Cohelan on California Class Actions

Timothy D. Cohelan
Cohelan & Khoury, San Diego, California

Generally, state class action procedures in the United States fall into four basic categories. First, some states have implemented statutes that follow the express terms of Federal Rules of Civil Procedure, Rule 23, as adopted and revised in 1966. Second, some states still follow the pre1966 rule 23, which dates to 1938. Third are states with Field Code statutes, of which California is one. Fourth and finally, some states have no class action statutes whatsoever. (Uniform Law Commissioners Model Class [Act] [Rule] Prefatory Note.) Obviously, class action procedures differ substantially from state to state, and California has its own unique set of class action procedures.

When can an active California litigant represent other, passive persons in a lawsuit? Class action procedure and practice answer this question. The relevant statutes and case law apply in this order:

1. Code of Civil Procedure § 382.
2. Civil Code § 1781(b)(1)(4).
3. California case law, if specifically applicable.
4. Federal Rules of Civil Procedure, Rule 23 (supplementing Civ C § 1781; see McGhee v. Bank of America, 60 Cal.App.3d 442, 131 Cal.Rptr. 482 (1st Dist.1976)).
5. Local rules of the county in which the matter is filed.
6. Federal case law interpreting Rule 23 (unless a constitutionally protected right is involved, in which case it is binding on the California court).

Certain provisions (Civ C § 1781(b)(1)(4)) of the CLRA (Civ C §§ 1750 et seq.) closely track Federal Rule 23. Their importance to standard (nonconsumer) class action practice over the past 20 years of California case law is open to question.

Class action procedure cannot alter substantive law. (City of San Jose v. Superior Court, 12 Cal.3d 447, 115 Cal.Rptr. 797, 525 P.2d 701 (1974).) However, because of its expanded effect, class certification powerfully affects the total substantive rights of class members. As a result, policy issues underlying the substantive area of law work to the advantage or disadvantage of the class device. For example, because of the policy preference accorded antitrust issues, an antitrust consumer class action will likely fare better than a minor consumer claim against the representations of an advertiser.

Since a class action lawsuit affects the rights of persons not before the court, the individual representative, or litigant, represents the interests of those absent persons. The success or failure of the individual litigant binds the absent class members. The person bringing a class action must adequately represent and protect the interests of the other members of the class who will be bound by the judgment. (La Sala v. American Sav. & Loan Ass'n, 5 Cal.3d 864, 871, 872, 97 Cal.Rptr. 849, 489 P.2d 1113 (1971)). Thereafter, res judicata bars members of the class from relitigating claims related to the primary right already decided. (Johnson v. American Airlines, Inc., 157 Cal.App.3d 427, 203 Cal.Rptr. 638 (1st Dist.1984).)

This critical difference in the scope and extent of the undertaking of litigant and counsel in class actions results in special procedural complexities and additional fiduciary obligations that will be discussed later.

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