U.S. SC: Miss. AG's lawsuit against LCD manufacturers doesn't constitute 'mass action'

WASHINGTON (Legal Newsline) -- The U.S. Supreme Court, in a unanimous ruling Tuesday, said Mississippi Attorney General Jim Hood's lawsuit against a group of liquid crystal display manufacturers does not constitute a mass action under the federal Class Action Fairness Act.

In its 14-page opinion, the nation's high court reasoned that Mississippi is the only named plaintiff.

"According to CAFA's plain text, a 'mass action' must involve monetary claims brought by 100 or more persons who propose to try those claims jointly as named plaintiffs," Justice Sonia Sotomayor wrote for the court.

"Because the State of Mississippi is the only named plaintiff in the instant action, the case must be remanded to state court."

Last February, Hood petitioned the court to review, and overturn, a ruling by the U.S. Court of Appeals for the Fifth Circuit.

The Fifth Circuit found that the suit qualified as a "mass action" under CAFA.

According to the act, mass actions are cases "in which monetary relief claims of 100 or more persons are proposed to be tried jointly on the ground that the plaintiffs' claims involve common questions of law or fact."

"The statute says '100 or more persons,' not '100 or more named or unnamed real parties in interest,'" Sotomayor noted.

"Had Congress intended the latter, it easily could have drafted language to that effect."

The companies being sued, six liquid crystal display manufacturers, and the Fifth Circuit argued that the act applies to parens patriae suits because individual consumers are the real parties in interest in the case.

But Hood argued that the state was the only plaintiff, and so CAFA doesn't apply.

The attorney general also argued that the Fifth Circuit's decision, issued in November 2012, contradicted four other cases brought by state attorneys general against the same companies.

He and a group of 46 other state attorneys general -- who filed a brief in support of Hood in July -- called the Fifth Circuit's ruling an "affront" to states' ability to bring parens patriae cases.

Hood, who critics say shows favoritism to trial lawyers donors to his political campaigns, filed a lawsuit against AU Optronics in 2011. In the case, Hood sued on behalf of the state, communities and residents who purchased LCDs.

It all relates to a 2006 U.S. Department of Justice grand jury investigation into price-fixing allegations against LCD makers.

In his suit, Hood named six LCD manufacturers also named in private class-action suits.

Of the 206 paragraphs in the filing, 176 of them are identical or nearly identical to the ones in the private class actions. Zimmerman Reid, one of the firms Hood hired as special assistants to litigate the case for the state, filed the private class actions.

Several states eventually signed a $539 million settlement with the LCD makers. But Mississippi, California, Illinois, South Carolina and Washington decided to pursue cases in their state courts.

The defendant companies removed each of the cases, but each state successfully fought to have the cases sent back to state court, except for Mississippi.

From Legal Newsline: Reach Jessica Karmasek by email at jessica@legalnewsline.com.