Federal Court Upholds Right of Plaintiffs Who Opted Out of Nationwide Class Action Settlement to Pursue Individual Claims

TLPJ Convinces Court to Reject Injunction in MetLife Case on Behalf of Opt-Outs

Model of the MetLife blimp outside the New York Stock Exchange. Photo courtesy of MetLife.

Affirming the rights of plaintiffs who opt out of class action settlements to pursue their own claims, the Chief Judge of the U.S. District Court for the Western District of Pennsylvania agreed with Trial Lawyers for Public Justice (TLPJ) that plaintiffs who opted all of their claims out of a nationwide class action settlement involving the Metropolitan Life Insurance Company (MetLife) cannot be barred from introducing key evidence in their individual cases against MetLife.

Chief Judge Donetta W. Ambrose of the Western District of Pennsylvania issued an order dated September 26, 2002, adopting as the Court’s opinion the report and recommendation of U.S. Magistrate Judge Kenneth J. Benson issued August 15, 2002. In that recommendation, Magistrate Judge Benson dramatically reversed his earlier recommendation that opt-out litigants should be enjoined from introducing evidence regarding MetLife’s nationwide sales practices in their individual cases against the insurance company. In her September 26 decision, Chief Judge Ambrose agreed with this conclusion and adopted the magistrate judge’s recommendation in its entirety.

Chief Judge Ambrose’s adoption of the magistrate judge’s reversal came about after TLPJ filed objections on behalf of 392 people who opted out of a nationwide class action settlement so that they could bring their own individual claims against MetLife based on allegations of deceptive sales practices. TLPJ’s objections argued that the federal magistrate’s initial decision of January 4, 2002, which recommended that the opt-out litigants be enjoined from fully prosecuting their claims against MetLife, violated their opt-out rights allowed under Rule 23 of the Federal Rules of Civil Procedure and was contrary to due process, the federal Anti-Injunction Act, and the express terms of the class action notice of settlement.

In his August 15 report, Magistrate Judge Kenneth Benson of the Western District of Pennsylvania agreed with TLPJ and concluded that his earlier recommendation violated Rule 23's opt-out provisions and the Anti-Injunction Act. In reversing his previous ruling, Magistrate Judge Benson wrote, "Wisdom, to paraphrase Justice Frankfurter, so often never comes that she ought not to be spurned just for coming late. On reconsideration, and in light of the arguments of the parties, I conclude the Report of January 4, 2002, was error." He ultimately recommended that the opt-out litigants should not be enjoined in any respect.

Leslie Brueckner

Michael Quirk

"This is a major victory for the rights of opt-out plaintiffs," said TLPJ’s Leslie Brueckner, who was the principal author of the objections for the opt-out litigants and argued TLPJ’s objections in federal court in Pittsburgh on February 28, 2002. "We commend the Court for recognizing and safeguarding the rights of opt-out litigants embodied in both Rule 23 and the U.S. Constitution."

"Our clients opted all of their claims out of the nationwide settlement," said TLPJ’s Michael Quirk, who co-authored the objections. "If the District Court had reinstated the injunction MetLife wanted, it would have rendered the opt-out right almost completely meaningless."

TLPJ’s original objections were filed as part of its Class Action Abuse Prevention Project, a nationwide campaign dedicated to monitoring, exposing, and fighting class action abuse nationwide. In addition to Brueckner and Quirk, the legal team on the case included TLPJ’s Executive Director Arthur H. Bryant and Kenneth R. Behrend, Jr., of Pittsburgh, who represents the 392 opt-out litigants in their 255 individual cases against MetLife.

Copies of TLPJ’s briefs and copies of the September 26 order and the August 15 report and recommendation in In Re: Metropolitan Life Insurance Sales Practices Litigation are available at TLPJ’s web site, www.tlpj.org.

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