Antitrust class actions are often sprawling litigations, so the early resolution of Article III standing disputes can result in sizable efficiencies for parties and courts.
Moreover, because standing is an irreducible constitutional minimum and an indispensable part of the plaintiff's case, rather than a mere pleading requirement,1 a court would "act ultra vires" if it purported to resolve merits questions before ensuring that it had Article III jurisdiction to do so, according to the U.S. Supreme Court's 1998 Steel Co. v. Citizens for a Better Environment decision.2
Nevertheless, some lower courts are split on how this holding applies where Article III disputes are raised in the context of class actions pursued under Rule 23 of the Federal Rules of Civil Procedure. A number of lower courts have deferred decisions on Article III standing until after resolving the plaintiffs' class certification motion.
Those courts rely on a pair of Supreme Court decisions — Amchem Products Inc. v. Windsor3 in 1997 and Ortiz v. Fibreboard Corp.4 in 1999 — that referred to class certification issues as "logically antecedent" to Article III questions.
But the majority of courts to consider the issue, including the U.S. Court of Appeals for the Sixth Circuit in April in Fox v. Saginaw County, Michigan, hold that Amchem and Ortiz do not require or even permit granting class certification motions before resolving Article III standing challenges.5
This split on timing is one of four ongoing disputes over standing in antitrust class actions,6 and is entwined with another split we previously addressed: whether named plaintiffs have standing to bring class claims in states where they made no purchases.7
Some courts have held that if Rule 23 issues may be antecedent to standing questions, then courts may wait to resolve Article III standing challenges until after deciding certification, and if a class is certified, then "Article III standing requirements must be assessed with reference to the class as a whole, not simply with reference to the individual named plaintiffs."8
By contrast, other courts have disagreed that Article III standing for named plaintiffs can be expanded through Rule 23 and have declined to defer standing issues.9
As we discuss below, and as the Sixth Circuit reasoned in Fox, litigants and decisions that rely on Amchem and Ortiz to defer standing issues until after ruling on plaintiffs' class certification motions improperly expand those cases' logically antecedent language to a situation the Supreme Court did not address — one where a plaintiff invokes class claims it lacks standing to bring in their own suit, in the hopes that they can certify a class and then rely on the absent class members' standing to maintain those class claims.
When Is Rule 23 Logically Antecedent to Article III According to the Supreme Court?
The Amchem and Ortiz decisions both addressed proposed settlement classes that brought claims for injuries caused by exposure to asbestos.
In those cases, objectors to the settlement classes argued that the classes should not be certified for failure to meet Rule 23 and Article III standing requirements, among other deficiencies.10
Both the Amchem and Ortiz settlements were attempts to achieve global resolutions of asbestos claims that on the one hand capped the defendants' significant liability exposure, and on the other, created funds accessible to future claimants without additional litigation.11
Accordingly, to achieve the first goal, the proposed settlements precluded class members from litigating against the defendant companies for any present or future asbestos-related injury or death.12
In both cases, the classes included future claimants of individuals who had been exposed to asbestos but had not yet experienced any asbestos-related injury, illness or death13, with defendants arguing that those class members lacked standing to sue.14
In neither Amchem nor Ortiz did the settling parties intend to litigate the claims: For the former, the proposed settlement agreement was filed on the same day as the complaint,15 and for the latter, a complaint was filed to certify a settlement class.16
Amchem was decided first. The Supreme Court upheld the U.S. Court of Appeals for the Third Circuit's denial of certification, reaching that decision after putting aside the standing dispute in favor of addressing the Rule 23 issues.17
In doing so, the Supreme Court reasoned that it was prudent to avoid constitutional questions when the nonconstitutional, Rule 23 determinations would be dispositive, as they were in Amchem given the court's denial of class certification.18
The Supreme Court also agreed with the Third Circuit's conclusion that deciding Rule 23 issues first would "offend no principle of constitutional law," because the Article III standing question for class members with future asbestos-related conditions did not exist unless, and until, a class was certified.19
In the Supreme Court's rephrasing of this conclusion, the "resolution [of the class certification issues] here is logically antecedent to the existence of any Article III issues."20
In Ortiz, the Supreme Court reversed the U.S. Court of Appeals for the Fifth Circuit's certification of the settlement class. Electing again to bypass the Article III dispute because the Rule 23 defects were dispositive, the Supreme Court held, "as they were in Amchem," that the class certification issues were logically antecedent.21
The Lower Courts' Split on the Scope of Amchem and Ortiz
When litigated, antitrust class actions are dissimilar in procedural posture from the two asbestos actions in Amchem and Ortiz that were filed for settlement purposes.
