imageClass action skeptics

Since 2011, a 5-4 majority of the Supreme Court has made class actions harder to bring and tougher to sustain.

In the current term, the Court’s quintet of class action skeptics — Chief Justice Roberts and Justices Alito, Kennedy, Scalia, and Thomas — may use a pair of cases in which it has heard arguments to all but doom wide swaths of class cases altogether.

I write not to address those cases but to explain why even if the threats they pose prove non-fatal, the reprieve may not last. Two other petitions for review on the Court’s docket pose existential threats almost as potent.

Deadly duo


The first case, Dow Chemical Co. v. Industrial Polymers, Inc., No. 14-1091 (U.S.), involves a claim that Dow and others conspired to fix the price of polyurethane chemicals. Dow lost at trial, and the district court entered a $1 billion judgment on the verdict. The Tenth Circuit affirmed (post here). Dow has asked the Supreme Court to take up these two questions:

1. Whether, in certifying a class under Federal Rule of Civil Procedure 23(b)(3), courts may presume class-wide injury from an alleged price-fixing agreement, even when prices are individually negotiated and individual purchasers frequently succeed in negotiating away allegedly collusive overcharges.

2. Whether a class may be certified or a class-wide damages judgment affirmed where plaintiffs’ common “proof” of damages is a model that (a) does not purport to determine the actual damages of most class members, but instead applies an “average” overcharge estimated from a sample of transactions of very different purchasers, or (b) assumes that defendants engaged in multiple antitrust violations, even though plaintiffs attempted to prove only one violation at trial.

Issue 2(a) poses the most danger for class actions. It challenges a method — common in antitrust, wage and hour, and other class actions — that computes a damages total on a class-wide basis. Dow urges that Rule 23(b)(3) requires something near a perfect damages model, one that assigns a damages amount to every class member rather than to the class as a whole.

What would result for class actions if the Court adopts the Dow view? Something close to catastrophe. Any workable damages model must use averages at some level to get to a class-wide total. Banning averages would thus immunize companies that fix prices, short workers on wages, and commit other misdeeds. Rule 23 would become a dead letter.

Overtime pay

The other worrisome case, Wal-Mart Stores, Inc. v. Braun, No. 14-1123 (U.S.), presents a similar question, this one with a due process angle. As Wal-Mart’s petition puts it:

In Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2561 (2011), this Court unanimously “disapprove[d]” the “novel project” of “Trial by Formula,” in which evidence pertaining only to a subset of class members is extrapolated to resolve the claims of the entire class without “further individualized proceedings,” because this procedure would impermissibly alter substantive law and preclude the litigation of “defenses to individual claims.” Here, both the Pennsylvania Supreme Court and Pennsylvania Superior Court upheld a classwide judgment of more than $150 million that was the product of just such a trial.

The question presented is:

Whether the Due Process Clause of the Fourteenth Amendment prohibits a state court from certifying a class action, and entering a monetary judgment in favor of the class, where the court permits the use of extrapolation to relieve individual class members of their burden of proof and forecloses the defendants from presenting individualized defenses to class members’ claims.

The sin in Braun looks a lot like the one in Dow. The defendants in both insist on a right to contest each class member’s damages on an individual basis and a requirement that plaintiffs prove damages for each class member.

Repercussions . . . and looking ahead

The stringent approach that the defendants advocate in Dow and Braun would gut Rule 23. Class actions make sense because they make an aggregate remedy practicable in fact. Economies of scale in class actions divide the sizable costs of proving liability and damages — often in the millions of dollars — across the large number of class members, making the total expense an affordable fraction the total harm. (An individual claim rarely involves enough at stake to justify the cost of proving a nationwide antitrust conspiracy, for instance.) Class-wide proof also makes the case triable to a jury in a reasonable amount of time. Forcing class plaintiffs to prove damages for each member of the class would further inflate costs, increase complexity of expert testimony, raise risk, and prolong trials — all to the detriment of class actions’ feasibility.

I think that what the Court does with Dow and Braun will depend on the outcome inTyson Foods, Inc. v. Bouaphakeo, No. 14-1146 (U.S.), an aggregate action for overtime pay under the Fair Labor Standards Act (FLSA). During the argument inTyson on November 10, 2015, one of the class action doubters, Justice Kennedy, stressed that FLSA cases may differ from class actions, partly because (under a 1946 ruling by the Court) the FLSA allows “just and reasonable inference”.See Transcript, Nov. 10, 2015, at 53:3-6 (“Do you concede that if this were a Rule 23 action and the FSLA were not involved that it would be a much closer, much more difficult case?”) (Kennedy, J.). If the Court upholds the $6 million judgment in Tyson, the doubters’ attention naturally would turn to the “much more difficult” issue of what to do with damages that depend on averages under the class action rule.

