In this edition of The Class Action Chronicle, Skadden’s Mass Torts, Insurance and Consumer Litigation Group analyzes recent decisions and trends affecting class action and collective action litigation, including developments relating to arbitration.
Ninth Circuit Rules That Question of Article III Standing of Absent Class Members Cannot Be Deferred Until Post-Trial Proceedings
In recent years, following the lead of the U.S. Supreme Court in TransUnion LLC v. Ramirez,1 courts have recognized that the requirement of Article III standing imposes substantial limits on class actions in federal court. One hotly contested issue is when the standing of absent class members must be considered and demonstrated — only after trial (as plaintiffs have argued) or at earlier stages in a proceeding (as defendants have urged).
A panel of the U.S. Court of Appeals for the Ninth Circuit recently weighed in on that question in Healy v. Milliman, Inc.2 In a decision authored by Judge Sidney Thomas, the panel held that all named and unnamed class members in a certified class action seeking damages must present sufficient evidence of standing to withstand a motion for summary judgment. The panel further held that the usual summary-judgment standards apply to this determination — in other words, to proceed to trial, every class member must demonstrate, at a minimum, that there is a genuine dispute of material fact whether they have standing.
District Court Proceedings
The case arose out of named plaintiff James Healy’s application for life insurance from an insurance company. After receiving the application, the insurer requested Healy’s medical and prescription history from the defendant, Milliman, an independent risk-management, benefits and technology firm based in Seattle. The report that Milliman generated and sent to the insurance company, however, contained the medical records and Social Security number of a different — and much less healthy — person, leading the insurer to deny Healy’s application.
Healy later filed a class action against Milliman, alleging that Milliman had violated the Fair Credit Reporting Act by failing to adopt reasonable procedures to ensure the maximum possible accuracy of the information that it reported. The district court certified an “inaccuracy class” composed of individuals (like Healy) whose reported information actually related to a different person. Milliman filed a motion for partial summary judgment, arguing that there was no evidence to establish standing for the inaccuracy class. In response, Healy argued that the only evidence required at the summary-judgment stage was evidence that the named plaintiffs — not absent class members — had Article III standing, as (in Healy’s view) absent class members need only establish standing after trial to recover damages. Healy also observed that at least some absent class members’ reports contained mismatched Social Security numbers, suggesting that those reports may also have contained inaccurate health information.
The district court granted Milliman’s motion for partial summary judgment and dismissed the claims of the inaccuracy class. In so doing, the district court relied on the Supreme Court’s decision in TransUnion to conclude that Healy was required to present “at least some direct evidence of concrete injury on a class-wide basis” at the summary-judgment stage to recover money damages. The district court held that the evidence of mismatched Social Security numbers that Healy presented, while indicative of standing for unnamed class members, did not amount to direct evidence of standing for each member of the inaccuracy class. Healy then moved the district court to certify its order for interlocutory appeal; the district court did so, and the Ninth Circuit accepted review.
The Appeal
On appeal, Healy challenged (1) the district court’s ruling that evidence that unnamed class members have standing must be submitted at summary judgment; and (2) the district court’s application of the summary-judgment standard to the evidence that Healy had presented. The Ninth Circuit addressed both issues in its opinion.
Requirement that unnamed class members show standing at summary judgment. The panel first affirmed the district court’s holding that all class members — named and unnamed — must come forward with evidence of Article III standing at the summary-judgment stage.
The panel recognized that, under Ninth Circuit precedent, before a class is certified, only named plaintiffs must prove they have Article III standing. At the same time, the panel also understood that, in light of the Supreme Court’s decision in TransUnion, both named and unnamed class members must demonstrate standing before they can obtain a final judgment after trial to recover individual awards of damages. The question in Healy addressed an intermediate stage: whether in a damages class action, unnamed class members must demonstrate evidence of standing after a class has been certified but before trial when the defendant has moved for summary judgment.
