The Shady Grove decision signifies that federal courts do not need to apply state laws that limit class action procedures when they conflict with Federal Rule of Civil Procedure 23. While states have authority over their own courts, this ruling restricts their ability to dictate class action procedures in federal courts.
For example: If a state law prohibits consumer class actions for small dollar amounts as punitive damages, this prohibition would not apply in federal courts where Rule 23 criteria are met.