Court Opinion

ID: 9460593
Source: CourtListenerOpinion
Date Created: 2023-08-04 21:55:14.232423+00
Date Added: 2024-06-11T17:36:41.881078
License: Public Domain

ALDISERT, Circuit Judge
(dissenting).
Much of the majority opinion is committed to defending the principle that a class determination vel non may be the subject of the Interlocutory Appeals Act of 1958, 28 U.S.C. § 1292(b). I was not aware that this was being challenged, see Kauffman v. Dreyfus Fund, Inc., 434 F.2d 727, 734 (3d Cir. 1970), cert. denied, 401 U.S. 974, 91 S.Ct. 1190, 28 L.Ed.2d 323 (1971). Rather, the very real § 1292(b) problem exemplified by this appeal is the imperative to set forth with specificity the “controlling question of law as to which there is substantial *770ground for difference of opinion. .” This court in banc had no assistance from the district court which certified this case for appeal, by the appellant who filed it, and by the panel of this court which permitted it to be lodged. The mere fact that a class action has been ordered is usually the subject of a “substantial ground for difference of opinion,” as the majority frankly admits. Yet if every class action grant or denial were certified under § 1292(b) the appellate courts would be swamped by the second-guessing process of class determination which I view predominately sounding in fact, rather than in law. I fail to see an exotic question of law requiring definition or refinement by this court when the sole issue is whether the factual complex of a given case meets the .class action requirements of Rule 23, F.R.Civ.P. Questions of law, not of fact, inhered in Kauffman v. Dreyfus, supra,, which met the issue whether a plaintiff, not a member of a class, could be a class representative.
If a question of law lurks in this appeal, and I suspect that one can be distilled from appellant’s brief, it is an issue restricted to the damage aspects of plaintiff’s complaint. Although reversing the class action determination, the court has failed to meet this issue.
Appellant’s basic theme, sounded in Ratner v. Chemical Bank New York Trust Co., 54 F.R.D. 412 (S.D.N.Y. 1972), and repeated in some 34 reported and unreported district court opinions chanting the same litany, is that a class action should not lie because in the event the court finds liability, an award of the statutory penalty of $100 for each class member would defeat the purpose of the Truth in Lending Act, 15 U.S.C. § 1601 et seq., and, • moreover, would threaten the solvency of the appellant because the statutory penalty would greatly exceed potential actual damages.
So posited, this case does present a proper appeal on a controlling point of law which the parties briefed and argued, but which today this court does not meet. Chief Judge Seitz met the issue squarely, and I am in total agreement with his treatment and disposition of it. A class action is but the sum of its parts. If a part, one case, may be filed under TILA, and appellant so concedes, there can be no statutory bar to combining all of the parts.
“Because a class action, ‘so instinct with benefits, is also wrought with mischievous effect,’ it is imperative that participating litigants and the court never lose sight of the laudatory fundamental purposes of this procedural device. Its historical purpose was to alleviate the burden on the court and its facilities in cases where a claim was common to a large number of...persons.” Greenfield v. Villager-Industries, Inc., 483 F.2d 824, 831 (3d Cir. 1973) (footnote omitted).
Another difficulty which arises when the district court, the appellant, and this court fail to identify the precise “controlling question of law” is the possibility of an appellate court decision based on contentions neither briefed nor argued by the parties. Although this difficulty did not arise in Johnson v. Alldredge, 488 F.2d 820 (3d Cir. 1973), I fear this is what has happened here. Distilled to its essence the court’s opinion today yields a conclusion that the patent case of Blonder-Tongue Laboratories, Inc. v. University of Illinois Foundation, 402 U.S. 313, 91 S.Ct. 1434, 28 L. Ed.2d 788 (1971), somehow alters orthodox thinking on Rule 23 interpretations. The court today faults and reverses the district court for not concluding that an individual test case is superior to a class action on the liability phase of this law suit because of the “new” concept of collateral estoppel enunciated by Blonder-Tongue: “We think the Blonder-Tongue decision requires that a new look be taken at the alternative of a test case in lieu of an early class action determination.” (Majority opinion at 760.)
I have extreme difficulty with this. First, the collateral estoppel issue was neither briefed nor argued by the parties, neither before the panel nor before the court in banc. At the very least, the *771court should have requested additional briefing or oral argument on this issue.1 Second, and more important, I question the underlying premises of the majority suggestion that the 1971 Blonder-Tongue case makes a jurisprudential contribution to class action litigation in this circuit which was not present at the time of the 1966 class amendments to Rule 23. For sixteen years prior to the adoption of the modern class action rules, the courts in this circuit followed the doctrine of Bruszewski v. United States, 181 F.2d 419 (3d Cir.), cert. denied, 340 U.S. 865, 71 S.Ct. 87, 95 L.Ed. 632 (1950).
As to the effect of Blonder-Tongue in other circuits in non-patent cases, I am not at all certain that Blonder-Tongue has the sweep now attributed to it. The court utilized some extremely cautionary language:
Undeniably, the court-produced doctrine of mutuality of estoppel is undergoing fundamental change in the common-law tradition. In its pristine formulation, an increasing number of courts have rejected the principle as unsound. Nor is it irrelevant that the abrogation of mutuality has been accompanied by other developments— such as expansion of the definition of “claim” in bar and merger contexts and expansion of the preclusive effects afforded criminal judgments in civil litigation — which enhance the capabilities of the courts to deal with some issues swiftly but fairly.
Obviously, these mutations in estoppel doctrine are not before us for wholesale approval or rejection. But at the very least they counsel us to re-examine whether mutuality of estoppel is a viable rule where a patentee seeks to relitigate the validity of a patent once a federal court has declared it to be invalid.
402 U.S. at 327, 91 S.Ct. at 1442. (Footnotes omitted.)
Moreover, Sea-Land Services, Inc. v. Gaudet, 414 U.S. 573, 94 S.Ct. 806, 39 L.Ed.2d 9 (1974), did not accord to Blonder-Tongue the inclusiveness attributed by the majority. (At 593, 94 S.Ct. 819.)