Looking further ahead

Where that would lead, I do not have a guess. InWal-Mart Stores, Inc. v. Dukes in 2011 and since, the Court has come close to delivering knock-out blows to class actions but so far has held back. The case that I argued to the Court, Comcast Corp. v. Behrend, 133 S. Ct. 1426 (2013), seemed likely to produce a broad rule about the necessity of admissible expert testimony showing class-wide damages in the class certification context but then proved a dud when the Court learned that Comcast had not preserved the issue in the courts below and changed the question presented post-argument. See Alison Frankel, The Supreme Court’s class action underachiever, Feb. 11, 2015. The majority also curtailed its ambitions in Dukes, coming close to saying but not quite pronouncing that Daubert‘s test for expert testimony applies in class certification proceedings. Others agree. See, e.g., Elizabeth Cabraser, The Class Abides: Class Actions and “the Roberts Court”, 48 Akron L. Rev. 756 (2015).

The cautious, incremental approach may continue. As an admirer of the class action, I hope it does. Because look out if it doesn’t.

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Photo of Barry Barnett Barry Barnett

Clients and colleagues call Barry Barnett an “incredibly gifted lawyer” (Chambers and Partners) who is “magic in the courtroom” (Who’s Who Legal), “the top antitrust lawyer in Texas” (Chambers and Partners), and “a person of unquestioned integrity” (David J. Beck, founder of Beck…

Clients and colleagues call Barry Barnett an “incredibly gifted lawyer” (Chambers and Partners) who is “magic in the courtroom” (Who’s Who Legal), “the top antitrust lawyer in Texas” (Chambers and Partners), and “a person of unquestioned integrity” (David J. Beck, founder of Beck Redden).

Barnett is a Fellow in the American College of Trial Lawyers, and Lawdragon has named him one of the top 500 lawyers in the United States three years in a row. Best Lawyers in America has honored him as “Lawyer of the Year” for Bet-the-Company Litigation (2019 and 2017) and Patent Litigation (2020) in Houston. Based in Texas and New York, Barnett has tried complex business disputes across the United States.

Barnett’s background, training, and experience make him indispensable to his clients. The small-town son of a Texas roughneck and grandson of a Texas sharecropper, Barnett “developed an unusual common sense about people, their motivations, and their dilemmas,” according to former client Michael Lewis.

Barnett has been historically recognized for his effectiveness and judgment. His peers chose him, for example, to the American College of Trial Lawyers and American Law Institute. His decades of trial and appellate work representing both plaintiffs and defendants have made him a master strategist and nimble tactician in complex disputes.

Barnett focuses on enforcement of antitrust laws, the “Magna Carta of free enterprise,” in Supreme Court Justice Thurgood Marshall’s memorable phrase. “Barry is one of the nation’s outstanding antitrust lawyers,” according to Joseph Goldberg, a member of the Private Antitrust Enforcement Hall of Fame. Named among Texas’s top ten antitrust lawyers of 2023, Business Today calls Barnett a “trailblazer” among the “distinguished legal minds” who “dedicate their skill and expertise to the maintenance of healthy competition in various sectors” of the Lone Star State’s booming economy. Barnett is also adept in energy and intellectual property matters and has battled for clients against a Who’s Who list of corporate behemoths, including Abbott Labs, Alcoa, Apple, AT&T, BlackBerry, Broadcom, Comcast, Dow, JPMorgan Chase, Samsung, and Visa.

Barnett commands a courtroom with calm and credibility and “is the perfect lawyer for bet the company litigation,” said Scott Regan, General Counsel of former client Whiting Petroleum. His performance before the Supreme Court in Comcast Corp. v. Behrend prompted the Court to withdraw the question on which it had granted review. The judge in a trial involving mobile phone technology called Barnett “one of the best” and that his opening statement the finest he had ever seen. Another trial judge told Barnett minutes after a jury returned a favorable verdict against the county’s biggest employer that he was one of the two best trial lawyers he’d ever come across—adding that the other one was dead.

A versatile trial lawyer, Barnett knows how to handle a case all the way from strategic pre-suit planning to affirmance on appeal. He’s tried cases to verdict and then briefed and argued them when they went before appellate courts, including the Second, Third, Fifth, and Tenth Circuits, the Supreme Court of Louisiana, and (in the case of Comcast Corp. v. Behrend) the Supreme Court of the United States.

