Opinion ID: 171219
Heading Depth: 3
Heading Rank: 1

Heading: American Pipe and its Progeny

Text: The American Pipe Court held that parties are entitled to intervene in an action after the denial of class certification even though the statute of limitations had expired as to the parties seeking to intervene. See American Pipe, 414 U.S. at 552-53, 94 S.Ct. 756. The commencement of the original class suit tolls the running of the statute of limitations for all purported members of the class until after the denial of the class certification motion, [10] id. at 553, 94 S.Ct. 756, or until they chose not to continue as a class member, id. at 551, 94 S.Ct. 756. At that juncture, the statute of limitations begins running again. Id. Conceptually, American Pipe incarnates the principle that the class action is a representative creature. See id. at 550, 94 S.Ct. 756. That is, members of a putative class are treated as if they were parties to the action itself until and unless they received notice thereof and chose not continue. Id. at 551, 94 S.Ct. 756. Thus, the filing of a class action, in a classic legal fiction, causes the courts to treat members of the asserted class as if they hav[e] instituted their own actions, at least so long as they continue to be members of the class . . . and they have the benefit of tolling . . . for as long as the class action purports to assert their claims. In re WorldCom, 496 F.3d at 255; see also American Pipe, 414 U.S. at 550, 94 S.Ct. 756 ([T]he filing of a timely class action complaint commences the action for all members of the class as subsequently determined.). Relying on the representativeness of class actions, the American Pipe Court concluded that no different a standard should apply to those members of the class who did not rely upon the commencement of the class action (or who were even unaware that such a suit existed). . . . American Pipe, 414 U.S. at 551, 94 S.Ct. 756; see also id. at 552, 94 S.Ct. 756. Pragmatically, the Court also concluded that a tolling rule was necessary to advance the goals of Rule 23, namely the efficiency and economy of litigation. Id. at 553, 94 S.Ct. 756. If not for a tolling doctrine, individuals would feel compelled to file placeholder lawsuits prior to the expiration of the statute of limitations, thereby clogging the channels of the court with suits already encompassed by the class action. Id. at 551, 553-54, 94 S.Ct. 756 ([A] rule requiring successful anticipation of the determination of the viability of the class would breed needless duplication of motions.). The tolling doctrine clears that clutter by sidelining lawsuits that might have been filed merely to preserve the option of later, individual intervention. Id. at 551-52, 553-54, 94 S.Ct. 756. Lastly, the American Pipe Court concluded that the tolling doctrine would not subvert the purpose of statutes of limitation. Id. at 554-55, 94 S.Ct. 756. Such statutes are designed to promote justice by preventing surprises through the revival of claims that have been allowed to slumber until evidence has been lost, memories have faded, and witnesses have disappeared. Id. at 554, 94 S.Ct. 756 (quoting Order of R.R. Telegraphers v. Ry. Express Agency, 321 U.S. 342, 348-49, 64 S.Ct. 582, 88 L.Ed. 788 (1944)). Triggered as it is by the filing of a class action, the tolling doctrine also obviates surprises. The class action notifies the defendants not only of the substantive claims being brought against them, but also of the number and generic identities of the potential plaintiffs who may participate in the judgment. Id. at 555, 94 S.Ct. 756. The Supreme Court subsequently expanded on American Pipe's holding. First, the Court asserted  albeit in dicta  that American Pipe disposed of the argument that class members, even if notified individually of the class's certification, would not exercise their Federal Rule of Civil Procedure 23(c)(2)(B)'s opt-out rights because of concerns that their claims would be time-barred. Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 176 n. 13, 94 S.Ct. 2140, 40 L.Ed.2d 732 (1974). Eisen asserted that American Pipe dispelled this concern because it established that commencement of a class action tolls the applicable statute of limitations as to all members of the class, whether the class was ultimately certified or not. Id. Second, in Crown, Cork & Seal Co. v. Parker, 462 U.S. 345, 103 S.Ct. 2392, 76 L.Ed.2d 628 (1983), the Court reemphasized the broad strokes of American Pipe : [T]he commencement of a class action suspends the applicable statute of limitations as to all asserted members of the class who would have been parties had the suit been permitted to continue as a class action. Id. at 353-54, 103 S.Ct. 2392 (quoting American Pipe, 414 U.S. at 554, 94 S.Ct. 756). This is the case regardless of whether those class members sought to intervene or to bring individual actions after the denial of class certification. Id. at 354, 103 S.Ct. 2392. The Court also underscored its holding that, once the statute of limitations has been tolled, it remains tolled for all members of the putative class until class certification is denied.  Id. (emphasis added). [11]