Chambers v. Moses H. Cone Mem'l Hosp. ( 2020 )

IN THE SUPREME COURT OF NORTH CAROLINA
No. 147PA18
Filed 5 June 2020
CHRISTOPHER CHAMBERS, on behalf of himself and all others similarly
situated
v.
THE MOSES H. CONE MEMORIAL HOSPITAL; THE MOSES H. CONE
MEMORIAL HOSPITAL OPERATING CORPORATION d/b/a MOSES CONE
HEALTH SYSTEM and d/b/a CONE HEALTH; and DOES 1 through 25, inclusive
On discretionary review pursuant to N.C.G.S. § 7A-31 of a unanimous decision
of the Court of Appeals, 259 N.C. App. 8, 814 S.E.2d 864 (2018), affirming an order
entered on 16 March 2017 by Judge James L. Gale, Chief Business Court Judge, in
Superior Court, Guilford County. Heard in the Supreme Court on 18 November 2019
in session in the Old Guilford County Courthouse in the City of Greensboro, pursuant
to section 18B.8 of Chapter 57 of the 2017 North Carolina Session Laws.
Higgins Benjamin, PLLC, by John F. Bloss, for plaintiff-appellant.
Womble Bond Dickinson, LLP, by Philip J. Mohr and Brent F. Powell, for
defendant-appellees The Moses H. Cone Memorial Hospital and The Moses H.
Cone Memorial Hospital Operating Corporation.
Patterson Harkavy LLP, by Burton Craige and Narendra K. Ghosh, for North
Carolina Advocates for Justice; Carol L. Brooke, Jack Holtzman, and Clermont
F. Ripley for North Carolina Justice Center; and William R. Corbett and
Deborah Goldstein for Center for Responsible Lending, amici curiae.
Joshua H. Stein, Attorney General, by Ryan Y. Park, Deputy Solicitor General,
Daniel T. Wilkes, Assistant Attorney General, and Matthew C. Burke, Solicitor
General Fellow, for the State of North Carolina, amicus curiae.
Linwood Jones for North Carolina Healthcare Association, amicus curiae.
CHAMBERS V. MOSES H. CONE MEM’L HOSP.
Opinion of the Court
EARLS, Justice.
Christopher Chambers and his wife were sued in May 2012 by The Moses H.
Cone Memorial Hospital Operating Corporation seeking collection of $14,358.14 plus
interest, allegedly owed for emergency room services. Around the same time,
Christopher Chambers filed a class action complaint against The Moses H. Cone
Memorial Hospital and The Moses H. Cone Memorial Hospital Operating Corporation
(Moses Cone) seeking a declaratory judgment that the contract he signed as an
uninsured patient needing emergency medical treatment entitled Moses Cone to
recover no more than the reasonable value of the services it provided. We must now
decide whether Moses Cone’s subsequent, unilateral action dismissing its claims
against Chambers and his wife and ceasing all other attempts to collect the debt,
prior to certification of the class in Chambers’s declaratory judgment action, renders
the entire class action moot. Following the logic of the Third Circuit Court of Appeals
decision in Richardson v. Bledsoe, 829 F.3d 273 (3d Cir. 2016), we hold that the
relation back doctrine “may be applied to relate a now-moot individual claim back to
the date of the class action complaint” when the event that moots the plaintiff’s claim
occurs before the plaintiff has had a fair opportunity to seek class certification and
provided that the plaintiff has not unduly delayed in litigating the motion for class
certification. Id. at 285. Therefore, “when ‘satisfaction of the plaintiff’s individual
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Opinion of the Court
claim [occurs] before the court can reasonably be expected to rule on the class
certification motion,’ the plaintiff’s stake in the litigation is not extinguished,” and
the case is not moot. Id. (quoting Lucero v. Bureau of Collection Recovery, Inc., 639
F.3d 1239, 1250 (10th Cir. 2011)).
I. Factual Background
On or about 23 August 2011, Chambers was treated at Moses Cone’s
emergency room where he underwent an emergency appendectomy. He was
uninsured at the time. In his complaint, Chambers alleged that the $14,358.14 he
was charged by Moses Cone (separate from independent physicians’ and other non-
hospital charges) was “far more than the payment amount required from the vast
majority” of Moses Cone’s patients receiving similar services, and he alleged that the
bill was grossly excessive, out of proportion to Moses Cone’s actual cost, and much
greater than the reasonable value of such services.
Chambers sought to bring this action on behalf of a class, defined as follows:
All individuals (or their guardians or representatives) who
within four years of the date of the filing of the Complaint
in this action and through the date that the Court certifies
the action as a class action (a) received emergency care
medical treatment at Moses H. Cone Memorial Hospital or
another Cone Health Hospital; (b) whose bills were not
paid in whole or part by commercial insurance or a
governmental healthcare program; and (c) who were not
granted a full discount or waiver under Defendants’ charity
care policies or otherwise had their bills permanently
waived or written off in full by Defendants.
According to Moses Cone’s standard contract in force at the time Chambers had his
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Opinion of the Court
appendectomy, the patient was obligated to pay the Moses Cone’s bill “in accordance
with the regular rates and terms of Cone Health.” Chambers contended he expected
to pay the same as other emergency care patients who sign the same contract but
that, as an uninsured patient, he was charged 100% of Moses Cone’s Chargemaster
rates, which he alleges are artificial, grossly inflated rates.
Chambers initially filed suit on 11 May 2012. Moses Cone filed an answer and
counterclaim on 3 August 2012 denying all class allegations, asserting seventeen
affirmative defenses, bringing counterclaims against Chambers and his wife seeking
compensatory damages and attorneys’ fees, and asking the trial court to consolidate
the action with Moses Cone’s original lawsuit seeking payment of the $14,358.14 bill.
Shortly after Moses Cone filed its answer and counterclaim, Robin D. Hayes sought
to intervene as a plaintiff, individually and as a class representative. More than a
year later, on 27 September 2013, the trial court ordered that “further consideration
of the [m]otion [to intervene] should be delayed until after the Court rules on
Plaintiff’s motion for class certification.” On 2 July 2014, the case was assigned to a
new judge and thereafter a status conference was held “at which the parties agreed
to . . . stay further proceedings in this case until the Court issued an opinion on related
matters in Hefner v. Mission Hosp., Inc., No. 12 CVS 3088.” The plaintiff’s claims in
Hefner eventually were ruled moot when the defendant hospital in that case
“unequivocally bound itself to seek no payment” of its bill from the plaintiff. This
case then was reactivated, and Chambers filed an Amended Class Action Complaint.
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Opinion of the Court
Moses Cone then dismissed its claims for the remainder of its bill and on the following
day, filed a motion to dismiss the case. The trial court granted the motion to dismiss
on 16 March 2017 and, citing Hefner, noted that “[s]imilar to the hospital defendant
in Hefner, Moses Cone has voluntarily dismissed with prejudice its collection action
against Chambers, meaning that Moses Cone has no right to recover any additional
payments from Chambers.” In addition, the trial court went on to deny Hayes’ motion
to intervene, leaving no plaintiff to maintain the class action claims.