While the objectors raised standing and Rule 23 challenges at the same time, litigation can be protracted, and years of discovery can take place before a decision on certification. Raising Article III standing challenges early can be strategically advantageous and can narrow discovery significantly.
Therefore, the question that arises in antitrust class actions, as well as other class actions, is whether a court may defer its decision on an early standing challenge until certification is briefed at a later time.
The Sixth Circuit addressed this question recently in Fox. The plaintiff argued that Amchem and Ortiz stood for the proposition that a court could defer standing questions until certification.22
But the Sixth Circuit disagreed, noting that "Amchem and Ortiz did not concern standing challenges to named plaintiffs; they concerned standing challenges to class members," and since no class members were parties unless a class was certified, it "makes sense to consider certification ahead of standing for that type of challenge," particularly since "a class-certification denial will make a class member's standing problem irrelevant."23
In contrast to Amchem and Ortiz, the named plaintiff's standing was challenged in Fox, and thus the Sixth Circuit only considered whether that plaintiff had standing: Since named plaintiffs are the only "parties from the start," a "court thus must immediately concern itself with their standing because jurisdictional issues precede the merits."24
With its holding in Fox, the Sixth Circuit joins other circuits holding that Amchem and Ortiz do not supply a basis to defer all standing questions until the class certification briefing.25
Decades earlier, however, the U.S. Court of Appeals for the Seventh Circuit's 2002 opinion in Payton v. County of Kane relied on what it termed a "juridical link doctrine" to permit a named plaintiff suing about the application of a state statute more broadly to pursue class claims against defendants that had never personally injured it.
The Seventh Circuit reasoned that the logically antecedent language from Amchem and Ortiz was a "directive to consider issues of class certification prior to standing."26
It therefore remanded to the U.S. District Court for the Northern District of Illinois to determine whether the plaintiff satisfied Rule 23 before deciding if the court had jurisdiction as to the claims against all defendants, cautioning that:
once a class is properly certified, statutory and Article III standing requirements must be assessed with reference to the class as a whole, not simply with reference to the individual[ly] named plaintiffs.27
District courts remain divided as well. In Bledsoe v. FCA US LLC in March, the U.S. District Court for the Eastern District of Michigan held that "Plaintiffs must demonstrate standing for every claim they raise," irrespective of the "logical antecedence" language in Amchem and Ortiz. It also determined that "where the putative plaintiffs' injury is in doubt, Article III standing issues should be resolved in the first instance."28
But in In re: Seroquel XR Antitrust Litigation last year, the U.S. District Court for the District of Delaware found there were similar "prudential considerations" as in Amchem, and declined to "wade through complex issues of jurisdiction and constitutional law when determinations of fact and interpretation of Rule 23 could well resolve the issue."29
Similarly, in In re: Vascepa Antitrust Litigation, the U.S. District Court for the District of New Jersey relied on Ortiz's logical antecedence language in February to hold that it was immaterial whether named plaintiffs had standing to pursue class claims in states other than those in which they were injured.
The court believed this issue related to Rule 23's predominance requirement only — and therefore deferred ruling on this standing dispute because it may be mooted if the court elected to deny class certification.30
And in In re: EpiPen (Epinephrine Injection, USP) Marketing, Sales Practices & Antitrust Litigation in 2021, Article III standing questions for the class were deferred to trial, and the U.S. District Court for the District of Kansas required jury findings on whether each class member had sustained an injury.31
Our View
Over 20 years after the Supreme Court's decisions in Amchem and Ortiz, there is still no consensus on the scope of the court's holdings on logical antecedence.
