Chapter §23.5 Purpose and Procedure

• Jurisdiction: Washington

§23.5PURPOSE AND PROCEDURE

This section provides an overview of class action lawsuits and discusses the procedural requirements for maintaining them.

(1)Purpose

CR 23 provides a procedural device whereby one or more persons or entities may sue or be sued as the representative of a class of those who have a common interest in the matter in dispute, without the necessity of joining all class members as parties to the suit. See, e.g., Dep't of Ecology v. Pacesetter Constr. Co., 89 Wn.2d 203, 215, 571P.2d196 (1977). "[A] primary function of the class suit is to provide a procedure for vindicating claims which, taken individually, are too small to justify individual legal action but which are of significant size and importance if taken as a group." Brown v. Brown, 6 Wn.App. 249, 253, 492P.2d581 (1971).

Class actions are remedial in character. The objectives of class actions include resolution of many individual claims in a single action, elimination of repetitious and possibly inconsistent adjudications, and improving access to the courts for those whose economic positions do not allow individual lawsuits. Darling v. Champion Home Builders Co., 96 Wn.2d 701, 706, 638 P.2d 1249 (1982).

The specific requirements set forth in CR 23 must be met before a class will be certified and an action allowed to be maintained as a class action. Pickett v. Holland Am. Line-Westours, Inc., 101 Wn.App. 901, 6 P.3d 63 (2000), rev'd on other grounds, 145 Wn.2d 178, 35 P.3d 351 (2001), cert, denied sub nom. Bebchick v. Holland Am. Line-Westours, Inc., 536 U.S. 941 (2002); Lacey Nursing Ctr. v. Dep't of Revenue, 128 Wn.2d 40, 905 P.2d 338 (1995); Defunis v. Odegaard, 84 Wn.2d 617, 529P.2d438 (1974); Johnson v. Moore, 80 Wn.2d 531, 496P.2d334 (1972). The determination of whether to allow a suit to proceed as a class action is one within the sound discretion of the trial court and will not be overturned absent a manifest abuse of discretion. Eriks v. Denver, 118 Wn.2d 451, 824P.2d1207 (1992); Brown, 6 Wn.App. 249.

Public policy supports a liberal construction of the rule so as to allow class action treatment as long as the specific requirements set forth in the rule are met. Courts have observed that "if there is an error made, let it be in favor and not against the maintenance of the class action, for it is always subject to modification" should later developments so require. Brown, 6 Wn.App. 249 (quotingEsplin v. Hirschi, 402 F.2d 94 (10th Cir. 1968), cert, denied, 394U.S. 928 (1969)). Courts generally favor liberal interpretation of the rule to prevent multiplicity of litigation, save costs and inconvenience to class members, free defendants from the risks of identical future litigation, and preserve court resources. Id.

The specific provisions of CR 23 provide substantial protections to members of a class; absent an express intention to supersede the provisions of CR 23, class action provisions of a specialized statute will not take precedence over the requirements of the rule. Pacesetter Constr, 89 Wn.2d 203. Nevertheless, when a class action is brought pursuant to a statute, the statute may contain its own class action requirements independent of CR 23. See, e.g., Hoffman-La Roche, Inc. v. Sperling, 493 U.S. 165, 110 S. Ct. 482, 107 L. Ed. 2d 480 (1989) (special procedures for class actions brought under Age Discrimination in Employment Act).

Courts have discretion to enter protective orders when necessary to protect against potential abuses of the class action procedure. Darling, 96 Wn.2d at 707.

(2)Procedure

Procedure under CR 23 is discussed below.

(a)Overall structure

CR 23(a) and (b) set out the prerequisites to maintenance of a class action. CR 23(b) establishes three different types of class action, known respectively as 23(b)(1), 23(b)(2), and 23(b)(3) class actions. To be certified as a class action, a suit must meet the requirements of CR 23(a) and one of the subsections of CR 23(b). The specific requirements of each subdivision are discussed in detail in §23.6(1) and (2), below.

The three types of class actions are not necessarily exclusive, but a class action ordinarily will fall within only one of the three categories—23(b)(1), 23(b)(2), or 23(b)(3). Because 23(b)(3) class actions require individual notice to all members, CR 23(c)(2), and do not bind those class members who choose to "opt out" of the action after receiving notice, CR 23(b)(3), a class action should be maintained under CR 23(b)(1) or CR 23(b)(2) rather than CR 23(b)(3) whenever possible. See 5 James W. Moore, Moore's Federal Practice §23.40[2] (3d ed. 2013).

Because CR 23(b)(1) and CR 23(b)(2) class actions (unlike CR 23(b)(3) class actions) ordinarily involve injunctive and declaratory relief only, certification of such actions as class suits does not involve considerations of manageability and procedural due process to the same extent or degree as certification of class actions for damages under CR 23(b)(3).

