We all know that the Supreme Court is responsible for interpreting and clarifying the law. When a dispute between two or more parties reaches the Supreme Court, the Court’s decision in that case has the potential to influence American laws for decades to come. Sometimes, the rulings made by the Supreme Court influence not just the laws, but how those laws are enforced, including when a decision can be appealed to a higher court.
Appealing a Consolidated Lawsuit
For example, in a recent dispute that the Supreme Court will hear this term, multiple lawsuits that have been filed alleging manipulation of the London Interbank Offered Rate (LIBOR). A number of those lawsuits have been consolidated into one complaint. Courts will sometimes do this when one plaintiff is facing multiple lawsuits in which the complaints are all the same or similar. By combining them into one large lawsuit, the courts can deal with the case more efficiently and avoid repeating itself by dealing with the same issues again and again.
Many times, when dealing with a lawsuit that has multiple complaints, a court will dismiss some of the complaints while allowing others to continue through the court system. The question then becomes whether plaintiffs can appeal the court’s dismissal to a higher court. When plaintiffs tried to do this in the recent case involving alleged manipulation of the LIBOR, the Second Circuit Court declined to hear the case, claiming that, because the lower court had only dismissed some of the complaints, the Second Circuit Court lacked the jurisdiction for an appeal. The plaintiffs then appealed the decision to the Supreme Court, which will hear the case this term. The Supreme Court’s decision will determine whether such cases can move up the appellate courts piece by piece, or as one consolidated case.
The Defendant’s Burden in Moving a Class Action Lawsuit to Federal Court
The Supreme Court will also rule on the application of the 2005 Class Action Fairness Act (CAFA). This act gave defendants the power to have a class action lawsuit moved to federal court, if the case fit certain requirements, in order to prevent plaintiffs from filing the lawsuit in the court that would be most likely to rule in their favor, also known as “forum shopping”. In order to move a case to federal court, the class of plaintiffs must consist of members from more than one state and the amount in dispute must be more than $5 million.
In Dart Cherokee Basin Operating Company, LLC v. Owens, the district court and the Tenth Circuit Court both remanded the case back to state court because the defendant did not provide sufficient evidence that the amount in dispute is more than $5 million. The defendant argues that the courts should not need evidence of the amount in dispute until the plaintiff denies the amount. The Supreme Court’s ruling in this case will determine the amount of evidence a defendant needs to provide in order to have a case moved to federal court. Continue reading