Mississippi’s LCD Case Heads to Supreme Court

     WASHINGTON (CN) – The U.S. Supreme Court on Tuesday agreed to decide whether state court should sort out Mississippi’s lawsuit against manufacturers and distributors of liquid crystal display panels.
     Claims over a long-running LCD price-fixing date back to 2007, when consumers accused several companies of fixing, raising, stabilizing and maintaining “prices for LCD panels sold indirectly to plaintiffs and the members of the other indirect-purchaser classes.”
     Mississippi, a state that explicitly prohibits class actions, brought its complaint under the Mississippi Consumer Protection Act and the Mississippi Antitrust Act. While the consumer law forbids class actions, the antitrust law makes no requirements typical of class actions brought under Rule 23 of the Federal Rules of Civil Procedure.
     AU Optronics and the other companies named in Mississippi’s state court complaint, removed the case to federal court. They said the Class Action Fairness Act warranted removal since the complaint either qualified as a class action or “mass action.”
     A federal judge in Mississippi disagreed on both counts and remanded the action, but the 5th Circuit reversed in November 2012.
     “Under the terms of the statute, a mass action is defined as a civil action in which (1) monetary relief claims of (2) 100 or more persons (3) are proposed to be tried jointly on the ground that the plaintiffs’ claims involve common questions of law or fact and (4) include an amount in controversy exceeding $75,000,” the ruling stated.
     “If undisputed that the present suit involves ‘monetary relief’ claims, and that the relief sought satisfies the amount in controversy requirement. Therefore, the decisive question is whether the suit involves the claims of ‘100 or more persons.’ If so, the suit is a mass action, and removal is proper.”
     “The real parties in interest in Mississippi’s suit are those more than 100 persons who, ‘by substantive law, possess[] the right sought to be enforced, and not necessarily the person who will ultimately benefit from the recovery,'” the three-judge panel added. “We find that the real parties in interest are numerous – far in excess of 100. Contrary to the state’s assertions, Mississippi is thus not the sole party in interest. Instead, the state (as a purchaser of LCD products) and individual citizens who purchased the products within Mississippi possess ‘rights sought to be enforced.'” (Parentheses and emphasis in original.)
     Though the Class Action Fairness Act, or CAFA, contains several disqualifying exceptions to the term mass action, the federal appeals court found that the “general public” exception offered the closest possibility but was still unsuccessful.
     “The requirement that ‘all of the claims’ be asserted on behalf of the public is not met here,” the judges wrote. “As discussed above, individual consumers, in addition to the State, are real parties in interest, so there is no way that ‘all of the claims’ are ‘asserted on behalf of the general public.'”
     “We do, however, acknowledge the concern that finding the general public exception inapplicable here may render such statutory exception a dead letter (because finding a suit to be a mass action negates the possibility of the exception applying), and we welcome congressional clarification of this issue,” they added.
     As is its custom, the Supreme Court issued no comment Tuesday while granting the state a writ of certiorari.

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