Court Opinion

ID: 9425739
Source: CourtListenerOpinion
Date Created: 2023-08-02 23:15:40.001013+00
Date Added: 2024-06-11T17:22:48.813792
License: Public Domain

*159Mr. Justice Powell
delivered the opinion of the Court.
On May 2, 1966, petitioner filed a class action on behalf of himself and all other odd-lot1 traders on the New York Stock Exchange (the Exchange). The complaint charged respondents with violations of the antitrust and securities laws and demanded damages for petitioner and his class. Eight years have elapsed, but there has been no trial on the merits of these claims. Both the parties and the courts are still wrestling with the complex questions surrounding petitioner’s attempt to maintain his suit as a class action under Fed. Rule Civ. Proc. 23. We granted certiorari to resolve some of these difficulties. 414 U. S. 908 (1973).
*160I
Petitioner brought this class action in the United States District Court for the Southern District of New York. Originally, he sued on behalf of all buyers and sellers of odd lots on the Exchange, but subsequently the class was limited to those who traded in odd lots during the period-from May 1, 1962, through June 30, 1966. 52 F. E. D. 253, 261 (1971). Throughout this period odd-lot trading was not part of the Exchange’s regular auction market but was handled exclusively by special odd-lot dealers, who bought and sold for their own accounts as principals. Eespondent brokerage firms Carlisle & Jacquelin and DeCoppet & Doremus together handled 99% of the Exchange’s odd-lot business. S. E. C., Report of Special Study of Securities Markets, H. Rv Doc. No. 95, pt. 2, 88th Cong., 1st Sess., 172 (1963). They were compensated by the odd-lot differential, a surcharge imposed on the odd-lot investor in addition to the standard brokerage commission applicable to round-lot transactions. For the period in question the differential was % of a point (12%-<é) per share on stocks trading below $40 per share and % of a point (25$) per share on stocks trading at or above $40 per share.2
Petitioner charged that respondent brokerage firms had monopolized odd-lot trading and set the differential at an excessive level in violation of §§ 1 and 2 of the Sherman Act, 15 U. S. C. §§ 1 and 2, and he demanded treble damages for the amount of the overcharge. Petitioner also demanded unspecified money damages from the Exchange for its alleged failure to regulate the differential for the protection of investors in violation of §§ 6 and 19 of the Securities Exchange Act of 1934, 15 U. S. C. §§ 78f and 78s. Finally, he requested attor*161neys’ fees and injunctive prohibition of future excessive charges.
A critical fact in this litigation is that petitioner’s individual stake in the damages award he seeks is only $70. No competent attorney would undertake this complex antitrust action to recover so inconsequential an amount. Economic reality dictates that petitioner’s suit proceed as a class action or not at all. Opposing counsel have therefore engaged in prolonged combat over the various requirements of Rule 23. The result has been an exceedingly complicated series of decisions by both the District Court and the Court of Appeals for the Second Circuit. To understand the labyrinthian history of this litigation, a preliminary overview of the decisions may prove useful.-
In the beginning, the District Court determined that petitioner’s suit was not maintainable as a class action. On appeal, the Court of Appeals issued two decisions known popularly as Eisen I and Eisen II. The first held that the District Court’s decision was a final order and thus appealable. In the second the Court of Appeals intimated that petitioner’s suit could satisfy the requirements of Rule 23, but it remanded the case to permit the District Court to consider the matter further. After conducting several evidentiary hearings on remand, the District Court decided that the suit could be maintained as a class action and entered orders intended to fulfill the notice requirements of Rule 23. Once again, the case was appealed. The Court of Appeals then issued its decision in Eisen III and ended the trilogy by denying class action status to petitioner’s suit. We now review these developments in more detail.

Eisen I

As we have seen, petitioner began this action in May 1966. In September of that year the District Court *162dismissed the suit as a class action. 41 F. R. D. 147. Following denial of his motion for interlocutory review under 28 U. S.‘ C. § 1292 (b), petitioner took an appeal as of right under § 1291. Respondents then moved to dismiss on the ground that the order appealed from was not final. In Eisen I, the Court of Appeals held that the denial of class action status in this case was appealable as a final order under § 1291. 370 F. 2d 119 (1966), cert. denied, 386 U. S. 1035 (1967). This was so because, as a practical matter, the dismissal of the class action aspect of petitioner’s suit was a “death knell” for the entire action. The court thought this consequence rendered the order dismissing the class action appealable under Cohen v. Beneficial Loan Corp., 337 U. S. 541, 546 (1949).

