This case is before the Court on Magistrate Judge Alan J. Baverman's Non-Final Report and Recommendation ("R & R"). The Court "may accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate judge."
Accordingly, the Court ADOPTSthe R & R [Doc. 41] as the opinion of this Court. For the reasons stated in the R & R, the Court DENIESDefendant's Partial Motion to Dismiss as to Non-Resident Class Members [Doc. 16].
SO ORDERED,this 14th day of February, 2018.
UNITED STATES MAGISTRATE JUDGE'S NON-FINAL REPORT AND RECOMMENDATION
ALAN J. BAVERMAN, UNITED STATES MAGISTRATE JUDGE
This matter is presently before the Court on a partial motion to dismiss the complaint as to non-resident class members, [Doc. 16], filed by Defendant Launch Technical Workforce Solutions, LLC ("Launch"), pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure. For the reasons set forth below, the undersigned RECOMMENDS that the motion, [Doc. 16], be DENIED .
I. Background
In the complaint, Plaintiff, on behalf of himself and all others similarly situated, asserts a claim against Launch for violations of the Fair Credit Reporting Act ("FCRA"),
All employees or prospective employees of Launch in the United States (including all territories and political subdivisions of the United States) who were the subject of a consumer report procured by Launch (or that Launch caused to be procured), which contained any negative (derogatory) information about them, and for whom Launch failed to provide that employee or prospective employee with a copy of their consumer report and/or FCRA summary of rights before Launch took adverse employment action against them, within the period prescribed by the FCRA, 15 U.S.C. § 1681p, prior to filing this action.
[Id. ¶ 70].
On August 7, 2017, Launch filed a partial motion to dismiss the complaint as to the members of the plaintiff class that are not Georgia residents, arguing that the
II. Discussion
Launch moves to dismiss the claims of the non-Georgia class members, arguing that Bristol-Myers Squibb Co. v. Superior Court of Cal., San Francisco Cnty. , --- U.S. ----,
Bristol-Myers concerned a Fourteenth Amendment due-process challenge to claims asserted by non-Californian plaintiffs in a mass civil action filed against Bristol-Myers Squibb Company in a California state court for injuries allegedly caused by a drug called Plavix. Bristol-Myers Squibb Co. ,
Here, the parties do not dispute that the Court may not exercise general personal jurisdiction over Launch but that the Court may exercise specific personal jurisdiction over Launch in adjudicating the claims of the named plaintiff. Launch, a Delaware limited-liability company, [Doc. 1 ¶ 21], with a single office located at its headquarters in Illinois, [Doc. 16-1 (Declaration of Jean Rollo, Launch's Chief Operating Officer ("Rollo Decl.") ) ¶ 7], contends that it lacks contacts with Georgia sufficient to establish general jurisdiction, [Doc. 16 at 2-3, 5-7], and that the Court would not have specific jurisdiction over individual claims asserted by the unnamed class plaintiffs because there is no connection between their individual claims and Launch's few activities within the state of Georgia, [Doc. 16-1 at 2, 7-10]. Plaintiff does not rebut the arguments, thus inherently conceding the issues. See Kramer v. Gwinnett Cnty. ,
After careful review, the Court concludes that due-process concerns do not foreclose its exercise of personal jurisdiction over Launch as to the claims of the resident named plaintiff both on his own behalf and on behalf of the unnamed non-resident plaintiffs. Launch's argument that Bristol-Myers is analogous to this case is not without logical appeal: California's "sliding-scale" approach to specific jurisdiction does bear some resemblance to a court's exercise of jurisdiction over the defendant as to the claims of unnamed non-resident members of the plaintiff class by allowing the unnamed non-resident plaintiff class members to ride the coattails of the named plaintiff's assertion of specific jurisdiction over the defendant as to the named plaintiff's claims. Acceptance of the analogy would require, however, that the Court, like Launch, disregard material differences between mass actions and class actions.
In a mass tort action such as Bristol-Myers , each plaintiff is a real party in interest, meaning that each plaintiff is personally named and required to effect service. See Bristol-Myers Squibb ,
The plaintiff must receive notice plus an opportunity to be heard and participate in the litigation, whether in person or through counsel. The notice must be the best practicable, "reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections." Mullane [v. Central Hanover Bank & Tr. ], 339 U.S. [306, 314-15,, 70 S.Ct. 652 (1950) ]; cf. 94 L.Ed. 865
Eisen v. Carlisle & Jacquelin , , 174-75, 417 U.S. 156 , 94 S.Ct. 2140 ... (1974). The notice should describe the action and the plaintiffs' rights in it. Additionally, ... due process requires at a minimum that an absent plaintiff be provided with an opportunity to remove himself from the class by executing and returning an "opt out" or "request for exclusion" form to the court. Finally, the Due Process Clause of course requires that the named plaintiff at all times adequately represent the interests of the absent class members. Hansberry , 40 L.Ed.2d 732 , 311 U.S., at 42-43 , 45. 61 S.Ct. 115
Shutts ,
Launch's position also rests on federalism concerns that are not at issue here in federal court. As a sister district court recently explained, Bristol-Myers protects the well-rooted principle that " 'the States, through their courts, [may] not reach out beyond the limits imposed on them by their status as coequal sovereigns in a federal system.' "
