Class Action

Credit Card Interest Rate Class Action Defense Cases–In re Capital One: Judicial Panel On Multidistrict Litigation (MDL) Grants Plaintiff Motion To Centralize Class Action Litigation But Selects Northern District Of Georgia As Transferee Court

By Michael J. Hassen

Judicial Panel Grants Plaintiff Request for Pretrial Coordination of Class Action Lawsuits Pursuant to 28 U.S.C. — 1407, Over Objection of Common Class Action Defendants, but Transfers Class Actions to Northern District of Georgia

Two class actions – one in the Georgia and one in Virginia – were filed against Capital One Financial and its wholly-owned subsidiary, Capital One Bank (USA) based on the claim that Capital One “unilaterally increased interest rates on customers’ credit card accounts without notice.” In re Capital One Bank Credit Card Interest Rate Hike Litig., ___ F.Supp.2d ___ (Jud.Pan.Mult.Lit. June 11, 2010) [Slip Opn., at 1]. Two additional class actions – one in California and another one in Georgia – were treated as potential tag-along cases, id., at 1 n.1. Attorneys for the Virginia class action plaintiffs filed a motion with the Judicial Panel for Multidistrict Litigation (MDL) requesting centralization of the class actions pursuant to 28 U.S.C. § 1407 in the Eastern District of Virginia, where their class action was pending. Id., at 1. Plaintiffs in the Northern District of Georgia class action supported the motion, id. Capital One opposed centralization of the class actions, or requested that the Judicial Panel delay ruling on the motion until the Georgia district court had ruled on the dispositive motions pending before it, Id. Specifically, defense attorneys had filed motions for summary judgment in each of the Georgia class actions, id., at 1-2. Alternatively, Capital One requested centralization in the Northern District of Georgia, id., at 1. The Judicial Panel granted the motion to centralize the class action lawsuits, rejecting defendants’ request to await decisions on the Georgia summary judgment motions because one had been filed only recently and because the California class action suggested that multidistrict litigation would still remain irrespective of the Georgia federal court’s rulings. Id., at 2. The Judicial Panel agreed, however, that the Northern District of Georgia was the appropriate transferee court because “[t]he first-filed actions are pending [there]” and because in one of those cases “discovery has begun and a motion for summary judgment is pending.” Id. Accordingly, the Panel transferred all class actions pending outside of Georgia to that district. Id.

Full post as published by Class Action Defense Blog on June 25, 2010 (boomark / email).