Opinion ID: 175982
Heading Depth: 4
Heading Rank: 2

Heading: Deferral of Second Opt-Out Procedure Until After Trial on the Merits

Text: CDN challenges the district court's decision to defer holding another opt-out process until after the trial on the merits. CDN argues that the process must take place early in the litigation so that members of the putative class cannot gauge the progress of the case, or know the result, before choosing whether to opt out. See Am. Pipe & Const. Co. v. Utah, 414 U.S. 538, 545-47, 94 S.Ct. 756, 38 L.Ed.2d 713 (1974). We have repeatedly held that the practice of giving class members notice and an opportunity to opt out exists primarily to protect class members' due process rights, since they will otherwise be bound by a final judgment litigated by others on their behalf. See Hanlon v. Chrysler Corp., 150 F.3d 1011, 1024 (9th Cir.1998); Valentino v. Carter-Wallace, Inc., 97 F.3d 1227, 1234 (9th Cir.1996); In re Gypsum Antitrust Cases, 565 F.2d 1123, 1125 (9th Cir.1977). The ordinary procedure is to give notice at the time of class certification. But the rule does not mandate notice at any particular time. See Fed.R.Civ.P. 23(c)(2). When, as here, there is a need to regulate the notice and opt-out processes to maintain the integrity of the action in the face of a party's coercive activity, a district court does not abuse its discretion in delaying the process substantially  even, if necessary, until after the trial on the merits. We reiterate that a district court's discretion to manage the notice and opt-out processes is particularly broad in a Rule 23(b)(1) or (b)(2) class action where notice and the opportunity to opt out are not mandatory. The district court in this case determined that holding another opt-out election immediately would not only delay the trial, but also would not avoid the coercion that had tainted the initial process. The court made these determinations only after it made specific findings regarding CDN's coercive behavior. We hold that in these circumstances the district court acted within its discretion to regulate the opt-out process to diminish the effects of the prior coercion and to avoid further coercion.