in people at the time the judge is 

6 making the determination as to whether to send out 

7 notice and, if so, in what form. Other interested 

8 persons in the cases. Typically today class actions 

9 arise in multi-district litigation. Everybody’s got 

10 signed onto the docket. All the judge has to do is 

11 send out announcements saying that there will be a 

12 hearing on such and such a day, not a formal hearing 

13 but an opportunity to communicate with the judge about 

14 the potential problems in the settlement.

15 This is an area where class counsel and 

16 defendants are not going to help the judge as much as 

17 people who are on the outside who will see the 

18 problems and can inform the judge about problems with 

19 both the merits of the settlement, the definition of 

20 the class, and, equally important, the form of the 

21 notice.

22 Sometimes notices are very good; sometimes 

23 they’re much less good. I had a very important 

24 experience in the silicone gel breast implant with 

25 Judge Sam Pointer. He brought everybody in, amici, 
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1 class members, attorneys who had these cases, and this 

2 was, of course, well before the time that we had 

3 websites and people were able to communicate that way.

4 He had a couple of days of informal 

5 proceedings down in Birmingham and he went through the 

6 notice, he went through the frequently asked 

7 questions, he went through the settlement agreement,

8 and many problems were resolved and people felt that 

9 they had an opportunity to present these issues at a 

10 very early stage.

11 Today, with websites and very other means, I 

12 think the court should be encouraged to have an 

13 opportunity for persons who are not directly involved 

14 in the settlement negotiations to be there for the 

15 judge to help the judge sort through these problems

16 both with regard to the notice to the class and the 

17 important issue of the timing, how long it’s going to 

18 be, when papers have to be submitted.

19 Those things are not going to be helped for 

20 the judge by the class counsel or by the defendants. 

21 So that’s my first set of suggestions on the front

22 end, but I first want to say I strongly support the 

23 effort to bring this information upfront.

24 The second relates to the conditions under 

25 which notice can be determined to be sent out. The 
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1 Committee has wisely in my view rejected the notion of 

2 preliminary approval that sends out a signal to the 

3 class and I might say to the judge, him or herself, 

4 that this is essentially a done deal, I’ve 

5 preliminarily approved it and you have to have a very 

6 high burden to get me to change my mind.

7 I don’t think that’s what was intended and I 

8 think it’s not good for the class and I don’t think 

9 it’s good for the interests of justice.

10 I am troubled, however, by the words that 

11 the committee has now used instead of preliminary 

12 approval and let me read a few of them. Words 

13 justified and is likely to be able to be approved, 

14 those seem to me to be very little different between 

15 those and preliminary approval.

16 I and several of my colleagues tried to work 

17 on some language and I want to be clear I’m not wedded 

18 to this language, but it’s in my written testimony and 

19 so let me read it to you now. 

20 It’s sufficient possibility that the 

21 proposal will warrant approval. As I say, I’m not 

22 convinced that’s better, but I think it’s more in the 

23 right direction. Clearly we want to make the point 

24 that it’s not automatic and that there’s no chance of 

25 being approval on the other end.
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1 I have submitted, in addition to my proposed 

2 language, some additional comments on page 7 of my 

3 written statement that would elucidate what I’m trying 

4 to get at at this time and I think they’re consistent 

5 with what the cases say and what the committee has 

6 been saying and I think they’ll be helpful to 

7 understand.

8 In the end, we have to leave it to the 

9 judge’s discretion, but I think by giving -- and what 

10 I’ve tried to do is to give some things that the judge 

11 should look at along the way as a means of determining 

12 whether it’s appropriate to give notice at this time.

13 I have a number of specific other 

14 suggestions in there. I’m glad to talk about the two 

15 I’ve mentioned here as well as those and thank the 

16 Committee for my opportunity to be here today.

17 JUDGE BATES: Thank you very much, Professor 

18 Morrison. So questions on those two suggestions or 

19 other things in the written submission that has been 

20 made? Virginia Seitz.

21 MS. SEITZ: Do you think there are due 

22 process concerns with your first suggestion? I mean, 

23 it sounds like a possibility at least of consideration 

24 of extra-record material or material that might come 

25 to the judge in a form where, you know, the other side 
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1 would not be present. I’m just, I’m wondering about 

2 the shape of your first suggestion that the judge be 

3 kind of generally educated on the topic in an informal 

4 way.

5 PROF. MORRISON: Well, I wanted to be clear 

6 that I didn’t think that we should have a formal 

7 hearing like the final Rule 23 hearing, but judges 

8 have proceedings in open court all the time and this 

9 would be an opportunity for people to appear in open 

10 court to make written submissions that would be filed 

11 and on the record, anything the judge wanted to do.

12 I certainly didn’t expect this to be ex 

13 parte in any way. I fully support the notion that the 

14 class counsel and defendants should have opportunities 

15 to review these materials and take a different view or 

16 a modified view.

17 MS. SEITZ: I just may have misunderstood 

18 what you meant by informal.

19 PROF. MORRISON: Yes, yes, thank you. I 

20 didn’t want to add another level of formality to 

21 hearings in this area.

22 JUDGE BATES: Professor Klonoff.

23 PROF. KLONOFF: Alan, on your first point on 

24 the application for attorney’s fees, are you 

25 suggesting just strong language that it’s a good idea,
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1 or are you suggesting a mandatory rule and if it’s a 

2 mandatory rule, can that really be done in the 

3 comments?

4 PROF. MORRISON: Strong language I think 

5 would be enough. I don’t think a judge would be 

6 committing reversible error if he or she didn’t do it,

7 but I think most judges will say that ought to be done 

8 and, indeed, if my first suggestion on -- my second 

9 suggestion on additional people coming in, objectors 

10 and class members would say how about let’s seeing 

11 that the attorney’s fees and the judge would be --

12 would recognize that it has to be submitted at some 

13 point, the question is when.

14 JUDGE BATES: Other questions?

15 (No response.)

16 JUDGE BATES: All right. Thank you very 

17 much, Alan.

18 PROF. MORRISON: Thank you.

19 JUDGE BATES: We appreciate it greatly.

20 PROF. MORRISON: Thank you.

21 JUDGE BATES: We’ll turn now to John Parker 

22 Sweeney, another representative from DRI.

23 MR. SWEENEY: Good morning. I am John 

24 Parker Sweeney, past president of DRI, The Voice of 

25 the Defense Bar. I’ve never appeared before this 
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1 group before. This feels a lot like an en banc 

2 argument. 

3 I’ve practiced law for over 40 years and 

4 I’ve been involved in class action work for much of 

5 that time, beginning when I was a young lawyer with 

6 the Securities and Exchange Commission filing amicus 

7 briefs on class action issues and then for most of the 

8 last 35 years practicing on behalf of businesses.

9 First I want to thank the Advisory Committee 

10 on Civil Rules for allowing DRI to testify today. 

11 Over the past five years we’ve submitted over two 

12 dozen amicus briefs to the Supreme Court providing our 

13 views in class action cases. We also commissioned the 

14 nation’s only annual national opinion poll devoted 

15 exclusively to the Civil Justice System, and I’ll 

16 refer to that a little bit later in my remarks.

17 I would also like to express our 

18 appreciation today for the work of the Rule 23 

19 Subcommittee. Among its many efforts to reach out to 

20 interested parties, Chairman Dow and other members of 

21 the Rule 23 Committee attended the DRI class action 

22 seminar in July 2015, heard oral comments, and engaged 

23 in a lively dialogue with attendees, and we thank them 

24 for that. We greatly appreciate that courtesy and 

25 recognize that this group has afforded that 
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1 opportunity for many other interested organizations in 

2 the Rule 23 amendment process.

3 DRI has also provided written comments to 

4 the Rule 23 Subcommittee on September 10, 2015. I 

5 will concentrate my remarks this morning on the issue 

6 of no-injury class actions.

7 The Supreme Court recently confirmed the 

8 importance of Article III standing in Spokeo,

9 requiring a class action plaintiff to have suffered an 

10 injury in fact that must be both concrete and 

11 particularized. If the individual class 

12 representative must demonstrate injury in fact, so too 

13 must the definition of any certified class require 

14 that each class member similarly have suffered injury 

15 in fact.

16 This principle was acknowledged or perhaps 

17 more appropriately assumed it appears in the Tyson 

18 Food decision, but there was a suggestion that the 

19 issue would be dealt with on a post-certification 

20 summary judgment rather than class certification.

21 Yet American businesses face many class 

22 actions brought by plaintiffs who cannot establish 

23 they’ve been injured on behalf of a proposed class of 

24 similarly uninjured individuals. In these no-injury

25 class actions, plaintiffs ask the courts to ignore the 
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1 requirements of injury in fact, often by seeking to 

2 recover some fixed amount or range of statutory 

3 damages without any showing of injury to any or many 

4 of the class members. Examples include claims brought 

5 under the consumer fraud or deceptive practices act of 

6 various states.

7 In a typical case, the plaintiff contends 

8 the defendant committed widespread technical 

9 violations of some statute but fails to demonstrate 

10 that he or she in the purported class sustained any 

11 actual injury as a result of the violations, or even 

12 if some are injured many are not.

13 They then seek to have the court certify the 

14 class and award aggregated damages based on some 

15 formulated calculation or range of statutory penalties 

16 or in the Tyson case an opinion based upon aggregate 

17 data providing estimates of injury across the class.

18 They also raise broad policy concerns about 

19 using the Civil Justice System to punish defendants 

20 for technical statutory violations, and punishment it 

21 is because the class members are by definition 

22 uninjured, there’s nothing compensatory about the 

23 process.

24 Permitting aggregated actions by uninjured 

25 individuals places enormous pressure on defendants to 
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1 settle claims that would be valueless if tried on an 

2 individual basis. The Rules Enabling Act, as this 

3 group well knows, prevents the use of procedural rules 

4 such as Rule 23 to abridge or enlarge substantive 

5 rights. Permitting class actions under Rule 23 on 

6 behalf of the uninjured absent class members who lack 

7 Article III standing flies in the face of this 

8 important congressional mandate.

9 Because some courts permit such aggregation 

10 of no-injury claims while others do not, the current 

11 environment is unpredictable for our members and our 

12 clients. More importantly, however, permitting 

13 litigation by and on behalf of uninjured parties 

14 burdens already limited judicial resources and impairs 

15 the ability of the Civil Justice System to process 

16 meritorial claims for actual injury.

17 This concern is not academic. The problem 

18 is very real. Professor Joanna Shepherd of Emory 

19 University Law School recently studied no-injury class 

20 actions. Professor Shepherd’s study was provided to 

21 the Rule 23 Subcommittee by Lawyers for Civil Justice 

22 in its May 14, 2015 comments. 

23 Professor Shepherd’s research team 

24 identified 2,158 class actions resolved between 2005 

25 and 2015. Of these, 432 cases in federal and state 
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1 court across 33 states met the study criteria for no2 injury classes.

3 Now, of these, of course, most were settled,

4 97-1/2 percent, and only less than a dozen actually 

5 went to judgment during this period. So perhaps it is 

6 quite wise for this group to have focused on tweaking 

7 the settlement process for class actions based upon 

8 this sample.

9 Defendants paid an estimated $4 billion to 

10 resolve these no-injury class actions, not including 

11 their own cost of defense. They paid out an average 

12 of over $9 million a case. These litigation expenses, 

13 attorney’s fees, settlement costs are initially borne 

14 by businesses but are ultimately passed on to 

15 consumers through increased prices, discontinued 

16 product lines, and the like.

17 As an organization devoted to improving the 

18 Civil Justice System, DRI believes rulemaking can 

19 address the problem of no-injury class actions. At 

20 the DRI class action seminar, the Rule 23 Subcommittee 

21 requested that DRI submit proposed language changes to 

22 Rule 23(b)(3) that would address DRI’s concerns on 

23 this issue.

24 We submitted that language to the 

25 Subcommittee in our September 10, 2015, comments to 
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1 clarify that the class certification under Rule 

2 23(b)(3) requires each class member to have suffered 

3 actual injury. The Lawyers for Civil Justice has also 

4 proposed similar language, and DRI supports that 

5 approach.

