Smith v. Bayer Corp. ( 2011 )

(Slip Opinion) OCTOBER TERM, 2010 1
Syllabus
NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
being done in connection with this case, at the time the opinion is issued.
The syllabus constitutes no part of the opinion of the Court but has been
prepared by the Reporter of Decisions for the convenience of the reader.
See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.
SUPREME COURT OF THE UNITED STATES
Syllabus
SMITH ET AL. v. BAYER CORP.
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE EIGHTH CIRCUIT
No. 09–1205. Argued January 18, 2011—Decided June 16, 2011
Respondent (Bayer) moved in Federal District Court for an injunction
ordering a West Virginia state court not to consider a motion for class
certification filed by petitioners (Smith), who were plaintiffs in the
state-court action. Bayer thought such an injunction warranted be
cause, in a separate case, Bayer had persuaded the same Federal
District Court to deny a similar class-certification motion that had
been filed against Bayer by a different plaintiff, George McCollins.
The District Court had denied McCollins’ certification motion under
Fed. Rule Civ. Proc. 23.
The court granted Bayer’s requested injunction against the state
court proceedings, holding that its denial of certification in McCollins’
case precluded litigation of the certification issue in Smith’s case.
The Court of Appeals for the Eighth Circuit affirmed. It first noted
that the Anti-Injunction Act (Act) generally prohibits federal courts
from enjoining state court proceedings. But it found that the Act’s re
litigation exception authorized this injunction because ordinary rules
of issue preclusion barred Smith from seeking certification of his pro
posed class. In so doing, the court concluded that Smith was invok
ing a State Rule, W. Va. Rule Civ. Proc. 23, that was sufficiently
similar to the Federal Rule McCollins had invoked, such that the cer
tification issues presented in the two cases were the same. The court
further held that Smith, as an unnamed member of McCollins’ puta
tive class action, could be bound by the judgment in McCollins’ case.
Held: In enjoining the state court from considering Smith’s class certifi
cation request, the federal court exceeded its authority under the “re
litigation exception” to the Act. Pp. 5–18.
(a) Under that Act, a federal court “may not grant an injunction to
stay proceedings in a State court except” in rare cases, when neces
2 SMITH v. BAYER CORP.
Syllabus
sary to “protect or effectuate [the federal court’s] judgments.” 28
U. S. C. §2283. The Act’s “specifically defined exceptions,” Atlantic
Coast Line R. Co. v. Locomotive Engineers, 398 U. S. 281, 286, “are
narrow and are ‘not [to] be enlarged by loose statutory construction,’ ”
Chick Kam Choo v. Exxon Corp., 486 U. S. 140, 146. Indeed, “[a]ny
doubts as to the propriety of a federal injunction against state court
proceedings should be resolved in favor of permitting the state courts
to proceed.” Atlantic Coast Line R. Co., 398 U. S., at 297. The excep
tion at issue in this case, known as the “relitigation exception,” au
thorizes an injunction to prevent state litigation of a claim or issue
“that previously was presented to and decided by the federal court.”
Chick Kam Choo, 486 U. S., at 147. This exception is designed to im
plement “well-recognized concepts” of claim and issue preclusion.
Ibid. Because deciding whether and how prior litigation has preclu
sive effect is usually the bailiwick of the second court—here, the West
Virginia court—every benefit of the doubt goes toward the state
court, see Atlantic Coast Line, 398 U. S., at 287, 297; an injunction
can issue only if preclusion is clear beyond peradventure. For the
federal court’s class-action determination to preclude the state court’s
adjudication of Smith’s motion, at least two conditions must be met.
First, the issue the federal court decided must be the same as the one
presented in the state tribunal. And second, Smith must have been a
party to the federal suit or must fall within one of a few discrete ex
ceptions to the general rule against binding nonparties. Pp. 5–7.