Chambers filed a notice of appeal, and the Court of Appeals affirmed the trial
court’s order dismissing the case. Chambers v. Moses H. Cone Mem’l Hosp., 259 N.C.
App. 8, 13, 814 S.E.2d 864, 869 (2018). The Court of Appeals concluded that because
Chambers’ bill was permanently waived, he was no longer a member of the proposed
class and, therefore, it was appropriate to apply the general rule that an appeal
presenting a question that has become moot will be dismissed. Id. at 12, 814 S.E.2d
at 868. Because the class had not yet been certified and the sole class representative
no longer had “a genuine personal interest in the outcome of the case,” the Court of
Appeals concluded that it “need not determine if the class action is now moot based
on the conduct of Moses Cone or the public interest.” Id. at 13, 814 S.E.2d at 868.
This Court granted discretionary review pursuant to N.C.G.S. § 7A-31 (2019).
Chambers’ original class action complaint alleged that uninsured patients
receiving emergency medical care at Moses H. Cone Memorial Hospital or another
Cone Health hospital who were charged 100% of the hospital’s Chargemaster rates
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Opinion of the Court
numbered “at least hundreds, if not thousands, of persons.” Chambers further
alleged (1) that there were questions of law and fact common to the class, which
predominate over any questions affecting only individual class members; (2) that he
will fairly and adequately represent the interests of the class; and (3) that a class
action is the superior method for the fair and efficient adjudication of the claims. The
complaint asserted the following:
Most losses are modest in relation to the expense and
burden of individual prosecution of the litigation
necessitated by the Defendants’ wrongful conduct. It
would be virtually impossible for the Class members to
efficiently redress their wrongs individually. Even if all
Class members could afford such individual litigation
themselves, the court system would benefit from a class
action. Individualized litigation would present the
potential for inconsistent or contradictory judgments.
Individualized litigation would also magnify the delay and
expense to all parties and the court system presented by
the issues of the case.
However, before these allegations could be tested at the class certification stage,
Moses Cone sought to end the litigation by dismissing its claims against Chambers
and suspending its attempts to collect the debt it alleged was owed by Chambers and
his wife for the emergency appendectomy.
II. Class Action Context
Class action lawsuits have long been a feature of our justice system. The class
action lawsuit originated in the middle ages. See Shaw v. Toshiba Am. Info. Sys.,
91 F. Supp. 2d 942, 948 (E.D. Tex. 2000) (tracing the history of class actions). “In
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order to facilitate the adjudication of disputes involving common questions and
multiple parties in a single action, the English Court of Chancery developed the bill
of peace.” 7A Charles Alan Wright, Arthur R. Miller & Mary K. Kane, Federal Practice
and Procedure: Civil § 1751 (3d ed. 1986). The English bill of peace became the basis
for class actions in the United States, including North Carolina’s early class action
decisions in the late 1800’s. See Bronson v. Wilmington N.C. Life Ins. Co., 85 N.C.
411, 414 (1881) (describing the class action mechanism as a feature of civil procedure,
citing Joseph Story’s treatise on English equity jurisprudence).
Thus, it is well-established that class actions can be an efficient and fair way
to resolve in one case disputes that may affect a large number of people. Maffei v.
Alert Cable TV of N.C., Inc., 316 N.C. 615, 620, 342 S.E.2d 867, 871 (1986); see also
Crow v. Citicorp Acceptance Co., 319 N.C. 274, 284, 354 S.E.2d 459, 466 (1987)
(stating that class actions serve many purposes, including “preventing a multiplicity
of suits or inconsistent results”); Fisher v. Flue-Cured Tobacco Coop. Stabilization
Corp., 369 N.C. 202, 216, 794 S.E.2d 699, 710 (2016) (same). By consolidating
numerous individual claims with common factual and legal issues into a single
proceeding, “the class-action device saves the resources of both the courts and the
parties.” Gen. Tel. Co. v. Falcon, 457 U.S. 147, 155 (1982). Moreover, courts have
also recognized the deterrent effect of class action lawsuits, which hold defendants
accountable for conduct that may be unlawful and widespread but difficult to address
when the conduct does not harm any single individual enough to make it economically
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expedient to bring a lawsuit. See Deposit Guar. Nat’l Bank v. Roper, 445 U.S. 326,
338 (1980); see also Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 617 (1997)
(explaining that the class action mechanism was designed to overcome the problem
that small recoveries do not provide incentive for any single individual to bring an
action to vindicate his or her rights); James Grimmelmann, Future Conduct and the
Limits of Class-Action Settlements, 91 N.C. L. Rev. 387, 421–22 (2013) (explaining
the deterrent effect of class action lawsuits on other potential defendants in similar
situations).
One potential obstacle to the efficient and equitable administration of the class
action procedure occurs when defendants settle the claims of individual plaintiffs
prior to class certification and contend that therefore the entire case has become
moot. The U.S. Supreme Court described the problem as follows:
Requiring multiple plaintiffs to bring separate actions,
which effectively could be “picked off” by a defendant’s
tender of judgment before an affirmative ruling on class
certification could be obtained, obviously would frustrate
the objectives of class actions; moreover it would invite
waste of judicial resources by stimulating successive suits
brought by others claiming aggrievement.
Roper, 445 U.S. at 339. Under federal law, where a named plaintiff’s individual claim
is mooted after the plaintiff-class has already been certified, it does not moot the
entire case. See Sosna v. Iowa, 419 U.S. 393, 401–02 (1975). Similarly, even where
class certification has been denied, a named plaintiff whose individual claim is moot
retains the right to appeal the denial of class certification. See Roper, 445 U.S. at
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339–40; U.S. Parole Comm’n v. Geraghty, 445 U.S. 388, 404 (1980). The question
raised in this case is whether the unilateral action by Moses Cone to moot the named
plaintiff’s individual claim renders the entire case moot when there has been no
discovery or ruling on plaintiff’s motion for class certification. The U.S. Supreme
Court has not directly resolved this question.
In Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663 (2016), the defendant made
an offer of judgment to satisfy the named plaintiff’s individual claim prior to class
certification, which was not accepted by the plaintiff, and then the defendant moved
to dismiss the case on mootness grounds. The U.S. Supreme Court held that the
plaintiff’s class action complaint “was not effaced by [the defendant’s] unaccepted
offer to satisfy his individual claim.” Id. at 670. Thus, “an unaccepted settlement
offer or offer of judgment does not moot a plaintiff’s case.” Id. at 672. However, “[t]he
Supreme Court, therefore, did not need to reach the arguably more difficult question:
whether a named plaintiff who did in fact lack a personal stake in the outcome of the
litigation could continue to seek class certification even though his claim became moot
before filing a motion for class certification.” Richardson, 829 F.3d at 282. Here, we
must decide an issue expressly left open in Campbell-Ewald. See Campbell-Ewald
Co., 136 S. Ct. at 672 (“We need not, and do not, now decide whether the result would
be different if a defendant deposits the full amount of the plaintiff’s individual claim
in an account payable to the plaintiff, and the court then enters judgment for the
plaintiff in that amount.”).