Eisen II

Nearly 18 months later the Court of Appeals reversed the dismissal of the class action in a decision known as Eisen II. 391 F. 2d 555 (1968). In reaching this result the court undertook an exhaustive but ultimately inconclusive analysis of Rule 23. Subdivision (a) of the Rule sets forth four prerequisites to the maintenance of any suit as a class action: “(1) the class is so numerous that joinder of all members is impracticable, (2) there are questions of law or fact common to the class, (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class, and (4) the representative parties will fairly and adequately protect the interests of the class.” The District Court had experienced little difficulty in finding that petitioner satisfied the first three prerequisites but had concluded that petitioner might not “fairly and adequately protect the interests of the class” as required by Rule 23 (a) (4). The Court of Appeals indicated its disagreement with the *163reasoning behind the latter conclusion and directed the District Court to reconsider the point.
In addition to meeting the four conjunctive requirements of 23 (a), a class action must also qualify under one of the three subdivisions of 23 (b).3 Petitioner argued that the suit was maintainable as a class action under all three subdivisions. The Court of Appeals held the first two subdivisions inapplicable to this suit4 and *164therefore turned its attention to the third subdivision, (b)(3). That subdivision requires a court to determine whether “questions of law or fact common to the members of the class predominate over any questions affecting only individual members” and whether “a class action is superior to other available methods for the fair and efficient adjudication of the controversy.” More specifically, it identifies four factors relevant to these inquiries. After a detailed review of these provisions, the Court of Appeals concluded that the only potential barrier to maintenance of this suit as a class action was the Rule 23 (b) (3) (D) directive that a court evaluate “the difficulties likely to be encountered in the management of a class action.” Commonly referred to as “manageability,” this consideration encompasses the whole range of practical problems that may render the class action format inappropriate for a particular suit. With reference to this litigation, the Court of Appeals noted that the difficulties of distributing any ultimate recovery to the class members would be formidable, though • not necessarily insuperable, and commented that it was “reluctant to permit actions to proceed where they are not likely to benefit anyone but the lawyers who bring them.” 391 F. 2d, at 567. The Court therefore directed the District Court to conduct “a further inquiry ... in order to consider the mechanics involved in the administration of the present action.” Ibid.
*165Finally, the Court of Appeals turned to the most imposing obstacle to this class action — the notice requirement of Rule 23 (c)(2). The District Court had held that both the Rule and the Due Process Clause of the Fifth Amendment required individual notice to all class members who could be identified. 41 F. R. D., at 151. Petitioner objected that mailed notice to the entire class would be prohibitively expensive and argued that some form of publication notice would suffice. The Court of Appeals declined to settle this issue, noting that “[o]n the record before us we cannot arrive at any rational and satisfactory conclusion on the propriety of resorting to some form of publication as a means of giving the necessary notice to all members of the class on behalf of whom the action is stated to be commenced and maintained.” 391 F. 2d, at 569.
The outcome of Eisen II was a remand for an eviden-tiary hearing on the questions of notice, manageability, adequacy of representation, and “any other matters which the District Court may consider pertinent and proper.” Id., at 570. And in a ruling that aroused later controversy, the Court of Appeals expressly purported to retain appellate jurisdiction while the case was heard on remand.