6 DRI is not alone in the belief that reform 

7 is necessary. For the past four years we have 

8 conducted the DRI national opinion poll on the Civil 

9 Justice System. Details on that polling and its 

10 certification by Quinnipiac can be found in my 

11 February 27, 2015, testimony to the House Judiciary 

12 Committee that’s been provided to this group.

13 In our 2013 poll, 68 percent of the 

14 respondents, fully two-thirds, said they would require 

15 plaintiffs to show actual harm rather than just the 

16 potential for harm to join a class action.

17 In 2014, we asked if the respondent would 

18 support a law requiring a person to show they were 

19 actually harmed by a company’s product, services, or 

20 policies rather than just showing the potential for 

21 harm. An overwhelming 78 percent of the respondents 

22 would support such a law.

23 Large majorities support this reform across 

24 many demographic categories in that survey, including 

25 86 percent of Republicans and 71 percent of Democrats, 
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1 73 percent of liberals and 85 percent of 

2 conservatives.

3 The American people think it makes no sense 

4 to pay damages to people who have suffered no harm. 

5 They support reform. It’s just common sense to them,

6 as it is to us. Thank you. I look forward to 

7 answering any questions you may have.

8 JUDGE BATES: Thank you, Mr. Sweeney. 

9 Questions for Mr. Sweeney? John Barkett.

10 MR. BARKETT: I have the same question that

11 I asked your colleague. Is that something that you 

12 think should hold up consideration of the changes that 

13 we’ve proposed, or do you believe it’s something that 

14 fits within the changes we proposed and we would not 

15 need to restart the process?

16 MR. SWEENEY: Fortunately, I’ve had some 

17 time to think about that since you originally asked 

18 the question and the answer is I think this group 

19 should go ahead with what’s on the table under the 

20 rulemaking. I acknowledge that your rulemaking 

21 process would require any proposal to be put out and 

22 further comment obtained on it.

23 There are two approaches before you that you 

24 can consider in that regard, but I don’t see that 

25 there is going to be any congressional action on this 
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1 issue if for no other reason HR 1927 that would have 

2 affected this sort of change is held up in the Senate 

3 probably behind a judicial appointment log jam that 

4 won’t come unclogged anytime soon, and I believe that 

5 that makes the desire for rulemaking all the more 

6 acute in the interim.

7 JUDGE BATES: Other questions? David

8 Campbell.

9 MR. CAMPBELL: Mr. Sweeney, would your 

10 proposal eliminate all medical monitoring class 

11 actions?

12 MR. SWEENEY: Not necessarily.

13 MR. CAMPBELL: How do you draw the line 

14 between medical monitoring for an injured versus a 

15 non-injured person when the purpose is to determine 

16 whether there’s an illness developing?

17 MR. SWEENEY: Well, medical monitoring 

18 requires for it to be a cause of action upon which you 

19 can get relief in most jurisdictions. Some injury, if 

20 there is injury, then medical monitoring necessarily 

21 would be a relief that’s attendant to that actual 

22 injury.

23 If there is no injury whatsoever and all you 

24 have is the specter of developing a disease that 

25 perhaps you have a greater risk, that is a much 
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1 murkier question from an Article III actual injury 

2 point of view, but I would submit that many of those 

3 claims would not satisfy that criteria, but many 

4 would.

5 JUDGE BATES: All right. Thank you, Mr. 

6 Sweeney. We appreciate it.

7 MR. SWEENEY: Thank you.

8 JUDGE BATES: I think we’ll hear one more 

9 witness before we take a morning break and that will 

10 be Stuart Rossman from the National Consumer Law 

11 Center and National Association of Consumer Advocates. 

12 Mr. Rossman.

13 MR. ROSSMAN: Thank you very much. As said, 

14 my name is Stuart Rossman. I am the Director of 

15 Litigation at the National Consumer Law Center in 

16 Boston and also the immediate past president of the 

17 National Association of Consumer Advocates, and I 

18 appear today on behalf of both organizations.

19 The National Consumer Law Center is a 

20 national nonprofit public interest organization 

21 representing the interests of low-income and elderly 

22 consumers in the areas of consumer credit, affordable 

23 home ownership, and access to utilities.

24 The National Association of Consumer 

25 Advocates is a membership organization made up of 
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1 public and private sector attorneys, legal services 

2 attorneys, and law professors whose primary areas of 

3 practice and areas of specialty are in the areas of 

4 protection and representation of consumers.

5 And I want to direct my comments today to 

6 the unique perspective that these two organizations 

7 have with respect to the proposed rule changes. From 

8 the National Association of Consumers Advocates’ 

9 perspective, the unique issues that are faced in 

10 consumer class actions, which as you’re well aware of,

11 often involve classes of very large sizes and the 

12 aggregation of fairly small in perspective claims 

13 under the various statutes at least compared to other 

14 forms of class actions and from the NCLC perspective, 

15 the unique interests of low-income and elderly 

16 consumers as they are affected by the proposed changes 

17 to Rule 23.

18 I do want to point out before going forward 

19 that I appreciated the opportunity to participate in 

20 providing comments twice before to the Rule 23 

21 Subcommittee and we have submitted both in April and 

22 September of 2015, and one of the things that we had 

23 provided to this Committee and that I would refer you 

24 to as well are the standards and guidelines for 

25 litigation and settling consumer class actions which 
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1 have been adopted by the National Association of 

2 Consumer Advocates. We are up to the third edition,

3 which was issued in 2014 and it appears at 299FRD160.

4 These are what we believe are the best 

5 practices that consumer advocates should follow in 

6 pursuing class actions. Class actions are integral to 

7 the work that we do and we believe that we should hold 

8 ourselves up to standards that perhaps even are higher 

9 than those required by the Rules of Civil Procedure,

10 and some of my comments will refer to those standards 

11 themselves.

12 I’d like to comment on three specific areas 

13 today. One is on the notice provisions, the second is 

14 on the issue of objectors, and the third is to briefly 

15 touch upon the issue of cy-prés.

16 On the issue of notice, which appears on 

17 page 219 and 220 of the materials that have been 

18 provided, I’m particularly pleased that the comments 

19 reflected a very important, I thought, discussion that 

20 took place at the conference in Dallas in September of 

21 2015 and I’m referring -- I know Professor Marcus just 

22 asked the question beforehand, but I had raised the 

23 point at that time and it is, in fact, reflected in 

24 the comments that there are two issues when it comes 

25 to notice as far as my clients are concerned.
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1 The first is the means of providing them 

2 with the notice, and although we are all aware of the 

fact that in the 21st 3 century there are ways of 

4 contacting and reaching people into the community that 

5 were not even on anyone’s mind in 1966, but that you 

6 do have to take into the fact that some of us are 

7 luddites and that there are issues out there that if 

8 you are going to more modern forms of notice that 

9 you’re going to perhaps leave behind many of my 

10 clients and they will not be effectively notified of 

11 what their rights may be.

12 In particular, I refer you to the fact that 

13 there have been studies done within the last year by 

14 the Census Bureau, by the FCC, and by the Pew Research 

15 Center, and I’m happy to provide access to those 

16 materials if you want, but all of them find that there 

17 are material discrepancies between various groups in 

18 our community with regards to their current access to 

19 the internet and that’s broken down by age 

20 understandably, income, by race and ethnicity, by 

21 whether or not you live in an urban, suburban or rural 

22 setting, whether you live on tribal lands, and also on

23 your educational level.

24 Interestingly, by the way, all three studies 

25 found that there was no discrepancy in terms of 
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1 gender, but in the other areas there were material 

2 discrepancies, and relying solely upon the electronic 

3 means of contacting people and giving them notice 

4 would be problematic.

5 And so I appreciate the fact that the 

6 comments recognize that and I would strongly indicate 

7 that the language be made mandatory rather than just 

8 suggestive, that these be taken into account given the 

9 nature of the case and the nature of the class members 

10 who would be available, and I would suggest that it is 

11 the burden of the parties who are proposing the 

12 settlement to recognize that issue and bring it to the 

13 court’s attention and how they would suggest that it 

14 be addressed, because there are very successful means 

15 out there to be able to reach those people.

16 The second part of notice, however, is with 

17 regards to the content of the notices themselves and 

18 on that I have just three comments. One does not 

19 appear in the comments right now but we had discussed 

20 in the past and that is that we very often find in 

21 consumer class actions that given the nature of the 

22 population that we are dealing with that it is very

23 effective to use what we call summary notice. 

24 It is a short form notice that either 

25 accompanies a full notice or is separate, sent out 
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1 separately from them, and in our standards and 

2 guidelines we set forth what should be included in 

3 those summary notices. In all cases they should 

4 include in plain and understandable terms the nature 

5 of the class, the relief sought and the means of 

6 obtaining further information, and in a settlement 

7 class you also want to be able to make sure that 

8 there’s a clear description of the relief that is 

9 going to be available and the opportunities for opting 

10 out or objecting to the settlement itself.

11 The language that can be used can be 

12 simplified, it is short, it is understandable, it is 

13 clear, and for many of our clients that summary notice 

14 is really the thing that allows them to understand 

15 what’s going on as opposed to getting a 15-page, 

16 single spaced small typed notice as to their rights. 

17 They’re entitled to both, but we suggest that the 

18 summary notice makes it far more effective.

19 The second thing that is I think also 

20 recognized in the comments is the readability factor. 

21 Unfortunately, the average reading age in the United 

22 States is at a fifth grade reading level and we 

23 suggest strongly that folks take cognizance of that in 

24 preparing their notices, working with their 

25 administrators to try to find ways. There are 
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1 specialists in readability and even most word 

2 processing systems will allow you to determine the 

3 readability.

4 I will tell you honestly I’ve never been 

5 able to get a class action notice below seventh grade 

6 reading level. It’s just virtually impossible, but 

7 it’s an issue that is very important.

8 And the third area which is not mentioned in 

9 the comments and I would suggest that it now be 

10 included is language accessibility. We suggest that 

11 courts take into account, once again, given the nature 

12 of the case, that we have a multilingual society. 

13 It’s a reality and providing requirements that 

14 language, that notice be provided in multiple 

15 languages, once again, given the nature of the case 

16 and the population that makes up the class, is 

17 something that should be included in the comments,

18 similar to the other issues I’ve mentioned.

19 On the objectors, I just wanted to state 

20 that we strongly support the rule proposal that has 

21 been proposed by the Rule 23 Subcommittee and I only 

22 have one comment with regards to what appears on page 

23 229. If an objector adds real value to settlement,

24 the comment, I think, correctly provides that they 

25 should be compensated, whether it be by lodestar or a 
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1 lodestar plus multiplier for what they’ve contributed 

2 to the improved settlement. However, I think it 

3 should be added in the comment and we support that it 

4 should be added in the comment that any amounts that 

5 are provided to the objectors or to the counsel be 

6 paid for by the defendants or from the attorney’s fees 

7 being paid from the plaintiff, and it should be made 

8 explicit that that improvement should not come from 

9 the common fund that would otherwise go to the members 

10 of the class and the claimants. It should not be 

11 deducted from the common fund.

12 And then finally I just want to refer to the 

13 fact that cy-prés was an issue that we believe that 

14 correctly the Subcommittee suggested not be included 

15 in this particular set of proposed changes or 

16 amendments. But on page 222 and 223 there is a 

17 reference to the ALI Principles of Aggregate 

18 Litigation, Section 3.07, and that is consistent 

19 exactly with Guideline No. 7 of the NACA Guidelines 

20 that I referred to beforehand.

21 And we think that, once again, above and 

22 beyond courts being encouraged to use 3.07 as the 

23 model for dealing for best practices with regards to 

24 cy-prés awards when directing distributions in those 

25 cases where monies are left over and it’s no longer 
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1 viable, efficient, or feasible to hand it over to the 

2 actual members of the class that there be a strong 

3 recommendation that 3.07 is, in fact, the proper and 

4 appropriate way to handle cy-prés. We think that the 

5 ALI got it right and we think the Subcommittee got it 

6 right and that courts should be encouraged to follow 

7 that particular rule. And with that, I’d be happy to 

8 answer any questions.

