Class Action Lawsuit Defense

Class Action Lawsuit Defense

Class Action Defense News, Developments and Commentary

Class Action Disgorgement Case Dismissed Against PG&E as Remedy Sought Would Interfere with Filed Rates

Posted in Class Action Trends

Companies in regulated markets, such as insurance and energy, are increasing litigating issues surrounding the “filed rate doctrine,” or in other words, whether they can be sued in a class action where the remedy sought necessarily challenges the rates that are required or approved by the relevant regulators.  Pacific Gas & Electric is a great example of a well-reasoned dismissal where the court understood the real risks that regulated industries face from inconsistent and duplicate liability from both regulators and the courts.

A California appellate court in the First District recently upheld a trial court’s demurrer of a class action complaint filed by class representative Filomena Guerrero against the Pacific Gas & Electric Company (“PG&E”).  The complaint alleged that PG&E deceptively represented to both California’s Public Utilities Commission (“PUC”) and the public regarding how much revenue it required to provide safe natural gas service.  The complaint sought restitution and disgorgement of profits for PG&E’s alleged “wrongful diversion of more than $100 million in rates it collected over a thirteen year period that should have been expended on natural gas pipeline safety projects.”  Guerrero v. Pac. Gas & Elec. Co., 2014 WL 5073493, at *1 (Cal. Ct. App. Oct. 10, 2014). Continue Reading

BakerHostetler Antitrust Lawyer Examines Recent Development in Antitrust Class Action Litigation

Posted in Antitrust

GCR 2014The Antitrust Review of the Americas 2015 features a chapter by BakerHostetler antitrust partner Edmund W. Searby entitled, “United States: Private Antitrust Litigation – Class Actions.”  He wrote:

“As many appreciate, two Supreme Court decisions in the last seven years have assisted the defense of antitrust class actions.  The first and most significant is the enhancement of pleading standards. Second, the Supreme Court addressed the standards for class certification in terms that at the very least require greater rigour in class certification. While neither Supreme Court decision is new, we review in this article recent cases to see how these decisions have affected the prosecution of antitrust class actions.”

The chapter includes sections on motions to dismiss antitrust class actions under Twombly, trends involving the application of greater rigor by courts in assessing antitrust class certifications, and patterns in antitrust class action filings by judicial circuit.  Read the chapter.

The 18th annual edition of The Antitrust Review of the Americas covers hot topics in the U.S., Canada and Brazil including: Cartels, Energy, Foreign Investment, Joint Ventures, IP & Antitrust, Mergers, Private Enforcement, Private Equity, Technology and Vertical Restraint. Government officials discuss current enforcement and priorities for the year ahead in the U.S., Canada, Barbados, Brazil, Colombia, Mexico and Nicaragua.

Extracts from The Antitrust Review of the Americas 2015 – www.GlobalCompetitionReview.com

Editor’s Note: This blog post is a joint submission with BakerHostetler’s Antitrust Advocate blog.

Court Takes Cue from Comcast v. Behrend, Certifies Class as to Liability but not Damages

Posted in Class Certification, Securities

Fort Worth Employees’ Retirement Fund v. J.P. Morgan Chase & Co.

In what appears to be an increasingly common practice since the Supreme Court decided Comcast Corp. v. Behrend, 133 S.Ct. 1426 (2013), the Southern District of New York recently certified a class as to liability, but rejected certification as to damages.  Fort Worth Employees’ Retirement Fund v. J.P. Morgan Chase & Co., — F.R.D. —-, 2014 WL 4840752, 09-3701 (JPO) (S.D.N.Y. Sep. 30, 2014).  Taking a cue from Comcast, the Court held that the predominance requirement for class certification—that “questions of law or fact common to class members predominate over any questions affecting only individual members,” see Fed. R. Civ. P. 23(b)(3)—requires plaintiffs to specify a damages methodology that can be utilized for the entire class.  The plaintiffs, investors in certain mortgage-backed securities issued by JP Morgan Chase & Co. and related entities (collectively “JPM”), failed to adequately specify the methodology they planned to use to value the securities at issue.  The Court therefore rejected certification as to damages and placed responsibility on each class member to prove damages on a member-by-member basis.  The Court, however, found that the plaintiffs proved predominance as to liability and certified the class for that limited purpose. Continue Reading

Federal Magistrate Recommends Dismissing TCPA Class Claims Against Coke

Posted in Rule 12 Motions to Dismiss, TCPA

Responding to an invitation to text can satisfy TCPA’s Express Consent Requirement

In a Telephone Consumer Protection Act (TCPA) putative class action against Coca-Cola and its marketing agent, a Northern District of Alabama magistrate judge recommended dismissal on September 3, 2014, of most of the plaintiff’s claims on grounds that the plaintiff gave Coca-Cola prior express consent to send text messages to his mobile phone.