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Opinion of the Court
Ten federal circuit courts of appeals have reached this arguably more difficult
question. Eight of those ten circuits have ruled that when a defendant acts to moot
the claims of individual named plaintiffs before the court has ruled on a class
certification motion, the entire action is not yet moot, and the named plaintiff retains
the representative capacity to pursue class certification and a ruling on the merits.1
This exception to mootness has been adopted by federal courts because “[i]n recent
years, this stratagem [of picking off the named plaintiff] has become a popular way
1 The Second, Third, Fifth, Sixth, Seventh, Ninth, Tenth, and Eleventh circuits have
some form of a pick off exception to mootness in the class action context. See Unan v. Lyon,
853 F.3d 279, 285–86 (6th Cir. 2017) (claims were not moot where government was “picking
off” named plaintiffs, retroactively determining them to be eligible for comprehensive
Medicaid coverage shortly after lawsuit was filed); Richardson v. Bledsoe, 829 F.3d at 284–
86 (reviewing federal circuit court precedent and based in part “upon consideration of the
well-reasoned approaches of our sister circuits, [ ] reaffirm[ing] the validity of the picking off
exception”); Wilson v. Gordon, 822 F.3d 934, 947–51 (6th Cir. 2016), reh’g en banc denied
Wilson v. Gordon, No. 14-6191, 2016 U.S. App. LEXIS 15697 (6th Cir. Aug. 1, 2016) (evidence
was sufficient for trial court “to conclude that ‘picking off’ exception applies in this case”);
Chapman v. First Index, Inc., 796 F.3d 783, 787 (7th Cir. 2015) (rejecting a claim of mootness
because following recent Supreme Court cases, “no one thinks (or should think) that a
defendant’s offer to have the court enter a consent decree renders the litigation moot and
thus prevents the injunction’s entry”); Fontenot v. McCraw, 777 F.3d 741, 751 (5th Cir. 2015)
(pick off exception to mootness applies where class certification motion has been filed even if
it has not yet been ruled on); Stein v. Buccaneers Ltd. P’ship, 772 F.3d 698, 705–07 (11th Cir.
2014) (exception to mootness in class actions applies even where plaintiffs’ individual claims
become moot before plaintiffs move to certify a class); Pitts v. Terrible Herbst, Inc., 653 F.3d
1081, 1091 (9th Cir. 2011) (even where plaintiff’s claim is not inherently transitory, class
certification relates back to the date the case was filed, and the case does not become moot
because “a claim transitory by its very nature and one transitory by virtue of the defendant’s
litigation strategy share the reality that both claims would evade review”); Lucero v. Bureau
of Collection Recovery, Inc., 639 F.3d 1239, 1249–50 (10th Cir. 2011) (exception to mootness
applies where defendant seeks to moot individual claim prior to ruling on class certification);
Comer v. Cisneros, 37 F.3d 775, 799 (2d Cir. 1994) (when claims of the named plaintiffs
become moot prior to class certification, the case is not moot if circumstances suggest class
certification may relate back to filing of the complaint).
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to try to thwart class actions.” Bais Yaakov of Spring Valley v. ACT, Inc., 798 F.3d
46, 48 (1st Cir. 2015). Even the two circuits that do not explicitly adopt a “pick off”
exception to mootness leave open the door to permit a plaintiff whose claims are moot
to continue as a class representative under either a “capable of repetition, yet evading
review” theory,2 or when the class certification motion was pending but not ruled on
at the time that the plaintiff’s claim became moot.3 The Fourth Circuit Court of
Appeals has not yet addressed this issue, but several federal district courts have
applied precedent from other circuits to find a “pick off” exception to mootness in
putative class action cases. See, e.g., Reyna v. Fiott, No. 1:17-cv-01192, 2018 U.S.
Dist. LEXIS 123949, at *8 (E.D. Va. Mar. 20, 2018) (holding case not moot, applying
relation back doctrine to pick off exception in immigrant detention case following
2 The Eighth Circuit has held that where the defendant acts to moot a named
plaintiff’s claim in a putative class action, the claim is capable of repetition, yet evading
review. See, e.g., Inmates of Lincoln Intake & Det. Facility by Windes v. Boosalis, 705 F.2d
1021, 1023 (8th Cir. 1983) (“[A] court may address on appeal the issue of whether the district
court ruled properly on the class certification issue, even though the named plaintiff’s claim
became moot prior to the district court’s consideration of the issue.”); Owens v. Heckler, 753
F.2d 675, 677 (8th Cir. 1985) (holding that the class action could proceed even though the
plaintiff’s individual claim had become moot).
3 In Cruz v. Farquharson, 252 F.3d 530 (1st Cir. 2001), the court held that “[d]espite
the fact that a case is brought as a putative class action, it ordinarily must be dismissed as
moot if no decision on class certification has occurred by the time that the individual claims
of all named plaintiffs have been fully resolved.” Id. at 533. However, Cruz left open the
question of whether mooting the named plaintiff’s claim also moots the entire action if the
class certification motion has been filed but not yet ruled on. Id. at 534 n.3; see also Bais
Yaakov of Spring Valley v. ACT, Inc., 798 F.3d 46, 51 (1st Cir. 2015) (“Cruz also left open the
possibility that a putative class action may not be moot if a motion for certification was
pending when the plaintiff's individual claims became moot . . . .”).
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Richardson), aff’d, Reyna v. Hott, 921 F.3d 204 (4th Cir. 2019); In re Monitronics
Int’l, Inc., Tel. Consumer Prot. Act. Litig., No. 1:13-MD-2493-JPB-MJA, 2016 U.S.
Dist. LEXIS 191414, at *13 (N.D. W. Va. June 27, 2016) (“[A] complete settlement
offer made before the plaintiff files a motion for class certification does not moot the
putative class action provided that the plaintiff move for class certification within a
reasonable time after discovery.”); Kensington Physical Therapy, Inc. v. Jackson
Therapy Partners, LLC, 974 F. Supp. 2d 856, 864 (D. Md. 2013) (“[A] complete
settlement offer made before class certification does not moot the putative class
claims.”); Shifflett v. Kozlowski, No. 92-0072-H, 1993 U.S. Dist. LEXIS 997, at *10
(W.D. Va. Jan. 25, 1993) (“[E]ven if the named plaintiffs’ claims become moot before
a class has been certified, the district court may nonetheless certify a class and the
action may be maintained as a class action.”). While this federal case law is not
binding precedent for this Court, it is instructive to observe the weight of precedent
in the federal class action context.