9 JUDGE BATES: Thank you, Mr. Rossman. 

10 Questions? Professor Klonoff.

11 PROF. KLONOFF: Aren’t there circumstances 

12 where you might want to take the objector’s payments 

13 out of the common fund where the objections say 

14 results are doubling and recovery goes to the class --

15 JUDGE BATES: Just a second, use the 

16 microphone and we’ll pick it up then.

17 PROF. KLONOFF: Okay. Aren’t there 

18 circumstances in which it would make sense to pay out 

19 of the common fund, for example, where the objection 

20 results in doubling the compensation to the class? 

21 I’m a little nervous about an absolute rule regardless 

22 of the circumstance. I was wondering what you thought 

23 about that.

24 MR. ROSSMAN: My concern there is that, once 

25 again, if the settlement doubles, then obviously the 
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1 attorney’s fees will commensurately in most cases be 

2 reflected, at least the plaintiff’s parties’ 

3 attorney’s fees. And if, in fact, someone has 

4 increased the value of the settlement, I could easily 

5 see taking it out of the additional amount that was 

6 given to the class. There shouldn’t be a windfall to 

7 the class. I agree with you on that.

8 But I also want to make sure that it’s 

9 understood that if a settlement is increased then, 

10 once again, the plaintiff’s attorneys should -- the 

11 ones who had proposed the original settlement at the 

12 lower amount should not get a commensurate amount of a 

13 windfall at the same time.

14 So I think you’re probably right under those 

15 circumstances you’d want to share the additional 

16 increase but making sure, once again, that the class 

17 members were not disproportionately affected by the 

18 increase or benefit proposed to the class.

19 JUDGE BATES: Professor Marcus.

20 PROF. MARCUS: This is a question I think I 

21 asked somebody else and I would imagine your 

22 organization would be in a position to hear about such 

23 things. Since the Supreme Court’s Campbell-Ewald

24 decision in January, are you aware if there’s been a 

25 pickup of pick off, so to speak, or has it gone away? 
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1 What is happening out there?

2 MR. ROSSMAN: Well, I don’t want to turn 

3 this into a public service announcement, but right 

4 before I came here we were working on amending or 

5 changing our class action manual that NCLC publishes 

6 because we’ve been monitoring the cases after Gomez

7 and there have been not a huge number, certainly not 

8 like it was after Spokeo, but there have been a 

9 significant number of cases that have come down, some 

10 on one side, some down on the other side.

11 But our experience has been and what we will 

12 be pointing out in our manual is that courts seem to 

13 be handling it just fine by themselves and it seems my 

14 suspicion is is that a year from now the pick off 

15 situation will have resolved itself. The courts are 

16 following Gomez, they’re working out the details and 

17 the circumstances, and it seems to be working just 

18 fine on its own through the judicial process.

19 JUDGE BATES: Judge Oliver.

20 JUDGE OLIVER: You addressed in your written

21 comments some things that you didn’t discuss this 

22 morning and perhaps that’s because you think those are 

23 not things we should be taking up right now. But you 

24 proposed a change to 23(c)(1)(A). You had some 

25 concerns about judges denying class certification by 
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1 just looking at complaints and you had suggested I 

2 think in your written comments that you would amend 

3 that to allow briefing or a reasonable time for 

4 discovery. Are you suggesting that’s something that 

5 should be part of this package, or what’s your view on 

6 that?

7 MR. ROSSMAN: Thank you very much for 

8 raising that. We still strongly believe -- I believe 

9 what’s being referred to is that we had suggested that 

10 there is an issue that there have been instances where 

11 class action pleadings have been stricken under Rule 

12 12(f) at a very early stage of the litigation and that 

13 what is actually happening here is that, unlike the 

14 Supreme Court’s requirement under Dukes that there be 

15 a full and thorough vetting of the class action 

16 principles before making a determination to clear 

17 certification, that it’s being decided at the pleading 

18 stage when no one has had an opportunity to do full 

19 discovery or present all of their appropriate 

20 arguments.

21 And so we were suggesting that there be an 

22 explicit change to (c)(1)(A) that would include 

23 language that says that the -- I believe the actual 

24 language we had that the determination should not be 

25 based solely on the complaint but rather on class 
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1 certification briefing and evidence submitted after a 

2 reasonable time for discovery.

3 We proposed that to the Rule 23 

4 Subcommittee. It did not make it into the final cut 

5 and very mindful of the question about whether we 

6 thought that -- I included it in there because I 

7 wanted you to be aware that we still feel that it’s 

8 important, but I left it out, heeding some of the 

9 previous comments that I don’t believe that this 

10 process should be held up because of that. That may 

11 be something for further consideration at a later 

12 time. It’s something we still believe in, but it 

13 should not be something that should hold up this 

14 particular process.

15 JUDGE BATES: Other questions?

16 (No response.)

17 JUDGE BATES: Mr. Rossman, thank you very 

18 much for your time.

19 MR. ROSSMAN: Thank you very much for this 

20 opportunity.

21 JUDGE BATES: I think maybe this is a good 

22 point, sort of a midpoint in terms of the witnesses to 

23 take a morning break. It’s 10:20 by my watch. If we 

24 could be ready to go again at 10:35, but let’s take a 

25 15-minute break and thank you.
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1 (Whereupon, a brief recess was taken.)

2 JUDGE BATES: We’ll proceed with additional 

3 witnesses. This has really been helpful so far and I 

4 look forward to the remaining witnesses. We’ll start 

5 with Brent Johnson from the Committee to Support 

6 Antitrust Laws.

7 MR. JOHNSON: Hello. My name’s Brent 

8 Johnson. I’m a partner at Cohen, Milstein, Sellers &

9 Toll here in Washington, D.C., where I focus on 

10 bringing antitrust class actions. I’m also a member 

11 of COSAL, the Committee to Support the Antitrust Laws,

12 and I’m expressing COSAL’s views here today.

13 COSAL is comprised of law firms throughout 

14 the country who represent individuals and businesses 

15 who have been harmed by violations of the antitrust 

16 laws. We hope to offer our practical knowledge and 

17 insight about how the Rule 23 Amendments might be 

18 interpreted. I’m very grateful for the opportunity to 

19 testify, and I refer the Committee to our written 

20 comments.

21 COSAL generally supports the proposed 

22 amendments to the Civil Rules and thanks the Committee 

23 for its hard work and initiative. I am here only to 

24 address one narrow issue with one of the amendments to 

25 Rule 23 and specifically Rule 23(e)(2)(C)(ii) and make 
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1 a hopefully concrete and modest proposal for slightly 

2 different language.

3 The current amendment to Rule 23 requires 

4 courts to take into account in deciding whether to 

5 approve a settlement the effectiveness of the proposed 

6 method of distributing relief to the class, including 

7 the method of processing class member claims if 

8 required.

9 While we do not believe it to be the correct 

10 interpretation of the Committee’s proposed language, 

11 some courts could mistakenly interpret the inclusion 

12 of such a factor and particularly the use of the word 

13 effectiveness to mean there are categorically 

14 ineffective methods of distributing relief to classes

15 and courts may use that factor to impose a heightened 

16 standard for identifying class members, processing 

17 claims, and distributing settlement proceeds that for 

18 certain groups of cases no method of distributing 

19 relief could meet. Such a standard could lead to the 

20 rejection of settlements for the sole reason of not 

21 meeting it.

22 So essentially this factor is, as some other 

23 folks have talked about, it could be misconstrued as 

24 imposing a heightened ascertainability standard. The 

25 Advisory Committee put this issue on hold in its 
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1 November 2015 meeting minutes and noted that it was 

2 still under study in its May 12, 2016, memo to the 

3 overall Rules Committee.

4 We think that’s unsurprising since it’s the 

5 subject of much debate and a fairly stark circuit 

6 split and is best left probably to resolution 

7 ultimately by the Supreme Court.

8 So given that hold, my purpose is not to 

9 argue either side of the ascertainability debate but 

10 to try to help the Committee ensure that it stays out 

11 of that fray in the current rulemaking process.

12 We believe that our new language does that 

13 and that it has no down side whatsoever. Our proposal 

14 is that when weighing approval of a settlement under 

15 Rule (e)(2)(C)(ii) that courts consider whether the 

16 proposed method of distributing relief to the class, 

17 including the method of processing class member claims 

18 if required, is the best method that is practicable 

19 under the circumstances.

20 So we eliminate the words “the effectiveness 

21 of” and add “whether” and then “is the best method 

22 that is practicable under the circumstances”. Our 

23 letter omitted the word “whether” in our proposed new 

24 language. Our apologies for that.

25 This new language has a number of virtues. 
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1 We believe that it eliminates any confusion as to 

2 whether the proposed language of the Committee should 

3 be read to add or impose any type of ascertainability 

4 requirement in approving a class settlement. We also 

5 think it eliminates arguments that could be made at 

6 class certification that might reference this factor 

7 to bolster arguments for a heightened ascertainability 

8 requirement at that stage.

9 It gives courts and litigants a familiar 

10 guideline on how to apply the standard because it 

11 mirrors the language in Rule 23(c)(2)(B) as it relates 

12 to notice, and we also believe that it more 

13 appropriately balances the concerns that are outlined 

14 in the comments to the proposed amendments. It 

15 ensures that the claims processing method does 

16 everything it can to deter unjustified claims, but it 

17 stops shy of having a standard that could be read to 

18 and could be used to preclude settlements entirely.

19 So that’s the sum of my comments on that 

20 very narrow issue, and I welcome any questions the 

21 Committee has.

22 JUDGE BATES: All right. Well, thank you 

23 very much, Mr. Johnson. Questions?

24 (No response.)

25 JUDGE BATES: Clear as a bell for us I 
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1 guess, Mr. Johnson. Thank you very much. We 

2 appreciate it.

3 MR. JOHNSON: Thank you.

4 JUDGE BATES: Next witness will be Mary 

5 Massaron from Plunkett Cooney.

6 MS. MASSARON: Good morning.

7 JUDGE BATES: Good morning.

8 MS. MASSARON: I’d like to thank you for 

9 giving me some time to speak about the rules. My name 

10 is Mary Massaron. I head the appellate practice group 

11 at Plunkett Cooney. I should also mention I’m the 

12 current president of Lawyers for Civil Justice. 

13 I want to thank you also for the huge amount 

14 of time, energy, and care that I know that the Rule 23 

15 Subcommittee has taken in going around the country and 

16 listening to the voices of practitioners and academics 

17 and judges on all sides of the very complicated issues 

18 that arise in the context of Rule 23. I think 

19 everyone appreciates that, and it’s really quite 

20 inspiring to see the process by which the rules that 

21 we live under and that we rely upon to effectuate the 

22 rule of law are adopted in such a careful, thoughtful 

23 way.

24 I want to speak very briefly this morning 

25 about a couple of points. First, I want to touch on 
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1 the question of cy-prés. Then I want to talk briefly 

2 about typicality and its relationship to the whole 

3 question about approval of settlements and some of the 

4 problems that arise in that area.

5 In terms of cy-prés, Lawyers for Civil 

6 Justice took the position which the Committee did not 

7 adopt of an outright ban on cy-prés and it did so 

8 because of the view that the use of cy-prés 

9 settlements, which has been increasing, is problematic 

10 on multiple grounds -- it results -- there’s no clear 

11 legal authority for it and it creates a host of 

12 problems with the whole class action context.

13 The Committee chose not to go there, which I 

14 think was certainly a centrist view, that is, we’re 

15 not going to endorse or exclude cy-prés. Based upon 

16 that, in my view, the reference in the note to the ALI 

17 principles should be removed. It seems to me by 

18 having that language in there what the Committee is 

19 essentially doing is putting its imprimatur on the use 

20 of cy-prés, which is a change in what the rules 

21 currently do and a change for which in our view, in my 

22 view there’s no authority for. 

23 That’s a substantive legal change that 

24 raises Rules Enabling Act problems, and that’s aside 

25 from all of the practical problems that I believe are 
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1 associated with the use of cy-prés settlements. Given 

2 that the rules are not blessing cy-prés as a solution, 

3 it seems to me that the comments should not also place 

4 the weight of the Committee behind that solution.

5 And certainly even those who support the use 

6 of cy-prés, it’s not necessary for the Committee to do 

7 that because courts are certainly aware of the ALI 

8 provisions. They’re referenced in any number of 

9 judicial opinions.

