Conflicts of interest among proposed class action member was a proper basis to deny class action certification the Sixth Circuit ruled recently in Schlaud v. Snyder, No 12-1105 (May 22, 2013). Because of these conflicts the proposed class representatives could not assure the adequacy of representation required by FRCivPro 23(a).
The case and the proposed class action challenged the deduction of union dues or agency fees from state subsidy payments to home childcare providers in Michigan. The class representatives claimed these deductions violated their First Amendment rights.
The proposed class was to consist of any home childcare providers who had the union dues or agency fees deducted. Alternatively, the plaintiffs proposed a subclass of any home childcare provider who did not vote in any union-related elections.
The Sixth Circuit found the class certification issued to turn on whether the named plaintiffs could provide adequacy of representation as required by FRCivPro 23(a). "A class representative must be part of the class and possess the same interest and suffer the same injury as the class members." Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 625-26 (1997).
The proposed class presented two issues regarding adequacy of representation: (1) conflict of interests; and, (2) different alleged injury. The court explained as follows:
Plaintiffs, who alleged that they were compelled to pay the fees under the CBA, have divergent interests from other potential class members, who voted in favor of that same CBA. Further, those who voted for the CBA did not suffer the injury alleged by plaintiffs because they were not compelled to support the Union financially – they voted to do so. Finally, plaintiffs' lawsuit would impair the ability of the Union to represent its members and is, therefore, not in the interest of those proposed class members who voted in favor of using collective action to improve the conditions of [the union members]."
Plaintiffs argued that the proposed subclass cured the conflict of interest issue "because no one in the proposed subclass expressed support for the Union." The court observed that this assertion required it to "assume that any home childcare provider who did not vote in any election related to the Union is opposed to supporting the Union financially", which it refused to do for two reasons: (1) a high turnover rate among home childcare providers supported the conclusion that many of the potential subclass members had not voted in union elections because they were not at the time home childcare providers; and, (2) in each union election a majority of voters supported the union.
Robert L. Abell
www.RobertAbellLaw.com
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