November 03, 2016

On November 3, 2016, the Advisory Committee on Civil Rules held the first of three hearings on the proposed amendments to Rule 23. Cohen Milstein Partner Brent Johnson provided testimony on behalf of COSAL and submitted written comments that he prepared along with his Cohen Milstein colleague Emmy Levens.  Mr. Johnson and Ms. Levens focused their comments on concerns with the proposed language under Rule 23(e)(2)(C)(ii) that would require courts to take into account, “the effectiveness of the proposed method of distributing relief to the class, including the method of processing class-member claims, if required” in deciding whether to approve a settlement. The concern is that some courts could mistakenly interpret the inclusion of such a factor and the word “effectiveness” to mean that there are categorically ineffective methods of distributing relief to classes.  Such a standard could lead to the rejection of settlements for this reason, thereby inserting a  heightened ascertainability standard into the Rule, when the committee specifically decided not to address that issue through this amendment process.

To avoid this issue, Mr. Johnson and Ms. Levens suggested that Rule 23(e)(2)(C)(ii) be changed to provide that, in considering whether to approve a class settlement under Rule 23(c)(3), courts consider: “(ii) whether the proposed method of distributing relief to the class, including the method of processing class-member claims, if required, is the best method that is practicable under the circumstances.” 

The Federal Rules Advisory Committee formulates and proposes revisions to the Federal Rules periodically, inviting input from judges, attorneys, legal scholars, and the general public. Comments to the proposed amendments will be considered by the Advisory Committee, which includes experienced trial and appellate lawyers, judges, and prominent legal scholars. The public study and comment period is ongoing and continues through February 15, 2017.