In sum, there is no “new look” in this circuit, and it is at least questionable that the Blonder-Tongue case mandates a re-tailoring of estoppel law in non-patent cases in those jurisdictions which do not share our Bruszewski views.
We have recently said: “Also influencing the general acceptance of class actions has been recognition of the fact that the collective or accumulative technique of this device makes possible an effective assertion of many claims which otherwise would not be enforced, for economic or practical reasons, were it not for the joinder procedure. The 1966 amendments to Rule 23 are a restatement and reinforcement of public policy, mutually expressed by the Judicial Conference of the United States, its advisory committee on Rules of Civil Procedure, the Supreme Court, and the Congress, which candidly facilitate and encourage the use of class actions.” Greenfield v. Villager Industries, Inc., supra, 483 F.2d at 831. Although the *772majority pay lip service to “the underlying assumption that class action disposition of multiple similar claims, especially small consumer claims, is socially desirable,” the brute effect of its frontal assault on this policy will debilitate consumer class actions. To suggest that the litigative strength of a lone consumer on one small claim can be any match for the adversary’s resources, simply because there is a provision in TILA for payment of attorneys’ fees, is to ignore blithely the realities of modern litigative processes. While there is biblical if not historical support for the notion that one David did slay a Goliath, the social desirability of consumer class actions was to insure that a David plaintiff had a Goliath capability against the Goliath propensities of his adversary, and thus the real power of the courtroom adversaries would be equalized. I have a gnawing fear that this court, with a historic tradition of consumer protection, today takes a major step backwards.
Finally, the observation is compelled that the majority, under the guise of the “superiority” finding, have now rewritten the opening mandate of Rule 23(c)(1): “As soon as practicable after the commencement of an action brought as a class action, the court shall determine by order whether it is to be so maintained.” They would now have it read: “As soon as practicable after the establishment of liability, the court shall determine an action brought as a class action.” This runs counter to the policy, if not the letter, of the Supreme Court’s latest expression of class actions in American Pipe & Construction Co. v. Utah, 414 U.S. 538, 94 S.Ct. 756, 38 L.Ed.2d 713 (1974):
A recurrent source of abuse under the former . . . [Rule 23] lay in the potential that members of the claimed class could in some situations await developments in the trial or even final judgment on the merits in order to determine whether participation would be favorable to their interests. If the evidence at the trial made their prospective position as actual class members appear weak, or if a judgment precluded the possibility of a favorable determination, such putative members of the class who chose not to intervene or join as parties would not be bound by the judgment. This situation — the potential for so-called “one-way intervention” — aroused considerable criticism upon the ground that it was unfair to allow members of a class to benefit from a favorable judgment without subjecting themselves to the binding effect of an unfavorable one. The 1966 amendments were designed, in part, specifically to mend this perceived defect in the former Rule and to assure that members of the class would be identified before trial on the merits and would be bound by all subsequent orders and judgments.13
(At 547, 94 S.Ct. at 763) (My emphasis). (Footnote omitted.)
Because it was faced with a statute of limitations issue, the Court was meticulous in emphasizing when the class action determination should be made:
Under the present Rule, a determination whether an action shall be maintained as a class action is made by the court “as soon as practicable after the commencement of an action brought as a class action. . . .” Rule 23(c)(1). Once it is determined that the action may be maintained as a class action under subdivision (b)(3), the court is mandated to direct to members of the class “the best notice practicable under the circumstances” advising them that they may be excluded from the class if they so request, that they will be bound by the judgment, whether favorable or not, and that a member who does not request exclusion may enter an appearance in the case. Rule 23(c)(2). Finally, the present Rule provides that in 23(b)(3) actions the judgment shall include all those found *773to be members of the class who have received notice and who have not requested exclusion. Rule 23(c)(3). Thus, potential class members retain the option to participate in or withdraw from the class action only until a point in the litigation “as soon as practicable after the commencement” of the action when the suit is allowed to continue as a class and they are sent notice of their inclusion within the confines of the class. Thereafter they are either non-parties to the suit and ineligible to participate in a recovery or be bound by a judgment, or else they are full members who must abide by the final judgment, whether favorable or adverse.
(At 547, 94 S.Ct. at 763) (Footnotes omitted.)
For these reasons, I dissent and would affirm the judgment of the district court.

. A number of arguments and rationalizations have been urged for the general rule that an appellate court will not consider sua sponte a legal argument not presented and urged by the litigants. These might be summarized as follows: (1) the litigants have a right to control the litigation, therefore the court should decide only those questions raised by the parties; (2) no error requiring rectification has been committed by the lower court since the lower court has — by definition — not ruled on the matter if the question is raised for the first time by the appellate court sua sponte; (3) in some cases this last concept has been enlarged into a fundamental, jurisdictional limitation which foreclosed the consideration of a question not raised in the lower court; and finally (4) the losing party has had no opportunity to rebut the argument accepted by the court, which may in fact be erroneous, and the court has received no assistance in deciding the question from the litigants who are well informed in the matter.
Vestal, Sua Sponte Consideration in Appellate Review, 27 Ford.L.Rev. 477, 487 (1958-59). (Footnote omitted.)

. See Advisory Committee’s Note to Proposed Rules of Civil Procedure, 39 F.R.D. 98, 105-106.