Starr International Company, Inc., on Its Behalf and on Behalf of a Class of Others Similarly Situated v. United States
109 Fed. Cl. 628
Fed. Cl.2013Background
- Starr International sued the United States alleging two government actions—the Credit Agreement of Sept. 22, 2008 and the June 30, 2009 reverse stock split—could constitute a taking or illegal exaction of shareholders’ property without just compensation.
- The Court previously held Starr sufficiently pled two government actions requiring compensation but did not rule on merits.
- Starr moved to certify two classes under Rule 23: a Credit Agreement Class and a Stock Split Class, plus appointment of class counsel.
- The Government opposed certification, arguing Rule 23’s requirements (typicality, commonality, adequacy) were not satisfied.
- The Court held Starr’s proposed two-class structure and the common questions presented were suitable for class-wide resolution and granted certification.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Commonality satisfaction for both classes | Starr’s claims share a common core: the same government actions affect all class members. | Gen. commonality is lacking due to individualized issues and damages, and multiple actions could dilute uniformity. | Commonality satisfied for both classes. |
| Typicality of named plaintiff for each class | Starr’s claims arise from the same actions and legal theories as the class members. | Differences in interests could undermine typicality across actions and voting rights. | Typicality satisfied for both classes. |
| Adequacy of representation and class counsel | Class counsel is qualified; intra-class interests are aligned; no lurking conflicts between classes. | Conflicts could exist between the two classes and between direct and derivative claims, potentially undermining adequacy. | Adequacy satisfied; conflicts deemed premature and not showing antagonistic interests within or between classes. |
| Superiority of class action | Class treatment will be economical given tens of thousands of dispersed shareholders and shared defenses and law. | No sufficient efficiencies demonstrated beyond prejudicing individual claims. | Superiority satisfied; class action is the superior method. |
Key Cases Cited
- Geneva Rock Prods., Inc. v. United States, 100 Fed. Cl. 778 (2011) (one core common question can bind class-wide resolution)
- Singleton v. United States, 92 Fed. Cl. 78 (2010) (class action efficiency and commonality considerations)
- Barnes v. United States, 68 Fed. Cl. 492 (2005) (five-element framework for certification and liberal construction in favor of certification)
- Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541 (2011) (commonality requires a common contention capable of classwide resolution)
- Amchem Prods., Inc. v. Windsor, 521 U.S. 591 (1997) (adequacy and manageability considerations in class actions)
- King v. United States, 84 Fed. Cl. 120 (2009) (low threshold for commonality in class actions)
- Douglas R. Bigelow Trust v. United States, 97 Fed. Cl. 674 (2011) (commonality satisfied where core legal question is shared)