The trial court must consider the appropriateness of class certification under the explicit criteria set forth in CR 23(a) and (b). Wash. Educ. Ass'n v. Shelton Sch. Dist. No. 309, 93 Wn.2d 783, 613 P.2d 769 (1980).

CR 23(b)(1) class actions

CR 23(b)(1) actions are appropriate when separate adjudications might result in inconsistent results, either to the party opposing the class or to class members. This type of class action may be appropriate in suits involving rights to land, patents, and certain taxpayer rights. For examples of suits under this subsection, see 5 James W. Moore, Moore's Federal Practice §§23.41-23.42(3ded.2013).Actionsunderthis subsection are predominantly, but not exclusively, actions for injunctive relief rather than actions for damages. A classic example of a situation in which damages may be involved in a CR 23(b)(1) action is when there is a "limited fund" of money that is insufficient to satisfy the claims of all members of a class. For an in-depth discussion of the limited-fund theory under Fed. R. Civ. P. 23(b)(1)(B), see Ortiz v. Fibreboard Corp., 527 U.S. 815, 119 S. Ct. 2295, 144 L. Ed. 2d 715 (1999).

For an example of a taxpayer rights lawsuit certified as a class action under this subsection, see Carrillo v. City of Ocean Shores, 122 Wn.App. 592, 599, 94 P.3d 961 (2004).

CR 23(b)(2) class actions

CR 23(b)(2) class actions are appropriate when the party opposing the class has acted or refused to act on grounds applicable generally to the class, thereby making injunctive and declaratory relief proper with regard to the class as a whole. Actions under this subsection therefore are actions for injunction and declaration of the applicable law only, rather than suits for damages. The classic CR 23(b)(2) class action is a suit against a state official or agency for violation of the legal or constitutional rights of a class of citizens. 5 James W. Moore, Moore's Federal Practice §23.43[1] (3d ed. 2013). Such suits may properly be characterized as CR 23(b)(2) cases. King v. Riveland, 125 Wn.2d 500, 518, 886 P.2d 160 (1994); Margola Assocs. v. City of Seattle, 121 Wn.2d 625, 633, 854P.2d23 (1993); Darrin v. Gould, 85 Wn.2d 859, 540P.2d882 (1975); Johnson, 80 Wn.2d 531; Bore v. Kinnear, 79 Wn.2d 755, 489P.2d898 (1971); Zimmer v. City of Seattle, 19 Wn.App. 864, 578P.2d548 (1978); Brown, 6 Wn.App. 249.

Washington appellate courts have been extremely liberal in certifying CR 23(b)(2) class actions when the constitutionality of a statute is at issue. For example, the court in Zimmer, 19 Wn.App. 864, reversed a trial court's order refusing certification of such a class, holding that a CR 23(b)(2) class was appropriate even though many class members could not be identified and even though some class members might not wish to benefit from the relief sought by the class representative. But see Eriks, 118 Wn.2d 451 (affirming trial court's refusal to recertify a CR 23(b)(3) class action as a CR 23(b)(2) class action). For an example of a taxpayer rights lawsuit certified as a class action under this subsection, see Carrillo, 122 Wn.App. at 599.

Although the primary remedy in a class action under CR 23(b)(2) is injunctive or declaratory relief, Washington cases have held that money damages also may be recovered when they are incidental to the equitable relief that is the primary focus of the action. Nelson v.Appleway Chevrolet, Inc., 129 Wn.App. 927,121P.3d95 (2005), aff'd, 160 Wn.2d 173, 157P.3d847 (2007). It was stated that incidental damages are a group remedy rather than an individual one, and may include those damages to which class members automatically would be entitled once liability to the class is established. Such damages should be capable of computation by reference to objective standards; they should not be dependent in any significant way on intangible, subjective differences in each class member's circumstances, and they should not introduce new and substantial legal or factual issues or complex individualized determinations. Sitton v. State Farm Mut.Auto. Ins. Co., 116 Wn.App. 245, 252-53, 63 P.3d 198 (2003).

In a CR 23(b)(2) class action for injunctive relief in an employment discrimination case, it was held that back pay is within the ambit of incidental damages that can be awarded in a case under this subsection when plaintiffs' predominant claim is for injunctive relief. Williams v. Boeing Co., 225 F.R.D. 626 (W.D. Wash. 2005). However, in Wal-Mart Stores, Inc. v. Dukes,___U.S.___, 131 S. Ct. 2541, 2557, 180 L. Ed. 2d 374 (2011), the United States Supreme Court determined that claims for back pay in employment...