Similarly, numerous state courts have also found an exception to mootness
where a defendant acts to moot the claim of the named plaintiff prior to class
certification. See, e.g., Growden v. Good Shepherd Health Sys., 550 S.W.3d 716, 727
(Tex. App. 2018) (applying an exception to mootness where defendant waived
plaintiff’s medical bill prior to the court considering class certification); Frazier v.
Castle Ford, Ltd., 59 A.3d 1016, 1024 (Md. 2013) (holding that providing individual
relief to the putative class representative does not moot a class action if the individual
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plaintiff has not had the opportunity for reasonable discovery and to seek class
certification); Jones v. S. United Life Ins. Co., 392 So. 2d 822, 823 (Ala. 1981) (holding
that when plaintiff’s individual case was mooted by defendant paying her claim prior
to class certification, plaintiff was not thereby ousted as a proper class
representative).
Several cases from other state courts arise in factually similar circumstances.
For example, in Growden, the plaintiff was charged hospital fees of $25,308.92 for a
brief emergency room visit to treat her daughter, who was uninsured. Growden, 550
S.W.3d at 720. The plaintiff’s complaint sought only declaratory relief on behalf of
herself and others similarly situated. Id. at 720–21. After the lawsuit was filed, but
before a ruling on class certification, the defendant hospital executed an affidavit
stating that it waived and had written off the charges, and that it would make no
further attempt to collect the plaintiff’s bills. At the same time, the defendant sought
dismissal of the lawsuit, which was granted by the trial court. Id. On appeal, the
Court of Appeals of Texas held that while the plaintiff’s individual claim became moot
when the hospital waived her bill, her class action claims were not mooted, applying
a pick off exception to mootness. Id. at 727.
Another similar case involved a bank’s attempt to enforce a “due-on-
encumbrance” acceleration clause in a mortgage contract when the plaintiff-
homeowner took out a second lien on the home. See La Sala v. Am. Sav. & Loan
Ass’n, 5 Cal. 3d 864 (1971). Upon receiving notice of the bank’s intent to accelerate
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the mortgage unless the homeowner agreed to a waiver fee and an increase in the
loan’s interest rate, the homeowner filed a class action complaint for declaratory
relief. Id. at 869–70. Before any class was certified, the bank voluntarily waived its
right to accelerate against the named plaintiffs and sought dismissal of the action for
lack of a representative plaintiff. Id. at 870. While not explicitly calling this a pick
off exception to mootness, the Supreme Court of California ruled that the plaintiffs
could continue to pursue class action certification even though their individual claims
had been resolved by the bank’s actions. Id. at 871 (“Even if the named plaintiff
receives all the benefits that he seeks in the complaint, such success does not divest
him of the duty to continue the action for the benefit of others similarly situated.”).
III. Richardson and the Relation Back Doctrine
In Richardson, the Court recognized that Article III mootness doctrine in class
action cases is more “flexible” than other federal justiciability requirements and that
“ ‘[i]n the class action context, special mootness rules apply’ for determining at what
point in time a named plaintiff must still have a personal stake in the litigation to
continue seeking to represent a putative class action.” Richardson, 829 F.3d at 278–
79 (quoting Brown v. Phila. Hous. Auth., 350 F.3d 338, 343 (3d Cir. 2003)). Thus,
class certification may, in certain circumstances, relate back to the filing of the
complaint, permitting a named plaintiff to serve as a putative class representative,
even though his individual claims are no longer justiciable. Most commonly, this
applies to claims that are “inherently transitory” or “capable of repetition, yet evading
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review.” See Cty. of Riverside v. McLaughlin, 500 U.S. 44, 52 (1991); Geraghty, 445
U.S. at 398–99. The facts in Richardson presented a different application of the
relation back doctrine, which that court called “the picking off exception to mootness.”
Richardson, 829 F.3d at 279.
The plaintiff in Richardson was a former inmate at a federal penitentiary, USP
Lewisburg, who sought relief for violations of his Fifth and Eighth Amendment rights
and on behalf of dozens of other inmates who he alleged suffered similar
unconstitutional treatment. Richardson was transferred to another federal facility
after his complaint was filed but before he moved for class certification. “Richardson
had standing to seek injunctive relief when he filed his amended complaint (as he
was still housed . . . at USP Lewisburg), [so the court] must ask whether his claims
for injunctive relief are now moot because he is no longer housed there.” Id. at 278.
Neither Richardson’s nor Chamber’s individual claims were inherently transitory.
However, their individual claims became moot as a result of actions over which they
had no control.
Applying its own precedent in Weiss v. Regal Collections, 385 F.3d 337, 347–
48 (3d Cir. 2004) (applying relation back doctrine to produce “picking off” exception
in debt collection context where the defendant made Rule 68 offer for full amount of
potential recovery before the plaintiff moved for class certification), abrogated on
other grounds by Campbell-Ewald Co., 136 S. Ct. 663, and after a careful review of
similar cases across the country, the Richardson court held that the relation back
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doctrine can be applied to relate a now-moot individual claim back to the date of the
class action complaint where a would-be class representative is not given a fair
opportunity to show that class certification is warranted and provided that the
plaintiff has not unduly delayed seeking class certification. Richardson, 829 F.3d at
286.
Thus, in applying this standard, a trial court must look to “two separate but
related considerations.” Id. First, it is necessary to examine whether the plaintiff
was given a “fair opportunity” to show that class certification is appropriate. Id. at
283 (citing Campbell-Ewald Co., 136 S. Ct. at 672 (“[A] would-be class representative
with a live claim of her own must be accorded a fair opportunity to show that
certification is warranted.”)). Second, a trial court must next consider whether the
plaintiff submitted the issue of class certification to the trial court without “undue
delay.” Id. at 287 (citing Weiss, 385 F.3d at 348).
In Richardson, there was no showing of any purpose or design on the part of
the defendant to intentionally relocate the plaintiff to another facility in order to moot
the putative class action case. Also, it was irrelevant to the analysis that the plaintiff
there, as with Chambers here, had not actually filed a class certification motion prior
to the event that mooted the plaintiff’s individual claim. Applying the pick off
exception, the court concluded that the case was not moot because only six weeks had
passed between the filing of the amended class action complaint and Richardson’s
transfer to another facility, the event that allegedly mooted his individual claim, and
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because Richardson “could not be expected to have presented the class certification
issue to the District Court within that amount of time.” Richardson, 829 F.3d at 289.
The Richardson court also noted that, in fairness, either party may raise the issue of
class certification, concluding that “[n]othing in the plain language of Rule 23(c)(1)(A)
[of the Federal Rules of Civil Procedure] either vests plaintiffs with the exclusive
right to put the class certification issue before the district court or prohibits a
defendant from seeking early resolution of the class certification question.” Id. at 288(quoting Vinole v. Countrywide Home Loans, Inc., 571 F.3d 935, 939–40 (9th Cir.
