CALIFORNIA CLASS ACTION LAW

Tag: United States district court

August 31, 2010

Ninth Circuit Holds Fraud and Consumer Protection Claims Preempted by Medicare Modernization Act

Medicare: Forward NOT Backward
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The Ninth Circuit Court of Appeals in Uhm v. Humana, Inc., No. 06-35672,  — F.3d —-, 2010 WL 3385546 (9th Cir. Aug. 30, 2010) held that the trial court lacked jurisdiction to consider plaintiffs’ breach of contract and unjust enrichment claims because they were not properly exhausted through the administrative remedial scheme established under the Medicare Prescription Drug Improvement and Modernization Act of 2003.  The court further held that plaintiff’s fraud and consumer protection act claims were not subject to the Act’s exhaustion provisions, but that they are expressly preempted.

Circuit Judge Betty Fletcher wrote a pointed concurrence chastising plaintiff’s counsel for filing the class action “all for the recovery of two months’ prescriptions” where a “bit of common sense and attention to the available administrative remedies should have been applied”:

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August 19, 2010

Ninth Circuit Holds That Deadline for Objection to Class Action Fee Award Must Be Set for Date After Plaintiff’s Counsel Files Fee Motion

B. B. Law, Attorney, Bozeman, Montana. (1911)
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The Ninth Circuit Court of Appeals yesterday clarified the timing of objections to class counsel’s fee requests under Fed. R. Civ. Proc. Rule 23(h), holding that objectors must be given a deadline to object after plaintiff’s fee application is submitted.  The litigation in In re Mercury Interactive Corp. Securities Litigation, No. 08-17372, — F.3d —-, 2010 WL 3239460 (9th Cir. Aug. 18, 2010), which involved stock option backdating, settled early on, at the motion to dismiss stage.

A settlement class was certified, the settlement of $117.5 million in cash was approved, and attorneys’ fees of 25% ($29.375 million) were awarded pursuant to the settlement agreement.  No objections were made to the settlement itself, but two objections were made to the proposed attorneys’ fees.  Id. *2.  The court described lead counsel’s fee application as follows: Read the rest of this entry »

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August 13, 2010

Deepwater Horizon Litigation Ordered Transferred to Eastern District of Louisiana by MDL Panel

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The Judicial Panel on Multidistrict Litigation issued its transfer order in In re Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico on April 20, 1010, 2010 WL 3166434 (U.S. Jud. Pan. Mult. Lit. Aug. 10, 2010) (slip op.)

The Panel faced four motions that collectively encompass 77 actions: 31 actions in the Eastern District of Louisiana, 23 actions in the Southern District of Alabama, ten actions in the Northern District of Florida, eight actions in the Southern District of Mississippi, two actions in the Western District of Louisiana, two actions in the Southern District of Texas, and one action in the Northern District of Alabama.

The Panel ordered that, pursuant to 28 U.S.C. § 1407, the actions transferred to the U.S. District Court for the Eastern District of Louisiana and assigned to the Honorable Carl J. Barbier for coordinated or consolidated pretrial proceedings with the actions pending in that district.

Upon careful consideration, however, we have settled upon the Eastern District of Louisiana as the most appropriate district for this litigation. Without discounting the spill’s effects on other states, if there is a geographic and psychological “center of gravity” in this docket, then the Eastern District of Louisiana is closest to it. Considering all of the applicable factors, we have asked Judge Carl J. Barbier to serve as transferee judge. He has had a distinguished career as an attorney and now as a jurist. Moreover, during his twelve years on the bench, Judge Barbier has gained considerable MDL experience, and has been already actively managing dozens of cases in this docket. We have every confidence that he is well prepared to handle a litigation of this magnitude.

Some parties have expressed concern that recusals among Eastern District of Louisiana judges unduly limit our choices, and that even Judge Barbier may be subject to recusal. Notwithstanding these concerns, the Panel is quite comfortable with its choice. Judge Barbier is an exceptional jurist, who would be a wise selection for this assignment even had those other judges in the district been available. Moreover, the Fifth Circuit recently denied the petition of certain defendants for a writ of mandamus directing Judge Barbier to recuse himself.

Chairman John G. Heyburn, II wrote for the Panel.

By CHARLES H. JUNG

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August 13, 2010

Ninth Circuit Holds That No Private Right of Action Exists to Enforce the Provisions of § 13(a) of the Investment Company Act of 1940

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In a shareholder class action, Northstar Financial Advisors, Inc. v. Schwab Investments, et al., 2010 WL 3169400 (9th Cir. Aug. 12, 2010), the Ninth Circuit Court of Appeals addressed whether there is a private cause of action to enforce the provisions of § 13(a) of the Investment Company Act of 1940 (“ICA” or “1940 Act”), 15 U.S.C. § 80a-13(a).  That section generally requires an investment company to obtain shareholder approval before deviating from the investment policies contained in the company’s registration statement filed with the Securities and Exchange Commission (“SEC”).

The Court held that “nothing in § 13(a) as originally enacted or as subsequently amended either creates a private cause of action or recognizes one exists with the clarity and specificity required under Supreme Court precedent.”

Marc J. Gross argued for plaintiff-appellee Northstar Financial Advisors, Inc.

Darryl P. Rains argued for defendants-appellants Schwab Investments, et al.

The case was argued before Circuit Judges Mary M. Schroeder N. Randy Smith and Hon. James Maxwell Moody, the Senior United States District Judge for the District of Arkansas, who was sitting by designation.  Circuit Judge Schroeder wrote the opinion of the Court.

By CHARLES H. JUNG

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