Relying on TransUnion, the Ninth Circuit held that the answer is “yes.” The panel began with the Supreme Court’s holding that “[e]very class member must have Article III standing in order to recover individual damages.” The panel explained that this requirement “made clear that named and unnamed class members must demonstrate standing at trial,” because plaintiffs “must demonstrate standing ‘with the manner and degree of evidence required at the successive stages of the litigation.’” The panel also emphasized that, in TransUnion, the Supreme Court had specifically “examined the trial record for evidence of injury to not just the named plaintiff, but also unnamed class members.” Thus, the panel explained, Healy’s position that unnamed class members could wait until a post-trial individualized claims process to present evidence of their own standing would contravene TransUnion. Because unnamed class members “had a burden to demonstrate standing at trial,” they also must show that there is a triable issue of fact as to their standing to survive “at summary judgment.”
In reaching this conclusion, the panel rejected Healy’s argument that Ninth Circuit precedent relieved absent class members of any duty to make any showing as to standing until after trial. Those cases all predated TransUnion, the court explained, and were therefore abrogated to the extent that they were inconsistent with TransUnion. And the only contrary post-TransUnion case had addressed a class seeking injunctive relief, not monetary damages.
Application of “usual summary judgment standards” to Article III standing inquiry. Although the Ninth Circuit panel agreed with the district court’s holding that absent class members’ Article III standing was relevant at summary judgment, the panel concluded that the lower court had failed to apply the “usual summary judgment standards” in assessing classwide standing. First, the panel faulted the district court for insisting upon “direct evidence,” concluding that it is possible to show standing through the use of “circumstantial evidence.” Second, the panel criticized the district court for requiring evidence from which a rational trier of fact would “necessarily” infer error on Milliman’s part, as the proper burden is merely to show that a rational trier of fact could reasonably infer such error (thus creating a material dispute of fact).
Given these issues with the district court’s application of the summary-judgment standard, the panel reversed and remanded for the court to consider whether Healy presented enough circumstantial evidence to allow a rational trier of fact to reasonably infer that classwide standing had been established.
Takeaways
The Healy opinion has several implications for future practice.
First, it establishes that Article III standing of unnamed class members in a damages class action must be proven at trial — not just in a post-trial claims process — but also that when a defendant moves for summary judgment on Article III standing grounds after a class has been certified, the class members must put forward evidence of their own standing. Specifically, to avoid summary judgment, all class members, both named and unnamed, must point to evidence creating a triable issue of fact.
Second, Healy provides strong evidence regarding the outcome of the critical issue of “whether every class member must demonstrate standing before a court certifies a class” that was expressly left open in TransUnion.3 Healy rejects the argument that plaintiffs frequently advance — that the standing inquiry for absent class members can wait until a post-trial claims process. And in doing so, Healy explained that at least nine prior Ninth Circuit decisions to that effect have been abrogated in part by TransUnion. If TransUnion’s requirement that standing must be demonstrated “with the manner and degree of evidence required at the successive stages of the litigation” means that absent class members must withstand summary judgment as to Article III standing to reach the classwide trial, as Healy confirms, then defendants have strong arguments that, by the same logic, a class can’t be certified unless plaintiffs can show that individualized questions of standing will not overwhelm common questions.
Third, Healy clarifies that the same standard that normally applies at summary judgment — i.e., that the nonmoving party must show that there is a genuine dispute of material fact — also applies to the standing determination. In other words, absent class members need not prove definitively that they have Article III standing; it is enough to show that there is evidence from which a rational factfinder could find standing. And in making this demonstration, a plaintiff may proffer both direct and circumstantial evidence.
En Banc Sixth Circuit Reverses Class Certification, Concluding That Defendants May Not Be Prevented From Raising Individualized Defenses
When liability cannot be determined without mini-trials for each class member, certification of a damages class action is improper. In Clippinger v. State Farm Automobile Insurance Co.,4 the en banc U.S. Court of Appeals for the Sixth Circuit, by a vote of 10-7, reversed certification in a case challenging the way auto insurers resolve claims involving totaled vehicles, holding that individualized valuation issues preclude class treatment.
Plaintiffs have filed similar class actions against auto insurers across the country, and five other circuits had rejected class certification.5 The divided Sixth Circuit panel opinion would have created a circuit split and attracted similar class actions in courts within the Sixth Circuit. But the decision by the full court of appeals to rehear the case and reverse the district court’s class certification order restores uniformity to the federal appellate courts’ rejection of class treatment in these cases.