2009)).
We previously have held that “Rule 23 [of the North Carolina Rules of Civil
Procedure] should receive a liberal construction” to ensure that the class action
mechanism remains a viable procedure when applicable. Crow, 319 N.C. at 280, 354
S.E.2d at 464 (quoting English v. Holden Beach Realty Corp., 41 N.C. App. 1, 9, 254
S.E.2d 223, 230–31, disc. rev. denied, 297 N.C. 609, 257 S.E.2d 217 (1979)). In state
court, mootness is “a form of judicial restraint,” rather than a jurisdictional concern,
as it is in federal court. In re Peoples, 296 N.C. 109, 147, 250 S.E.2d 890, 912 (1978).
In the class action context, where absent class members may have unresolved claims,
any prudential concerns that may guide the exercise of that constraint are
outweighed by the value of serving the multiple purposes of the class action
procedure, including “ ‘the efficient resolution of the claims or liabilities of many
individuals in a single action’ and ‘the elimination of repetitious litigation and
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Opinion of the Court
possible inconsistent adjudications involving common questions, related events, or
requests for similar relief.’ ” Crow, 319 N.C. at 280, 354 S.E.2d at 464. Therefore, it
is appropriate to adopt the Richardson standard in these circumstances to allow
relation back of the plaintiff’s claim to the date of the filing of the complaint for
purposes of the justiciability analysis in class action cases under Rule 23 of the
North Carolina Rules of Civil Procedure.
Further support for this interpretation of North Carolina class action law
comes from this Court’s prior decision in Reep v. Beck, 360 N.C. 34, 619 S.E.2d 497(2005). There, we held that while it is not error as a matter of law to rule on a motion
to dismiss prior to ruling on a class certification motion, “[t]his Court is confident
that, in determining the sequence in which motions will be considered, North
Carolina judges will continue to be mindful of longstanding exceptions to the
mootness rule and other factors affecting traditional notions of justice and fair play.”
Id. at 40, 619 S.E.2d at 501 (citing Simeon v. Hardin, 339 N.C. 358, 371, 451 S.E.2d
858, 867 (1994); Cty. of Riverside, 500 U.S. at 52; 5 James Wm. Moore et al., Moore’s
Federal Practice § 23.64[1][b] (3d ed. 2005)). It is such a notion of justice and fair play
that motivates the Court to adopt the pick off exception and allow the relation back
of the plaintiff’s claim for justiciability purposes.
Requiring that a named plaintiff have a fair opportunity to present the issue
of class certification to the trial court ensures that class representatives will not be
picked off at the dawn of the litigation before they have had a chance to engage in
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Opinion of the Court
appropriate discovery and otherwise prepare to seek class certification from the trial
court. It will prevent both a “race to pay off named plaintiffs” before they can pursue
class certification and premature class certification determinations before the
development of the factual record necessary for a trial court’s rigorous analysis of the
issues involved in a class certification motion. Richardson, 829 F.3d at 282, 288. The
question of what constitutes a fair opportunity in this context naturally will vary from
case to case based on considerations such as the complexity of the case, the nature of
discovery required to determine class certification, the stage at which the named
plaintiff’s individual claims become moot, and other relevant factors.
The Richardson test also provides fairness to the defendant by incorporating
an important corollary to the fair opportunity requirement—that is the notion that
the plaintiff must present the issue of class certification to the trial court without
“undue delay.” Richardson, 829 F.3d at 287. In other words, a class representative,
while taking advantage of the fair opportunity to seek class certification, cannot be
dilatory and instead must “act[ ] diligently to pursue the class claims.” Stein v.
Buccaneers Ltd. P’ship, 772 F.3d 698, 707 (11th Cir. 2014). In cases where the trial
court finds the named plaintiff was, in fact, dilatory in seeking class certification, the
pick off “exception should not apply and ‘courts [should] adhere to the general rule
that the mooting of [the] named plaintiff’s claim prior to class certification moots the
entire case.’ ” Richardson, 829 F.3d at 286 (first alteration in original) (quoting
Lucero, 639 F.3d at 1249); see Stein, 772 F.3d at 707 (“A named plaintiff who does not
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Opinion of the Court
act diligently may not have what it takes to adequately present the issues. But to act
diligently, a named plaintiff need not file a class-certification motion with the
complaint or prematurely; it is enough that the named plaintiff diligently takes any
necessary discovery, complies with any applicable local rules and scheduling orders,
and acts without undue delay.”). The guiding principle underlying the adoption of a
pick off exception is fairness to the putative class members. However, the defendant,
too, must be shielded from vexatious or unfair litigation tactics. The Richardson test
provides the appropriate balance between the interests of the respective parties in
this regard.
Moses Cone’s argument that the U.S. Supreme Court has rejected any
exception to mootness in these circumstances is unavailing for several reasons. First,
the case Moses Cone relies on, Genesis Healthcare Corp. v. Symczyk, 569 U.S. 66(2013), emphasized that the Fair Labor Standards Act proceeding at issue in that
case was “fundamentally different” from a Rule 23 class action. 569 U.S. at 74. Unlike
class certification under Rule 23, “conditional certification” under the FLSA “does not
produce a class with an independent legal status, or join additional parties to the
action.” Id. at 75. Therefore, conclusions about a plaintiff’s claim becoming moot
before certification under the FLSA cannot be transplanted to the Rule 23 class action
context. Cf. United States v. Sanchez-Gomez, 138 S. Ct. 1532, 1539 (2018) (stating
that cases in the class certification context are inapposite to FLSA actions “because
‘Rule 23 actions are fundamentally different from collective actions under the FLSA’
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Opinion of the Court
” (quoting Genesis HealthCare, 569 U.S. at 74)). The outcome in Genesis Healthcare
turned on the unique implications of conditional certification under the FLSA, and is
not controlling here.
Second, the U.S. Supreme Court has noted that the question presented here is
unresolved. See Campbell-Ewald Co., 136 S. Ct. at 672 (noting “we . . . do not [ ] now
decide” whether actually mooting the plaintiff’s claim before class certification would
moot the entire case). In Campbell-Ewald, the Court left for another day the question
of whether unilateral action by the defendant that satisfied the named plaintiff’s
individual claim before class certification could moot the entire case. Id. Thus, the
U.S. Supreme Court has not explicitly endorsed or rejected a pick off exception to
mootness in class action cases.
Finally, even if federal law were settled in this area, this Court is required to
decide how mootness applies under state law to class actions brought under the
North Carolina Rules of Civil Procedure. See, e.g., Scarvey v. First Fed. Sav. and
Loan Ass’n of Charlotte, 146 N.C. App. 33, 41, 552 S.E.2d 655, 660 (2001) (federal
class action cases are not binding on the Court of Appeals). Federal precedents are
instructive and we are indeed following the Third Circuit’s lead in articulating the
pick off exception, but ultimately federal precedent is not binding on how this Court
should interpret North Carolina class action law.
