Court Opinion

ID: 9497837
Source: CourtListenerOpinion
Date Created: 2023-08-05 17:01:23.950233+00
Date Added: 2024-06-11T17:58:27.023561
License: Public Domain

DENNIS, Circuit Judge,
specially concurring:
Although I concur in the outcome, I disagree with the majority opinion’s statement that “[cjourts have likened the degree of proof required [in determining *326market efficiency] to the standards used in preliminary injunction hearings ... and 12(b)(2) jurisdictional contests.”1 Contrary to the majority’s reading, the Fourth Circuit’s opinion in Gariety v. Grant Thornton, LLP, 368 F.3d 356, 366 (4th Cir.2004), and the Seventh Circuit’s opinion in Szabo v. Bridgeport Machines, Inc., 249 F.3d 672, 676 (7th Cir.2001), do not liken or compare standards or degrees of proof from other proceedings at all. Instead, the Fourth and Seventh Circuits simply referred to those inquiries as models or analogs of how district courts can “probe behind the pleadings in resolving class action certifications”2 without disobeying the Supreme Court’s admonishment in Eisen against “expanding the ... certification analysis to include consideration of whether the proposed class is likely to prevail ultimately on the merits.”3 For example, Gariety simply says:
A model for [the certification] process can be observed in the context of the preliminary injunction practice. Courts make factual findings in determining whether a preliminary injunction should issue, but those findings do not bind the jury ..., and the jury’s findings on the merits govern the judgment to be entered in the case.4
And Szabo in the same vein observes that “[cjourts make similar inquiries routinely ... before deciding whether [courts] possess jurisdiction over the subject matter of the case and the persons of the defendants, the location of the proper venue, application of forum non conveniens, and other preliminary issues.”5
The only “standards” that have ever been required in class certifications are more open textured: e.g., “close look,” Amchem Products, Inc. v. Windsor, 521 U.S. 591, 615, 117 S.Ct. 2231, 138 L.Ed.2d 689 (1997); “rigorous analysis,” Falcon, 457 U.S. at 161, 102 S.Ct. 2364; Spence v. Glock, Ges.m.b.H, 227 F.3d 308 (5th Cir.2000); Castano v. American Tobacco Co., 84 F.3d 734, 740 (5th Cir.1996). On the other hand, the Supreme Court in Eisen v. Carlisle and Jacquelin, 417 U.S. 156, 177-178, 94 S.Ct. 2140, 40 L.Ed.2d 732 (1974), admonished that a “more than likely to prevail” standard is inappropriate in a Rule 23 certification analysis. In fact, we recently held that a court must conduct an “intense factual investigation” while at the same time “takfing] care to inquire into the substance and structure of the underlying claims without passing on their merits.” Robinson v. Texas Auto. Dealers Ass’n, 387 F.3d 416 (5th Cir.2004).
Thus, although I agree with the majority’s holding that the district court did not adequately weigh the factors for and against a finding of market efficiency, I strongly disagree with the majority’s reading of Gariety and Szabo. Contrary to the majority’s impression, these cases do not support or suggest the adoption or application of degrees or standards of proof in efficient market determinations for the purposes of class certification.

. Op. Pg. 322-23.

. Gariety, 368 F.3d at 366 (quoting General Telephone Co. of Southwest v. Falcon, 457 U.S. 147, 160, 102 S.Ct. 2364, 72 L.Ed.2d 740 (1982)).

. Id. (citing Castano v. American Tobacco Co., 84 F.3d 734, 744 (5th Cir.1996)).

. Id. at 366 (citing Univ. of Texas v. Camenisch, 451 U.S. 390, 395, 101 S.Ct. 1830, 68 L.Ed.2d 175 (1981)).

. Szabo, 249 F.3d at 676.