The en banc Sixth Circuit’s decision also reinforces fundamental principles governing how to apply the predominance requirement of Federal Rule of Civil Procedure 23(b)(3). A plaintiff’s assertion of a classwide legal theory or proposal for adjudicating liability and damages classwide is not enough; courts must scrutinize what is actually needed to litigate the claims asserted and cannot certify a class when individualized, fact-intensive issues unique to each class member’s claims or the defendant’s available defenses make a single class proceeding unworkable. The Sixth Circuit further made clear that the Rules Enabling Act — which prohibits federal rules from abridging, modifying or enlarging any substantive right6 — precludes certifying a damages class when doing so would eliminate a defendant’s right to present individualized defenses to each class member’s claim.
As discussed below, these aspects of the Clippinger court’s opinion highlight important tools for defending against certification of damages classes more broadly, well beyond the auto insurance context.
District Court Proceedings
Some standard-form auto insurance policies promise to pay the “actual cash value” of totaled cars — that is, cars that cost more to repair than they were worth prior to the crash. Plaintiffs across the country have filed class actions alleging that insurers violate these policies by using valuation methods that undervalue the vehicles.
In this case, the plaintiff’s theory was that State Farm breached the insurance policy by applying a “typical negotiation adjustment[]” to the advertised price of comparable vehicles to account for the fact that many dealers sell used cars for less than the advertised list price. In the plaintiff’s view, the use of that adjustment systematically lowered the actual cash value for all cars, allowing the issue to be tried on a classwide basis.
The district court granted the plaintiff’s motion for certification of a damages class of Tennessee customers holding State Farm policies that covered 90,000 used vehicles. The district court accepted for certification purposes the plaintiff’s theory that a typical negotiation adjustment unlawfully reduced State Farm’s actual-cash-value estimate and that damages could be calculated classwide using a “simple mathematical calculation” to recalculate the actual-cash-value estimate without the typical negotiation adjustment.
The Panel Opinion
A divided panel initially affirmed.7 The panel majority agreed with the district court that whether the use of typical negotiation adjustments is permissible in calculating vehicles’ actual cash value was a common liability question. And it approved the district court’s endorsement of a classwide damages model that would remove the negotiation adjustment from State Farm’s valuation for each class member’s vehicle.
The panel acknowledged that other circuits had rejected class certification in similar cases but declined to follow those decisions. The panel reasoned that, in its view, the individualized issues in the case went only to damages and not liability, and that the plaintiff’s proposed methodology provided an adequate “‘starting place’ for classwide valuation and damages calculation.”
The En Banc Opinion
State Farm petitioned for rehearing en banc, and the full Sixth Circuit agreed to rehear the appeal.
In an opinion authored by Judge Eric Murphy (who had dissented from the panel opinion), the en banc court reversed. The court of appeals assumed without deciding that plaintiff had satisfied Rule 23(a)(2)’s commonality requirement, and it declined to reach State Farm’s arguments related to Rule 23(a)’s typicality and adequacy requirements.
Instead, the court focused on Rule 23(b)(3)’s predominance requirement and concluded that it was not met. Neither the insurance policy nor Tennessee law makes the use of a negotiation adjustment “facially unlawful,” the court explained. Instead, the contractual obligation is to pay the actual cash value of the vehicle, and therefore the central question for determining liability is “[w]hat was the actual cash value (that is, the fair market value) of each class member’s vehicle?” Thus, whether there was a breach of contract depended on whether a class member was paid less than that actual cash value.
Answering that question, the court continued, is “fact-intensive” and “requires an independent and individualized assessment of each absent class member’s property” — including such factors as “‘the year, make and model, mileage, options, and the overall condition of the vehicle’ before an accident.” A jury or juries could not feasibly repeat 90,000 times over the process of studying the “unique characteristics” of each used car to determine the car’s value, including because such a process would require the parties to “present individual proof on a plaintiff-by-plaintiff basis.”
The en banc Sixth Circuit next rejected the plaintiff’s argument that the abuse-of-discretion standard of review could salvage the district court’s order. The court explained that a legal error always amounts to an abuse of discretion, and the district court’s certification order rested on the “legal mistake” of misinterpreting the terms of the insurance policy to categorically bar the challenged negotiation adjustment.
Finally, the court further held that the district court’s certification order violated the Rules Enabling Act, which provides that the rules of procedure (including Rule 23) may not “‘abridge, enlarge or modify any substantive right’ of a party.”