Eisen III

After it held the evidentiary hearing on remand, which together with affidavits and stipulations provided the basis for extensive findings of fact, the District Court issued an opinion and order holding the suit maintainable as a class action. 52 F. R. D. 253 (1971). The court first noted that petitioner satisfied the criteria identified by the Court of Appeals for determining adequacy of representation under Rule 23 (a)(4). Then it turned to the more difficult question of manageability. Under this general rubric the court dealt with problems of the com*166putation of damages, the mechanics of administering this suit as a class action, and the distribution of any eventual recovery. The last-named problem had most troubled the Court of Appeals, prompting its remark that if “class members are not likely ever to share in an eventual judgment, we would probably not permit the class action to continue.” 391 F. 2d, at 567. The District Court attempted to resolve this difficulty by embracing the idea of a “fluid class” recovery whereby damages would be distributed to future odd-lot traders rather than to the specific class members who were actually injured. The court suggested that “a fund equivalent to the amount of unclaimed damages might be established and the odd-lot differential reduced in an amount determined reasonable by the court until such time as the fund is depleted.” 52 F. R. D., at 265. The need to resort to this expedient of recovery by the “next best class” arose from the prohibitively high cost of computing and awarding multitudinous small damages claims on an individual basis.
Finally, the District Court took up the problem of notice. The court found that the prospective class included some six million individuals, institutions, and intermediaries of various sorts; that with reasonable effort some two million of these odd-lot investors could be identified by name and address; 5 and that the names and addresses of an additional 250,000 persons who had participated in special investment programs involving *167odd-lot trading6 could also be identified with reasonable effort. Using the then ..current first-class postage rate of six cents, the court determined that stuffing and mailing each individual notice form would cost 10 cents. Thus individual notice to all identifiable class members would cost $225,0007 and additional expense would be incurred for suitable publication notice designed to reach the other four million class members.
The District Court concluded, however, that neither Rule 23 (c) (2) nor the Due Process Clause required so substantial an expenditure at the outset of this litigation. Instead, it proposed a notification scheme consisting of four elements: (1) individual notice to all member firms of the Exchange and to commercial banks with large trust departments; (2) individual notice to the approximately 2,000 identifiable class members with 10 or more odd-lot transactions during the relevant period; (3) individual notice to an additional 5,000 class members selected at random; and (4) prominent publication notice in the Wall Street Journal and in other newspapers in New York and California. The court calculated that this package would cost approximately $21,720.
The only issue not resolved by the District Court in its first opinion on remand from Eisen II was who should bear the cost of notice. Because petitioner understandably declined to pay $21,720 in order to litigate an action *168involving an individual stake of only $70, this question presented something of a dilemma:
“If the expense of notice is placed upon [petitioner] , it would be the end of a possibly meritorious suit, frustrating both the policy behind private antitrust actions and the admonition that the new Rule 23 is to be given a liberal rather than a restrictive interpretation, Eisen II at 563. On the other hand, if costs were arbitrarily placed upon [respondents] at this point, the result might be the imposition of an unfair burden founded upon a groundless claim. In addition to the probability of encouraging frivolous class actions, such a step might also result in [respondents'] passing on to their customers, including many of the class members in this case, the expenses of defending these actions.” 52 F. R. D., at 269.
Analogizing to the laws of preliminary injunctions, the court decided to impose the notice cost on respondents if petitioner could show a strong likelihood of success on the merits, and it scheduled a preliminary hearing on the merits to facilitate this determination. After this hearing the District Court issued an opinion and order ruling that petitioner was “more than likely” to prevail at trial and that respondents should bear 90% of the cost of notice, or $19,548. 54 F. R. D. 565, 567 (1972).
Relying on the purported retention of jurisdiction by the Court of Appeals after Eisen II, respondents on May 1, 1972, obtained an order directing the clerk of the District Court to certify and transmit the record for appellate review. Subsequently, respondents also filed a notice of appeal under 28 U. S. C. § 1291. Petitioner's motion to dismiss on the ground that the appeal had not been taken from a final order was denied by the Court of Appeals on June 29, 1972.
*169On May 1, 1973, the Court of Appeals issued Eisen III. 479 F. 2d 1005. The majority disapproved the District Court's partial reliance on publication notice, holding that Rule 23 (c) (2) required individual notice to all identifiable class members. The majority further ruled that the District Court had no authority to conduct a preliminary hearing on the merits for the purpose of allocating costs and that the entire expense of notice necessarily fell on petitioner as representative plaintiff. Finally, the Court of Appeals rejected the expedient of a fluid-class recovery and concluded that the proposed class action was unmanageable under Rule 23 (b) (3) (D). For all of these reasons the Court of Appeals ordered the suit dismissed as a class action. One judge concurred in the result solely on the ground that the District Court had erred in imposing 90% of the notice costs on respondents. Petitioner’s requests for rehearing and rehearing en banc were denied. 479 F. 2d, at 1020.
Thus, after six and one-half years and three published decisions, the Court of Appeals endorsed the conclusion reached by the District Court in its original order in 1966 — that petitioner’s suit could not proceed as a class action. In its procedural history, at least, this litigation has lived up to Judge Lumbard’s characterization of it as a “Frankenstein monster posing as a class action.” Eisen II, 391 F. 2d, at 572.
II