The Supreme Court has not offered additional guidance to date, and disputes on related issues — including whether named plaintiffs can bring class claims that they have no individual standing to litigate — further complicate questions on the appropriate time to decide Article III disputes.
We think, however, that the Sixth Circuit's reasoning in Fox is most faithful to the requirement that a plaintiff invoking federal court jurisdiction "must have standing 'at the outset of the litigation,'" with jurisdiction turning "on the facts as they are when a plaintiff sues, not on later-in-time facts,"32 and that thereafter the plaintiff must maintain and demonstrate its standing "with the manner and degree of evidence required at the successive stages of the litigation."33
As we discussed previously, the Supreme Court has held that Rule 23 cannot give plaintiffs "different rights in a class proceeding than they could have asserted in an individual action."34
Since any expectation that a named plaintiff's standing may change after a class is certified would be contrary to that ruling, there is no reason — or constitutional ability — to defer deciding on whether the named plaintiff has standing to assert the claims it brings until some later time.35
To be clear, none of this renders Amchem or Ortiz obsolete. Where a challenge is raised to class members' standing, for instance, a court may well follow the lead of those cases and decline to decide a potentially tricky constitutional question by disposing of the issue on another ground,36 such as by denying a motion for class certification.
But where defendants challenge the named plaintiffs' standing to bring one or more of the claims they assert, we agree with the majority of circuits that have decided the issue that the "standing issue must be addressed first, prior to deciding class certification."37
1 Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992).
2 Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 101 (1998) (Scalia, J.) ("While some of the [discussed Supreme Court decisions] must be acknowledged to have diluted the absolute purity of the rule that Article III jurisdiction is always an antecedent question, none of them even approaches approval of a doctrine of 'hypothetical jurisdiction' that enables a court to resolve contested questions of law when its jurisdiction is in doubt."); but see id. at 112 (Stevens, J., concurring) (opining that the Court had created new constitutional law by electing to resolve an undecided constitutional question first, when it could have answered the statutory question instead and avoided reaching the constitutional question altogether).
3 Amchem Prods. v. Windsor, 521 U.S. 591 (1997).
4 Ortiz v. Fibreboard Corp., 527 U.S. 815 (1999).
5 Fox v. Saginaw County, Mich., 67 F. 4th 284, 296-97 (6th Cir. 2023).
6 Other common issues include: (1) whether a class that includes members who lack standing may be certified and, if so, whether the number of such members must be de minimis; and (2) whether a plaintiff has sufficiently alleged or proven concrete injury-in-fact to itself and the proposed class, which we covered in "Challenging Standing in Antitrust Class Actions: Injury-In-Fact," Law360, https://www.law360.com/articles/1606633 (May 11, 2023).
7 "Challenging Standing in Antitrust Class Actions: Rule 23," Law360, https://www.law360.com/articles/1687048/challenging-standing-in-antitrust-class-actions-rule-23 (June 9, 2023).
8 See, e.g., Payton v. County of Kane, 308 F.3d 673, 679-80 (7th Cir. 2002). Other courts, cognizant of the unresolved constitutional questions in this area, have chosen to decide Rule 23 issues first for pragmatic reasons, and not because they felt obligated to do so by existing precedent. See, e.g., In re Seroquel XR (Extended Release Quetiapine Fumarate) Antitrust Litig., 2022 U.S. Dist. LEXIS 117525, at *52 (D. Del. July 5, 2022) ("The courts that have addressed whether a named plaintiff has standing to assert claims that only putative class members may advance are split. . . . Although I see Defendants' position on this interesting issue, for pragmatic reasons I will defer the standing analysis required by Article III until after class certification has been resolved under Rule 23.").