The plaintiff alleged that he and the putative class members responded to a Coca-Cola scoreboard message at a college football game asking fans to “vote” for their favorite team using their mobile phones.  The plaintiff alleged that, after voting, he received a series of unsolicited text messages on his mobile phone.  Based on this, the plaintiff alleged that Coca-Cola unlawfully used an automated telephone dialing system (“ATDS”) to text his mobile phone and that Coca-Cola unlawfully texted his mobile number in violation of the national do-not-call registry on which the number was allegedly listed.

Coca-Cola filed a motion to dismiss both the ATDS claim and the do-not-call registry claim. On the ATDS claim, Coca-Cola unsuccessfully argued that a text message is not a call under the TCPA (an argument that courts have almost universally rejected), and that Coca-Cola did not use an ATDS in dialing the plaintiff’s mobile number (a closer question under current law because the parameters of what qualifies as an ATDS are constantly evolving with technology).  Coca-Cola was successful, however, in arguing that it had a complete affirmative defense to the plaintiff’s claims because the plaintiff gave “prior express consent” by texting his “vote” to Coca-Cola.  In agreeing with Coca-Cola on the express consent argument, the Court adopted a fairly expansive—but well-supported by precedent—definition of consent as “knowingly releasing” a mobile number to a potential caller.  In so finding, the Court noted that the plaintiff could not “plausibly claim that he was simply voting for his favorite team with no expectation of receiving ‘telemarketing’ messages in return.” Continue Reading

In “Zombie” Class Action, Seventh Circuit Requires Plaintiffs to Present Evidence to Prove Home-State Exception to CAFA Jurisdiction

Posted in Class Action Fairness Act, Class Certification

On Tuesday, the Seventh Circuit decided Myrick v. Wellpoint, Inc., Nos. 12-3882, 13-2230, 2014 WL 4073065 (Aug. 19, 2014), which held that plaintiffs were required to produce evidence—and not merely assumptions—about the citizenship of class members to establish the “home-state exception” to CAFA jurisdiction under 28 U.S.C. § 1332(d)(4). The case arose when a health insurer offering policies in Illinois was bought out in 2001 and, in 2002, withdrew from the Illinois market and canceled all of its Illinois policies.

Plaintiffs filed suit in Illinois state court, alleging that the cancellation violated Illinois law, and sought to certify a class of all former policyholders. Defendants removed the case to federal court pursuant to CAFA, as the proposed class had the requisite size, amount in controversy, and minimal diversity. Continue Reading

Nominations Open for ABA Journal’s Top 100 Legal Blogs – Class Action Lawsuit Defense

Posted in Uncategorized

The American Bar Association Journal announced that it is compiling its annual list of the 100 best legal blogs and invites readers to submit a nomination:

Use the form below to tell us about a blog—not your own—that you read regularly and think other lawyers should know about. If there is more than one blog you want to support, feel free to send us additional amici through the form. We may include some of the best comments in our Blawg 100 coverage. But keep your remarks pithy—you have a 500-character limit.

We invite our readers to recommend the Class Action Lawsuit Defense blog and other favorite legal blogs for selection by the ABA. Submissions are accepted through August 8, 2014.

Sixth Circuit Affirms Certification and Summary Judgment for TCPA Class, Despite State Law Class Action Prohibition

Posted in Class Actions Privacy, Class Certification, Consumer Class Action, State Class Action Law, TCPA

On July 9, 2014, the Sixth Circuit affirmed a district court ruling that a consumer TCPA class action could proceed against Lake City Industrial Products, rejecting Lake City’s argument that Michigan law prohibited TCPA class actions.  American Copper & Brass, Inc. v. Lake City Industrial Products, Inc., Case No. 13-2605, (6th Cir. 2014).  In addition, Lake City’s potential bankruptcy and inability to pay a judgment was irrelevant at this stage of the case, so summary judgment also was affirmed.