(b) The issue the federal court decided was not the same as the one
presented in the state tribunal. This case is little more than a rerun
of Chick Kam Choo. There, a federal court dismissed a suit involving
Singapore law on forum non conveniens grounds and then enjoined
the plaintiff from pursuing the “same” claim in Texas state court.
However, because the legal standards for forum non conveniens dif
fered in the two courts, the issues before those courts differed, mak
ing an injunction unwarranted. Here, Smith’s proposed class mir
rored McCollins’, and the two suits’ substantive claims broadly
overlapped. But the federal court adjudicated McCollins’ certification
motion under Federal Rule 23, whereas the state court was poised to
consider Smith’s proposed class under W. Va. Rule 23. And the State
Supreme Court has generally stated that it will not necessarily inter
pret its Rule 23 as coterminous with the Federal Rule. Absent clear
evidence that the state courts had adopted an approach to State Rule
23 tracking the federal court’s analysis in McCollins’ case, this Court
could not conclude that they would interpret their Rule the same way
and, thus, could not tell whether the certification issues in the two
courts were the same. That uncertainty would preclude an injunc
tion. And indeed, the case against an injunction here is even
Cite as: 564 U. S. ____ (2011) 3
Syllabus
stronger, because the State Supreme Court has expressly disap
proved the approach to Rule 23(b)(3)’s predominance requirement
embraced by the Federal District Court. Pp. 8–12.
(c) The District Court’s injunction was independently improper be
cause Smith was not a party to the federal suit and was not covered
by any exception to the rule against nonparty preclusion. Generally,
a party “is ‘[o]ne by or against whom a lawsuit is brought,’ ” United
States ex rel. Eisenstein v. City of New York, 556 U. S. ___, ___, or
who “become[s] a party by intervention, substitution, or third-party
practice,” Karcher v. May, 484 U. S. 72, 77. The definition of “party”
cannot be stretched so far as to cover a person like Smith, whom
McCollins was denied leave to represent. The only exception to the
rule against nonparty preclusion potentially relevant here is the ex
ception that binds non-named members of “properly conducted class
actions” to judgments entered in such proceedings. Taylor v. Stur
gell, 553 U. S. 880, 894. But McCollins’ suit was not a proper class
action. Indeed, the very ruling that Bayer argues should have pre
clusive effect is the District Court’s decision not to certify a class.
Absent certification of a class under Federal Rule 23, the precondi
tion for binding Smith was not met. Neither a proposed, nor a re
jected, class action may bind nonparties. See id., at 901. Bayer
claims that this Court’s approach to class actions would permit class
counsel to try repeatedly to certify the same class simply by changing
plaintiffs. But principles of stare decisis and comity among courts
generally suffice to mitigate the sometimes substantial costs of simi
lar litigation brought by different plaintiffs. The right approach does
not lie in binding nonparties to a judgment. And to the extent class
actions raise special relitigation problems, the federal Class Action
Fairness Act of 2005 provides a remedy that does not involve depart
ing from the usual preclusion rules. Pp. 12–18.
593 F. 3d 716, reversed.
KAGAN, J., delivered the opinion of the Court, in which ROBERTS,
C. J., and SCALIA, KENNEDY, GINSBURG, BREYER, ALITO, and SOTOMAYOR,
JJ., joined, and in which THOMAS, J., joined as to Parts I and II–A.
Cite as: 564 U. S. ____ (2011) 1
Opinion of the Court
NOTICE: This opinion is subject to formal revision before publication in the
preliminary print of the United States Reports. Readers are requested to
notify the Reporter of Decisions, Supreme Court of the United States, Wash
ington, D. C. 20543, of any typographical or other formal errors, in order
that corrections may be made before the preliminary print goes to press.
SUPREME COURT OF THE UNITED STATES
_________________
No. 09–1205
_________________
KEITH SMITH, ET AL., PETITIONERS v. BAYER
CORPORATION
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE EIGHTH CIRCUIT
[June 16, 2011]
JUSTICE KAGAN delivered the opinion of the Court.*
In this case, a Federal District Court enjoined a state
court from considering a plaintiff’s request to approve a
class action. The District Court did so because it had
earlier denied a motion to certify a class in a related case,
brought by a different plaintiff against the same defen
dant alleging similar claims. The federal court thought its
injunction appropriate to prevent relitigation of the issue
it had decided.
