Plaintiffs Aim to Salvage Class Action Against Milberg After SCOTUS Ruling
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Gregory P. Joseph.[/caption] Plaintiffs lawyers are asking an appeals court to reinstate certification of their class-action legal malpractice lawsuit against Milberg LLP and its lawyers, insisting that a U.S. Supreme Court decision earlier this year didn’t derail their case. In a Nov. 9 filing, attorney Lawrence Kasten wrote that the facts of his case don’t parallel that of Microsoft v. Baker, a June 12 decision in which the Supreme Court blocked a controversial procedural tool used by plaintiffs to appeal class certification orders by voluntarily dismissing their own case. Appealing class certification is critical to both sides because those decisions often make or break a case. Kasten represents Lance Laber, a purported class member in the Milberg case, who appealed an Arizona judge’s 2012 decision not to certify the class. In 2015, the U.S. Court of Appeals for the Ninth Circuit vacated that order, and Milberg petitioned the Supreme Court to take up the case. On June 19, the Supreme Court granted the petition, then vacated the Ninth Circuit’s order for further consideration in light of Microsoft. Kasten wrote that his case is different: In Microsoft, the lead plaintiff voluntarily dismissed his case so that he could appeal final judgment, but in the Milberg case, Laber was an intervenor—not one of the original two plaintiffs who voluntarily dismissed the case after they lost on certification. “The path forged by Laber is not, in any sense, a functional equivalent to the ‘we-pretend-to-dismiss-with-prejudice-but-do-not-really-mean-it’ path pursued by Mr. Baker and his co-plaintiffs,” wrote Kasten, a partner at Lewis Roca Rothgerber Christie in Phoenix. Kasten referred a request for comment to his law firm colleague, Robert McKirgan, who didn’t respond. An attorney for the defendants, Gregory Joseph of Joseph Hage Aaronson in New York, declined to comment. His response brief is due on Dec. 4. In Microsoft, the Supreme Court found the controversial tactic had violated Federal Rule of Civil Procedure 23(f), which permits interlocutory appeals of class actions, and wasn’t a “final decision” under Judiciary and Judicial Procedure Code 1291. A concurring opinion found that under Article III of the Constitution, federal courts would have no jurisdiction over cases once plaintiffs dismissed their claims. Several cases have been stayed in light of Microsoft, which reversed a Ninth Circuit decision. Days after the ruling, Eli Lilly & Co. moved to dismiss a long-standing appeal in a case brought by a class of consumers who used Cymbalta, an antidepressant prescription drug. The Ninth Circuit granted dismissal of the case on Oct. 12. The Milberg case dates back to 2001, when the securities firm represented a nationwide class of investors who sued Variable Annuity Life Insurance Co. Inc. in Arizona federal court. A judge certified the class but ended up vacating that order after Milberg missed several disclosure deadlines in 2004, prompting judgment against the plaintiffs, according to court filings. In 2009, two purported class members, including Columbia Law School professor Philip Bobbitt, brought the legal malpractice case, which sought to certify the same class that had been in the insurance case. The case named Milberg, one of its attorneys, Michael Spencer, who is of counsel, and four former attorneys: firm co-founder Melvyn Weiss, who spent 18 months behind bars after pleading guilty to charges involving kickbacks to lead plaintiffs; Janine Lee Pollack, now a partner at Wolf Haldenstein Adler Freeman & Herz; Lee Weiss, now a partner at Berns Weiss; and Brian Kerr, now special counsel at Baker Botts. The suit also named three other law firms and their principals: Ronald Uitz, of Uitz & Associates in Washington, D.C.; Sheldon Lustigman and Andrew Lustigman, previously of The Lustigman Firm, and now at Olshan Frome Wolosky in New York; and Tucson’s Gabroy Rollman & Bossé, now Bossé Rollman, and its partners Ronald Lehman and John Gabroy, now resigned. But U.S. District Judge Frank Zapata of the District of Arizona declined to certify the legal malpractice case, concluding that the laws of the 50 states in which more than 1 million class members lived made the class too disparate to certify. The plaintiffs voluntarily dismissed their case with prejudice in 2013 after Zapata declined interlocutory appeal of his order. In Laber’s appeal, the Ninth Circuit vacated that order, concluding that the claims of all class members fell under the law of Arizona, where the alleged malpractice occurred. On Oct. 10, the Ninth Circuit ordered both sides to address Microsoft. In his brief, Kasten wrote the Supreme Court’s 1977 holding in United Airlines v. McDonald “endorsed the procedure followed in this case,” in which an unnamed class member intervened to appeal a class certification order in a sex discrimination case brought by female flight attendants. Microsoft, he wrote, “did not alter the viability of the procedure endorsed in United Airlines.” But in United Airlines, Joseph wrote in his original answer brief in the case, the intervenor didn’t know to act before judgment took place. “That is emphatically not the case here,” he wrote. “Appellant was not blindsided. Following denial of the petition, appellant acted in concert with plaintiffs, through their shared counsel, to generate this appeal.”
