The U.S. District Court for the Western District of Tennessee dismissed the plaintiffs’ claims as time-barred in Phipps, et al. v. Wal-Mart Stores, Inc., No. 3:12-CV-01009, 2013 WL 752152 (W.D. Tenn. 2013), but encouraged appellate review in its order. Now, the Sixth Circuit has agreed to entertain an interlocutory appeal on this issue in Phipps, et al. v. Wal-Mart Stores, Inc., No. 13-6194 (6th Cir.), and a showdown in the U.S. Supreme Court may be forthcoming.BackgroundAs previously discussed, in March 2013, the Western District of Tennessee, in Phipps, et al. v. Wal-Mart Stores, Inc., No. 3:12-CV-01009, 2013 WL 752152 (W.D. Tenn. Feb. 20, 2013), dismissed the class claims of former Dukes plaintiffs on the ground that they were time-barred under Andrews v. Orr, 851 F.2d 146, 149 (6th Cir. 1988). By way of background, Andrews held that the tolling principle of American Pipe & Constr. Co. v. Utah, 414 U.S. 538, 554 (1974) — namely, that the commencement of a class action lawsuit suspends the statute of limitations as to putative members of the failed class — applied only to the initiation of new individual actions, and not new class actions. Andrews, 851 F.2d at 149 (“[T]he pendency of a previously filed class action does not toll the limitations period for additional class actions by putative members of the original asserted class.”).But the district court in Phipps did not stop there (to the chagrin of Wal-Mart and employers everywhere).
But relying on 11th circuit precedent, the court said that this tolling principle does not apply to a subsequent class action: Although the limitations period is tolled for individual claims while a class action suit is pending, in the Eleventh Circuit “the pendency of a previously filed class action does not toll the limitations period for additional class actions by putative members of the original class.” Griffin v. Singletary, 17 F.3d 356, 359 (11th Cir. 1994) (emphasis in original) (quoting Andrews v. Orr, 851 F.2d 146, 149 (6th Cir. 1988)). The Eleventh Circuit categorically refuses to toll the limitations period for subsequent class actions by members of the original class once class certification is denied in the original suit.
[2] See, e.g., Korwek v. Hunt, 827 F.2d 874, 879 (2d Cir. 1987) (“[T]he tolling doctrine enunciated in American Pipe does not apply to permit a plaintiff to file a subsequent class action following a definitive determination of the inappropriateness of class certification.”); Salazar-Calderon v. Presidio Valley Farmers Ass’n, 765 F.2d 1334, 1351 (5th Cir. 1985) (“Crown’s tolling principle applies, plaintiffs argue, not only for the first class certification petition filed but also for any subsequent petitions involving the same class. We are not persuaded.”); Andrews v. Orr, 851 F.2d 146, 149 (6th Cir. 1988); Robbin v. Fluor Corp., 835 F.2d 213, 214 (9th Cir. 1987).[3] Salazar-Calderon, 765 F.2d at 1351 (American Pipe tolling does not apply to permit putative class members to file a subsequent class action).
At base, Phipps appears to permit follow-on or “stacked” class actions when the new class is, in effect, a sub-class of the prior class—even when the Supreme Court has famously decertified the prior class for want of Rule 23(a) commonality.In Andrews v. Orr, 851 F.2d 146 (6th Cir. 1988), the Sixth Circuit recognized that its sister circuits were “in unanimous agreement that the pendency of a previously filed class action does not toll the limitations period for additional class actions by putative members of the original asserted class.” Id. at 149.
They acknowledged that the Supreme Court’s decision in American Pipe held that the filing of a class action suspends the running of the limitations period on class members’ individual claims, yet they insisted that American Pipe does not permit the filing of follow-on class actions, quoting a 1988 Sixth Circuit precedent to the effect “that the pendency of a previously filed class action does not toll the limitations period for additional class actions by putative members of the original asserted class.” Andrews v. Orr, 851 F.2d 146, 149 (6th Cir. 1988). They argued, moreover, that while 28 U.S.C. §1367(d) applies to individual litigants’ state-law claims, it cannot be used to benefit members of a class that was not certified.
This new development definitely merits some attention. In this latest ruling, the court reiterated its prior statement questioning the validity of the Sixth Circuit’s decision in Andrews v. Orr, 851 F.2d 146, 149 (6th Cir. 1988). The court described the Andrews case as stating “categorically, that there was ‘unanimous agreement that the pendency of a previously filed class action does not toll the statute of limitations period for additional class actions by putative members of the original class.’
Id. at *12.The Court’s Opinion The Court determined that the class claims were time-barred based on the Sixth Circuit controlling decision of Andrews v. Orr, 851 F.2d 146, 149 (6th Cir. 1988), which addressed whether American Pipe tolling applies to a follow-on subclass action.By way of background, Andrews was the third in a succession of class action racial discrimination lawsuits, the first of which was resolved through a consent decree, and the district court denied certification in the second.