In this case, federalism concerns do not apply. [Bristol-Myers ] is about limiting a state court's jurisdiction when it tried to reach out-of-state defendants on behalf of out-of-state plaintiffs in a mass action suit. That scenario is inapplicable to nationwide class actions in federal court .... Specifically, while [Bristol-Myers ] involves non-resident plaintiffs forum-shopping in California to reach a non-resident defendant with insufficient contacts, the ... litigation [before the court] involves Defendants that have made enough contacts to the forum states to hold them liable there in nationwide class actions. ... Congress ... enabled class actions because Congress recognizes the need for efficiency-for plaintiffs and defendants as well as the judicial system-in managing such mass filings. Class action promotes "efficiency and economy of litigation." Crown, Cork & Seal Co. v. Parker ,, 349, 462 U.S. 345 , 103 S.Ct. 2392 (1983). Therefore, a nationwide class action in federal court is not about a state's overreaching, but rather relates to the judicial system's handling of mass claims involving numerous ... parties. 76 L.Ed.2d 628
Chinese-Manufactured Drywall Prods. Liability Litig. ,
Recognizing in its reply brief that Bristol-Myers is, at best, analogous to this matter, [Doc. 34 at 1], Launch suggests that by referencing Omni Capital in Bristol-Myers , the Supreme Court was "tipping its hand, at least tacitly implying that Bristol-Myers ' principles and logic apply in a Fifth Amendment case such as this one," [see id. at 3]. The Court rejects this argument. First, by stating that because the Court's decision "concern[ed] the due process limits on the exercise of specific jurisdiction by a State, [it] le[ft] open the question whether the Fifth Amendment imposes the same restrictions on the exercise of personal jurisdiction by a federal court," Bristol-Myers ,
Moreover, Launch does not acknowledge authority holding that unnamed non-resident members of a plaintiff class will not detract from a named plaintiff's ability to establish specific personal jurisdiction over the defendant on behalf of the class, much less seek to distinguish it or argue that it was wrongly decided. See, e.g.,
It also bears noting that unnamed members of plaintiff classes have been held distinct from named plaintiffs in that the unnamed members' status as a "party" is seen not as "an absolute characteristic, but rather a conclusion about the applicability of various procedural rules that may differ based on context." Devlin v. Scardelletti ,
In sum, the undersigned concludes that because Bristol-Myers simply reaffirms controlling due-process law and does not apply to federal class actions and because Launch has not otherwise presented persuasive authority in support of its motion, Launch has shown no reason that this Court may not continue to exercise jurisdiction over a nationwide class claim on the strength of its specific personal jurisdiction over the defendant as to the named plaintiff's claim. Accordingly, it is hereby RECOMMENDED that the District Judge DENY Launch's partial motion to dismiss the complaint as to non-resident plaintiff class members.
III. Conclusion
For the reasons discussed above, the undersigned RECOMMENDS that the partial motion to dismiss be DENIED , [Doc. 16].
IT IS SO RECOMMENDED , this the 26th day of January, 2018.
Notes
Section 1681b(b)(3) provides, in relevant part, that
in using a consumer report for employment purposes, before taking any adverse action based in whole or in part on the report, the person intending to take such adverse action shall provide to the consumer to whom the report relates-
(i) a copy of the report; and
(ii) a description in writing of the rights of the consumer under this subchapter, as prescribed by the Bureau under section 1681g(c)(3) of this title.
15 U.S.C. § 1681b(b)(3).
The deadline for Plaintiff to file a motion for class certification is stayed until after the Court's ruling on this partial motion to dismiss. [Doc. 23]. Although there has been no class certification, the Court will, for simplicity's sake, hereinafter refer to the members of the proposed plaintiff class as "the plaintiff class."
Launch has not opposed Plaintiff's filing of the supplemental authority, (see Dkt.), and the filing of persuasive authority issued after briefing is, of course, a well-established practice that is helpful to the Court, Hornor, Townsend, & Kent, Inc. v. Hamilton , No. Civ. A. 1:01 CV
The Due Process Clause of the Fourteenth Amendment to the United States Constitution limits the personal jurisdiction of state courts. Bristol-Myers Squibb Co. ,
Had Plaintiff pursued the issue, the Court would not have found that Launch is subject to general jurisdiction in Georgia. Compare Carmouche v. Tamborlee Mgmt., Inc. ,
Launch repeatedly mischaracterizes Bristol-Myers -both in the brief it filed in support of its motion to dismiss and in its reply brief-as a class-action lawsuit, [Doc. 16 at 1-2, 4, 8; Doc. 34 at 2-3], when it was not a class-action suit but rather was a mass tort action, Bristol-Myers Squibb Co. ,
Plaintiff does argue in his reply brief that Rule 23 of the Federal Rules of Civil Procedure does not temper due process unfairness. However, the Court finds no citations to supportive case law in either of his briefs, and the one apparently on-point article he attempts to proffer is not properly cited, is misquoted in Plaintiff's brief, is thirty years old, and, and despite being authored by the now-Chief Judge of the U.S. Court of Appeals for the Seventh Circuit, is a law-journal article and therefore presents, at best, only persuasive authority. [See Doc. 34 at 8 (citing Diane P. Wood, Adjudicatory Jurisdiction & Class Actions ,
Notably, the Solicitor General explained in its brief in Bristol-Myers that the case "d[id] not present any question concerning whether a state court may entertain class actions, under established rules, to resolve claims arising from conduct in multiple jurisdictions." U.S. Amicus Br. Supporting Petitioner Bristol-Myers, Bristol-Myers Squibb Co. v. Superior Court of Cal., San Francisco Cnty. , No. 16-466,
The Court is aware, based on its own research, that there are cases where district courts have found that Bristol-Myers precludes a finding of personal jurisdiction over the claims of non-resident plaintiff class members, but they contain little analysis and the Court therefore does not find them persuasive. See, e.g., McDonnell v. Nature's Way Prods., LLC , No.