Moses Cone further contends that the pick off exception to mootness cannot be
applied in this case because the trial court specifically found that there was no
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Opinion of the Court
evidence that Moses Cone wrote off Chambers’ debt in order to prevent the trial court
from ever reaching the question of whether a class should be certified. Given the
standard that we utilize here, defendant’s motive is not relevant to the inquiry. The
pick off exception to mootness that we have adopted does not rely on any finding of
bad faith or improper motive on the part of any party. It is perfectly reasonable that
in order to minimize its exposure and limit its liability, a defendant would seek to
end a class action lawsuit as quickly as possible before class certification. The pick
off exception is not a penalty for bad actions, it is simply necessary to protect the class
action mechanism as a means of promoting judicial economy, fairness, deterrence,
and efficiency in the determination of disputed claims, particularly where the amount
in controversy in any particular case is small, but the number of potentially impacted
plaintiffs is large.
Further, in light of the Richardson standard, there is no required showing of a
pattern of repeated picking off of numerous individual plaintiffs, time and again,
before the pick off exception applies. It was this type of evidence that the trial court
held was missing in this case. The trial court reasoned in its legal analysis of
defendants’ motion to dismiss that
[p]erhaps if Moses Cone were to continue to dismiss its
collection actions against all patients who challenge the
validity of the Contract, the Court could consider whether
Moses Cone is taking action to evade judicial review of its
Contract. But at this time, the action does not fit within
the narrow capable-of-repetition exception.
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Opinion of the Court
However, where the pick off exception to mootness applies, rather than the capable
of repetition, yet evading review exception, the question is whether the plaintiff had
a reasonable opportunity to pursue class certification and did so without undue delay.
The defendant’s actions in other cases is not relevant to that inquiry.
The dissent’s proposed solution to the mootness problem, namely that other
putative class members can now file their own new lawsuit, ignores the fact that the
statute of limitations might continue to run against class members who, while
Chambers’ claims were pending, would have no need to file separately. Additionally,
the dissent takes us to task for improperly legislating, but in fact, mootness is a court-
made doctrine and this Court previously has adopted several exceptions to mootness
absent any action by the legislature. See, e.g., N.C. State Bar v. Randolph, 325 N.C.
699, 701, 386 S.E.2d 185, 186 (1989) (per curiam) (adopting the exception to mootness
where a case involves “a question that involves a matter of public interest, is of
general importance, and deserves prompt resolution” (citations omitted)); Simeon,
339 N.C. at 371, 451 S.E.2d at 867 (adopting an exception to mootness where the
“case belongs ‘to that narrow class of cases in which the termination of a class
representative’s claim does not moot the claims of the unnamed members of the
class’ ” and where “[t]he claim . . . is one that is distinctly ‘capable of repetition, yet
evading review.’ ” (quoting Gerstein v. Pugh, 420 U.S. 103, 110 n. 11 (1974)); In re
Hatley, 291 N.C. 693, 694, 231 S.E.2d 633, 634 (1977) (adopting the exception to
mootness where “collateral legal consequences of an adverse nature can reasonably
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Opinion of the Court
be expected to result therefrom” (citing Sibron v. New York, 392 U.S. 40, 57 (1968)).
There still are countless ways that a class action matter may become moot after the
original complaint is filed, depending on the nature of the case and the allegations of
the complaint. We have determined that the Richardson standard for evaluating
whether an individual plaintiff’s claim should or should not relate back to the date
the complaint was filed for the purpose of determining mootness, commonly called a
pick off exception, is a fair balance of the rights of all parties.
IV. Conclusion
Accordingly, we conclude that a remand to the trial court to apply the
appropriate legal standard is warranted. See, e.g., Worley v. Moore, 370 N.C. 358,
368, 807 S.E.2d 133, 140–41 (2017) (reversing and remanding for an application of
the proper legal standard where the trial court applied an incorrect test). Our holding
today recognizes a narrow exception to the doctrine of mootness when a named
plaintiff’s individual claim becomes moot before the plaintiff has had a fair
opportunity to pursue class certification and has otherwise acted without undue delay
regarding class certification. In these limited circumstances, the named plaintiff’s
claim relates back to the filing of the complaint for mootness purposes, and he retains
the legal capacity to pursue class certification and class-wide relief, even though his
individual claim may have been satisfied.4 The decision of the Court of Appeals is
4 To be sure, even applying the relation back doctrine, obtaining class certification still
requires Chambers to meet the stringent requirements of Rule 23 of the North Carolina Rules
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Opinion of the Court
reversed, and this case is remanded for further proceedings consistent with this
opinion.
REVERSED AND REMANDED.
of Civil Procedure. See generally Faulkenbury v. Teachers’ & State Emps. Ret. Sys. of N.C.,
345 N.C. 683, 697, 483 S.E.2d 422, 431 (1997) (describing prerequisites for bringing a class
action).
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Justice NEWBY dissenting.
The rule of law provides the consistency and predictability citizens need to plan
their daily affairs. Under the rule of law, courts generally apply existing precedent
and allow the citizens to make significant changes through their elected
representatives in the legislature. When a court purports to act under its common-
law authority, but in doing so ignores the requirements of a controlling statute, it
usurps a role for which it was not designed. Historically, this Court has recognized,
as a matter of judicial restraint, that mootness renders a case nonjusticiable. And the
General Assembly has declared that class representative plaintiffs must adequately
represent the interests of the class. Today, the majority leaves behind both of these
well-established legal principles. The majority adopts an exception to mootness that
is neither supported by this Court’s precedent nor justified by the policy
considerations the majority attempts to address. It thus gives judicial life support to
class action claims led by named plaintiffs who have no personal interest in the case
and are in no position to adequately represent the interests of the rest of the class
claimants. I respectfully dissent.
Stated objectively, the procedural facts here do not justify the majority’s
departure from our longstanding precedent. On 23 August 2011, the named plaintiff,
Christopher Chambers, came to defendant hospital for emergency treatment. He, like
every other patient, was given a form on which he was asked to agree to pay for the
CHAMBERS V. MOSES H. CONE MEM’L HOSP.
Newby, J., dissenting
hospital’s services in full. He was not asked whether he was insured, presumably
because federal law restricts a hospital’s ability to consider the insurance status of a
patient who needs emergency medical care. See, e.g., 42 U.S.C. § 1395dd (2011); 42
C.F.R. § 489.24(d)(4). After Chambers left the hospital, the hospital billed him for the
services based on the “Chargemaster,” a document commonly used by hospitals to
standardize rates for various medical services. On 11 May 2012, Chambers filed his
original class complaint against the hospital claiming, among other things, breach of
contract and breach of the covenant of good faith and fair dealing. The hospital filed
a counterclaim against Chambers for payment of its bill.1 The trial court dismissed
some of Chambers’s claims, leaving only the contract-related claims intact.
