Class Representative Who Won at Trial Can Still Appeal Class Decertification, Holds Second Circuit

In Jin v. Shanghai Original, Inc., No. 19-3782 (2d Cir. Mar. 9, 2021), the Second Circuit holds that although a prevailing party ordinarily does not have standing to appeal, a plaintiff who was also a class representative may nevertheless appeal the decertification of the class.

Plaintiff Jin successfully moved to certify a Fed. R. Civ. P. 23 class of restaurant employees in a New York Labor Law (NYLL) wage-and-hour case. But a week before trial, “the district court sua sponte decertified the class based on class counsel’s inadequate representation.” Jin’s case went forward to trial on an individual basis and prevailed. He then appealed the decertification.

The Second Circuit immediately hits an appellate jurisdiction bump not originally briefed by the parties. “Jin’s appeal of the decertification presents a curious preliminary question. His success on the merits of his individual claims––the court awarded damages, attorney’s fees, and costs––could be seen as mooting his interest in appealing the decertification of the class. We conclude that it has not.”

“[T]he live controversy requirement asks whether the putative unnamed class members and defendants maintain an ‘adversary relationship … with respect to the underlying cause of action’” (quoting Franks v. Bowman Transp. Co., 424 U.S. 747 (1976)). The panel finds that the putative class members continue to have live case. “At least some of the putative class members still possess live NYLL claims against the Owners and are potentially ‘entitled to the relief already afforded [Jin].’”

The next issue, and the “crux of our mootness inquiry,” is “whether Jin retains a personal stake in this appeal.” The Supreme Court held in U.S. Parole Comm’n v. Geraghty, 445 U.S. 388 (1980), and Deposit Guar. Nat’l Bank, Jackson, Miss. v. Roper, 445 U.S. 326 (1980), that a class representative can appeal the denial of certification even if their individual claims were moot.

“The Owners argue that Jin does not possess a personal stake because he does not have a financial interest in the class certification issue, given that Jin already obtained damages, attorney’s fees, and costs. We disagree. Even accepting that Jin lacks a financial interest in the class certification issue,12 neither we nor the Supreme Court have required that to satisfy personal stake in the context of a named plaintiff appealing the denial of class certification following a favorable judgment on the merits at trial.”

The panel invokes the “private attorney general” model. “The private attorney general concept relates to the objectives of the class action device, which include deterring misconduct through private enforcement of vital public policies …. The class Jin seeks to represent serves this goal: given the small size of many of the individual claims, those class members lack incentive to pursue the alleged NYLL violations and would not obtain relief without class certification. The district court also credited Jin’s assertion that ‘the predominantly immigrant workers implicated by this action may fear retaliation’––another impediment for class members …. Under the specific factual circumstances here, Jin’s private attorney general interest suffices to establish his personal stake in this appeal.”

The panel also notes that the situation might be different if Jin had settled his claim, “because of the greater risk that ‘there is no longer a ‘self-interested party advocating’ for class treatment’ …. There is a material difference between a named plaintiff voluntarily settling their individual claim and a named plaintiff like Jin who prevails on the merits of that claim at a trial. With the former, the nature of the plaintiff’s decision to settle is entirely voluntary––the named plaintiff possesses full control of her destiny––whereas with the latter, the named plaintiff submits to the control of the court for the adjudication of her individual claims.”

Having decided that the class decertification was not moot and Jin had standing to appeal it, the panel finally affirms the district court’s holding that class counsel did not adequately represent the class. “The record is replete with  counsel’s shortcomings before the class was decertified: class counsel (1) attempted numerous times to delay trial without any meritorious basis; (2) had the court reopen discovery to conduct twenty-eight depositions related to the Owners’ alleged misconduct but conducted only three and failed to inform the court until over a month after they abandoned depositions; (3) repeatedly failed to submit a witness list that complied with Judge Ross’s instructions; and (4) in its final revised list, indicated they would only call two class members as witnesses despite indications in the [joint pre-trial order] of the significance of class-member testimony.”

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