Consumer Class Actions and Mass Torts
Virginia Supremes Flatly Reject American Pipe Tolling
Previously I have discussed the federal doctrine of so-called American Pipe tolling, in which a legal fiction is employed to toll the running of the statute of limitations on absent class members' federal causes of action during the pendency of the class action -- at least until certification is denied or something else occurs (such as dismissal) that would make it unreasonable for an absent class member to think that her interests are continuing to be protected by the class action lawsuit. The whole doctrine is based on the legal fiction that absent class members actually are aware of the pending class action suit and would seek to intervene in it unless class action tolling of the statute of limitations applied to their claims.
American Pipe tolling is a judicially-created exception to federal statutes of limitations in federal courts. Whether a previously-filed class action has any effect on the running of the statute of limitations on a state law cause of action is for each state to decide. Most states have not directly considered the question. Of those that have, many do not give any tolling effect to class actions filed outside of the state, i.e., they reject cross-jurisdictional class action tolling. This makes sense, of course, when you remember that the whole tolling doctrine is premised on the fiction that absent class members are actually aware of the putative class action. That is much less likely where the class action was filed in another state far away.
Recently, the MDL transferee in the Fosamax litigation certified two tolling questions to the Virginia Supreme Court. The MDL transferee was faced with a motion for summary judgment on four individual claims brought by Virginia residents. Each was clearly outside the statute of limitations unless tolling was applied. Plaintiffs argued that the prior pendency of a putative nationwide class action filed in the Middle District of Tennessee operated to toll the running of the statute of limitations on their Virginia law claims for strict liability, negligence, and medical monitoring.
Virginia law doesn't even allow class actions in state court. So the MDL transferee asked two questions of the Virginia Supreme Court: (1) does equitable tolling apply to extend the statute of limitations during the pendency of a putative class action, and (2) does the statute of limitations itself allow for tolling during the pendency of a putative class action. The Virginia Supreme Court answered with a resounding "no." See Casey v. Merck & Co., No. 111438, Slip op. (Va. Mar. 2, 2012).
It first held that Virginia law is clear that there are no equitable exceptions to the statute of limitations. It then looked at the text of the statute of limitations itself. The statute does allow for credit to be given to a previously-filed action, but that previously-filed action must have been the same party as the party to the later suit. Here, different named plaintiffs had filed the Tennessee action -- albeit as putative representatives of all people who took Fosamax. The Virginia Supreme Court noted that Virginia law does not allow class actions and thus does not recognize such "representative" status. Accordingly, it held that there was no statutory authority for tolling the statute of limitations here because the parties to the two actions were different.
Casey thus squarely places Virginia in the camp of states that have rejected not only cross-jurisdictional class action tolling, but any form of class action tolling whatsoever.