The attorneys representing the plaintiffs here had also filed a similar class
action complaint in Hefner v. Mission Hospital Inc., No. 12 CVS 3088, 2015 NCBC
LEXIS 115 (N.C. Super. Ct. Dec. 15, 2015). The parties agreed to allow the trial court
to address those claims first because they appeared to be virtually identical to the
ones filed in this case, and because the plaintiffs’ attorneys were the same.2 In Hefner,
the trial court denied the plaintiff’s class action certification motion because the
unique factual issues among the various individual plaintiffs’ claims made
determination of liability on a class-wide basis inappropriate. After denying class
1 The hospital sought to consolidate into the action against Chambers a separate
collection action it had filed against him.
2 Though the class action allegations in Hefner and this case present similar issues,
the factual bases for the claims in Hefner are unrelated to the facts of this case.
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Newby, J., dissenting
certification the trial court dismissed Hefner’s individual claim as moot, finding there
was no longer an actual controversy between the hospital and him because the
hospital dismissed its counterclaim, binding itself not to seek payment from him.
After the denial of class certification and dismissal in Hefner, Chambers filed
an amended complaint on 1 April 2016, voluntarily dropping his contract-related
claims against the hospital and seeking class action declaratory relief under a new
theory. The amended complaint explained that Chambers was acting as a
representative of all individuals who, within four years of the original complaint’s
filing, received emergency care at the hospital, the cost of which was not covered by
insurance, and who were not granted a discount or waiver by the hospital. The
amended complaint asserted that this class of individuals “consists of at least
hundreds, if not thousands, of persons.” After Chambers’s decision not to pursue his
individual contract claims, the hospital dismissed with prejudice its counterclaim for
payment from Chambers.3 Accordingly, Chambers was no longer a member of the
class he purported to represent; he owed the hospital nothing. The hospital then
moved to dismiss the class action for lack of subject matter jurisdiction because of
mootness.
The trial court found that Chambers’s claim for declaratory relief was moot
because he had no individual interest in the action. In considering the then-
3 According to the hospital, its dismissal of its counterclaim for payment was in
response to Chambers’s dropping of his individual contract claims.
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Newby, J., dissenting
recognized exceptions to mootness, the trial court found no evidence that the
hospital’s billing practices were illegal, that any patient would be subject to the same
billing terms in the future, or that the hospital would forgive the debt of any other
patient in order to avoid judicial review of its billing practices. These facts are
uncontested and therefore binding on appeal. The trial court then concluded that no
exception to mootness applied. It also determined that because Chambers and the
hospital both dismissed their breach of contract claims, “Chambers no longer has a
live claim that warrants his representing an ongoing class.” The court dismissed his
class claim for declaratory relief.
On appeal, a unanimous panel of the Court of Appeals affirmed, applying the
language of the class action rule and the longstanding precedent of this Court that
parties must have a personal stake in the outcome of a case to adequately represent
a class. Chambers successfully petitioned this Court for discretionary review.
Rule 23 of the North Carolina Rules of Civil Procedure provides that “[i]f
persons constituting a class are so numerous as to make it impracticable to bring
them all before the court, such of them, one or more, as will fairly insure the adequate
representation of all may, on behalf of all, sue or be sued.” N.C.G.S. § 1A-1, Rule 23(a)
(2019) (emphasis added). This Court has therefore held that to bring a class action, a
party must show (1) “the existence of a class”; (2) that “the named
representatives . . . will fairly and adequately represent the interests of all members
of the class”; and (3) “that the class members are so numerous that it is impractical
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Newby, J., dissenting
to bring them all before the court.” Crow v. Citicorp Acceptance Co., 319 N.C. 274,
282–83, 354 S.E.2d 459, 465–66 (1987) (citations omitted). To satisfy the second
requirement, the named plaintiff or plaintiffs must have a “genuine personal interest,
not a mere technical interest, in the outcome of the action.” Id. at 283, 354 S.E.2d at
465.
Chambers does not have a genuine personal interest in the outcome of this
case. Chambers chose to dismiss his contract claims, and the hospital then dismissed
with prejudice its counterclaim against him for payment of its bill. Chambers
therefore has no personal stake in seeing the hospital’s billing practices invalidated.
The trial court thus appropriately found that Chambers’s claim was moot.
Because there is no dispute that Chambers’s claim is moot, the central question
in this case is whether any exception to mootness applies to his claim such that the
class action can nonetheless proceed with him as the class representative. In other
words, the question is whether Chambers will fairly and adequately represent all
members of the class. Before today’s opinion, traditional exceptions to mootness have
included when the defendant voluntarily ceases the challenged practice, see, e.g., City
of Mesquite v. Aladdin’s Castle, Inc., 455 U.S. 283, 289, 102 S. Ct. 1070, 1074, 71 L.
Ed. 2d 152, 159 (1982); when the issue presented in the case is “capable of repetition,
yet evading review,” Simeon v. Hardin, 339 N.C. 358, 371, 451 S.E.2d 858, 867 (1994);
and when the question involved is a matter of public interest, In re Hatley, 291 N.C.
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CHAMBERS V. MOSES H. CONE MEM’L HOSP.
Newby, J., dissenting
693, 694, 231 S.E.2d 633, 634 (1977). None of these exceptions apply to this case.4
The express language of Rule 23, and our precedent, requires that a named
plaintiff must adequately represent the class. If a named plaintiff’s claim is moot, he
does not adequately represent a class of individuals with claims that are not moot.
Chambers’s claim here is moot, and no mootness exception applies. If the majority
followed this Court’s precedent and adhered to the rationale of class actions, that
would be the end of the matter.
The majority, however, crafts a new exception to mootness, a “pick off”
exception, and discards the well-established requirement that a named
representative of a class must have a genuine personal interest in the outcome of the
case.5 See Faulkenbury v. Teachers’ and State Emps.’ Ret. Sys. of N.C., 345 N.C. 683,
4 First, the hospital has not voluntarily ceased its billing such that no indebted party
could challenge the practice. Clearly there are other individuals who are able to challenge
the practice, as the amended complaint states that there are “at least hundreds” of class
members. Neither does this case present an issue that is capable of repetition, yet evading
review. The hospital’s billing and collections practices against some of these alleged victims
appears to be ongoing. Thus, it seems that numerous other individuals with active claims
could represent the class now that Chambers’s claim is moot. Finally, this case does not
involve a matter of public interest as the courts of this State have understood that exception.
In this case, the parties most affected by the hospital’s billing practices are only those in the
alleged class itself. Moreover, since the facts giving rise to this case occurred, the hospital
has changed its billing practices, in accordance with federal law, to no longer reference a
standard rate system like the one to which Chambers objects.
