Consumer Law

Duties to absent class members--maybe not so much, says NY's highest court

By Stephen Gardner

The New York Court of Appeals (top NY court) issued an opinion last week, discussing the effort by a class member to discover internal documents of class counsel, for use in a subsequent class action against class counsel.

Wyly had sought the "right to review documents reflective of Class Counsel's pre-trial investigations related to the Class Actions; all the discovery produced or taken in the Class Actions; and all requests for discovery, indices, summaries, or other materials created by Class Counsel in relation to the Class Actions."

The court said that "the class counsel-absent class member relationship is simply too unlike the traditional attorney-client relationship to support extending the Sage Realty presumption to absent class members."

And then held that "where an absent class member brings a CPLR article 4 special proceeding seeking access to class counsel's litigation files after termination of the representation, Supreme Court must first consider how much the absent class member has at stake. If (as the parties do not dispute here) the absent class member has a substantial financial interest in the class action's outcome, the court must then decide whether the absent class member has demonstrated a legitimate need for the requested documents."

Distinguishing a class counsel's relationship to absent class members from a traditional attorney-client relationship troubles me, because it takes away from the duties we should always impose on ourselves and, in fact, makes us vulnerable to defense efforts to get us to short-change absent class members.

In fact, the very nature of the absent member's relationship to the class counsel makes that counsel's duty all the more important, because the relationship is essentially a confluence of attorney-client and fiduciary duties.

Let me stress that, in this case, I'm not sympathetic to Sam Wyly, who might not have been acting just in the interest of other class members.

So I'm talking theory and not the morally just result in this case.

Full post as published by CL&P Blog on May 11, 2009 (boomark / email).