10 Secondly, I want to talk briefly about the 

11 question of typicality. LCJ proposed language in its 

12 comment allowing certification only if the claims or

13 defenses and type and scope of injury of 

14 representative parties are typical of the type and 

15 scope of injury of the class.

16 Many of the problems that the Committee has 

17 heard about and that you can see in the case law arise 

18 from classes which combine injured and non-injured 

19 members or classes which combine people whose injuries 

20 are not yet manifest with people whose injuries are 

21 manifest, and many of the efforts in the rule to focus 

22 more on approval, the approval process for settlement 

23 are intended at the back end to try to prevent some of 

24 the abuses that can arise out of these conflicts of 

25 interest from classes that have such disparate groups.
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1 In my view, the stronger way to address that 

2 is at the front end by making sure that the class 

3 representatives and the class are defined in a way 

4 that is consistent so those conflicts of interest 

5 don’t arise. That’s particularly useful because --

6 and this I think can be seen if you read some of the 

7 cases involving conflicts of interest or issues around 

8 settlement -- it’s very difficult even with this 

9 effort to provide additional information which might 

10 be useful to the court for the court to really 

11 evaluate and see in depth where these problems might 

12 arise, and therefore, it seems to me a better approach 

13 is to adopt this language about typicality which 

14 really would prevent that.

15 That’s really all I wanted to focus on 

16 today. I see that there’s time left, which I’m happy 

17 to use to answer questions or give back to the 

18 Committee for the other witnesses.

19 JUDGE BATES: Thank you, Ms. Massaron. 

20 Questions? Judge Dow.

21 JUDGE DOW: Sorry about that. One question 

22 I have is, so what happens at the end of a case when 

23 settlement is proposed, the defendant says, I don’t 

24 want to get into any question about reverter here, I 

25 don’t want to have a fight about that, it’s going to 
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1 be easier if we just say this is the amount of money 

2 we’re going to pay, and then we’ve done two rounds of 

3 distributions to the named class members and anybody 

4 we can identify who are absent class members, and then 

5 there’s this small amount of money left?

6 And if you flat out ban cy-prés, that money, 

7 you could either pay it to the claims administrator 

8 and they’ll exhaust it to try to find more people or 

9 you can pay it to some cy-prés recipient. What’s the 

10 position of yourself or DRI on that scenario?

11 MS. MASSARON: Well, I’ll give my position 

12 because I don’t want to misspeak organizationally. It 

13 seems to me that in that circumstance there’s really 

14 two situations. One is where the amount that’s going 

15 out to the class members is less than their injury 

16 because it’s a settlement, and in that circumstance it 

17 seems to me, if the class is properly defined, you 

18 should be able in one or two distributions to get that 

19 money to the class members.

20 On the other hand, if the settlement amount 

21 is fully compensating people, then it seems to me it 

22 should revert to the defendant because it’s no longer 

23 compensatory. But the idea of paying it to some third 

24 party that’s not a party to the lawsuit has a punitive 

25 aspect which is not consistent with a compensatory 
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1 Civil Justice System and certainly is a substantive 

2 legal measure which it seems to me raises real 

3 Enabling Act issues.

4 JUDGE BATES: John Barkett.

5 MR. BARKETT: Is your specific suggestion to 

6 delete the line on page 223 of this book that we’ve 

7 all been handed out now? Many courts have found 

8 guidance on this subject in Section 3.07 of the 

9 American Law Institute Principles of Aggregate 

10 Litigation 2010, is that the specifics is just to 

11 delete that sentence?

12 MS. MASSARON: That’s correct.

13 JUDGE BATES: Other questions?

14 (No response.)

15 JUDGE BATES: Ms. Massaron, thank you very 

16 much. We appreciate your comments.

17 MS. MASSARON: Thank you very much for the 

18 opportunity. 

19 JUDGE BATES: Next up from Georgetown 

20 University Law Center will be Brian Wolfman. 

21 Professor Wolfman.

22 PROF. WOLFMAN: Thank you very much for 

23 having me. If you don’t mind, the last statement 

24 piqued my interest, so let me opine on it even though 

25 I wasn’t planning to with respect to the cy-prés,
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1 which is that, while I understand the last witness’s 

2 concerns, it seems to me that you would know better 

3 than I but that the reference to the ALI principles is 

4 not so much to endorse or not endorse the use of cy5 prés but to endorse the use of cy-prés only when you 

6 cannot get the money in the hands of the class members 

7 in a practicable way. So I would urge the Committee 

8 not to delete that sentence. 

9 Anyway, let me talk now about what I was 

10 planning to talk about, which is first Rule 

11 23(e)(5)(B), which is the subject of my written 

12 comments. This is the rule, as you know, that 

13 requires approval for payments to objectors and their 

14 lawyers not only when the case is pending in a 

15 district court but when the case is pending on appeal. 

16 I think it’s a very, very good rule.

17 Given the importance of the rule, I was 

18 surprised that neither the proposed rule nor the 

19 Committee notes said anything as to the standard for 

20 approval or disapproval or factors for the court’s 

21 consideration. I was particularly surprised given 

22 that the current proposal seeks to provide even more 

23 guidance for settlement approval under (e)(2) and yet, 

24 as I say, there’s no guidance with respect to 

25 approvals or disapprovals under (e)(5)(B).
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1 I believe that a standard for approval 

2 should take into account two basic ideas: one,

3 wherever possible a class settlement should treat 

4 similarly situated class members alike and, two, class 

5 settlements exist for purposes of aggregated, not 

6 individual, treatment of class members’ claims.

7 As to the first point, equal treatment, 

8 which I stressed in my 1999 proposal on this topic 

9 which I attached to my current testimony, the 

10 Committee proposal has adopted this concept in Rule

11 (e)(2)(D), requiring the court to consider whether a 

12 proposed class settlement treats members equitably 

13 relative to each other, that is in essence an equal 

14 treatment idea.

15 As to the second point that class action 

16 settlements are for class treatment, the rules also 

17 speak to this, I think, as a general matter 

18 authorizing individual treatment in one way only by 

19 allowing members to opt out, but by not giving them 

20 super opt out rights to use the class device to 

21 extract enhanced individual gain at the expense of the 

22 class.

23 So I’ve proposed language to take into 

24 account these two concepts. It would authorize the 

25 district court to approve an individual objector side 
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1 deal only where, one, the objector is uniquely 

2 situated such that she has a genuine claim to 

3 disparate and more favorable treatment and, two, it is 

4 impractical or impossible for her to opt out and 

5 pursue her own litigation.

6 As I said in my written comments, if the 

7 objector can’t meet this standard, then surely the 

8 objector’s lawyer can’t meet that standard and be 

9 entitled to special treatment.

10 If an objector’s lawyer wants a fee, that 

11 lawyer, like any other lawyer, should seek a fee 

12 openly under Rules 23(h) and 54(d) as part of the 

13 settlement consideration process.

14 Finally, my final point here is that the 

15 proposed note says, I think quite accurately, and I’m 

16 quoting here, “Class counsel sometimes may feel that 

17 avoiding the delay produced by an appeal justifies 

18 providing payment or other consideration to these 

19 objectors,” meaning these objectors seeking to extort 

20 the process.

21 I’d add that defendants sometimes feel the 

22 same way, but I’m concerned that without further 

23 comment lawyers and courts may view this concern about 

24 delay even as a possible basis for approving a side 

25 payment to objectors and their lawyers.
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1 And, you know, to be blunt about it, the 

2 extortion itself should never be a reason to approve 

3 it, and I urge the Committee to consider my proposed 

4 language clarifying on that score.

5 I do want to address one other thing which 

6 is not yet the subject of comments and I will submit 

7 written comments before the deadline on notice. In 

8 particular, I’m concerned about the proposed new 

9 statement in 23(c)(2) about notice going by mail or 

10 electronic means or other appropriate means.

11 The note endorses that nod to electronic 

12 notice on the ground that, you know, things have 

13 changed since Eisen. You know, under the current 

14 rule, the current rule doesn’t require U.S. Mail 

15 notice, but it doesn’t give that nod or green light to 

16 email or even banner notice. And the problem is, I 

17 think, that the effectiveness of these forms of notice 

18 particularly as a form of notice that you’re using to 

19 effectuate relief to the class have not been proved.

20 And I point to Todd Hilsey’s comments in 

21 this regard and I’ll say nothing further, although I 

22 think his comments are well taken. So then what is in 

23 my judgment sort of going on here or what’s the 

24 problem? I think where class members’ mailing 

25 addresses are known and significant monetary relief is 
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1 likely available to many or all class members, I don’t 

2 know of a case in my experience -- I’ve been doing 

3 this for a while -- in which electronic notice is 

4 likely going to be the most reliable means of getting 

5 notice and the relief to the class members.

6 So where class members’ mailing addresses 

7 are known, you know, what are the circumstances where 

8 electronic notice might be reasonable and appropriate? 

9 And I can think of this, a situation in which the 

10 amounts available to the class members are so small 

11 that no rational class member would pursue his or her 

12 own litigation. 

13 And if that’s so, then the problem is not to 

14 improve notice in (b)(3) cases but to rethink the 

15 notice regime in Rule 23 more generally. So, in a 

16 (b)(1) or a (b)(2) case, notice must simply be 

17 appropriate or at the settlement stage, you know, 

18 reasonable, but there’s no requirement of individual 

19 notice to all members who can be identified through 

20 reasonable effort as there is under (b)(3).

21 And that’s true for two related reasons. 

22 One is that the treatment of the class needs to be 

23 unitary or should be unitary and that the individuals, 

24 as I say, don’t need to control their own litigation. 

25 And, in fact, in (b)(1) and (b)(2) cases, there’s 
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1 good reason that individuals not be allowed to control 

2 their own litigation.

3 But the same could be said for my 

4 hypothetical, you know, small claims (b)(3) case. 

5 Take, for example, a case in which class members’

6 claims at their maximum are $100 each. Much like the 

7 (b)(1) and (b)(2) case, this hypothetical calls for 

8 unitary treatment precisely because there’s no reason 

9 for a person to pursue their own litigation.

10 So, in this circumstance, you want 

11 appropriate notice, you want appropriate notice, and 

12 that may not require individualized notice of any kind 

13 to all class members. So, in that situation, 

14 particularly at the certification stage, you want 

15 notice to a fair cross-section of the class and maybe 

16 to others whom the court and parties already know have 

17 an interest in the litigation to enable a fair cross18 section of absent class members to intervene and to 

19 object to aid the process that brings insights to bear 

20 on the litigation.

21 But in my hypothetical, you don’t need 

22 individual notice there any more than you do in the 

23 (b)(1) or (b)(2) case and so you may save money in 

24 that circumstance not particularly because you’re 

25 using electronic notice but by not having to notify 
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1 the entire class individually by any means.

2 So what I’m suggesting here is stepping back 

3 and looking at notice under Rule 23 more generally and 

4 asking what are the circumstances in which full-scale 

5 individualized notice are or are not required. But I 

6 don’t think we want to suggest weakening the means by 

7 which we do individualized notice when individualized 

8 notice is truly desirable.

9 So let me put it another way. I don’t think 

10 we should assume that email notice or banner notice, 

11 banner ads are truly providing individualized notice 

12 to the whole class as opposed to acknowledging that 

13 there may be some cases now typed as Rule 23(b)(3)

14 cases in which individualized notice of the whole 

15 class is neither desirable, particularly at the 

16 certification stage, or legally required.

17 So I urge the Committee to delete the new 

18 reference to these various forms of notice and maybe 

19 take up at a future time this more holistic approach 

20 to the perspective I’ve just described.

21 JUDGE BATES: All right. Thank you, 

22 Professor Wolfman. Are there questions? Professor 

23 Marcus.

24 PROF. MARCUS: It strikes me that I’m 

25 referring to your last subject, the question of I take 
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1 it limiting or abolishing what’s in the rule currently 

2 for individual notice in (b)(3) class actions?

3 PROF. WOLFMAN: No, no, I think that’s not 

4 what I’m saying. What I’m saying is -- and when I 

5 submit my comments I will draw this out a little more. 

