The Puzzle Of Enforcing Class Action Bars Post-Shady Grove

By Daniel Fong and Robert Guite (April 24, 2018, 11:43 AM EDT) -- Despite the significant passage of time since the U.S. Supreme Court's ruling in Shady Grove Orthopedic Associates v. Allstate Insurance[1], courts continue to wrestle with whether state statutory class action bars are enforceable in federal court. Eight years ago the U.S. Supreme Court ruled that a New York class action seeking statutory penalties could proceed in federal court despite New York's prohibition on class actions seeking statutory penalties. In Shady Grove, the court compared N.Y. Civil Practice Law Ann. § 901(b), which bars class actions seeking statutory penalties, with Federal Rule of Civil Procedure 23, which permits class actions in federal court. Writing for the majority, Justice Antonin Scalia acknowledged that Rule 23 and § 901(b) directly conflict, and subsequently ruled that Rule 23 preempted application of New York's state bar on certain class actions....

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