Specifically, the court held that the district court’s proposal to avoid vehicle-specific evidence and assume State Farm discounted the actual cash value of each vehicle by the amount of the typical negotiation adjustment was inconsistent with the Rules Enabling Act. Neither the insurance policy nor Tennessee regulations limited the evidence that State Farm could use to value totaled vehicles, and — even assuming plaintiff were correct that the typical negotiation adjustment did not reflect market conditions — State Farm would have the right to present at trial evidence showing that it paid the actual cash value of each vehicle notwithstanding the negotiation adjustment. That right does not and could not change in the context of a class action: Courts “may not meet the predominance element by barring a defendant from raising unique statutory or contractual ‘defenses to individual claims.’”
The Sixth Circuit further held that the limitation below on the evidence that would be relevant in proving the actual cash value of each used vehicle would abridge not just State Farm’s rights, but also the rights of absent class members who otherwise could argue that State Farm undervalued their vehicles “by more than the typical-negotiation adjustment.”
The court thus concluded that the “contract claims will require ‘mini trials as to each’ class member” consistent with the parties’ rights to present individualized evidence and the Rules Enabling Act. That requirement made “a class action an inappropriate vehicle to manage the litigation.”
Takeaways
The Sixth Circuit’s ruling is undoubtedly a relief to auto insurers, who otherwise likely would have faced additional similar class actions in district courts within that Circuit. But the Clippinger decision also has broader implications for businesses defending against damages class actions.
The Sixth Circuit’s decision makes clear that courts cannot accept at face value plaintiffs’ proposals for how the case could be resolved on a classwide basis. Instead, courts must rigorously scrutinize how the claims and defenses would actually be litigated, consistent with the Rules Enabling Act and defendants’ due process right to present all available defenses.
Clippinger further confirms that courts must guard against mismatches between the theories plaintiffs offer in service of class certification and the actual elements of their claims (and the defendant’s defenses to those claims). In Clippinger, for example, the plaintiff’s theory that State Farm automatically breached the insurance policies by utilizing typical negotiation adjustments could not be squared with the policies themselves, which required State Farm to pay the actual cash value of the vehicle rather than employ a specific valuation methodology.
The Clippinger court’s rigorous application of the Rules Enabling Act also requires rejecting plaintiffs’ proposals for a classwide trial that would jettison individualized defenses. The Sixth Circuit’s approach follows Supreme Court precedent holding that a class cannot be certified on the premise that the defendant “will not be entitled to litigate its statutory defenses to individual claims.”8 Clippinger confirms — contrary to the arguments raised by the dissent — that the logic of the Supreme Court’s holding is not limited to the particular defense at issue in that case. Instead, that holding establishes the broader proposition that, under the Rules Enabling Act, Rule 23 cannot be used to abridge a defendant’s substantive right to present the full range of defenses that would be available to it in an individual case.
Other Recent Class Action Decisions of Note
Fourth Circuit Clarifies Proper Procedural Vehicle for Pre-Discovery Challenges to Class Certification
Oliver v. Navy Federal Credit Union, 167 F.4th 106 (4th Cir. 2026)
Defendants sometimes seek to challenge whether a case may proceed as a class action at an early stage in litigation. In a decision written by Judge Toby Heytens, the U.S. Court of Appeals for the Fourth Circuit held that the proper vehicle for a pre-discovery attack on class allegations is a motion to deny class certification under Rule 23(c)(1)(A), “coupled with a motion to strike under 23(d)(1)(D) should the motion to deny class certification be granted.” The court also reaffirmed that class certification may be denied at the pleading stage only if noncompliance with Rule 23 is clear “as a matter of law” on the face of the complaint.
First, the court held that Rule 23(c)(1)(A) — not Rule 12(f) or Rule 23(d)(1)(D) — is the proper source of authority for pre-discovery challenges to class certification. Rule 23(c)(1)(A) provides: “At an early practicable time after a person sues or is sued as a class representative, the court must determine by order whether to certify the action as a class action.” The court noted that Rule 12(f)’s operative terms — “redundant, immaterial, impertinent, or scandalous matter” — do not track Rule 23’s certification requirements. And the court added that Rule 23(d)(1)(D) — which allows a court to “require that the pleadings be amended to eliminate allegations about representation of absent persons and that the action proceed accordingly” — is a housekeeping provision that comes into play only after the court has already made a certification decision under Rule 23(c)(1)(A). Thus, the proper procedure in challenging class certification is to make a “a motion to deny class certification under 23(c)(1)(A), coupled with a motion to strike under 23(d)(1)(D) should the motion to deny class certification be granted.”