6 This is in a 2006 article I wrote along with Alan 

7 Morrison that in a way there’s two really different 

8 kinds of (b)(3) cases going on.

9 There’s one where there’s a substantial 

10 amount at stake or there could be a real reason for 

11 someone to individually control their litigation, like 

12 even though, for instance, the amounts available are 

13 small, there’s a fee shifting provision that makes 

14 individual litigation sensible.

15 In those situations, sure, individualized 

16 notice should remain there, but not everything typed 

17 is a (b)(3) case necessarily. Take the $5 case in 

18 which there’s no rational basis for individual control 

19 of the litigation. I don’t see that as being 

20 significantly different from why you don’t demand 

21 individualized notice in the (b)(1) and (b)(2)

22 situations.

23 PROF. MARCUS: Well, I guess what crossed my 

24 mind is that your imaginary hypothetical $100 claim 

25 case sounds a whole lot like Eisen --
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1 PROF. WOLFMAN: Yes, that’s right.

2 PROF. MARCUS: -- and Eisen interprets the 

3 current. So you are asking that we alter the result 

4 in Eisen not in terms of means of notice but in terms 

5 of giving notice at all?

6 PROF. WOLFMAN: Not at all, but it would be 

7 a different type of notice. Notice always has to be 

8 reasonable.

9 PROF. MARCUS: You’re saying the alternative 

10 means would work okay then?

11 PROF. WOLFMAN: Yes. Let me put it this 

12 way. Eisen is a rule case. It’s not a constitutional 

13 case, right. So the question is what --

14 PROF. MARCUS: That’s probably correct.

15 PROF. WOLFMAN: Well, at least on its face 

16 there’s constitutional implications in it but sort of 

17 on its face the bare holding. And it just -- again, I 

18 draw this out in this 2006 NYU Law Review article and 

19 it’s not that -- believe me, it’s not that I don’t --

20 you know, I represent objectors, I represent class

21 members. It’s not that I don’t care from that side of 

22 the V.

23 It’s the problem if you increase the cost 

24 dramatically in cases where there’s no sensible reason 

25 for people to increase -- handle their -- control 
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1 their own litigation, particularly at the 

2 certification stage, you’re increasing the -- you’re 

3 lowering the amount that might be available for the 

4 class and creating more ground for a possible sell out 

5 settlement because, you know, only the defendant is 

6 going to be willing to pay the notice, for the notice, 

7 that huge notice to get the case out of their hair, 

8 whereas that money that’s being used for very little 

9 purpose, particularly at the certification stage --

10 we’re not talking about getting relief to people --

11 could be used to the benefit of the class.

12 Again, I’m just saying in that $100 case,

13 maximum $100, maximum $3, maximum $4, there are cases 

14 like that. There are cases like that and why are we 

15 spending our money for that any more than in the 

16 (b)(1) and (b)(2) situation.

17 JUDGE BATES: Ms. Cabraser.

18 MS. CABRASER: Are you essentially 

19 suggesting that for future purposes we ought to 

20 consider a proportionality rule with respect to 

21 whether there should be individualized notice in any 

22 given class action?

23 PROF. WOLFMAN: I don’t know there would be 

24 proportionality. I think it would be trained on the 

25 question whether it’s rational or sensible or feasible 
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1 to control one’s own litigation. I think that, and 

2 again, you know, you could be a small claims case, but 

3 there’s reason to do individual litigation because

4 under that statute there’s fee shifting, so people 

5 might want to opt out and litigate on their own.

6 So it would depend. Again, I have in mind 

7 actually a proposed rule which sort of carves (b)(3)

8 into two segments. I think most (b)(3) cases would go 

9 forward as they do today with the individualized 

10 notice, but some of them wouldn’t necessarily have to.

11 A reason I raise this in conjunction with 

12 the nod towards email notification, because the 

13 obvious reason for email notification is to reduce 

14 costs in some or all circumstances. 

15 But if we know going in that that 

16 notification is less effective, and that’s what Todd 

17 Hilsey says. I think he’s right. I think it’s right 

18 in my experience in the few cases I’ve seen it in. If 

19 that’s correct, then why don’t we, you know, jigger it 

20 in a different way and say spend the money in cases 

21 where it makes sense to spend the money and don’t 

22 spend the money in cases where it doesn’t, but don’t 

23 use the email notification sort of as an excuse to 

24 deal with the high costs.

25 JUDGE BATES: John Barkett.
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1 MR. BARKETT: It doesn’t say email. It says 

2 electronic means.

3 PROF. WOLFMAN: Right.

4 MR. BARKETT: But it seems to me that your 

5 focus is on the prior sentence, that including 

6 individual notice to all members who can be identified 

7 through reasonable effort. I am understanding you to 

8 be saying that individual notice to all members who 

9 can be identified may not make sense in certain cases.

10 PROF. WOLFMAN: In this, sir, and probably a 

11 probably narrow set of cases, yes, but I’m certainly 

12 not saying take that out for now because that would 

13 require further study, you know, and that’s what I’m 

14 saying.

15 But I have a sense that what’s going on with 

16 electronic notice, which is frequently in the form of 

17 email, but it could be banner ads, it could be other 

18 things, is that you’re using that as a way to reduce 

19 costs when I don’t think -- you know, if you have a 

20 case where you have $1,000 claims, you know, 

21 legitimate $1,000 claims, you can go find those 

22 people.

23 I’ve done it in my cases. I’ve had cases 

24 where we got 94 percent of the money paid out to 92 

25 percent of the class members because we went and found 
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1 them. We would never have been able to do that if you 

2 had email notice or a banner ad notice serving as the 

3 underlying -- the undergirding of that process.

4 MR. BARKETT: No, I’m not saying that. In 

5 our discussions, I was on the Subcommittee and as I 

6 recall anyway, one of the reasons why this sentence 

7 was added, I think quite innocently, was simply to 

8 make sure that courts understood that you didn’t 

9 necessarily have to use mail in every circumstance. 

10 It wasn’t suggesting you shouldn’t use U.S. Mail, but 

11 it wasn’t designed to do anything more than indicate 

12 that there may be other appropriate means depending 

13 upon the facts of the case so that the judge knew that 

14 the judge had discretion, that Eisen didn’t 

15 necessarily say it always had to be first class mail.

16 PROF. WOLFMAN: Right.

17 MR. BARKETT: So that was a rather innocent 

18 addition. But I’m hearing you suggest it was so 

19 innocent that we should remove it.

20 PROF. WOLFMAN: That’s right. I mean, I 

21 think that’s fair. I mean, you know, again, you know, 

22 Todd Hilsey, his comments take the same view as I do 

23 that it could be read in a wrong way. I’m obviously 

24 not questioning the motivations. You know, I didn’t 

25 know whether it was innocent or not. I was just 
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1 questioning the words as I saw them on the paper.

2 Don’t forget the current rule doesn’t say 

3 U.S. Mail, so there’s nothing about the current rule 

4 that wouldn’t allow different means and courts are 

5 already using different means, so this seems like a 

6 nod in that direction and that would be -- if any 

7 courts or lawyers are going to construe it that way,

8 that would concern me because I don’t believe that 

9 there is an empirical basis.

10 You know, I’ve read some of the materials 

11 that Todd cited and based on my experience, I don’t 

12 think there’s an empirical basis for saying that, you 

13 know, banner ads, for instance, or other forms of 

14 electronic notice are a good way to reach people in a 

15 meaningful way so they take action, you know, when

16 there are $1,000 claims out there or $5,000 claims out 

17 there.

18 MR. BARKETT: Can you foresee no case in 

19 which electronic notice might be as good as or better 

20 than U.S. Mail notices?

21 PROF. WOLFMAN: That’s it, that’s a great 

22 question. I would put it this way. Let’s say you had 

23 a case in which you weren’t seeking -- I think I can 

24 think of two circumstances. One of them relates to a 

25 case I worked on.
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1 The first is that let’s say you’re not 

2 attempting to get at everybody to begin with, you’re 

3 just doing a (b)(2) type of notice, you know, you want 

4 everybody to come in, potential interveners, you want 

5 to really inform the process. You know, it’s possible 

6 that email notice would be at least part of a 

7 reasonable scheme in that situation.

8 I can also think of a situation where let’s 

9 say there’s a product that’s uniquely tied to the use 

10 of email between the purchaser and the seller and such 

11 that that’s how on a regular basis the class member 

12 deals with the defendant and only that way.

13 And there was a case I had that somewhat 

14 presented that scenario. I would seek --

15 MR. BARKETT: Another example of that might 

16 be members or past members of a professional 

17 organization.

18 PROF. WOLFMAN: It’s possible, but, again, I 

19 want to stress one thing and, again, I think these are 

20 empirical questions, exactly why I think as Todd said 

21 in his comments to step back before you even hint in 

22 this area.

23 I think that’s possible, but I’d only stress 

24 that people are more likely to open, read and take 

25 seriously the massive amounts of email they get if 
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1 they’re regularly in contact with somebody about the 

2 topic, not just that they’re, you know, that they’re 

3 in contact once in a while.

4 Let me be very open about this. I don’t 

5 read every email from the D.C. Bar. I read some of 

6 them because there’s a lot of them and so forth. I 

7 don’t want to mention any other organizations.

8 (Laughter.)

9 JUDGE BATES: Other questions? 

10 MS. CABRASER: Yeah.

11 JUDGE BATES: Elizabeth.

12 MS. CABRASER: I think what the Subcommittee 

13 was trying to get at is to make sure that the best 

14 practicable means of notice could be employed under 

15 the circumstances of the case, which raises two 

16 questions.

17 I understand the empirical debate. I also 

18 recall a number of declarations by Todd Hilsey, among 

19 others, that when you have a stale mailing list first

20 class mail is a waste of time and money and it’s not 

21 the best way to do it and should not be used, so it’s 

22 circumstantial.

23 PROF. WOLFMAN: Right.

24 MS. CABRASER: I was wondering if what 

25 you’re suggesting is something along the lines of what 
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1 the California Rules of Court provide? California is 

2 unburdened by Eisen and so those class action rules 

3 provide that the court has essentially untrammeled 

4 discretion to dispense with notice entirely, determine 

5 the form and content of notice, and to decide who pays 

6 for it, and it is proportional to the issues involved 

7 and the amount at stake, is that?

8 PROF. WOLFMAN: No, I mean, I think that’s 

9 too much discretion.

10 MS. CABRASER: Too much discretion.

11 PROF. WOLFMAN: Again, I don’t think you 

12 want it in a case where people are likely going to 

13 want to cash in and are likely -- you know, there’s a 

14 decent chance they might want to control their own 

15 litigation, and I think you want to go with what you 

16 have now but generally not rely on electronic means to 

17 get ahold of them.

18 You know, I can’t speak for what Todd did in 

19 the past when he was in the business, but I can tell 

20 you what he says now and, as I say, I’ve read some of 

21 the underlying materials that he cites and they seem 

22 pretty convincing as a general matter that mailing 

23 lists plus additional work.

24 In the case I mentioned in which we found 92 

25 percent of the people and handed out 94 percent of the 
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1 money, we did mail and then we did additional work to 

2 get these folks because real money was at stake.

3 JUDGE BATES: I’m going to bring this to a 

4 close.

5 PROF. WOLFMAN: Yeah.

6 JUDGE BATES: But, Judge Oliver, last 

7 question for Professor Wolfman.

8 JUDGE OLIVER: Yes. So you’re suggesting a 

9 whole new regime in regard to (b)(1), (2) and (3) and 

10 kind of a rethinking of notice, period. And that 

11 probably is something that’s not part of this project 

12 but beyond that sounds like you’re suggesting that the 

13 rule is okay as it is because there’s no need to tell 

14 people that Eisen allows something other than first

15 class mail. Is that what you’re --

16 PROF. WOLFMAN: Exactly. Precisely.

17 JUDGE BATES: All right. With that final 

18 word, we will move on to the next witness. Thank you 

19 very much, Professor Wolfman.

20 The next witness is Hassan Zavareei from 

21 Tycko & Zavareei. 

22 MR. ZAVAREEI: Good morning. Thank you for 

23 the opportunity to testify here today. I have been 

24 practicing for a little bit over 20 years. I began my 

25 practice at Gibson, Dunn & Crutcher as a defense 
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1 attorney, including doing class action work, and for 

2 the past approximate 15 years our firm has been doing 

3 plaintiff side class action litigation.

