The Eleventh Circuit is poised to reconsider recent standing decisions favorable for defendants seeking to invoke Article III’s standing requirements to defeat class certification.
At issue is the Eleventh Circuit’s July 2022 decision in Drazen v. Pinto, holding that (i) all class members must have Article III standing in order to receive individual damages (whether through a settlement or otherwise), and (ii) the standing determination is decided under Eleventh Circuit law, even where certain class members do not reside within the Eleventh Circuit’s geographic boundaries and may have standing under other circuit precedent. 41 F.4th 1354, 1360–61 (11th Cir. 2022). The dispute in Drazen arose in the context of the Telephone Consumer Protection Act (“TCPA”), and addressed both unwanted phone calls and text messages. While a settlement in Drazen was pending, the Eleventh Circuit held in Salcedo v. Hanna, 936 F.3d 1162, 1168 (11th Cir. 2019), that, contrary to precedent in other circuits, a single unwanted text message was not sufficient to give rise to Article III standing under the TCPA. Because the panel was bound by Salcedo, and because the proposed class definition in the Drazen settlement included individuals whose sole harm was an unwanted text message, those individuals did not have standing. The panel therefore vacated the district court’s approval of the settlement.
This blog previously discussed how Drazen gave defendants in the Eleventh Circuit another tool to defeat certification, because any class definition that included class members without standing was a “class definition that cannot stand.” Drazen, 41 F.4th at 1362. It would also require defendants looking to settle class actions in that circuit to ensure that class definitions in any settlement are limited to individuals with Article III standing.
But now it is possible that those implications may not come to pass. The Drazen appellee sought rehearing en banc, but the petition focused entirely on the Eleventh Circuit’s decision in Salcedo, not the actual panel decision in Drazen. The Eleventh Circuit just announced that it would rehear Drazen en banc, and it vacated the panel’s decision. See 2023 WL 2468505 (11th Cir. Mar. 13, 2023). No explanation was given for the Court’s decision to rehear the case en banc.
If the en banc court reconfirms Salcedo, it will likely affirm the panel’s ruling in Drazen (although Drazen’s holding that standing must be determined solely by Eleventh Circuit law was not squarely implicated by Salcedo). But if the en banc court finds that Salcedo was wrongly decided, then the Drazen decision will almost certainly be reversed. It is worth noting that the Eleventh Circuit is the only circuit that has held that unwanted text messages are insufficient to confer standing under the TCPA, and the decision in Salcedo conflicts with decisions in the Second, Fifth, Seventh, and Ninth Circuits. Check back here for an update after the Eleventh Circuit issues its decision.