Second, the court reaffirmed its 1978 holding in Goodman v. Schlesinger9 that a district court may deny class certification at the pleading stage only if the complaint’s allegations show noncompliance with Rule 23 “as a matter of law.” As support for its holding, the court cited decisions by the First and Eleventh Circuits.10 The Fourth Circuit interpreted those decisions as holding that district courts may resolve class certification before discovery, but only if the impropriety of class certification is obvious from the face of the complaint alone.
Notably, other circuits have approved of the use of motions to strike class allegations under Rule 12(f) and Rule 23(d)(1)(D) — but regardless of the procedural label attached to an early motion challenging class allegations, as the Fourth Circuit acknowledged, “[i]t is common ground that district courts may sometimes make class certification decisions based solely on the pleadings and before any discovery has occurred.” And in Oliver itself, the court affirmed the dismissal of the damages class allegations, explaining that the case involved the “rare circumstance” where a lack of predominance or superiority was “readily apparent” on the face of the complaint.
Specifically, the damages class bundled together borrowers with different loan products, who experienced different outcomes, and invoked the laws of different states. These “vari[ations]” made it necessary “to evaluate ‘each individual mortgage applicant . . . on so many different variables’” that the damages class could not be certified. At the same time, the court was unwilling to affirm the dismissal of the plaintiff’s requests to pursue classwide declaratory and injunctive relief under Rule 23(b)(2), because there is no predominance or superiority requirement for classes seeking such relief.
Ninth Circuit Holds That Rule 23(d) Authorizes Courts to Invalidate Arbitration Agreements Procured Through Misleading Communications With Absent Class Members in a Pending Putative Class Action
Avery v. TEKsystems, Inc., 165 F.4th 1219 (9th Cir. 2026)
In a decision by Judge Lucy Koh, the U.S. Court of Appeals for the Ninth Circuit held that Rule 23(d) authorizes a district court to refuse to enforce an arbitration agreement found to have been procured through misleading communications with putative class members. The case concerned alleged violations of California wage and hour laws. Two years into the case, after the briefing of class certification was complete, the defendant implemented a new arbitration agreement for its employees, which were distributed with emails saying that class actions are “wasteful,” “inefficient,” involve “exorbitant fees,” “tend to enrich only attorneys,” and would “require[]” the employer “to ignore individual employee issues and concerns.” The defendant moved to compel arbitration against class members who did not opt out of arbitration, but the district court denied the motion under Rule 23(d).
In affirming the district court’s decision, the Ninth Circuit resolved a question raised, but not answered, in an earlier case.11 In that prior case, the court had observed that the Fourth, Sixth and Eleventh Circuits had ruled that district courts can address misleading and coercive communications used to obtain agreements from prospective class members, but it declined to reach the issue for lack of appellate jurisdiction. In Avery, the Ninth Circuit explained it had appellate jurisdiction and was joining with those other circuits’ decisions.
The Ninth Circuit further held that full invalidation of the arbitration agreement, rather than simple corrective notice, was the appropriate remedy. Sending a corrective notice alone would leave class members bound by agreements they had entered into based on what the court viewed as misleading communications. The court likewise rejected the defendant’s contention that Rule 23(d) authorizes only prospective restrictions on communications, not invalidation of agreements resulting from past communications. Such a limitation, the court reasoned, would strip the rule’s supervisory authority of practical effect, because misleading communications can subvert an entire class proceeding before any court order can issue.
Finally, the court held that the district court properly decided enforceability rather than delegating that question to the arbitrator. Although the agreement incorporated a delegation clause covering arbitrability disputes, the plaintiffs challenged the validity of the delegation provision itself, requiring the district court to resolve the issue before compelling arbitration of the broader enforceability question.
