June 29, 2012

The other mistake the Supreme Court made yesterday

By Deborah J. La Fetra Senior Attorney

Largely lost in the hullaballoo yesterday, the Supreme Court dismissed First American v. Edwards as “improvidently granted.”  It did not give any reasons for the dismissal.

This case asked whether a plaintiff who suffered no injury whatsoever from a defendant’s technical violation of statute could pursue a class action in federal court.  Article III of the Constitution allows federal courts to hear cases and controversies, while Article II describes the duties of the Executive branch to “take Care that the Laws be faithfully executed,” — that is, to enforce the law.  PLF (joined by the Center for Constitutional Jurisprudence) argued that the plaintiff’s lawsuit was barred by Article III because her lack of injury meant that there was no case or controversy to be resolved.

This case was particularly important because the plaintiff represented a class, and allowing noninjury class actions are an anchor on the economy, benefitting no-one other than the plaintiffs’ attorneys.  This is because the cases generally end when a class is certified because the defendant company will settle to avoid the cost of going to trial, even if its defenses have merit.  The requirement that a litigant have standing recognizes that courts are not super-legislatures deciding broad questions of policy but rather tribunals best equipped to resolve individual disputes and clearly defined questions of law and fact.  Article III requires an actual injury in fact to maintain standing. “No harm” lawsuits—particularly “no harm” class actions, as in this case—are a drain on both economic and judicial resources, to no one’s benefit except the plaintiffs’ bar.

This issue will not go away.  It will continue to “percolate” in the lower courts until the Supreme Court once again chooses to try to resolve it.

What to read next