A new Seventh Circuit decision – Santiago v. City of Chicago – bolsters the strategy among some class action defense lawyers to not bifurcate class certification and merits discovery.[i] This strategy instead contemplates that the opposition to Plaintiff’s class certification motion will be filed simultaneously with a motion for summary judgment. The Seventh Circuit’s decision endorses the view that it is inefficient to spend time and resources considering whether class certification should be granted as to claims that might not ultimately survive summary judgment.
Bifurcating discovery in class actions has long been a popular strategy among some defense lawyers. The primary factor driving this trend has been the potential to reduce the hefty costs associated with defending a class action. Under the bifurcated discovery model, courts divide discovery into two sequential phases: class certification discovery followed by class merits discovery.[ii]
A common argument in support of bifurcated discovery is that merits questions are sometimes irrelevant to a class certification analysis (though the U.S. Supreme Court has blurred the lines between the two in recent years).[iii] Therefore, limiting initial discovery to class certification issues until a class has been certified allows the parties to focus on one hurdle at a time.[iv] But while this approach is sometimes deemed preferable, it is not always.
Specifically, the bifurcated discovery model fails to account for the benefits of having a summary judgment ruling. If discovery is bifurcated, class certification decisions are usually made prior to the court’s summary judgment decisions. The bifurcated discovery model allows courts to consider all the elements of all claims (that survived the motion to dismiss) in their class certification deliberations. This can create a problem for defense lawyers and sometimes the court alike when the summary judgment stage finally arrives—class certification may have been granted for a number of claims that discovery has shown should not survive summary judgment.
The Seventh Circuit’s holding in Santiago v. City of Chicago solidifies the strategic decision to file both the opposition to class certification and a motion for summary judgment simultaneously, rather than to bifurcate discovery.[v] In Santiago, the Court reversed the grant of class certification and remanded the case for further analysis.[vi] Critically, the Seventh Circuit reminded lower courts that the crux of any class certification inquiry begins with the elements of the underlying causes of action.[vii] Without knowing exactly what claims have survived and what elements remain, a court cannot certify a class.[viii]
As the Seventh Circuit explained, when a court begins its class certification analysis with the elements of the claims, it can more clearly frame within those elements what it deems to be common and individual issues.[ix] “By juxtaposing them in that way, the district court’s predominance inquiry would have better trained on the legal or factual questions that qualify each class member’s case as a genuine controversy.”[x] The Court added, “[o]nly by properly circumscribing the claims and breaking them down into their constituent elements can a district court decide which issues are common, individual, and predominant.”[xi]
The Santiago analysis undercuts the notion that bifurcated discovery is the most effective strategy for defending class actions. Instead, the Santiago analysis demonstrates that playing the longer game by filing both opposition to class certification and a motion for summary judgment simultaneously could prove to be more effective.
The summary judgment motion will allow courts to assess the merits of each claim before making a class certification decision. If the defense’s summary judgment motion knocks out particular claims prior to class certification, courts can only consider the surviving claims (and those elements) in their class certification determination. This, in turn, could reduce overall litigation costs throughout the life of the class action by preventing the need for motions to decertify a class.
While the bifurcated discovery model does allow for early class certification decisions, these class certification decisions can be premature without an in-depth look at the merits of the case. The bifurcated discovery model allows class certification to be granted long before testing the allegations of each cause of action with discovery.
In contrast, simultaneously filing both the opposition to class certification and a motion for summary judgment may have significant benefits for defendants. Courts can dispense with weaker claims by granting summary judgment, and this subsequently decreases the likelihood that class certification will be granted.
[i] See generally Santiago v. City of Chi., No. 20-3522, 2021 WL 5876023, at *15-16 (7th Cir. Dec. 13, 2021).
[ii] Manual for Complex Litigation (“MCL”) § 21.14 (“Discovery relevant only to the merits delays the certification decision and may ultimately be unnecessary. Courts often bifurcate discovery between certification issues and those related to the merits of the allegations.”).
[iii] See id.
[v] See Santiago, 2021 WL 5876023, at *15-16.
[vi] Id. at *20.
[vii] Id. at *15.
[viii] Id. at *15-16.
[ix] Id. at *15.
[x] Id. (internal quotation marks omitted).