At the outset we must decide whether the Court of Appeals in Eisen III had jurisdiction to review the District Court’s orders permitting the suit to proceed as a class action and allocating the cost of notice. Petitioner contends that it did not. Respondents counter by asserting two independent bases for appellate jurisdiction: first, that the orders in question constituted a “final” *170decision within the meaning of 28 U. S. C. § 12918 and were therefore appealable as of right under that section; and, second, that the Court of Appeals in Eisen II expressly retained jurisdiction pending further development of a factual record on remand and that consequently no new jurisdictional basis was required for the decision in Eisen III. Because we agree with the first ground asserted by respondents, we have no occasion to consider the second.
Restricting appellate review to "final decisions” prevents the debilitating effect on judicial administration caused by piecemeal appellate disposition of what is, in practical consequence, but a single controversy. While the application of § 1291 in most cases is plain enough, determining the finality of a particular judicial order may pose a close question. No verbal formula yet devised can explain prior finality decisions with unerring accuracy or provide an utterly reliable guide for the future.9 We know, of course, that § 1291 does not *171limit appellate review to “those final judgments which terminate an action . . . Cohen v. Beneficial Loan Corp., 337 U. S., at 545, but rather that the requirement of finality is to be given a “practical rather than a technical construction.” Id., at 546. The inquiry requires some evaluation of the competing considerations underlying all questions of finality — “the inconvenience and costs of piecemeal review on the one hand and the danger of denying justice by delay on the other.” Dickinson v. Petroleum Conversion Corp., 338 U. S. 507, 511 (1950) (footnote omitted).
We find the instant case controlled by our decision in Cohen v. Beneficial Loan Corp., supra. There the Court considered the applicability in a federal diversity action of a forum state statute making the plaintiff in a stockholder’s derivative action liable for litigation expenses, if ultimately unsuccessful, and entitling the corporation to demand security in advance for their payment. The trial court ruled the statute inapplicable, and the corporation sought immediate appellate review over the stockholder’s objection that the order appealed from was not final. This Court held the order appeal-able on two grounds. First, the District Court’s finding was not “tentative, informal or incomplete,” 337 U. S., at 546, but settled conclusively the corporation’s claim that it was entitled by state law to require the shareholder to post security for costs. Second, the decision did not constitute merely a “step toward final disposition of the merits of the case . . . .” Ibid. Rather, it concerned a collateral matter that could not be reviewed effectively on appeal from the final judgment. The Court summarized its conclusion in this way:
“This decision appears to fall in that small class which finally determine claims of right separable from, and collateral to, rights asserted in the action, *172too important to be denied review and too independent of the canse itself to require that appellate consideration be deferred until the whole case is adjudicated.” Ibid.
Analysis of the instant case reveals that the District Court’s order imposing 90% of the notice costs on respondents likewise falls within “that small class.” It conclusively rejected respondents’ contention that they could not lawfully be required to bear the expense of notice to the members of petitioner’s proposed class. Moreover, it involved a collateral matter unrelated to the merits of petitioner’s claims. Like the order in Cohen, the District Court’s judgment on the allocation of notice costs was “a final disposition of a claimed right which is not an ingredient of the cause of action and does not require consideration with it,” id., at 546-547, and it was similarly appealable as a “final decision” under § 1291. In our view the Court of Appeals therefore had jurisdiction to review fully the District Court’s resolution of the class action notice problems in this case, for that court’s allocation of 90% of the notice costs to respondents was but one aspect of its effort to construe the requirements of Rule 23 (c) (2) in a way that would permit petitioner’s suit to proceed as a class action.10
Ill
Turning to the merits of the case, we find that the District Court’s resolution of the notice problems was *173erroneous in two respects. First, it failed to comply with the notice requirements of Rule 23 (c)(2), and second, it imposed part of the cost of notice on respondents.
A
Rule 23 (c) (2) provides that, in any class action maintained under subdivision (b)(3), each class member shall be advised that he has the right to exclude himself from the action on request or to enter an appearance through counsel, and further that the judgment, whether favorable or not, will bind all class members not requesting exclusion. To this end, the court is required to direct to class members "the best notice practicable under the circumstances, including individual notice to all members who can be identified through reasonable effort.” 11 We think the import of this language is unmistakable. Individual notice must be sent to all class members whose names and addresses may be ascertained through reasonable effort.
The Advisory Committee’s Note to Rule 23 reinforces this conclusion. See 28 U. S. C. App., p. 7765. The Advisory Committee described subdivision (c) (2) as “not merely discretionary” and added that the “mandatory notice pursuant to subdivision (c) (2) . . . is designed to fulfill requirements of due process to which the class action procedure is of course subject.” Id., at 7768. The *174Committee explicated its incorporation of due process standards by citation to Mulleme v. Central Hanover Bank & Trust Co., 339 U. S. 306 (1950), and like cases.
In Mullane the Court addressed the constitutional sufficiency of publication notice rather than mailed individual notice to known beneficiaries of a common trust fund as part of a judicial settlement of accounts. The Court observed that notice and an opportunity to be heard were fundamental requisites of the constitutional guarantee of procedural due process. It further stated that notice must be “reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections.” Id., at 314. The Court continued:
“But when notice is a person's due, process which is a mere gesture is not due process. The means employed must be such as one desirous of actually informing the absentee might reasonably adopt to accomplish it. The reasonableness and hence the constitutional validity of any chosen method may be defended on the ground that it is in itself reason-bly certain to inform those affected.” Id., at 315.