5 This Court has the authority to develop the common law. But it does not have the
authority to contravene statutory directives. Moreover, when the contemplated change is so
drastic as to contravene a long-established and wide-reaching legal doctrine like mootness,
this Court should allow the people to decide what sort of change, if any, is necessary and
carry out that change through the legislature.
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Newby, J., dissenting
697, 483 S.E.2d 422, 431 (1997). The majority’s broadly applicable exception
effectively eliminates mootness in the class action context, but, ironically, the
majority characterizes its holding as “narrow.” Expanding upon the reasoning of the
Third Circuit in Richardson v. Bledsoe, 829 F.3d 273 (3d Cir. 2016), the majority holds
that a class action is not moot “when the event that moots the [named] plaintiff’s
claim occurs before the [named] plaintiff has had a fair opportunity to seek class
certification and provided that the [named] plaintiff has not unduly delayed in
litigating the motion for class certification.”
This new rule, transplanted from federal law, is unworkable in this case.6
Chambers originally filed a class complaint on 11 May 2012. Four years later, on 1
April 2016, after it was clear that his alleged class claim was doomed to fail and was
adversely affected by his personal claim, he filed an amended class complaint based
on an entirely different legal theory and dropped his personal claim. How is a court
to apply the majority’s test? In other words, when considering whether Chambers has
had a “fair opportunity” to file a class certification motion and whether he has “unduly
delayed” in bringing such a motion, is the key point in time when the 2012 complaint
was filed, when the 2016 complaint was filed, or some other time? A court could not
determine what sort of delay is “undue” after years of litigation has passed during
which Chambers was permitted to completely change his legal theory.
6 In general, given dissimilarities between state and federal civil procedural rules, this
Court should hesitate to transplant whole cloth procedural principles from federal law.
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CHAMBERS V. MOSES H. CONE MEM’L HOSP.
Newby, J., dissenting
For similar reasons, the new rule is manifestly unfair to defendants. The class
Chambers purports to represent includes people who received care at the hospital
within four years of the filing of the complaint. The complaint was originally filed on
11 May 2012. Thus, his class action references events that happened as early as 2008.
This passage of time raises issues about potential class members who are now
immune from collection actions because of statutes of limitations and other
considerations. Forcing the hospital to defend itself under such circumstances is
unduly burdensome and unfair. The majority’s new rule is thus unworkable with such
class action complaints that have been amended.
The majority also claims that its new pick-off exception promotes “justice and
fair play” to class claimants. It is unclear how that is so. It does not serve the interests
of class claimants to allow actions to proceed with named plaintiffs who cannot satisfy
the requirements that “the named representatives . . . will fairly and adequately
represent the interests of all members of the class; [and] . . . have a genuine personal
interest, not a mere technical interest, in the outcome of the case.” Faulkenbury, 345
N.C. at 697, 483 S.E.2d at 431. Such named plaintiffs likely would not be poised to
adequately vindicate the interests of the “at least hundreds, if not thousands,” of class
members. Therefore, the majority’s new rule is unfair not only to defendants, but also
to putative class members who need a named plaintiff who will fully vindicate their
interests. To put it in terms of the majority’s new test, the delay in this case certainly
would seem “undue” from the perspective of the members of the purported class
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CHAMBERS V. MOSES H. CONE MEM’L HOSP.
Newby, J., dissenting
whose interests have taken the backseat while Chambers has spent years fighting to
be the one who leads the class.
The majority does not even discuss the traditional requirement of class actions
that the named plaintiff must adequately represent the interests of class members.
It merely makes a passing statement that even under its new rule class actions
ultimately must still satisfy the requirements of Rule 23 to obtain certification. The
majority thus apparently thinks that all of Rule 23’s requirements could be met even
if the named plaintiff has no personal stake in the outcome of the case. Perhaps the
implication is that when a named plaintiff has shown reasonable diligence to bring a
class certification motion, that party has demonstrated some commitment to
pursuing the interests of the class claimants as required by Rule 23(a).
If that is the majority’s assumption, it is a misguided one. If the named plaintiff
no longer has a personal interest in the outcome of the case, that party cannot fairly
and adequately represent the interests of all class members. The named plaintiff’s
interest is, to quote Faulkenbury, “mere[ly] technical.” 345 N.C. at 697, 483 S.E.2d at
431. Particularly in cases like this one, in which hundreds of other parties may more
adequately represent the class interests than a party who has no personal stake in
the outcome, there is no policy justification for keeping the class action alive with the
original named plaintiff as the class representative.
Finally, the majority’s apparent concern, that a defendant could inhibit a class
claim from ever reaching satisfactory resolution, is unwarranted. The majority claims
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Newby, J., dissenting
that its new rule “ensures that class representatives will not be picked off at the dawn
of the litigation before they have had a chance to engage in appropriate discovery and
otherwise prepare to seek class certification from the trial court.” The majority
believes its rule “will prevent . . . a ‘race to pay off named plaintiffs’ before they can
pursue class certification . . . .” (Quoting Richardson, 829 F.3d at 282).
That concern is unfounded both in this case and as a general matter. In this
case, the trial court specifically found there “is no record to support the argument”
that the hospital intended to “pick off” Chambers. Indeed, it only dismissed its
counterclaim against him after Chambers dismissed his individual contract claims.
Thus, even if in theory some sort of “pick-off” exception should be created, the facts of
this case do not warrant it here. Pending since 2012, this case does not present a good
vehicle for the Court to create a new rule.
In general, repeated “picking off” of named plaintiffs is not a strategy that
defendants are likely to vigorously pursue. When a named plaintiff’s claim is mooted
and the class action is therefore dismissed, the class action can be refiled with a new
named plaintiff.7 For a defendant to fully resolve all claims against it, it either must
settle the claims of a sufficient number of class members individually until no “class”
remains, or it must eventually deal with the class as a whole. Thus, a defendant would
likely have to settle many individual claims to make the issues raised by class action
7 Again, that observation holds true in this case, in which Chambers has alleged that
there are “at least hundreds, if not thousands,” of class members. Many of them may be
available to pursue this case as a named representative.
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Newby, J., dissenting
finally disappear. This strategy often will be cost-prohibitive, and, even if a defendant
can afford it, it will lead to most class members receiving a satisfactory resolution of
their claims.
Chambers independently dismissed his contract claims against the hospital.
Only after that did the hospital dismiss its counterclaim against Chambers,
rendering his claim moot and removing his personal stake in the case. Rather than
resuscitating old class actions with inadequate representation, the best course is our
historic one, which allows parties to find mutually beneficial paths forward, accepts
any consequences to justiciability, and allows classes to regroup and return with
proper representation. Not only could this encourage settlements that give relief to
individual claimants, but it would also help ensure that the interests of those still in
the class are vindicated by the attorneys dealing primarily with the named plaintiffs,
who must have an active interest in the case. The majority’s expansive new path is
both unnecessary and contrary to North Carolina law. I respectfully dissent.
-11-