In February 2006, Lake City, a pipe-thread sealing tape distributor, retained a fax-blasting company to transmit approximately 10,000 Lake City advertisements.  American Copper, a Michigan equipment wholesaler, received Lake City’s fax later that month.  American Copper had no preexisting business relationship with Lake City and had not consented to the receipt of faxes from Lake City.  American Copper filed a class action law suit in federal district court in Michigan in 2009, alleging that Lake City violated the Telephone Consumer Protection Act (TCPA).  The district court granted class certification and summary judgment in favor of American Copper, and Lake City appealed.

On appeal, Lake City argued that the district court erred by refusing to apply Michigan Court Rule 3.501(A)(5), which states that an “action for a penalty or minimum amount of recovery without regard to actual damages imposed or authorized by statute may not be maintained as a class action unless the statute specifically authorizes its recovery in a class action.”  The Sixth Circuit acknowledged that because the TCPA provides for a minimum recovery of $500 per violation, regardless of actual damages, and does not specifically authorize class actions, TCPA suits cannot be maintained as class actions in Michigan state court.

Noting the “general rule” that the Federal Rules of Civil Procedure apply to all civil cases brought in federal courts, the court affirmed the district court’s rejection of Lake City’s argument.  There are “rare exceptions,” however, where Congress may bypass the federal rules and require federal courts to apply state procedure.  Seizing on the following language, Lake City argued that the TCPA evinces Congress’s intent that state procedural rules apply to all TCPA cases:

A person or entity may, if otherwise permitted by the laws or rules of court of a State, bring in an appropriate court of that State –

(A) an action based on a violation of this subsection or the regulations prescribed under this subsection to enjoin such violation,

(B) an action to recover for actual monetary loss from such a violation, or to receive $500 in damages for each such violation, whichever is greater, or

(C) both such actions.

47 U.S.C. 227(b)(3) (italics added).

The Sixth Circuit held that “[t]he better view of this state-oriented language relied on by Lake City . . . is that Congress simply intended to ‘enable states to decide whether and how to spend their resources on TCPA enforcement.’” Id. at 8, citing Giovanniello v. ALM Media, LLC, 726 F.3d 106, 114 (2d Cir. 2013).  While admitting that its holding could lead to forum shopping, the Court noted a recent United States Supreme Court case — Shady Grove Orthopedic Assocs., P.A. v. Allstate Ins. Co,. 559 U.S. 393, 416 (2010) — which held that a “Federal Rule governing procedure is valid whether or not it alters the outcome of the case in a way that induces forum shopping.”

The Court also held that the district court correctly disregarded Lake City’s assertion that summary judgment would lead to its bankruptcy.  “Lake City’s ability (or inability) to pay a judgment was irrelevant at the summary judgment stage of the case.”  Opinion at 4.

As this case demonstrates, the stakes in TCPA cases could not be higher for the unwary.  Businesses are urged to seek appropriate counsel before undertaking activities that might implicate the statute.

Basic Is Dying a Slow Death: The Supreme Court Upholds the Fraud-on-the-Market Presumption in Halliburton but Allows Rebuttal

Posted in Securities

Given the opportunity to overrule its landmark 1988 decision in Basic v. Levinson, in which it created the fraud-on-the-market presumption, the Supreme Court declined. The Court found in its decision this week in Halliburton that, while it was not ready to dismiss the presumption altogether, it would allow defendants to offer rebuttal evidence at the class certification stage. Halliburton is another example, along with Wal-Mart and Amgen,[1] of the Court’s recent trend toward expanding the scope of the class certification inquiry, thereby allowing defendants another option for defeating securities fraud actions prior to any discovery as to the merits in the case. While some plaintiffs are hailing the decision as a victory, the benefits the decision provides to the defense bar can not be overstated. The Justices’ 9-0 opinion now will allow defendants to rebut the applicability of the presumption at the class certification stage. Basic may not have been overturned, but it is no longer the powerful plaintiffs’ tool it once was. The bottom line for defendants: “You can’t always get what you want, but sometimes you get what you need.”

