The response to our post in January on the Blain class action denial in the Paxil litigation, as well as the likely fallout from the just-decided reversal of class certification in Regents of University of California v. Credit Suisse First Boston (USA), Inc., 2007 WL 816518 (5th Cir. Mar. 19, 2007) (the subject of our last post), got us thinking about the most extreme manifestation of American Pipe class action tolling. That’s what Bexis a few years ago called “cross-jurisdictional” class-action tolling when he was participating in the appeal that became Portwood v. Ford Motor Co., 701 N.E.2d 1102 (Ill. 1998). The description has been generally adopted. Fortunately the concept mostly hasn’t.
First of all, what is it? Well, all of the Supreme Court’s class action tolling cases, American Pipe & Construction Co. v. Utah, 414 U.S. 540 (1974), Crown, Cork & Seal Co. v. Parker, 462 U.S. 345 (1983), and Chardon v. Soto, 462 U.S. 650 (1983), all involved successive suits in the same jurisdiction – federal-question cases brought in federal court. In that context the Court acted to prevent members of putative classes from having to file otherwise needless protective actions simply to toll the statute of limitations during the pendency of a class action that might or might not get certified. Thus class-action tolling generally seeks to promote “the litigative efficiency and economy that [Rule 23] in its present form was designed to serve,” American Pipe, 414 U.S. at 556, and to prevent “a needless multiplicity of actions.” Crown, Cork & Seal, 462 U.S. at 351.
While this sort of tolling essentially gives plaintiffs something for nothing – tolling the statute of limitations on the basis of a meritless class action filing – the rationale of avoiding unnecessary filings at least makes sense when talking about the same court system. If it’s a single court system, then tolling will at least preclude the burden (assuming it’s really a burden at all – there’s something to be said for collecting lots of filing fees for suits that mostly won’t go anywhere) of all these greatly feared protective actions.
“Cross-jurisdictional” tolling, on the other hand, refers to allowing a failed class action filed in jurisdiction “A” to toll the statute of limitations on an individual action later filed by a putative class member in jurisdiction “B.” In a lot of cases that means a state court action filed after a failed federal court class action. In other cases it means filing an individual action in one state after class certification is denied in a different state. In either case, the policy of avoidance of protective filings doesn’t work. In fact, the opposite is true. A liberal tolling rule only invites more suits to be filed in the jurisdiction that has it. Thus, even on its own terms, cross-jurisdictional tolling based upon meritless class actions doesn’t make sense.
Thus, even states allowing class-action tolling in some contexts do not apply it to meritless class actions filed in other jurisdictions. Illinois is one of them. It recognizes class-action tolling within the state’s own court system, Steinberg v. Chicago Medical School, 371 N.E.2d 634 (Ill. 1977), but not in the cross-jurisdictional context. Federalism was one reason not let meritless class actions filed in federal courts toll the statute of limitations in the state’s own court system:
[B]ecause state courts have no control over the work of the federal judiciary, we believe it would be unwise to adopt a policy basing the length of Illinois limitation periods on the federal courts’ disposition of suits seeking class certification. State courts should not be required to entertain stale claims simply because the controlling statute of limitations expired while a federal court considered whether to certify a class action.
Portwood v. Ford Motor Co., 701 N.E.2d 1102, 1104 (Ill. 1998). Accord Maestas v. Sofamor Danek Group, 33 S.W.3d 805, 808-09 (Tenn. 2000) (cross-jurisdictional tolling “would essentially grant to federal courts the power to decide when Tennessee’s statute of limitations begins to run. . .contrary to our legislature’s power to adopt statutes of limitations”).
Forum shopping is another major reason – and probably the best reason – why cross-jurisdictional tolling is improvident:
Our concerns with forum shopping and with the delay occasioned by the pendency of a class action in federal court are well illustrated by the instant case. . . . Plaintiffs contend that our rejection of cross-jurisdictional tolling will necessitate numerous...