9 See, e.g., Fox., 67 F. 4th at 296-97.
10 Amchem, 521 U.S. at 608; Ortiz, 527 U.S. at 831.
11 Amchem, 521 U.S. at 601; Ortiz, 527 U.S. at 825.
12 Id.
13 Amchem, 521 U.S. at 602; Ortiz, 527 U.S. at 825-26.
14 See, e.g., Amchem, 521 U.S. at 611.
15 Id. at 601.
16 Ortiz, 527 U.S. at 825.
17 Amchem, 521 U.S. at 612
18 Id. (discussing Georgine v. Amchem Prods., 83 F.3d 610, 623 (3d Cir. 1996)).
19 Georgine, 83 F.3d at 623.
20 Amchem, 521 U.S. at 612.
21 Ortiz, 527 U.S. at 831.
22 Fox, 67 F.4th at 296.
23 Id. at 296-97.
24 Id. at 297.
25 See e.g., Mahon v. Ticor Title Ins. Co., 683 F.3d 59, 65 (2nd Cir. 2012) ("The Court's language regarding the logical antecedence of class certification issues appears to us to be a description of the case before it, and not, as the Payton decision maintained, a general directive regarding the order in which a court should treat class certification and Article III standing in every action."); Neale v. Volvo Cars of N. Am., LLC, 794 F.3d 353, 360 (3d Cir. 2015); Flecha v. Medicredit, Inc., 946 F.3d 762, 769 (5th Cir. 2020) (holding Rule 23 should be decided before Article III for the proposed class, but also stating, "To be sure, if it is the class representative who presents a standing problem, then that standing issue must be addressed first, prior to deciding class certification.").
26 Payton, 308 F.3d at 678-80. As shown in the preceding footnote, other courts have strongly disagreed that Amchem and Ortiz set out "a general directive regarding the order in which a court should treat class certification and Article III standing in every action." E.g., Mahon, 683 F.3d at 65. And the Sixth Circuit's decision in Fox maligned the "juridical link doctrine" for purporting to create an "efficiency" exception to Article III standing by relying on a 1973 decision from the Ninth Circuit that predated the clear and strict standing rules the Supreme Court subsequently adopted. 67 F.4th at 295-96.
27 Payton, 308 F.3d at 680.
28 Bledsoe v. FCA US LLC, 2023 U.S. Dist. LEXIS 49585, at *106 (E.D. Mich. Mar. 23, 2023). While the defendants also raised the argument that plaintiffs lacked standing to bring claims arising under the laws of any states for which there was no putative class representative, the court did not decide this issue because it found that plaintiffs effectively conceded the point. Id.
29 Seroquel, 2022 U.S. Dist. LEXIS 117525 at *53-54. See also In re Surescripts Antitrust Litig., 2022 U.S. Dist. LEXIS 109387, at *640 n.8 (N.D. Ill. June 21, 2022).
30 In re Vascepa Antitrust Litig. Indirect Purchaser, 2023 U.S. Dist. LEXIS 30091, at *10 (D.N.J. Feb. 23, 2023).
31 See, e.g., In re EpiPen (Epinephrine Injection, USP) Mktg., Sales Pracs. & Antitrust Litig., 2021 U.S. Dist. LEXIS 239220, at *78-79 (Dec. 15, 2021).
32 Fox, 67 F.4th at 294-95 (quoting Friends of the Earth, Inc. v. Laidlaw Env't Servs. (TOC), Inc., 528 U.S. 167, 180 (2000)).
33 Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992).
34 Tyson Foods, Inc. v. Bouaphakeo, 577 U.S. 442, 458 (2016).
35 The Sixth Circuit in Fox goes into detail discussing myriad other ways that appeals to "efficiency" and the like do not justify setting side Article III's strictures, with a long list of Supreme Court precedent this approach would violate. 67 F.4th at 294-98.
36 See, e.g., Ashwander v. TVA, 297 U.S. 288, 347 (1936).
37 Flecha, 946 F.3d at 769.
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