The Path to the Supreme Court

Halliburton involved a claim under section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder brought by a class of Halliburton shareholders.[2] After already making one trip up to the Supreme Court several years ago, the case had been remanded to the district court to determine whether a class should be certified. On remand, the district court granted class certification and Halliburton appealed, for a second time, arguing that plaintiffs were not entitled to the fraud-on-the-market presumption because the alleged misrepresentations had not impacted the stock price. Thus, the case eventually made its way back to the Supreme Court, which certified two questions: whether Basic should be overruled and the fraud-on-the-market presumption eliminated; and whether defendants should be allowed to present rebuttal evidence at the class certification stage.

Plaintiffs May Still Rely on the Fraud-on-the-Market Presumption

In Basic, the Court determined that securities fraud class plaintiffs did not need to demonstrate individual reliance on alleged misstatements. Instead, plaintiffs could rely on the “fraud-on-the-market presumption.” The presumption is based on the economic theory that all material information about a company is disseminated into and absorbed by the market place, and is reflected in the stock price. Thus, anyone who purchases the stock in the market essentially “relies” on the integrity of the market price. Halliburton asked the Court to overrule Basic and deny plaintiffs the benefit of the fraud-on-the-market presumption.

In a decision authored by Chief Justice John G. Roberts, Jr., in which all Justices joined, the Court rejected Halliburton’s invitation to overrule Basic. The Court did not reaffirm the correctness of its earlier ruling, but rather found only that there was no “special justification” that warranted overruling long-standing precedent. The Court recognized that “[a]lthough the presumption is a judicially created doctrine designed to implement a judicially created cause of action, we have described the doctrine as ‘a substantive doctrine of federal securities-fraud law.’” So, for the near future, the fraud-on-the-market presumption stands.

Defendants Can Rebut the Presumption at Class Certification

The second question the Court addressed was whether defendants can rebut the fraud-on-the-market presumption before a class is certified. The Court answered this question in the affirmative, giving defendants another weapon against certification.

In order to invoke the presumption, plaintiffs must demonstrate that the alleged misrepresentations were public and material and the defendant’s stock traded in an efficient market. Defendants may then rebut the presumption by proving that the misstatements did not in fact impact the price of the security. Thus, if the market price was not impacted, then plaintiffs cannot argue they “relied” on the misstatement when they “relied” on the market price. Defendants were already allowed to present this evidence at summary judgment and trial, but the issue before the Court was whether defendants were entitled to make the argument at class certification and before significant discovery costs and legal expenses were incurred.

Significantly, the Court held that defendants do have the right to present this evidence in opposition to class certification, reasoning that the evidence relates to the question of predominance. Plaintiffs must demonstrate that common questions predominate over individualized questions, which includes invoking the fraud-on-the-market presumption to avoid individual questions of reliance. District courts will now determine whether the presumption applies before granting class certification and, thus, should be allowed to consider arguments both for and against invoking the presumption. As the Court reasoned: “Price impact is . . . an essential precondition for any Rule 10b-5 class action. While Basic allows plaintiffs to establish that precondition indirectly, it does not require courts to ignore a defendant’s direct, more salient evidence showing that the alleged misrepresentation did not actually affect the stock’s market price and, consequently, that the Basic presumption does not apply.”

No matter the spin the plaintiffs’ bar puts on it, Halliburton is a win for defendants. It was hard to imagine the Court would overrule over 25 years of precedent in Basic and, in effect, eliminate class actions under section 10(b). The Court has, however, provided securities fraud class action defendants another out prior to class certification. This issue will likely play out as a battle of the experts as the parties argue over what caused movements in a stock’s price. As the Court has acknowledged, class certification is often the death knell of securities fraud class actions as it forces defendants into settlement. Once a class is certified, the potential damages increase so astronomically that defendants are often forced to settle. Defendants now have another argument against class certification, and one that will undoubtedly become a staple in opposing class certification.

If you have any questions about this alert, please contact Marc D. Powers at mpowers@bakerlaw.com or 212.589.4216; Paul G. Karlsgodt at pkarlsgodt@bakerlaw.com or 303.764.4013; Mark A. Kornfeld at mkornfeld@bakerlaw.com or 212.589.4652; Deborah H. Renner at drenner@bakerlaw.com or 212.589.4654; or any member of BakerHostetler’s Class Action Defense or Securities Litigation and Regulatory Enforcement teams.