We hold to the contrary. In issuing this order to a state
court, the federal court exceeded its authority under the
“relitigation exception” to the Anti-Injunction Act. That
statutory provision permits a federal court to enjoin a
state proceeding only in rare cases, when necessary to “pro
tect or effectuate [the federal court’s] judgments.” 28
U. S. C. §2283. Here, that standard was not met for two
reasons. First, the issue presented in the state court was
not identical to the one decided in the federal tribunal.
And second, the plaintiff in the state court did not have
the requisite connection to the federal suit to be bound by
——————
* JUSTICE THOMAS joins Parts I and II–A of this opinion.
2 SMITH v. BAYER CORP.
Opinion of the Court
the District Court’s judgment.
I
Because the question before us involves the effect of a
former adjudication on this case, we begin our statement
of the facts not with this lawsuit, but with another. In
August 2001, George McCollins sued respondent Bayer
Corporation in the Circuit Court of Cabell County, West
Virginia, asserting various state-law claims arising from
Bayer’s sale of an allegedly hazardous prescription drug
called Baycol (which Bayer withdrew from the market that
same month). McCollins contended that Bayer had vio
lated West Virginia’s consumer-protection statute and the
company’s express and implied warranties by selling him
a defective product. And pursuant to West Virginia Rule
of Civil Procedure 23 (2011), McCollins asked the state
court to certify a class of West Virginia residents who had
also purchased Baycol, so that the case could proceed as a
class action.
Approximately one month later, the suit now before us
began in a different part of West Virginia. Petitioners
Keith Smith and Shirley Sperlazza (Smith for short) filed
state-law claims against Bayer, similar to those raised in
McCollins’ suit, in the Circuit Court of Brooke County,
West Virginia. And like McCollins, Smith asked the court
to certify under West Virginia’s Rule 23 a class of Baycol
purchasers residing in the State. Neither Smith nor
McCollins knew about the other’s suit.
In January 2002, Bayer removed McCollins’ case to the
United States District Court for the Southern District of
West Virginia on the basis of diversity jurisdiction. See 28
U. S. C. §§1332, 1441. The case was then transferred to
the District of Minnesota pursuant to a preexisting order
of the Judicial Panel on Multi-District Litigation, which
had consolidated all federal suits involving Baycol (num
bering in the tens of thousands) before a single District
Cite as: 564 U. S. ____ (2011) 3
Opinion of the Court
Court Judge. See §1407. Bayer, however, could not
remove Smith’s case to federal court because Smith
had sued several West Virginia defendants in addition to
Bayer, and so the suit lacked complete diversity. See
§1441(b).1 Smith’s suit thus remained in the state court
house in Brooke County.
Over the next six years, the two cases proceeded along
their separate pretrial paths at roughly the same pace. By
2008, both courts were preparing to turn to their respec
tive plaintiffs’ motions for class certification. The Federal
District Court was the first to reach a decision.
Applying Federal Rule of Civil Procedure 23,2 the Dis
trict Court declined to certify McCollins’ proposed class
of West Virginia Baycol purchasers. The District Court’s
reasoning proceeded in two steps. The court first ruled
that, under West Virginia law, each plaintiff would have
to prove “actual injury” from his use of Baycol to recover.
App. to Pet. for Cert. 44a. The court then held that be
cause the necessary showing of harm would vary from
plaintiff to plaintiff, “individual issues of fact predomi
nate[d]” over issues common to all members of the pro
posed class, and so the case was not suitable for class
treatment. Id., at 45a. In the same order, the District
Court also dismissed McCollins’ claims on the merits in
light of his failure to demonstrate physical injury from his
use of Baycol. McCollins chose not to appeal.