Seventh Circuit Holds That 2024 BIPA Amendment Limiting Statutory Damages to Single Recovery Per Person Applies Retroactively to Pending Cases
Clay v. Union Pacific Railroad Co., 171 F.4th 975 (7th Cir. 2026)
The U.S. Court of Appeals for the Seventh Circuit, in a decision by Chief Judge Michael Brennan, held that the 2024 amendment to Section 20 of Illinois’s Biometric Information Privacy Act (BIPA) — which narrows the potential exposure under that statute12 — applies retroactively to cases pending at the time of enactment.
BIPA prohibits the “collect[ion],” “capture,” “disclos[ure]” or “disseminat[ion]” of “biometric information” without consent,13 and creates a private right of action for violations of the act.14 The consolidated cases involved employees who alleged that their employers “collected their fingerprints or hand geometry through a ‘biometric time clock’” in violation of BIPA, and sought statutory damages for each scan to clock in or out. While those suits were pending, Illinois amended Section 20 of BIPA to provide that an entity collecting biometric information “in more than one instance . . . from the same person using the same method of collection . . . has committed a single violation . . . for which the aggrieved person is entitled to, at most, one recovery” of statutory damages.15 The Seventh Circuit observed that the “financial stakes of this case are high”: A finding of liability “could net” one plaintiff alone “$7.5 million in statutory damages,” and “billions of dollars” in aggregated statutory damages across the proposed class, if the amendment did not apply retroactively.
To decide that question, the court looked to Illinois’ retroactivity principles. Under those principles, Illinois courts first ask whether the General Assembly has “expressly indicated the temporal reach of the amendment.” If not, Illinois law requires courts to “consider whether amendments constitute substantive or procedural changes in the law.” The court held that the amendment was procedural: Amending the remedy without “alter[ing] when ‘a cause of action . . . has arisen’” or “the rights, duties, and obligations of persons to one another” is a procedural change under Illinois law, which classifies amendments to remedial provisions as non-substantive. Accordingly, the court held that the amendment applies retroactively to all pending cases.
Finally, the court also emphasized that “damages appear to be discretionary under BIPA,” as the 2024 amendment clarifies that “plaintiffs are ‘entitled to, at most, one recovery’” — meaning that “plaintiffs alleging thousands of violations might not even be entitled to the full award of liquidated damages permitted by Section 20(a).”
Sixth Circuit Holds District Courts Must Undertake Detailed Erie Analysis in Case Concerning Multistate Class-Certification Predominance Inquiry
Generation Changers Church v. Church Mutual Insurance Co., 168 F.4th 354 (6th Cir. 2026)
In an opinion by Judge Richard Allen Griffin, the U.S. Court of Appeals for the Sixth Circuit held that a district court conducting an Erie analysis as part of a Rule 23(b)(3) predominance inquiry erred by failing to consider nonbinding state law and decisions of other federal courts concerning state law.
Generation Changers Church had filed a putative class action against its insurer, Church Mutual, on behalf of policyholders from 10 states, alleging that Church Mutual had improperly calculated the payments for claims based on property damage. The policy required the insurer to pay the actual cash value for property losses; the plaintiff alleged that the insurer improperly reduced its payments by including the depreciation of nonmaterial costs, such as labor. The district court certified a class for four states where binding or statutory authority addressed the issue but declined to certify classes for six states, concluding that “the unsettled nature of the law in these six states would make a ten-state class prohibitively unwieldy.”
First, as to Ohio and Kentucky, the Sixth Circuit held that the district court had erred by declining to follow Sixth Circuit decisions holding that Kentucky and Ohio law did not allow inclusion of depreciation of labor costs unless unambiguously permitted in the policy. The district court had “discounted” those decisions on the theory that “‘Erie-based precedents [are] more malleable than other precedents’ because they are more readily ‘subject to revisiting based on new data.’” The Sixth Circuit disagreed, explaining: “Although a district court may strike its own path through state law, it must first explain why our decisions should not be followed” — even though the district court did not identify any change in law or new state-court decisions that called the Sixth Circuit’s Erie predictions into question.
Second, as to three other states, the Sixth Circuit held that the district court had failed to consider the “persuasive federal authorities” and “persuasive intermediate state court authority” that Generation Changers Church had proffered. The Sixth Circuit noted that federal courts “must . . . predict what state law says,” and the district court’s failure to address these decisions and make an Erie prediction as to those three states’ laws constitutes error.
