When we last left off with the lawsuit, Judge Richard Boulware was going to issue a ruling on whether to allow the UFC plaintiffs class action status. If denied, the case would be effectively over pending an appeal. But, it appears that the case may be in more limbo due to another case.
Early last month, the plaintiffs in the UFC antitrust lawsuit requested a hearing to go over the various issues awaiting Judge Boulware. It has been almost two years since the last hearing in the case.
Judge Boulware was awaiting a Ninth Circuit Court of Appeals case which had an impact on the decision to grant or deny class action certification. Prior to this, he all but made his decision to grant certification to the bout class of fighters allegedly aggrieved by the UFC. It also meant that the identity class, those claiming the UFC impacted their intellectual property rights, would be denied class action certification.
But an antitrust case in the Ninth Circuit caught the attention of the Court and would likely have an impact on the opinion of Judge Boulware. This, despite the opinion, has yet to be issued in written form.
That case involves the alleged price fixing by tuna companies of its products to consumers. One of the tuna companies, Chicken of the Sea, International, has settled with plaintiffs. But, other companies remain, including Starkist, which has filed a writ of certiorari (essentially an appeal) to the U.S. Supreme Court.
The issue central to the appeal in Olean Wholesale Grocery Co-Op v. Bumble Bee Foods, LLC (aka the Tuna case) in determining the class participants. The key takeaways from the Ninth Circuit ruling in the Tuna case is that the District Court need only determine whether plaintiffs’ evidence proves that a common question is capable of class-wide resolution and that there is no per se rule preventing certification of a class that includes more than a de minimis number of uninjured class members.
Central to the inquiry as it relates to the UFC Antitrust lawsuit is the fact that the plaintiffs’ expert(s) need not have to prove that all in the class of plaintiffs have been injured. While there may be a nominal number of uninjured class members, the argument by defendants in the Tuna case and by the UFC in the antitrust case is that more than a de minimis number of uninjured class members are a part of the class action litigation. As a result, the UFC would argue that since the experts of the plaintiffs cannot show that all of the presumed class of individuals cannot show the commonality of the injury, that the class cannot be certified. The current ruling from the Ninth Circuit that in determining class certification, the Court does NOT have to show this and only that it is capable of class-wide resolution.
This issue in the Tuna case is now being appealed to the U.S. Supreme Court. And while the highest Court in the country does not take many cases, this may be one that it could take. The reason why is not the substance of the Tuna case but the underlying ruling in determining the governing of Rule 23 of the Federal Rule of Civil Procedure pertaining to class action lawsuits. The requirement that the proposed class of injured individuals must have a common injury is at issue. If applied with a strict adherence to the rule, Judge Boulware would deny the class certification for the bout class based on the belief that not every fighter in the class would be able to claim injury. But that would go against the now-standing law set forth in the Tuna case which indicates that courts cannot “create a ‘fail safe’ class that is defined to include only those individuals who were injured.” Practicing Antitrust and Class Action lawyers will also point to the dissent in the case which states that it is opportune for class actions plaintiffs and “is akin to the NFL declining to review a critical and close call fumble during the waning minutes of the game unless and until the game reaches overtime (which, of course, will likely never occur if it does not decide the disputed call).” Judge Kenneth Lee (a Trump appointee) also paraphrased the time-honored fear of the ‘floodgates of litigation’ based upon the ruling. He stated, the ruling “will unleash a tidal wave of monstrously oversized classes designed to pressure and extract settlements.”
Of the 10,000 or so petitions to the high court, SCOTUS only hears a sliver of those cases (75-85). The U.S. Supreme Court is interested in clarifying issues of law rather than specific issues in a case. Thus, determining the application of Rule 23 would seem like an issue it would be able to clarify for future potential class action lawsuits. Whether or not SCOTUS will accept the Tuna case in its fall term should be known prior to its start in October.
One of the detailed issues here that may grab The U.S. Supreme Court’s attention is the issue of standing in the lawsuit. The question of the ‘unharmed’ individuals in the class action lawsuit would give rise to a lack of standing in federal court. The issue of standing relates to the ability for an individual/entity to be a part of a lawsuit. In this instance, if an individual suing in the lawsuit has no injury, they do not have standing to bring the lawsuit. In another antitrust lawsuit that went before the U.S. Supreme Court, the Court did not reach that question, but this case would give them the opportunity to decide if they had to determine the standing of the individual class members prior to accepting the certified class.
To refresh everyone’s recollection, the plaintiffs’ expert Hal Singer opined that the bout class wages were adversely impacted by the UFC’s anticompetitive practices based on a controversial (according to defendants) regression analysis. He utilized a model based upon wage share rather than wage level. This analysis, according to those on the side of the UFC, would open the floodgates of litigation. Singer’s analysis also brings up the issue of Daubert related to expert reports in these types of cases. In the Tuna case, the appellate court indicated that the Daubert standard would apply to expert opinion. Daubert, a case which established the rule, allows for the Court to be the gatekeeper of expert testimony. This grants the Court to rule upon the admissibility of scientific evidence that is reliable and relevant in the specific area of expertise. The UFC challenged several expert opinions including attempting to exclude Singer’s report from evidence.
Where does the UFC case right now? After the Ninth Circuit ruled on the Tuna case, the plaintiffs requested that the Court take into consideration the ruling. In a separate filing it has requested a hearing to essentially ask on a status of the matter. The Court has yet to respond via filing to issue a date for a hearing. It is clear that the ruling on the UFC Antitrust case should come to some sort of decision. Judge Boulware does not have to await the decision in the Tuna case, nor does it really have to wait on the writ by Starkist. But, all participants in the case must wait on the Court to come to some sort of decision on how to proceed, if at all.
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