Philip Bobbitt v. Milberg LLP, 801 F.3d 1066

Milberg LLP, lead counsel in an Arizona securities class action against VALIC, secured class certification in 2004 but later missed disclosure deadlines; the district court struck expert testimony, vacated certification, and entered judgment for VALIC.
Absent class members were not notified of the decertification or judgment; plaintiffs later sued Milberg for legal malpractice for failing to preserve the class.
Plaintiffs sought Rule 23(b)(3) class certification in the malpractice suit; the district court denied certification, finding individual choice-of-law questions predominated because each absent class member’s home-state law governed.
The district court concluded laws of up to fifty states might apply and plaintiffs had not shown conflicts would not defeat predominance.
Named plaintiffs voluntarily dismissed their individual claims; an unnamed class member, Lance Laber, intervened to appeal the denial of class certification.
The Ninth Circuit vacated and remanded, holding the district court erred in applying each claimant’s domicile law rather than Arizona law (where the alleged malpractice and injury occurred) to individual malpractice claims.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Proper choice-of-law for each absent class member's legal malpractice claim	Arizona law applies because the malpractice (missed filings, sanctions, decertification) and resulting injury occurred in Arizona	Domicile-state laws govern each absent class member’s claim, creating individualized choice-of-law issues	Held for plaintiff: Arizona has the most significant relationship; Arizona law applies to each claim
Effect of multistate domiciles on Rule 23(b)(3) predominance	Common legal issues predominate if a single controlling law (Arizona) applies	Diversity of domiciles means up to 50 different laws could apply, defeating predominance	Court found district abused discretion by assuming multiple states’ laws; remanded to reassess predominance under Arizona law
Relevance of where client feels economic consequences	Injury location is where the interest was held and lost (Arizona), not where plaintiffs reside	Economic injury occurs at the plaintiff’s domicile	Held for plaintiff: focus is location of the injury (Arizona), not where consequences are felt
Whether relationships with unnamed class members were centered outside Arizona	Plaintiffs: relationship centered in Arizona because the class action and judgment were in Arizona	Defendants: minimal contact with absent members; domiciles control	Held for plaintiff: relationship centered in Arizona; domicile factor given little weight when unrelated to injury

Stearns v. Ticketmaster Corp., 655 F.3d 1013 (9th Cir. 2011) (standard of review for class-certification denials)
Hinkson v. United States, 585 F.3d 1247 (9th Cir. 2009) (abuse of discretion when court makes an error of law)
Coneff v. AT&T Corp., 673 F.3d 1155 (9th Cir. 2012) (choice-of-law questions reviewed de novo)
Bates v. Superior Court, 749 P.2d 1367 (Ariz. 1988) (Arizona applies Restatement §145 for multistate torts)
Patton v. Cox, 276 F.3d 493 (9th Cir. 2002) (location of quasi-judicial proceeding is persuasive in choice-of-law)
Johnson v. Nextel Commc'ns Inc., 780 F.3d 128 (2d Cir. 2015) (distinguishable attorney-malpractice choice-of-law decision where attorney-client relationships were formed in plaintiffs’ home states)
Berger v. Home Depot USA, Inc., 741 F.3d 1061 (9th Cir. 2014) (jurisdictional precedent cited by the panel)