The Sixth Circuit therefore remanded for the district court to undertake a more detailed Erie analysis in assessing the propriety of class certification. The court affirmed the denial of certification as to one other state, however, because the only authority that the plaintiff had offered was a state agency’s regulatory guidance that was silent about the depreciation of nonmaterial costs — guidance that the Sixth Circuit considered insufficient to support an Erie prediction that could justify certification.
Virginia Governor Vetoes Bill That Would Have Opened State Courts to Class Actions for the First Time
Virginia is one of two states — along with Mississippi — that bars plaintiffs from bringing class actions in state court. In April 2026, the Virginia General Assembly passed legislation that would eliminate that prohibition and, for the first time, allow class action lawsuits to proceed in Virginia state courts, while also broadening the reach of the Virginia Consumer Protection Act.16 Opponents warned that the legislation would dramatically expand potential liability for Virginia employers, while proponents argued the legislation would fill a gap for Virginia consumers bringing actions under $5 million in controversy.17
Gov. Abigail Spanberger vetoed the bill on May 19, 2026.18 This was the second time that a Virginia class action bill was rejected by the governor; a predecessor bill was vetoed in 2024 by then-Gov. Glenn Youngkin.19 Spanberger had previously returned the bills to the General Assembly with proposed amendments that would have limited venue to four regional circuit courts — Richmond, Fairfax County, Norfolk and Roanoke — and granted courts enhanced authority to dispose of claims at the summary-judgment stage.20 The General Assembly declined to adopt those amendments and returned the original bills to the governor.
Spanberger expressed support for the underlying goal of the bill, saying: “I support the General Assembly’s goal of providing a class action mechanism that can be used by plaintiffs in Virginia courts. I offered amendments to ensure that when Virginia adopts its first-ever class action procedure, we do so in a tailored and judicious way — building on longstanding federal precedent while providing regional circuit courts an opportunity to develop expertise. The General Assembly did not accept these amendments.”21
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1 594 U.S. 413 (2021).
2 164 F.4th 701 (9th Cir. 2026).
3 594 U.S. at 431 n.4.
4 173 F.4th 817 (6th Cir. 2026) (en banc).
5 See Ambrosio v. Progressive Preferred Ins. Co., 154 F.4th 1107, 1110-13 (9th Cir. 2025); Freeman v. Progressive Direct Ins. Co., 149 F.4th 461, 468-71 (4th Cir. 2025); Schroeder v. Progressive Paloverde Ins. Co., 146 F.4th 567, 576-78 (7th Cir. 2025); Drummond v. Progressive Specialty Ins. Co., 142 F.4th 149, 158-61 (3d Cir. 2025); Sampson v. United Servs. Auto. Ass’n, 83 F.4th 414, 417, 421-23 (5th Cir. 2023).
6 See 28 U.S.C. § 2072(b).
7 See Clippinger v. State Farm Auto. Ins. Co., 156 F.4th 724 (6th Cir. 2025).
8 Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 367 (2011).
9 584 F.2d 1325 (4th Cir. 1978).
10 See Manning v. Bos. Med. Ctr. Corp., 725 F.3d 34 (1st Cir. 2013) and Mills v. Foremost Ins. Co., 511 F.3d 1300 (11th Cir. 2008).
11 See Dominguez v. Better Mortg. Corp., 88 F.4th 782 (9th Cir. 2023).
12 See Pub. Act. 103-0769, 2024 Ill. Laws 6788.
13 740 Ill. Comp. Stat. Ann. 14/15(b), (d).
14 740 Ill. Comp. Stat. Ann. 14/20(a).
15 740 Ill. Comp. Stat. Ann. 14/20(b).
16 SB 229, Civil Actions Filed on Behalf of Multiple Persons; Class Actions, 2026 Gen. Assemb., Reg. Sess. (Va. April 22, 2026).
17 Markus Schmidt, “Virginia Class Action Proposal Dies After Spanberger Veto,” Virginia Mercury (May 22, 2026).
18 SB 229, Veto Message, 2026 Gen. Assemb., Reg. Sess. (Va. May 19, 2026).
19 Schmidt, supra note 17.
20 See SB 229, Amendment in the Nature of a Substitute § 8.01-267.15, 2026 Gen. Assemb., Reg. Sess. (Va. April 11, 2026).
21 Veto Message, supra note 18.
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