Court overturns class certification in suit against Nextel, law firm
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A federal appeals court on Wednesday reversed a ruling that had established a class action in an discrimination case involving telecommunications firm Nextel Communications Inc.
In the complex litigation, New York law firm Leeds, Morelli & Brown P.C., which represented 587 plaintiffs with discrimination claims against Reston, Virginia-based Nextel, had agreed with Nextel to set up a dispute resolution process to settle all claims without going to court, according to the unanimous ruling by the 2nd U.S. Circuit Court of Appeals in New York in Michael S. Johnson et al. v. Nextel Communications Inc.
After most of the cases were settled through the out-of-court process, a group sued both the law firm and Nextel on behalf of the entire class. The suit alleged breach of fiduciary duty, legal malpractice and breach of contract.
In September 2013, a New York federal judge certified a class action, holding that common issues “predominated over any individual issues” and that New York law applied even though the class members were from 27 states, according to the appeals ruling that overturned the class certification.
The federal judge erred in certifying the class, the appeals court said. “Under the circumstances of the case,” the common issues “are substantially outweighed by individual issues,” the three-judge appeals court panel said.
Furthermore, “It is clear that New York is not the state with the most significant relationship to the claims here and, instead, the class members’ individual home states have the most significant contacts,” the appeals court ruled in remanding the case for further proceedings.
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