imageWe left off last Monday in the middle of something — the Seventh Circuit’s latest proof of its leadership in the law of class actions.

My talk of the Seventh Circuit surge followed a segment on The outsize influence of Justice Scalia.

Now let’s finish up with the surge before turning to the third and final reason class actions will rebound: Politics.

Seventh Circuit surge, part 2

At the end of the last post, we watched Chief Judge Diane Wood of the Seventh Circuit dispatch, in Kleen Products LLC v. Int’l Paper Co., No. 15-2385 (7th Cir. Aug. 4, 2016), defense complaints about evidence showing a “common impact” from the container board cartel’s price-fixing on all members of the direct-purchaser class.

Wal-Mart and Comcast

Now we come to Chief Judge Wood’s handling of two Supreme Court opinions in which Justice Scalia had written the 5-4 majority opinions reversing class certifications, Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011), and Comcast Corp. v. Behrend, 133 S. Ct. 1426 (2013).

She did so thus:

Defendants also argue that Dwyer’s approach is the same kind of “trial-by-formula” that the Supreme Court rejected in Wal-Mart. But in that case the Court disapproved the plaintiff’s attempt to take a sample of the class members, who alleged employment discrimination, to determine what percentage of that sample had actually experienced discrimination, and then to extrapolate that percentage for the whole class. The Purchasers here are doing nothing of the sort: they assert that every person or entity in North America paid the overcharges that resulted from Defendants’ collusive practices. Even for transactions where prices were negotiated individually or a longer term contract existed, the district court found, reasonably, that the “starting point for those negotiations would be higher if the market price for the product was artificially inflated.”

We have already discussed the Purchasers’ common proof of damages, but we add a few more words here to respond to the Defendants’ Comcast arguments. Defendants understand Comcast to hold that “individualized damages do foreclose predominance if plaintiffs present no classwide method to ad- judicate damages tethered to their theory of antitrust violations and if resolving those individualized damages issues would ‘overwhelm questions common to the class.’” Brief for Appellants at 36 (quoting 133 S. Ct. at 1433). We agree with Defendants that Comcast insists that the damages theory must correspond to the theory of liability, but that is all Comcast said that is pertinent to our case.

Kleen Products, slip op. at 16-17.

Aggregate damages

The last topic from Kleen Products involved damages in class actions. Chief Judge Wood wrote:

Defendants complain that it is wrong to calculate aggregate rather than individual damages for the class. The district court rejected that position as a matter of law, as do we. We held in Loeb Indus., Inc. v. Sumitomo Corp., 306 F.3d 469 (7th Cir. 2002), that plaintiffs are permitted to use estimates and analysis to calculate a reasonable approximation of their damages. Id. at 493. And we already have confirmed that at the class certification stage, plaintiffs are not obliged to drill down and estimate each individual class member’s damages. The determination of the aggregate classwide damages is something that can be handled most efficiently as a class action, and the allocation of that total sum among the class members can be managed individually, should the case ever reach that point. If in the end the Defendants win on the merits, this entire matter will be over in “one fell swoop.”* (See WILLIAM SHAKESPEARE, MACBETH, act 4, sc. 3, l. 220 (David Bevington ed., Pearson Longman 6th ed. 2009.) If Purchasers prevail on the common issues, both liability and aggregate damages will be resolved. The district court did not commit reversible error when it concluded that the class issues predominated.

Kleen Products, slip op. at 18.

Inertia and politics

Reason number three for the rebound of class actions combines inertia and politics.

If the Senate’s confirmatory torpor persists through January 2017, the preponderance of appellate judges who look more favorably on class actions will persist. President Obama has named two Supreme Court justices and 55 court of appeals judges. Since his first inauguration, eight of the 13 courts of appeals have flipped from majority Republican appointees to majority Democratic appointees. “And they really are diverse; 43 percent of Obama’s judges have been women, shattering the old record of 29 percent under Bill Clinton, and 36 percent have been non-white, surpassing Clinton’s record of 24 percent. Obama has appointed 11 openly gay judges, when before him there was only one.” Michael Grunwald, “Did Obama win the judicial wars?“, Aug. 18, 2016, Politico.

The preponderance will grow if the Democratic nominee does not blow the lead she currently has. Although nobody knows what will happen in November, FiveThirtyEight puts her chances at 89.2 percent.

A switch to a Democratic majority in the Senate — currently about a 50-50 bet — would make confirming the judicial nominees of a President Hillary Clinton faster. It also could affect the liberalness of her nominees.

What if Chief Judge Merrick Garland, President Obama’s choice to replace Justice Scalia, winds up joining the Court? Will a Justice Garland help a renaissance in class actions?

We don’t know of what he will do, but we do know that he and two of his D. C. Circuit colleagues vacated class certification in a high-profile antitrust case, In re Rail Freight Fuel Surcharge Antitrust Litig., 725 F.3d 244 (D.C. Cir. 2013). See “D.C. Circuit Derails Fuel Surcharge Class“, The Contingency, Aug. 9, 2013.

In Rail Freight, the panel (with Judge Janice Rogers Brown writing the opinion) took an “expansive” view of Comcast, holding “that any indicia of individualized damages in a Rule 23(b)(3) class action — which is a near certainty — dooms certification.” Alex Parkinson, Comcast Corp. v. Behrend and Chaos on the Ground, 81 U. Chi. L. Rev. 1213, 1226 & 1227 (2014). That sounds a potentially sour note in an otherwise pro-class forecast.

* * * *

Class actions will rebound in the near term for three reasons:

  • Justice Scalia’s death removed their most effective opponent,
  • the Seventh Circuit’s pro-class leadership accentuates the positives of class treatment and shows the way forward for other circuits, and
  • current electoral trends signal consolidation of, and probable growth in, the preponderance of Democratic appointees to the federal appellate bench.

* The “fell” in “fell swoop” means “fierce, cruel, ruthless”.

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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.