4 I’ve litigated probably over 20 class 

5 actions, settled not quite as many unfortunately, and 

6 I’m here as a practitioner to talk about my experience 

7 and I want to address three specific issues that I 

8 believe have come up today in some fashion or another.

9 The first is the changes to Rule 23 that provide for 

10 electronic notice; the provisions in Rule 23(e)(1) and 

11 (2) relating to the type of notice and the means for 

12 determining whether to give notice to class members, 

13 sort of this frontloading process that we used to 

14 refer to as preliminary approval; and then I want to 

15 address some of the changes relating to objections.

16 First, with respect to the electronic notice 

17 change, I disagree with what we just heard from 

18 Professor Wolfman with respect to the importance of 

19 electronic notice. I have in many cases experienced 

20 the benefit of electronic notice and including in 

21 class action settlements involving professional 

22 associations, as Judge Bates just mentioned, but I 

23 think it’s becoming the rule, not the exception, that 

24 most businesses, associations, organizations 

25 communicate primarily with their customers through 
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1 electronic means, predominantly through email, and I 

2 think that the provision just simply acknowledging 

3 that and providing that as an opportunity or an option 

4 is absolutely -- it does no harm and I think it does 

5 some good. I think it allows the clarity.

6 There are some judges that are reluctant to 

7 do electronic notice and I think that the rule makes 

8 it clear that the proposed rule, change to the rule 

9 makes it clear that that is acceptable and I think 

10 that is helpful.

11 I can give another example. In addition to 

12 the association, we had a case involving college 

13 students who had a bank account set up through an 

14 outside organization. Almost all of their 

15 communications were done through email.

16 I think one of the first witnesses talked 

17 about his daughter in college not receiving first

18 class mail. My daughter’s the same. I sent her a 

19 letter; she didn’t really know what it was. And I 

20 think that is what a significant segment of our 

21 population and our consumer population has turned to 

22 now, which is electronic mail, and I think in addition 

23 to it being efficient also it saves the class money.

24 Typically who pays for this notice? Notice 

25 is incredibly expensive and the class typically pays 
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1 for it. Now there are times where you can negotiate 

2 and depending on the state of negotiations where the 

3 defendant pays for it, but that’s not always the case.

4 And so doing anything you can to make that notice 

5 process efficient and inexpensive I think is 

6 beneficial to the interests of the class.

7 The second thing that I want to address and 

8 this is a minor point, which is, with respect to the 

9 factors that the Subcommittee has added with respect 

10 to what the courts should consider when giving notice 

11 to the class, what we used to call preliminary 

12 approval, I think that it is important as somebody who 

13 litigates in state and federal courts all across the 

14 country, there are factors in virtually every 

15 different circuit. There is a lot of overlap, but 

16 there’s also some factors that appear in one circuit 

17 and not in another, and I think this is a fine effort 

18 by the Subcommittee to try and get some uniformity and 

19 I think that they’ve brought in the most important 

20 factors from all of the different circuits.

21 I would also, however, like to talk a little 

22 bit about one of those suggested changes which is in 

23 Rule 23(e)(2)(C)(iii), which relates to the 

24 effectiveness of the proposed method of distribution 

25 to the class. That was something that Mr. Johnson 
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1 testified about earlier.

2 My concern is a little bit different than 

3 the one that Mr. Johnson testified about. My concern 

4 is that the provision speaks to the method of 

5 distribution to the class, and I think that there are 

6 instances in which the distribution is not necessarily 

7 to the class but for the benefit of the class.

8 For example, when the class members are 

9 unreachable, when the money is going to be distributed 

10 to an appropriate cy-prés organization or through 

11 escheatment, so I think that an appropriate change 

12 would be to simply remove the word “to” and replace it 

13 with “for the benefit of”.

14 I want to devote the rest of my comments to 

15 what I think is probably the most important change 

16 that the Committee is considering, which is the change 

17 to the standards for objections and how objections 

18 will be treated. This is something that I deal with 

19 as a litigator, as a practitioner on a constant basis, 

20 including in cases in front of Judge Dow and Judge 

21 Bates here, and I think that there is an important 

22 place for objectors in the class action process and I 

23 think we’ve also acknowledged and we’ve learned that 

24 that is also a place that has been abused and has 

25 caused a lot of trouble not just for plaintiff’s 
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1 attorneys but also for defense attorneys and for the 

2 courts. They’ve wasted a lot of judicial resources 

3 and they’ve really sort of used a mechanism designed 

4 to promote fairness for the entire class in a way that 

5 has really turned into a self-serving blackmail or 

6 greenmail situation.

7 And unfortunately I don’t believe that the 

8 proposed rule change is going to work. I understand 

9 the rationale behind it and the economics behind it. 

10 The idea is that if we force these people, these 

11 professional or bad faith objectors -- and I would 

12 make a distinction between professional and bad faith 

13 objectors. I think we had two professors who say that 

14 they frequently represent objectors. You could argue 

15 that those are professional objectors, and I don’t 

16 think that that’s what we’re really concerned about. 

17 I think that what we’re concerned about are bad faith 

18 objectors, people who bring objections for the sole 

19 purpose of trying to extract monetary compensation,

20 and I think that’s what the rule is aimed at.

21 Unfortunately, it ignores what I think is 

22 the practical implication of how this really plays out 

23 in a case. Specifically, all of the action with 

24 respect to objections happens after an appeal is 

25 docketed. The objectors don’t ask for money. They 
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1 don’t even speak to plaintiff’s counsel while the case 

2 is still before the district court. They wait until 

3 after the final approval order has been granted and 

4 then they file their appeal, and at that time, that’s 

5 when they go to the plaintiff’s counsel and demand 

6 ransom to allow the settlement to go forward.

7 Now the rule as written attempts to address 

8 that by directing the parties to Rule 62.1, and 

9 unfortunately I just, as a practical matter, I don’t 

10 think that that is going to work. I don’t think that 

11 it is an appropriate mechanism for addressing the 

12 issues primarily because once the appeal has been 

13 docketed the district court no longer has jurisdiction 

14 over the appeal, and I don’t even think that there’s 

15 anything that requires the litigants, including the 

16 objector or the plaintiff’s attorneys to even follow 

17 those procedures because I don’t think they’re 

18 properly before the district court anymore.

19 So I think that you’re opening, potentially 

20 opening up a -- well, I guess leaving intact a 

21 loophole that’s already been there. And for me, I 

22 think that probably the most effective way of 

23 addressing this issue is not through Rule 23, changes 

24 to Rule 23. I appreciate that the Subcommittee has 

25 probably heard a lot about this problem and many 
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1 members of the Subcommittee have dealt with this issue 

2 themselves and have been trying to solve this very 

3 serious problem, but I’m afraid that Rule 23 is 

4 probably not the best avenue for addressing the 

5 change.

6 I think that the most appropriate method of 

7 fixing this problem is through the Federal Rules of 

8 Appellate Procedure, providing for an expedited appeal 

9 process for certain objections, and allowing for the 

10 courts of appeals to use expedited appeals or summary

11 affirmance, which we have done in many cases when 

12 we’ve been dealing with bad faith objections.

13 And alternatively I’ve made a proposal. I 

14 believe it’s probably not something that the Committee 

15 could consider at this point, but if the Committee 

16 wanted to do something with respect to Rule 23, I 

17 think it would be important to call out what we’re 

18 really talking about and that’s bad faith objectors 

19 and to make a determination if an objector is a bad 

20 faith objector and allow the court of appeals to use 

21 that information to expedite the appeal or to make a 

22 summary disposition. Thank you for the opportunity to 

23 address you today.

24 JUDGE BATES: Thank you, Mr. Zavareei. 

25 Questions? John Barkett.
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1 MR. BARKETT: Maybe we should let Rick go 

2 first.

3 PROF. MARCUS: No.

4 JUDGE BATES: He was still getting ready.

5 MR. BARKETT: No problem. This was a topic 

6 of enormous debate, the objectors’ discussion. I’ve 

7 heard both sides of the story in numerous meetings and 

8 there are large members of folks who prosecute class 

9 actions who take a different view from you. They 

10 think that this will work.

11 I don’t know who’s right and who’s wrong,

12 but in terms of your experience and even in preparing 

13 for today, have you communicated with your colleagues 

14 who have different views and is it just the case that 

15 you and they do not agree, you think it won’t work and 

16 others think it will work? Is that where we are?

17 MR. ZAVAREEI: Well, I’m not sure that due 

18 consideration has been given to the jurisdictional 

19 issue. You know, I participated in one of the 

20 roadshows that the Subcommittee generously provided, I 

21 think it was here in D.C., the Duke University Law 

22 Center’s roadshow, and I think these proposals came 

23 after that, so there was really no discussion about 

24 the jurisdictional issue on appeal and that’s my 

25 concern.
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1 MR. BARKETT: It has been studied and it’s 

2 not clear to me that you’re right that there isn’t 

3 jurisdiction, there’s at least a genuine question 

4 here. But the way the language is worded is such that 

5 courts can take advantage of indicative orders and 

6 follow the procedure and it’s an interesting question,

7 but it’s not clear to me that there isn’t jurisdiction 

8 because I know I was a part of calls where we looked 

9 at lots of cases. But is that your concern, that you 

10 have decided as a matter of law that that can’t work 

11 and therefore this rule doesn’t make sense? Is that 

12 where you are?

13 MR. ZAVAREEI: Well, I guess I’m not a 

14 constitutional scholar, I’m not in a position to 

15 determine whether it can or cannot work. It’s my 

16 opinion based on my study of the cases that there’s at 

17 least a significant question as to whether or not 

18 there’s jurisdiction at that point, and so I think it 

19 creates some potential unintended consequences and 

20 potential for abuse. So I think where it is unclear 

21 like that that I think that it’s just, it’s ill22 advised to tread.

23 JUDGE BATES: Judge Dow.

24 JUDGE DOW: So I’m curious about your 

25 proposal here about the request for finding the 
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1 objection was filed in bad faith and so many years 

2 ago, before I was on the Civil Committee, I was on the 

3 Appellate Committee, and we studied this issue 

4 starting about 2010, maybe even before that.

5 The proposal I had was for a certificate of 

6 appealability, which sounds a lot like this, and I was 

7 persuaded that we’d have a Rules Enabling problem 

8 because congress is the one that gives district judges 

9 the ability or the authority to issue certificates of 

10 appealability in habeas cases because I thought that 

11 was a good example.

12 District courts, by the time the settlement 

13 is approved, a district court knows the case very, 

14 very well and is in perfect position to decide whether 

15 this is good faith or bad faith.

16 But here’s the other issue, the point of my 

17 question here is, you said and consistent with my 

18 practice these guys just lay low while the case is in 

19 the district court, and one solution we have to that 

20 problem is that objections now need to be stated with 

21 specificity, and my hope is that district judges will 

22 get either these phantom objections or no objection 

23 and say that’s a waiver and that the court of appeals 

24 will affirm that and say we’re not even going to 

25 consider an objection that wasn’t raised in the 
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1 district court because it wasn’t stated with 

2 particularity.

3 But how would the district court get this 

4 issue here where you’re saying there’s a request for a 

5 finding that the objection was filed in bad faith if, 

6 again, the objection really doesn’t surface in toto 

7 until it’s already in the court of appeals?

8 MR. ZAVAREEI: Well, I guess I’m not sure I 

9 understand because, in my experience, the objector 

10 files an objection and makes itself known in the 

11 district court.

12 JUDGE DOW: But it says nothing.

13 MR. ZAVAREEI: Well, often it’s a 

14 boilerplate objection, but if it says nothing, I think 

15 that together with the other factors that I proposed 

16 or other factors that the Rules Committee could 

17 consider as a basis for determining whether or not 

18 it’s a good faith or a bad faith appeal.

19 JUDGE DOW: Because sometimes we don’t know, 

20 I mean, it could be we don’t know unless it’s a 

21 notorious serial objector that that nothing was 

22 furtiveness or cluelessness.