The Court then held that publication notice could not satisfy due process where the names and addresses of the beneficiaries were known.12 In such cases, “the reasons *175disappear for resort to means less likely than the mails to apprise them of [an action’s] pendency.” Id., at 318.
In Schroeder v. City of New York, 371 U. S. 208 (1962), decided prior to the promulgation of amended Rule 23, the Court explained that Múlleme required rejection of notice by publication where the name and address of the affected person were available. The Court stated that the “general rule” is that “notice by publication is not enough with respect to a person whose name and address are known or very easily ascertainable . . . .” Id., at 212-213. The Court also noted that notice by publication had long been recognized as a poor substitute for actual notice and that its justification was “ 'difficult at best.’ ” Id., at 213.
Viewed in this context, the express language and intent of Rule 23 (c) (2) leave no doubt that individual notice must be provided to those class members who are identifiable through reasonable effort. In the present case, the names and addresses of 2,250,000 class members are easily ascertainable, and there is nothing to show that individual notice cannot be mailed to each. For these class members, individual notice is clearly the “best notice practicable” within the meaning of Rule 23 (c) (2) and our prior decisions.
Petitioner contends, however, that we should dispense with the requirement of individual notice in this case, and he advances two reasons for our doing so. First, the prohibitively high cost of providing individual notice to 2,250,000 class members would end this suit as a class action and effectively frustrate petitioner’s attempt to vindicate the policies underlying the antitrust and se*176curities laws. Second, petitioner contends that individual notice is unnecessary in this case, because no prospective class member has a large enough stake in the matter to justify separate litigation of his individual claim. Hence, class members lack any incentive to opt out of the class action even if notified.
The short answer to these arguments is that individual notice to identifiable class members is not a discretionary consideration to be waived in a particular case. It is, rather, an unambiguous requirement of Rule 23. As the Advisory Committee’s. Note explained, the Rule was intended to insure that the judgment, whether favorable or not, would bind all class members who did not request exclusion from the suit. 28 U. S. C. App., pp. 7765, 7768. Accordingly, each class member who can be identified through reasonable effort must be notified that he may request exclusion from the action and thereby preserve his opportunity to press his claim separately or that he may remain in the class and perhaps participate in the management of the action. There is nothing in Rule 23 to suggest that the notice requirements can be tailored to fit the pocketbooks of particular plaintiffs.13
Petitioner further contends that adequate representation, rather than notice, is the touchstone of due process in a class action and therefore satisfies Rule 23. We think this view has little to commend it. To begin with, Rule 23 speaks to notice as well as to adequacy of representation and requires that both be provided. Moreover, petitioner’s argument proves too much, for it *177quickly leads to the conclusion that no notice at all, published or otherwise, would be required in the present case. This cannot be so, for quite apart from what due process may require, the command of Rule 23 is clearly to the contrary. We therefore conclude that Rule 23 (c) (2) requires that individual notice be sent to all class members who can be identified with reasonable effort.14
B
We also agree with the Court of Appeals that petitioner must bear the cost of notice to the members of his class. The District Court reached the contrary conclusion and imposed 90% of the notice cost on respondents. This decision was predicated on the court’s finding, made after a preliminary hearing on the merits of the case, that petitioner was “more than likely” to prevail on his claims. Apparently, that court interpreted Rule 23 to authorize such a hearing as part of the determination whether a suit may be maintained as a class action. We disagree.
We find nothing in either the language or history of Rule 23 that gives a court any authority to conduct a preliminary inquiry into the merits of a suit in order to determine whether it may be maintained as a class action. Indeed, such a procedure contravenes the Rule by allowing a representative plaintiff to secure the benefits of a class action without first satisfying the requirements for it. He is thereby allowed to obtain a determination on the merits of the claims advanced on *178behalf of the class without any assurance that a class action may be maintained. This procedure is directly contrary to the command of subdivision (c)(1) that the court determine whether a suit denominated a class action may be maintained as such “[a]s soon as practicable after the commencement of [the] action . . . In short, we agree with Judge Wisdom’s conclusion in Miller v. Mackey International, 452 F. 2d 424 (CA5 1971), where the court rejected a preliminary inquiry into the merits of a proposed class action:
“In determining the propriety of a class action, the question is not whether the plaintiff or plaintiffs have stated a cause of action or will prevail on the merits, but rather whether the requirements of Rule 23 are met.” Id., at 427.
Additionally, we might note that a preliminary determination of the merits may result in substantial prejudice to a defendant, since of necessity it is not accompanied by the traditional rules and procedures applicable to civil trials. The court’s tentative findings, made in the absence of established safeguards, may color the subsequent proceedings and place an unfair burden on the defendant.
In the absence of any support under Rule 23, petitioner’s effort to impose the cost of notice on respondents must fail. The usual rule is that a plaintiff must initially bear the cost of notice to the class. The exceptions cited by the District Court related to situations where a fiduciary duty pre-existed between the plaintiff and defendant, as in a shareholder derivative suit.15 Where, as here, the relationship between the parties is truly ad*179versary, the plaintiff must pay for the cost of notice as part of the ordinary burden of financing his own suit.
Petitioner has consistently maintained, however, that he will not bear the cost of notice under subdivision (c) (2) to members of the class as defined in his original complaint. See 479 P. 2d, at 1008; 52 F. R. D., at 269. We therefore remand the cause with instructions to dismiss the class action as so defined.16
The judgment of the Court of Appeals is vacated and the cause remanded for proceedings consistent with this opinion.