Editor’s Note: This BakerHostetler Alert was issued June 26, 2014. Authored by: Marc D. Powers, Mark A. Kornfeld, Deborah H. Renner, and Jessie M. Gabriel 


[1] For a discussion of the Amgen decision, please refer to our Executive Alert of March 8, 2013, A Big Week for the Securities Bar: Amgen and Gabelli.
[2] For further information on the background of the case leading up to the Supreme Court’s recent decision, please refer to our Executive Alert of September 30, 2013, Basic Is Anything But: Courts Continue to Wrangle with the Fraud-on-the-Market Presumption.


Baker & Hostetler LLP publications are intended to inform our clients and other friends of the firm about current legal developments of general interest. They should not be construed as legal advice, and readers should not act upon the information contained in these publications without professional counsel. The hiring of a lawyer is an important decision that should not be based solely upon advertisements. Before you decide, ask us to send you written information about our qualifications and experience.

Low-Tech Proof In a High-Tech World: Northern District of California Denies Class Certification In Hulu Data Privacy Case

Posted in Class Actions Privacy, Class Certification, Rule 23 Requirements

On June 16, the Northern District of California denied a motion for class certification in In re Hulu Privacy Litigation, No. C 11-03764 LB, ECF No. 111.  The plaintiffs in that action alleged that Hulu violated the Video Privacy Protection Act (“VPPA”) by disclosing personal identification information (“PII”) to third parties, including Facebook.  Hulu provides its users with online, on-demand access to video content, such as television programs and movies.  The PII allegedly disclosed was the plaintiffs’ video viewing selections on Hulu.  The Court denied the motion without prejudice, holding that the class was not ascertainable because the plaintiffs proposed to rely on self-reporting affidavits to prove class membership.

This decision represents an interesting contrast between allegations of high-tech data privacy violations and low-tech methods of proof.  As discussed below, the plaintiffs’ failure to corroborate their self-reporting affidavits by reference to the defendant’s records was fatal to their proposed identification of class members.  This failure is especially noticeable in a case where the alleged violations involve transmissions of electronic data identifying the plaintiffs.  Moreover, because internet based services like Hulu and Facebook reach millions of customers, the potential damage awards can soar into the billions of dollars.  This is especially true in the context of the VPPA, which provides for a relatively large statutory damage award of $2,500 per person.  As the Court reasoned in this case, such a large pot of gold can distort the purpose of both class actions and statutory damages, and further increases the importance of objective forms of proof at the class certification stage.

Plaintiffs’ Disclosure Theory

The named plaintiffs claimed that their PII was disclosed to Facebook as a result of Hulu’s inclusion of a Facebook “Like” button on its “watch page.”  A watch page is a unique webpage generated each time a Hulu user selects video content to view on hulu.com.  Specifically, the plaintiffs claimed that when they selected video content to view on hulu.com, Hulu loaded a watch page that included the Like button.  The mere loading of the Like button caused certain information to be automatically sent to Facebook, including the uniform resource locator (“URL”), or web address of the watch page.  During the class period, the URL of Hulu’s watch pages included the title of the video content the Hulu user selected.  This alone, however, did not disclose the identity of the Hulu user to Facebook.  In order for Facebook to connect the title of the video to a specific Facebook user, an additional piece of information was required in the form of a “c_user” web cookie.  The c-user cookie, which contained the Hulu users’ Facebook ID, would automatically be sent to Facebook when the Like button on the watch page loaded. This only occurred, however, when a Hulu user watched a video on the same computer and web browser used to access Facebook in the previous four weeks, while using the default settings.

Ascertaining the Putative Class

In order for a class to be certified, as the Court instructed, it must “be sufficiently definite and ‘clearly ascertainable’ by reference to objective criteria ‘so that it is administratively feasible for a court to determine whether a particular person is a class member and thus bound by the judgment.”  Here, the Court found the class is comprised of users of both Facebook and Hulu during the class period who actually had their PPI transmitted to Facebook.

Although the plaintiffs did not suggest it, the Court opined that the first part of this question—identifying users of both Faceboook and Hulu during the class period—could be easily determined by cross-referencing the user email addresses of both services.  Determining which of those users actually had their PII transmitted to Facebook, however, is not so simple.

There was no dispute that relevant disclosure was the transmission of the c-user cookie.  If the c-user cookie had been cleared from a particular Hulu users’ computer, it could not be transmitted to Facebook when the Like button loaded, and there was no disclosure in violation of the VPPA.  The Court found that there are various situations where the c-user cookie would be cleared from a Hulu user’s web browser.  For example, the c_user cookie would not be sent if the Hulu user logged out of Facebook, used different web browsers to access Facebook and Hulu, manually cleared the cookies on their web browser, or used software that blocked cookies.

