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Absent Class Members Suing in State Court Are Not Bound by Prior Federal District Court Decision
Last year, in Shady Grove Orthopedic Associates, P. A. v. Allstate Ins. Co., 559 U.S. ___, 130 S. Ct. 1431; 176 L. Ed. 2d 311 (2010), the Supreme Court held that state law prohibitions against the use of the class action device did not apply to suits pending in federal court because class claims in federal court are governed by the requirements of Federal Rule of Civil Procedure 23.
Recently, in Smith v. Bayer Corp., 564 U.S. ___, 131 S.Ct. 2368, 180 L.E.2d 341 (2011), the Court addressed a variation on that theme: whether a federal court decision denying class certification had any preclusive effect on efforts by other plaintiffs to seek certification in state court under nearly identically worded state procedural rules. In Smith, the district court overseeing a federal MDL concluded that a West Virginia plaintiff could not seek class-wide relief under that state's consumer protection act. When an unrelated group of plaintiffs in a West Virginia state court proceeding then sought certification of essentially the same class in the state forum, the federal district court stepped in and enjoined further state court certification proceedings. The Eighth Circuit affirmed.
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