Barnett is a sought-after public speaker, often serving on panels and talking about topics like the trials of antitrust class actions and techniques for streamlining complex litigation. He also comments on trends in commercial litigation and the implications of major rulings for outlets such as NPR, Reuters, Law360, Corporate Counsel, and The Dallas Morning News. He’s even appeared in a Frontline program about underfunding of state pensions, authored chapters on “Fee Arrangements” and “Techniques for Expediting and Streamlining Litigation” (the latter with Steve Susman) in the ABA’s definitive treatise on Business and Commercial Litigation in Federal Courts, 5th, and commented on How Antitrust Enforcers Might Think Like Plaintiffs’ Lawyers.

Clients and other hard graders have praised Barnett for his courtroom skills and legal acumen.

A client in a $100 million oil and gas case, which Barnett’s team won at trial and held on appeal, said Barnett and his team “presented a rare combination of strong legal intellect, common sense about right and wrong, and credibility in the courtroom.” David McCombs at Haynes and Boone said Barnett “has a natural presence that goes over well with juries and judges.”

Even former adversaries give Barnett high marks. Lead opposing counsel in a decade-long antitrust slugfest said “Barry is a highly skilled advocate. He understands what really matters in telling a narrative and does so in a very compelling manner.”

Barnett relishes opportunities to collaborate with all kinds of people. At the Center for American and International Law (CAIL), founded by a former prosecutor at Nuremberg in 1947 and headquartered in the Dallas area, he has served on the Executive Committee, co-chaired the committee that produced CAIL’s first-ever strategic plan, supported CAIL’s Institute for Law Enforcement Administration and other development efforts, and proposed formation of a new Institute for Social Justice Law. CAIL’s former President David Beck said “Barry is extremely bright” and is “very well prepared in every lawsuit or professional task he undertakes.”

Barnett is also a Trustee of the New-York Historical Society, a Sterling Fellow at Yale, a member of the Yale University Art Gallery’s Governing Board, a winner of the Class Award for his work on behalf of his college class, and a proud contributor to the Yellow Ribbon Program at Harvard Law. Barnett’s pro bono work includes leading the trial team representing people who are at greatest risk of severe illness and death as a result of being exposed to the novel coronavirus SARS-CoV-2 while being detained in the Dallas County jail—work for which he received the NGAN Legal Advocacy Fund RBG Award.

At Susman Godfrey, Barnett has served on the firm’s Executive Committee, Employment Committee, and ad hoc committees on partner compensation, succession of leadership, and revision of the firm’s partnership agreement. He also twice chaired the Practice Development Committee.

Barnett understands that clients face many pressures. Managing the stress is important, especially in matters that take years to resolve. He encourages clients to call him whenever they have a question or concern and to keep the inevitable ups and downs in perspective. He wants them to know that he will do his level best to help them achieve their goals. He also strives to foster trust and to make working with him a pleasure.

Cyrus “Skip” Marter, the General Counsel of Bonanza Creek in Denver and a former Susman Godfrey partner and client, said Barnett is “excellent about communicating with clients in a full and honest manner” and can “negotiate for his clients from a position of strength, because he is not afraid to take a case through a full trial on the merits.” Stacey Doré, the President of Hunt Utility Services and a former client, said that Barnett is “an excellent trial lawyer and the person you want to hire for your bet-the-company cases. He is client focused, responsive, and uniquely savvy about trial and settlement strategy.” A New York colleague said, “Barry is a joy to work with as co-counsel. He tackles complex procedural and factual hurdles capably, efficiently, and without drama.”

Barnett’s wide-ranging experience and calm, down-to-earth approach enable him to connect with clients, judges, jurors, witnesses, and even opposing counsel. He grew up in Nacogdoches, Texas. He co-captained his high school varsity football team as an All-East Texas middle linebacker while also serving as the Editor of Key Club’s Texas-Oklahoma District, won the Best Typist award, took the History Team to glory, and sang in the East Texas All Region Choir. As Dan Kelly of client Vistra Corp. put it, Barnett is “a great person to be around.”

Barnett is steady and loyal. He has practiced at Susman Godfrey his entire career. He and his wife Nancy live in Dallas and enjoy spending time in Houston and New York. Their daughter works for H-E-B in Houston, and their son is a Haynes and Boone transactions lawyer in Dallas.

As a member of Ivy League championship football teams in his junior and senior years at Yale and a parent of two Yalies, Barnett has no trouble choosing sides for “The Game” in November. And he knows how important fighting all the way to the end is. On his last play from scrimmage, in the waning minutes of The Game on Nov. 22, 1980, he recovered a Crimson fumble.

Yale won, 14-0.