It is so ordered.

 Odd lots are shares traded in lots of fewer than a hundred. Shares traded in units of a hundred or multiples thereof are round-lots.

 On July 1, 1966, the $40 “breakpoint” was raised to $55.

 “(b) Class Actions Maintainable.
“An action may be maintained as a class action if the prerequisites of subdivision (a) are satisfied, and in addition:
“(1) the prosecution of separate actions by or against individual members of the class would create a risk of
“(A) inconsistent or varying adjudications with respect to individual members of the class which would establish incompatible standards of conduct for the party opposing the class, or
“(B) adjudications with respect to individual members of the class which would as a practical matter be dispositive of the interests of the other members not parties to the adjudications or substantially impair or impede their ability to protect their interests; or
“(2) the party opposing the class has acted or refused to act on grounds generally applicable to the class, thereby making appropriate final injunctive relief or corresponding declaratory relief with respect to the class as a whole; or
“(3) the court finds that the questions of law or fact common to the members of the class predominate over any questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy. The matters pertinent to the findings include: (A) the interest of members of the class in individually controlling the prosecution or defense of separate actions; (B) the extent and nature of any litigation concerning the controversy already commenced by or against members of the class; (C) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; (D) the difficulties likely to be encountered in the management of a class action.”

 Before the Court of Appeals, petitioner dropped the contention that the suit qualified under subdivision (b)(1)(B). The court held subdivision (b) (1) (A) inapplicable on the ground that the pro*164spective class consisted entirely of small claimants, none of whom could afford to litigate this action in order to recover his individual claim and that consequently there was little chance of “inconsistent or varying adjudications with respect to individual members of the class which would establish incompatible standards of conduct for the party opposing the class . . . Subdivision (b) (2) was held to- apply only to actions exclusively or predominantly for injunctive or declaratory relief. Advisory Committee’s Note, Proposed Rules of Civil Procedure, 28 U. S. C. App., p. 7766.