23 MR. ZAVAREEI: There may be no basis to make 

24 the --

25 JUDGE DOW: And quite often it’s the second.
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1 MR. ZAVAREEI: Right. And there may be no 

2 basis to make that determination but I think there 

3 will be some instances where that determination can be 

4 made and that might ease the process for the court of 

5 appeals.

6 JUDGE BATES: Professor Marcus.

7 PROF. MARCUS: I think this is following on 

8 not only to some of the other questions but also to 

9 some suggestions we heard from others earlier today,

10 and I’m wondering about your reaction to them.

11 One suggestion was that every objector must 

12 file with the court a statement that he or she or it 

13 has abandoned or is withdrawing the objection and 

14 receiving no consideration for it, and I’m wondering 

15 given that I understand it may often happen that quite 

16 innocently class members send in objections and then 

17 realize those are unwarranted and decide not to pursue 

18 them, how you think that might work.

19 And, also, I think there’s been some 

20 reference to discovery in relation to who the 

21 objectors are and how often they’ve objected in the 

22 past, maybe requiring them to reveal that or to assert 

23 that in their objections.

24 In connection with findings of bad faith or 

25 something like that, would you contemplate that we 
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1 would have possibly extended discovery? So I’ve got 

2 two kind of practical questions about how your 

3 concerns or the concerns of others might be addressed 

4 concerning objectors and I’m basing those on things we 

5 heard earlier today from other people.

6 MR. ZAVAREEI: So, with respect to your 

7 first question, I believe that, unfortunately, as 

8 written, there is not an express prohibition or bar on

9 compensation. There’s just a requirement that there 

10 be a court hearing and the district court be notified 

11 and that the district court approve it. And I think 

12 that there’s a problem there because these objectors 

13 that we’re talking about that this rule is aimed at 

14 addressing are really quite shameless with respect to 

15 that.

16 PROF. MARCUS: Well, I guess the specific 

17 thing that occurred to me is that there may be a large 

18 number of other people out there who are behaving very 

19 differently and I’m wondering whether you think that’s 

20 correct and, if so, whether some rule that said they 

21 may not abandon their objections without filing some 

22 document in court would be a good idea.

23 MR. ZAVAREEI: Oh, I see what you’re saying. 

24 Well, I guess I don’t read the rule to be saying 

25 that. It’s my --
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1 PROF. MARCUS: No, the rule is -- no, I’m 

2 only saying that was, I believe, suggested by someone 

3 else this morning, so I’m asking you about that.

4 MR. ZAVAREEI: Yeah, no, I agree with you, I 

5 think that would be a bad idea. I think there are a 

6 lot of objectors who simply object, they have their 

7 opinions heard, the district courts often take those 

8 opinions into consideration and then they wish to 

9 dismiss their appeal, and I don’t think there should 

10 be any impediment to that.

11 PROF. MARCUS: And then the other is 

12 discovery in relation to who the objectors are and 

13 what they’ve been doing in their past lives.

14 MR. ZAVAREEI: Yeah, I have never 

15 experienced a court that is unwilling to allow for 

16 such discovery where appropriate. There have been, I 

17 think, some instances that I’m aware of where it has 

18 been abused and where discovery of legitimate 

19 objectors has been unduly intrusive and could 

20 potentially chill legitimate objectors. So I really 

21 don’t know what the correct balance is on that.

22 JUDGE BATES: Judge Campbell.

23 JUDGE CAMPBELL: I want to make sure I 

24 understand your concern about the practical problem of 

25 how the rule would work. So assuming a settlement is 
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1 approved, an objector who’s never said anything to 

2 anybody appeals, that objector then comes to counsel 

3 and says give me some money, Rule 25 -- or 23(e)(5)(B)

4 would then say that the objector can receive no 

5 payment in connection with dismissing the appeal 

6 unless it’s approved by the court, which means the 

7 parties can say to the objector, sorry, we can’t give 

8 you any money unless it’s approved.

9 And Subpart C would say that since it’s on 

10 appeal 62.1 applies, meaning the court of appeals 

11 looks to the district court as to whether or not 

12 they’re going to approve payment.

13 What’s the way around that? What is your 

14 concern about what the objector will do to evade that 

15 procedure?

16 MR. ZAVAREEI: Well, it would have to be the 

17 objector and the plaintiff’s counsel together

18 paying -- who would be the one paying the objector,

19 and the way around it would be to simply just ignore 

20 the rule because arguably the rule has no bearing once 

21 the case is -- once the district court has been 

22 divested of jurisdiction.

23 And so I have a concern that the rule may be 

24 inapplicable at that point. And, in addition, even if 

25 they do follow through and they do bring a request for 
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1 an advisory opinion from the district court under Rule 

2 62.1, what power and authority does the district court 

3 have at that point?

4 Let’s say that they come together and say, 

5 judge, we -- district court judge, we have agreed to 

6 pay $100,000 to the objector, he’s going to dismiss 

7 his appeal, this is going to allow everybody to get 

8 their money soon, and the district court says, okay, 

9 well, under 62.1, I’m going to issue an advisory

10 opinion that says that if the case was remanded to me 

11 then I would permit it, because that’s really all that 

12 the district court can do under 62.1 is to say what it 

13 would do if it was remanded back.

14 But what practical effect does that have on 

15 the appeal? The court of appeals is free to simply 

16 ignore that and to do nothing with it. If the parties 

17 then, after that hearing is done and the district 

18 court says, I don’t think that the case should be 

19 dismissed, I think that it’s inappropriate, that’s not 

20 binding on the court of appeals. And the court of 

21 appeals, if the parties come to it and dismiss, is 

22 still free to dismiss the case at that point and allow 

23 the compensation to go forward.

24 JUDGE CAMPBELL: Well, on your first 

25 concern, which is that the parties may just ignore the 
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1 rule and do a side deal they don’t tell anybody about, 

2 that’s true whether the case is pending in the 

3 district court or the court of appeals, right? I 

4 mean, we can’t prevent that by language in the rule it 

5 seems to me.

6 MR. ZAVAREEI: Well, I guess my concern and 

7 maybe this is wrong, but my concern is is that I don’t 

8 know that the -- it’s not that they’re ignoring an 

9 applicable rule. It’s they’re ignoring a rule that 

10 doesn’t apply because they’re no longer in front of 

11 the district court, that they’re in front of the court 

12 of appeals and the rules that apply at this point are 

13 not -- there’s no reservation of jurisdiction that I’m 

14 aware of for this particular purpose.

15 If you look at the cases that I’ve cited in 

16 my written submission, the preservation of 

17 jurisdiction is very narrow, and I don’t see anything 

18 in the cases to suggest that there would be a 

19 preservation of jurisdiction for an issue like this.

20 JUDGE BATES: Professor Klonoff.

21 PROF. KLONOFF: I think Judge Campbell 

22 really articulated what I was going to get at. I 

23 think there may just be a disagreement on how Rule 

24 62.1 works and what impact it has is the sense that 

25 I’m getting.
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1 MR. ZAVAREEI: Perhaps, but my concern is is 

2 that Rule 62.1 is not something that -- I mean, if you 

3 look for case law in Rule 62.1, you won’t find very 

4 much. It’s not a rule that has ever been used for 

5 something like this to my knowledge, and I think it’s 

6 sort of putting a square peg in a round hole and it’s 

7 going to present some unintended consequences because 

8 of that.

9 PROF. KLONOFF: I mean, what’s your solution 

10 then? I know you mentioned the appellate remedies. 

11 There already are appellate procedures for expediting 

12 appeals and so forth. Those haven’t solved the 

13 problem and that’s not really something that this 

14 Committee could address anyhow because that would be 

15 the Appellate Committee.

16 MR. ZAVAREEI: Yeah, the one suggestion that 

17 I had was to allow the district court to make a 

18 finding that an objection is in bad faith so that that 

19 can help facilitate an expedited appeal.

20 JUDGE BATES: All right. Thank you very 

21 much. We appreciate your comments.

22 MR. ZAVAREEI: Thank you.

23 JUDGE BATES: We have one more witness. 

24 We’ll have that witness in just a moment.

25 (Pause.)
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1 JUDGE BATES: All right. Our next witness 

2 is Sai. We appreciate him coming today, and when he’s 

3 ready, we’re happy to hear from you.

4 SAI: Thank you, Your Honor, and may it 

5 please the Committee. It is unfortunate, though 

6 perhaps unsurprising, that in a room full of class 

7 action lawyers not one has stepped forward to 

8 represent the class of people who do not have a 

9 lawyer. So, on my own behalf and those similarly 

10 situated, in the mood of the day --

11 JUDGE BATES: Let’s, excuse me, let’s adjust 

12 the microphone a little bit so we can hear somewhat 

13 better. I’m sorry to interrupt.

14 SAI: Sure.

15 JUDGE BATES: Here, we’re using another 

16 microphone now.

17 SAI: There, better, yes?

18 JUDGE BATES: Yes, I think so.

19 SAI: Sorry. So thank you, Your Honor, and 

20 may it please the Committee. It is unfortunate,

21 though unsurprising, that in a room full of class 

22 action lawyers none have stepped forward to represent 

23 the interests of those who do not have counsel, so in 

24 the spirit of the day, on my own behalf and on behalf 

25 of all those similarly situated, I would like to raise 
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1 some objections to the proposed Rules for CM/ECF as 

2 applies to pro se filers.

3 This Committee, as have the parallel 

4 committees in the appellate bankruptcy and criminal 

5 rules, has proposed a change to the rules that not 

6 simply excuses pro se filers from electronic filing, 

7 which is wholly appropriate, but prohibits pro se 

8 filers from filing electronically unless they first 

9 show good cause essentially.

10 And I believe that this is improper. There 

11 are notes in previous minutes of the Committee and 

12 other committees that give some reasons why one may 

13 want to do so. I believe they’re erroneous and I’ll 

14 address them later, but the notes of the current 

15 Committee, the report and the rules notes make no such 

16 claim.

17 The only claim that’s made is that some pro 

18 se litigants may not be able to deal with CM/ECF 

19 filing, which is true, and that for that reason they 

20 are to be excused from the requirement that is being 

21 imposed on those who are represented by counsel that 

22 everything must be e-filed.

23 The problem is that if you don’t permit pro 

24 se parties to e-file unless they first obtain leave of 

25 the court, which I would add is on a case-by-case 
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1 basis, even if someone has permission from even the 

2 same court in another case to e-file, they must file 

3 again in paper with case opening or so forth and must 

4 file again a motion for permission to use CM/ECF even 

5 if they’ve used it for years, as I have, for instance.

6 There are a number of harms that are quite 

7 significant and sometimes, in fact, dispositive that 

8 come to pro se litigants because they are uniquely 

9 targeted by this prohibition on pro se filing.

10 So, for instance, there’s the case delays. 

11 So, if I as a pro se litigant wish to open a case, I 

12 can only do so not by CM/ECF even though I have CM/ECF 

13 access and have used it successfully. I have to file 

14 it by paper. That takes a week to print and mail and 

15 so forth, it arrives to the court in a non-electronic 

16 format, which I’ll get to in a moment, and that’s even 

17 if I have successfully litigated before, and 

18 incidentally I have. Just as full disclosure, I have 

19 filed pro se and in the one case adjudicated on the 

20 merits against the TSA I was declared the prevailing 

21 party and awarded costs against the Department of 

22 Justice.

23 So it’s not that people who file pro se are 

24 necessarily vexatious, but essentially that is the 

25 presumption baked into the rules. If I filed with 
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1 CM/ECF and I note that I’m not going to meet a 

2 deadline, I can confer with opposing counsel, call 

3 them up, say, do you object to me having an extension 

4 of a week or whatever the case is and at 11:58 p.m. 

5 file a motion for extension which will be timely.

6 If I notice that I am late even on the day 

7 of, it is literally not possible for me to file a 

8 motion for extension. That would be completely timely 

9 if I had CM/ECF access and cannot be timely in paper.

10 In some cases, this can be dispositive. For 

11 instance, if I am replying or seeking leave to extend 

12 an opposition to a motion for summary judgment or a 

13 motion to dismiss, the court rules on it during the 

14 pendency of that filing window when it would be in the 

15 mail on paper. The court could dispose of it, to my 

16 detriment, simply because I didn’t have access to ask 

17 for an extension immediately.