Accordingly, in order to define the class, the plaintiffs would have to show that each class member: (i) logged onto Hulu and Facebook from the same browser; (ii) did not log out of Facebook; (iii) did not set their browsers to clear cookies; and (iv) did not use software to block cookies.  The plaintiffs only proposed method for determining the class members was self-reporting affidavits.  To that end, the named plaintiffs submitted declarations attesting that they were Facebook users who accessed Facebook on the same computer they used to watch videos on Hulu.com.   They also claimed that they had not cleared their cookies in some time nor used any ad-blocking software.

The Court rejected this method of defining the class members, reasoning that because the potential damages for each plaintiff are relatively high, some form of verification beyond a self-reporting affidavit is required.  It explained that “objective criteria (such as corroboration by reference to a defendant’s records or provision of some proof of purchase) are important to establishing class membership as opposed to relying only on potential members’ say-so and subjective memories that may be imperfect.”

The Court likened the plaintiffs’ reliance on the memory of the potential class members here to subjective estimates of smokers’ long term smoking habits in Xavier v. Philip Morris USA Inc., 787 F.Supp. 2d 1075 (N.D. Cal. 2011), where a court denied class certification.  The Court also reasoned that the incentive of a relatively high statutory damage award of $2,500 per class member is relevant to analyzing the credibility of the plaintiffs’ self-reporting affidavits.

Because the self-reporting affidavits were the only proposed method the plaintiffs offered to identify class members, the Court denied their class certification motion holding that they failed to define an ascertainable class.

Low-Tech Proof In a High-Tech World

Paradoxically, in attempting to define a class of plaintiffs aggrieved through high-tech, electronic communications that are largely invisible to the end user, the plaintiff relied on the very low-tech and unreliable method of self-reporting.  The Court did not shy away from delving deep into the weeds of how electronic communications, such as cookies and URLs, are transmitted in determining whether the plaintiffs could adequately define a class.

It also, apparently, did not lose sight of the key issues of fact that would need to be determined: (i) whether Hulu transmitted information to Facebook that allowed Facebook to identify a specific person and connect their identity to the specific video materials they requested or viewed; and (ii) if so, whether Hulu did so knowingly.

Presumably, Hulu would only have knowingly disclosed such information to Facebook in support of some business purpose.  As the Court noted, Hulu’s main source of income is advertising revenue.  Facebook’s business model is similarly based on advertising revenue.  This was not lost on the Court, which noted that there was no evidence that Facebook took any action with the information it allegedly received from Hulu.

Had Hulu or Facebook used the alleged PII in support of their respective businesses there would presumably be some record.  For example, one would expect there to be business records such as emails and legal agreements memorializing the purpose of Hulu transferring the alleged PII to Facebook.  Additionally, there would also likely be some type of electronic record created by Facebook’s collection and use of the alleged PII.  A reference to such records would have provided  “objective criteria” corroborating the plaintiffs’ self-reporting affidavits.  This is precisely what that the Court found was lacking from the plaintiffs’ proposed method of defining the class.  Indeed, had the plaintiffs been able to reference electronic records showing that Facebook actually collected and used the PII—which by definition contains the Hulu users’ identities—that alone would have likely defined the class.

There is also little question that the potentially enormous damage award in this case played into the Court’s refusal to rely on the plaintiff’s self-reporting affidavits.  As the Court stated, “[t]he possibility of substantial pecuniary gain affects the[] analysis [of the affidavits’ credibility].  That incentive . . . makes this case different than the small-ticket consumer protection class actions that this district certifies routinely.”  The Court did not stop there, however, discussing the potential damage award again in response to due process concerns raised by Hulu.

Hulu claimed that the statutory damage award of $2,500 per class member would result in an aggregated damage award of billions of dollars, and argued that this ran afoul of due process.  The court agreed noting that such an “award is wildly disproportionate to any adverse effects class members suffered, and it shocks the conscience.”  Moreover, the Court reasoned, such an enormous damage award “potentially distorts the purpose of both statutory damages and class actions” and “may induce an unfair settlement.” Ultimately, the Court declined to address this issue, finding that it is “best addressed after a class is certified.”