 These two million traders dealt with brokerage firms who transmitted their odd-lot transactions to respondents Carlisle & Jacquelin and DeCoppet & Doremus via teletype. By comparing the odd-lot firms’ computerized records of these teletype transactions and the general-services brokerage firms’ computerized records of all customer names and addresses, the names and addresses of these two million odd-lot traders can be obtained.

 In the period from May 1962 through June 1968, 100,000 individuals had odd-lot transactions through participation in the Monthly Investment Plan operated by the Exchange and 150,000 persons traded in odd lots through participation in a number of payroll deduction plans operated by Merrill Lynch, Pierce, Fenner & Smith,

 Adjusting this figure to reflect the subsequent 40 increase in first-class postage would yield a figure of $315,000.

 Section 1291 provides:
“The courts of appeals shall have jurisdiction of appeals from all final decisions of the district courts of the United States, the United States District Court for the District of the Canal Zone, the District Court of Guam, and the District Court of the Virgin Islands, except where a direct review may be had in the Supreme Court.”

 As long ago as 1892 the Court complained: “Probably no question of equity practice has been the subject of more frequent discussion in this court than the finality of decrees. . . . The cases, it must be conceded, are not altogether harmonious.” McGourkey v. Toledo & Ohio R. Co., 146 U. S. 536, 544-545. In the intervening years the difficulty of resolving such questions has not abated. As Mr. Justice Black commented in Gillespie v. U. S. Steel Corp., 379 U. S. 148, 152 (1964), “whether a ruling is 'final’ within the meaning of § 1291 is frequently so close a question that decision of that issue either way can be supported with equally forceful arguments, and ... it is impossible to devise a formula to resolve all marginal cases coming within what might well be called the 'twilight zone’ of finality.”

 As explained in Part III of this opinion, we find the notice requirements of Rule 23 to be dispositive of petitioner’s attempt to maintain the class action as presently defined. We therefore have no occasion to consider whether the Court of Appeals correctly resolved the issues of manageability and fluid-class recovery, or indeed, whether those issues were properly before the Court of Appeals under the theory of retained jurisdiction. *175notice required does not even name those whose attention it is supposed to attract, and does not inform acquaintances who might call it to attention.” 339 U. S., at 315.

 Emphasis added. Subdivision (c)(2) provides in full:
“(2) In any class action maintained under subdivision (b)(3), the court shall direct to the members of the class the best notice practicable under the circumstances, including individual notice to all members who can be identified through reasonable effort. The notice shall advise each member that (A) the court will exclude him from the class if he so requests by a specified date; (B) the judgment, whether favorable or not, will include all members who do not request exclusion; and (C) any member who does not request exclusion may, if he desires, enter an appearance through his counsel.”

 The Court’s discussion of the inadequacies of published notice bears attention:
“It would be idle to pretend that publication alone, as prescribed here, is a reliable means of acquainting interested parties of the fact that their rights are before the courts. . . . Chance alone brings to the attention of even a local resident an advertisement in small type inserted in the back pages of a newspaper, and if he makes his home outside the area of the newspaper’s normal circulation the odds that the information will never reach him are large indeed. The chance of actual notice is further reduced when, as here, the

 Petitioner also argues that class members will not opt out because the statute of limitations has long since run out on the claims of all class members other than petitioner. This contention is disposed of by our recent decision in American Pipe & Construction Co. v. Utah, 414 U. S. 538 (1974), which established that commencement of a class action tolls the applicable statute of limitations as to all members of the class.

 We are concerned here only with the notice requirements of subdivision (c)(2), which arc applicable to class actions maintained under subdivision (b)(3). By its terms subdivision (c)(2) is inapplicable to class actions for injunctive or declaratory relief maintained under subdivision (b)(2). Petitioner's effort to qualify his suit as a class action under subdivisions (b) (1) and (b) (2) was rejected by the Court of Appeals. See n. 4, supra.

 See, e. g., Dolgow v. Anderson, 43 F. R. D. 472, 498-500 (EDNY 1968). We, of course, express no opinion on the proper allocation of the cost of notice in such cases.

 The record does not reveal whether a smaller class of odd-lot traders could be defined, and if so, whether petitioner would be willing to pay the cost of notice to members of such a class. We intimate no view on whether any such subclass would satisfy the requirements of Rule 23. We do note, however, that our dismissal of the class action as originally defined is without prejudice to any efforts petitioner may make to redefine his class either under Rule 23 (c) (4) or Fed. Rule Civ. Proc. 15.