SCOTUS Rules American Pipe Tolling Does Not Apply to Class Claims Trial

July 12, 2018

In a recent article in the American Association for Justice’s Trial magazine, Labaton partner David Goldsmith discussed the impact of the recent U.S. Supreme Court decision in China Agritech Inc. v. Resh on the courts and plaintiffs’ bar. The unanimous ruling held that American Pipe’s tolling rule does not apply to successive class actions.

“The Court’s decision effectively permits members of a class to pursue only individual claims following an initial denial of class certification, regardless of the type of class action, the reason for the denial, or the ability to cure whatever is precluding class treatment. This new limitation will be bad for courts because absent class members will likely file protective class complaints as a hedge against denial of the named plaintiffs’ class certification motion, and it will be bad for plaintiffs (especially plaintiffs of modest means) because if they do not protect themselves in this manner, they will be left with individual claims that often will be economically infeasible to pursue.”

David added that the only absent class members that will continue to benefit from American Pipe are “big entities with claims and resources sufficiently large to justify litigation.” David contributed to the amicus curiae brief filed on behalf of AARP and AARP foundation in China Agritech.