18 If I would want to file a PITRO case in a 

19 new case, say that there’s some eminent action that I 

20 want a restraining order against, it’s next week, for 

21 instance, electronic filing, that’s no big deal. I 

22 mean, you have to serve it and all that, but it can be 

23 done more or less immediately.

24 If I am restricted for no good reason from 

25 filing electronically, it is not possible for me to 
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1 file such a case even if it is completely meritorious.

2 If I want leave, sick leave to file as an 

3 amicus or to intervene, which incidentally I’ve done. 

4 I’ve sought leave to intervene in one case which is 

5 ongoing as a member of the press to unseal or unredact 

6 some documents, which is a standard, widely accepted 

7 permissive intervention. Because the court in that 

8 case does not permit pro se filing at all by CM/ECF, I 

9 have to file that on paper, incurring costs, incurring 

10 delays. In fact, there was a scrub with the agent 

11 that sends my mail for me, and that imposed extra 

12 delays. There’s no good reason to have that.

13 Similarly, if I’m a pro se filer and I don’t 

14 yet have CM/ECF, I don’t get NEFs, Notices of 

15 Electronic Filing. So I find out about it after an 

16 additional delay because it takes time for me to get 

17 mail, which because I travel a lot I have a mail 

18 receiving agent that scans it for me and sends it and 

19 so forth, but it takes like a week for me to get 

20 something by mail.

21 So functionally what happens is I go every 

22 day on PACER and pay PACER 10 cents to a buck every 

23 time just to check the docket to see if there’s an 

24 update, and there’s no reason for that when I could 

25 just be getting an NEF like everybody else.
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1 So I mentioned costs. There’s printing, 

2 mailing. If somebody is IFP, and incidentally I am, 

3 it goes against the spirit of the IFP statute for 

4 somebody to incur costs that are completely avoidable.

5 If I file by CM/ECF, it costs a millicent 

6 perhaps to upload a PDF. If I file the same document 

7 on paper, it can cost me five to 40 bucks depending on 

8 how much paper, how fast, is it certified, et cetera, 

9 and there’s absolutely no reason for that.

10 Furthermore, as may be obvious, I have some 

11 concerns about accessibility of judicial records both 

12 to myself and to the public. Paper records, when they 

13 are ingested by the courts, are scanned, they’re 

14 typically not OCR’d, and even if they were, OCR is 

15 really poor by comparison to native electronic 

16 documents. So the documents that I submit suffer in 

17 readability for myself and for other people, including 

18 those with disabilities.

19 I use links in my documents to exhibits, to 

20 resources available, to publicly available court 

21 decisions, things like that. Those are all obviously 

22 completely destroyed by printing even though in my 

23 PDFs they’re fine.

24 The structure of a PDF is harmed. In a 

25 simple filing, okay, that’s not a big deal, but in a 
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1 more complex filing like a motion for summary 

2 judgment, which may have various exhibits and 

3 structure and so forth, that impairs the utility.

4 And, of course, many courts have 

5 requirements that documents that are originally 

6 electronic be submitted as native electronic 

7 documents, which is entirely appropriate, and I cannot 

8 obey if I must file on paper.

9 So I’m happy to elaborate in detail and I 

10 will be submitting written comments, so if anyone has 

11 questions or comments for me to elaborate on in 

12 writing I’m happy to do so.

13 But coming back to the statements in the 

14 Committee’s minutes and in the notes, clearly some pro 

15 se litigants do not have the means to access CM/ECF. 

16 They may not have internet access regularly. They may 

17 be imprisoned in such a way that they’re restricted 

18 from having internet access on a regular basis or from 

19 email that may be necessary for NEFs and so forth. 

20 They may simply not have the skills necessary to do 

21 so.

22 But for those of us who are not, there’s 

23 this presumption which is entirely on its head. The 

24 presumption should be that I need not show cause to be 

25 excused from electronic filing, that being pro se is a 
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1 presumed good cause as the rules provide for attorney 

2 filers. Attorney filers can show good cause to be 

3 excused. So it should be simply that I am presumed to 

4 have cause to be excused, but I should also be 

5 presumed permission to file electronically if I wish.

6 There have been concerns expressed about 

7 docketing errors, for instance, that I may misdocket 

8 something and then a clerk needs to go in and correct 

9 it. Well, the clerk already has to do all of the work 

10 if I file on paper and bluntly put, they have, in 

11 fact, gotten it wrong sometimes and I’ve had to have 

12 them correct the errors.

13 There’s cases where there may be an 

14 assumption that pro se filers may -- I believe it’s in 

15 the minutes of previous meetings – they may file porn, 

16 they have file something that’s libelous and so forth 

17 and that would be immediately on PACER and available 

18 to all.

19 Well, you know, they can just put it on blog 

20 or something, this is not a prevention and there are 

21 sanctions that are available. So what is baked into 

22 the rules by this rule is essentially a presumption of 

23 a sanction that is commonly applied to vexatious 

24 litigants, namely that they’re not permitted to file 

25 without leave of court.
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1 So functionally I am not permitted to file 

2 without leave of court, though I’m not vexatious at 

3 all, and the same applies to all other pro se filers. 

4 I think that is completely backwards. I will 

5 preserve any time that I have left and happy to answer 

6 any questions and, as I said, I’m going to be filing 

7 written comments, so if you would like me to 

8 elaborate, I’m happy to do so.

9 JUDGE BATES: Thank you, Sai. We appreciate 

10 your comments thus far and will appreciate any written 

11 comments you file as well. We do have at least one 

12 question. Professor Cooper.

13 PROF. COOPER: And this is something that I 

14 missed and I’d simply like to have the details. I 

15 think I heard you say that you encounter or know of 

16 circumstances in which the court requires a party to 

17 do something that cannot be done on paper, can only be 

18 done by e-filing. If so, just some elaboration of 

19 that would be welcome.

20 SAI: Sure. The Northern District of 

21 California, for instance, has a rule that requires in 

22 general that electronic documents be filed 

23 electronically; that is, if you have something that is 

24 a native electronic PDF, you have to upload it as a 

25 native electronic format. You can’t scan it and 
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1 rasterize it and then re-upload it as something that’s 

2 not accessible.

3 I believe that that rules does have an 

4 exemption for parties who are not electronic filers,

5 but the clear intent of the rule is correct. To the 

6 extent possible things should be filed in electronic 

7 format. It improves accessibility, improves usability 

8 for everybody.

9 But although that rules does make an 

10 exemption for non-electronic filers, so it is not that 

11 I can’t comply with the rule technically, I cannot 

12 comply with the spirit of the rule, which I should be 

13 able to do and can if I am allowed electronic access.

14 JUDGE BATES: All right. Other questions? 

15 John Barkett.

16 MR. BARKETT: What regimes are you working 

17 under right now? We’re talking about the change that 

18 would provide for filing by an unrepresented person, 

19 the proposed language of Rule 5 says, “When allowed or 

20 required, a person not represented by attorney may 

21 file electronically only if allowed by court order or 

22 by local rule.” And Romanette 2 says, “may be 

23 required to file electronically only by court order or 

24 by a local rule that includes reasonable exceptions.”

25 Are you under these limitations now before 
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1 any changes to the rule anywhere?

2 SAI: In some courts yes, in some courts no. 

3 So I’ve filed in D.C. District, D.C. Appellate, 

4 Massachusetts District, which never granted me 

5 electronic filing, First Circuit, Northern District of 

6 California, and Ninth Circuit.

7 In Massachusetts District, I was never 

8 allowed e-filing, although I’ve used e-filing for 

9 years, and there was no reason given. In direct 

10 contrast, in the Ninth Circuit where I had an appeal, 

11 although I could not open a case newly in the Ninth 

12 Circuit, so if there’s original action under, for 

13 instance, 49 U.S. Code 46110, which is original 

14 actions in court of appeals, so if it’s an appeal, the 

15 Ninth Circuit allows automatically if you have a case 

16 open you can file electronically, all you have to do 

17 is go on PACER, sign a form and it’s done, which is 

18 great, although that still has the problems that I 

19 mentioned for opening a case.

20 But, yes, the current rules are very similar 

21 in many courts. As I mentioned, the Western District 

22 of Tennessee, I filed to intervene, filed for leave to 

23 file electronically to reduce costs, for instance, if 

24 I’m granted costs, and there’s been no ruling on that,

25 so by default I’m forced to file on paper for no 
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1 reason.

2 MR. BARKETT: And the District of 

3 Massachusetts, is that a local rule that requires you 

4 to seek leave of court?

5 SAI: Yes, I believe so. I believe all of 

6 the courts I mentioned have local rules that require 

7 seeking leave of court, except for Western District of 

8 Tennessee has no rule and therefore by default 

9 prohibits it by unrepresented parties, whereas the 

10 Ninth Circuit’s local rule says that anyone who has a 

11 case can just go on PACER and sign up.

12 MR. BARKETT: Is there any district court 

13 where you’ve appeared where you’ve been able to file 

14 electronically?

15 SAI: Yes, all of the above except for 

16 Massachusetts and Tennessee. So I’ve filed 

17 electronically in D.C. District, in D.C. Circuit, in 

18 First Circuit, in Ninth Circuit, and Northern 

19 District.

20 MR. BARKETT: Without seeking leave of 

21 court?

22 SAI: With seeking leave of court in all of 

23 those except for Ninth Circuit.

24 MR. BARKETT: And then has a court order 

25 actually been issued with any kind of explanation, or 
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1 is it just pro forma you’re allowed?

2 SAI: Generally it’s pro forma. The 

3 Northern District of California initially denied my 

4 first motion because I hadn’t certified some technical 

5 things that were in the local rules exactly to the 

6 judge’s preference, so I submitted a supplemental 

7 affidavit and renewed the motion and it was granted.

8 In Massachusetts District, it was denied 

9 without reason. I moved for clarification. No reason 

10 was given. I have absolutely no idea why the court 

11 denied access. I use PACER all the time.

12 JUDGE BATES: All right. Any further 

13 questions?

14 (No response.)

15 JUDGE BATES: Sai, thank you very much. We 

16 appreciate your comments here today.

17 SAI: Thank you, Your Honor.

18 JUDGE BATES: And we’ll look forward to any 

19 written submission that you make.

20 SAI: Thank you, Your Honor.

21 JUDGE BATES: Thank you for coming.

22 That, I believe, concludes our hearing for 

23 today. We appreciate all of the very valuable 

24 information that we’ve received from the variety of 

25 witnesses.
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1 I want to express a few thanks, first of 

2 all, to those who have helped put this on smoothly. 

3 The rules office staff under the leadership of Rebecca 

4 Womeldorf but Julie Wilson and Shelly Cox and everyone 

5 else who’s helped put this on.

6 Most of the testimony focused on Rule 23,

7 and a special thanks to the Rule 23 Subcommittee under 

8 the leadership of Judge Dow and with Professor Marcus 

9 as reporter, but all those members of the 

10 Subcommittee, thank you very much for all your work, 

11 which continues next with a hearing scheduled in 

12 Phoenix, Arizona, on January 4.

13 So that concludes this portion of today’s 

14 activities for the Advisory Committee. We’re a little 

15 bit early, so maybe I need a little bit of advice on 

16 what exactly the schedule will be with respect to 

17 lunch and so forth. But let’s call the hearing to a 

18 close at this point, but just hold on for a second.

19 (Whereupon, at 12:01 p.m., the meeting in 

20 the above-entitled matter adjourned.)

21 //

22 //

23 //

24 //

25 //
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REPORTER'S CERTIFICATE

DOCKET NO.: N/A

CASE TITLE: Advisory Committee on Civil Rules

HEARING DATE: November 3, 2016 

LOCATION: Washington, D.C.

I hereby certify that the proceedings and 

evidence are contained fully and accurately on the 

tapes and notes reported by me at the hearing in the 

above case before the Administrative Office of the

U.S. Courts.

Date: November 3, 2016

 

Margaret Blumenthal

Official Reporter

Heritage Reporting

Corporation

Suite 206

1220 L Street, N.W.

Washington, D.C. 20005-4018