On January 24, the Supreme Court granted certiorari in Laboratory Corporation of America Holdings v. Davis to address a long-unsettled issue central to class-action litigation: “Whether a federal court may certify a class action pursuant to Federal Rule of Civil Procedure 23(b)(3) when some members of the proposed class lack any Article III injury.”
The case arises out of the Ninth Circuit. The plaintiffs—two legally blind patients and the American Council for the Blind—filed a class-action lawsuit alleging that LabCorp’s self-service check-in kiosks violated the Americans with Disabilities Act because they were not accessible to the blind without assistance. Among a bevy of claims, the plaintiffs sought relief under California’s “Unruh Act,” which the plaintiffs contend imposes a minimum of $4,000 in state law statutory damages for every violation of the ADA. Since the plaintiffs’ proposed damages class consisted of all legally blind individuals who visited a LabCorp in California and could not use the self-service kiosk due to their disability, LabCorp estimated its potential exposure at approximately half a billion dollars per year if the class was certified.
Opposing class certification, LabCorp argued that class treatment was improper, including because a significant share of the class did not have Article III standing to bring their claims. In particular, LabCorp noted that the class included potentially substantial numbers of individuals who visited a LabCorp but never intended (or wanted) to use the self-service kiosks to check in. The district court did not address this standing issue when certifying the class; and on appeal, the Ninth Circuit affirmed certification in an unpublished order relying on circuit precedent indicating that the presence of “more than a de minimis number of uninjured class members” did not defeat class certification.
The extent to which a certified class can contain uninjured class members has deeply divided courts. In TransUnion v. Ramirez, the Supreme Court held that a federal court could not grant relief to uninjured class members. 594 U.S. 413, 431 (2021). But lower courts have reached different conclusions as to whether and when a class can be certified if it contains uninjured class members. The LabCorp cert. petition argued that a three-way circuit split on this question exists. According to the petition, the Second and Eighth Circuits did not permit certification under Article III if the class contained uninjured members; the D.C. and First Circuits did not permit certification under Rule 23(b)(3) if the class contained more than a de minimis number of uninjured class members; and the Ninth, Seventh, and Eleventh Circuits did permit certification under Rule 23(b)(3) unless a significant portion of the class is uninjured, subject to the case otherwise meeting predominance, superiority, and other requirements for class certification.
Whatever position the Supreme Court takes could have a significant impact on class action litigation in federal court. Whether a class contains uninjured class members is a frequently litigated issue.
The Court has not yet set a date for argument, but merits briefing is set to be complete in April 2025, and we expect a decision will be issued by the end of the Court’s term in June. We will continue to monitor the proceedings and will provide updates on Inside Class Actions.