Remember the antitrust settlement class that a Third Circuit panel struck down last year? The one that went en banc a few weeks later? The one whose oral argument Blawgletter saw and wrote a post about?
Today, the en banc Third Circuit ruled 7-2 in favor of class certification. Judge Rendell, who wrote the dissent from the panel ruling, authored the full court's majority opinion. As she summarized:
At issue on appeal in this class action litigation is the propriety of the District Court's certification of two nationwide settlement classes comprising purchasers of diamonds from De Beers S.A. and related entities ("De Beers"). The settlement provided for a fund of $295 million to be distributed to both the direct and indirect purchasers: the direct purchasers were to receive $22.5 million of the fund, while the indirect purchasers would receive $272.5 million. A panel of our Court held that the District Court‘s ruling was inconsistent with the predominance inquiry mandated by Federal Rule of Civil Procedure 23(b)(3), and remanded the matter for further proceedings. See Sullivan v. DB Investments, Inc., 613 F.3d 134 (3d Cir. 2010), reh’g en banc granted and vacated by Sullivan v. DB Investments, Inc., 619 F.3d 287 (3d Cir. 2010). We then granted the plaintiffs‘ petition for rehearing en banc and vacated the prior order. Accordingly, we address anew the propriety of the District Court‘s certification of the direct and indirect purchaser classes pursuant to Federal Rule of Civil Procedure 23(b)(2) and 23(b)(3), and also consider for the first time the objections raised to the fairness of the class settlement.2
We believe that the predominance inquiry should be easily resolved here based on De Beers‘s conduct and the injury it caused to each and every class member, and that the straightforward application of Rule 23 and our precedent should result in affirming the District Court‘s order certifying the class. But the objectors to the class certification and our dissenting colleagues insist that, when deciding whether to certify a class, a district court must ensure that each class member possesses a viable claim or "some colorable legal claim," (Dissenting Op. at 10). We disagree, and accordingly, we will reason through our analysis in a more deliberate manner in order to explain why the addition of this new requirement into the Rule 23 certification process is unwarranted.
Sullivan v. DB Invesments, Inc., No. 08-2784, slip op. at 10-11 (3d Cir. Dec. 20, 2011) (en banc) (foonotes omitted).
The court went on to okay the district court's plan for doling out the money to members of the two subclasses of direct and indirect buyers and its award of about $73 million in fees and expenses to class counsel. The panel hadn't reached either issue because it ruled that the case didn't qualify for class treatment.
[Hat tip to the ever-alert William Hoese, whose membership in Phi Beta Kappa will come as no surprise to those who know him.]