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Alert: Recent Seventh Circuit Decisions May Signal Heightened Scrutiny Under Adequacy Prong

Written by: Eric L.Samore
December 14, 2011

SmithAmundsen's class action team recently secured a significant victory from the Seventh Circuit, raising the bar that plaintiff counsel must clear in order to satisfy the adequacy requirement for class certification. In an opinion authored by Judge Posner, the court vacated class certification in Creative Montessori Learning Centers v. Ashford Gear, No. 11-8020 (7th Cir. Nov. 22, 2011), because class counsel are fiduciaries of the class. Any serious doubts about their ability to loyally represent the interests of the class requires a denial of class certification. Judge Posner took issue with the district court’s holding that only the most egregious conduct by class counsel “could ever arguably justify denial of class status,” stating that such a ruling “would if taken literally condone, and by condoning invite, unethical conduct.” Usually adequacy of counsel is not contested at class certification hearings. Defense counsel ordinarily argues other defenses such as predominance.

The significance of this opinion was highlighted in an article by BNA Class Action Litigation Report titled, “Recent Seventh Circuit Decisions May Signal Heightened Scrutiny Under Adequacy Prong."

Reproduced with permission from Class Action Litigation Report, 12 CLASS 1149 (Dec. 9, 2011).
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