Although McCollins’ suit was now concluded, Bayer
asked the District Court for another order based upon it,
——————
1 The Class Action Fairness Act of 2005, 119 Stat. 4, which postdates
and therefore does not govern this lawsuit, now enables a defendant to
remove to federal court certain class actions involving nondiverse
parties. See 28 U. S. C. §§1332(d), 1453(b); see also infra, at 17.
2 Although McCollins had originally sought certification under West
Virginia Rule of Civil Procedure 23 (2011), federal procedural rules
govern a case that has been removed to federal court. See Shady Grove
Orthopedic Associates, P. A. v. Allstate Ins. Co., 559 U. S. ___ (2010).
4 SMITH v. BAYER CORP.
Opinion of the Court
this one affecting Smith’s case in West Virginia. In a
motion—receipt of which first apprised Smith of McCol
lins’ suit—Bayer explained that the proposed class in
Smith’s case was identical to the one the federal court had
just rejected. Bayer therefore requested that the federal
court enjoin the West Virginia state court from hearing
Smith’s motion to certify a class. According to Bayer, that
order was appropriate to protect the District Court’s
judgment in McCollins’ suit denying class certification.
The District Court agreed and granted the injunction.
The Court of Appeals for the Eighth Circuit affirmed.
In re Baycol Prods. Litigation, 593 F. 3d 716 (2010). The
court noted that the Anti-Injunction Act generally prohib
its federal courts from enjoining state court proceedings.
But the court held that the Act’s relitigation exception
authorized the injunction here because ordinary rules of
issue preclusion barred Smith from seeking certification of
his proposed class. According to the court, Smith was
invoking a similar class action rule as McCollins had used
to seek certification “of the same class” in a suit alleging
“the same legal theories,” id., at 724; the issue in the state
court therefore was “sufficiently identical” to the one the
federal court had decided to warrant preclusion, ibid. In
addition, the court held, the parties in the two proceedings
were sufficiently alike: Because Smith was an unnamed
member of the class McCollins had proposed, and because
their “interests were aligned,” Smith was appropriately
bound by the federal court’s judgment. Ibid.We granted certiorari, 561 U. S. __ (2010), because the
order issued here implicates two circuit splits arising from
application of the Anti-Injunction Act’s relitigation excep
tion. The first involves the requirement of preclusion law
that a subsequent suit raise the “same issue” as a previous
case.3 The second concerns the scope of the rule that a
——————
3 Compare In re Baycol Prods. Litigation, 593 F. 3d 716, 723 (CA8
Cite as: 564 U. S. ____ (2011) 5
Opinion of the Court
court’s judgment cannot bind nonparties.4 We think the
District Court erred on both grounds when it granted the
injunction, and we now reverse.
II
The Anti-Injunction Act, first enacted in 1793, provides
that
“A court of the United States may not grant an injunc
tion to stay proceedings in a State court except as
expressly authorized by Act of Congress, or where
necessary in aid of its jurisdiction, or to protect or
effectuate its judgments.” 28 U. S. C. §2283.
The statute, we have recognized, “is a necessary concomi
tant of the Framers’ decision to authorize, and Congress’
decision to implement, a dual system of federal and state
courts.” Chick Kam Choo v. Exxon Corp., 486 U. S. 140,
146 (1988). And the Act’s core message is one of respect
for state courts. The Act broadly commands that those
tribunals “shall remain free from interference by federal
courts.” Atlantic Coast Line R. Co. v. Locomotive Engi
——————
2010) (case below) (holding that two cases involve the same issue when
“[t]he state and federal [class] certification rules . . . are not signifi
cantly different”), with J. R. Clearwater Inc. v. Ashland Chemical Co.,
93 F. 3d 176, 180 (CA5 1996) (holding that two cases implicate different
issues even when “[the state rule] is modeled on . . . the Federal Rules”
because a “[state] court might well exercise [its] discretion in a different
manner”).
4 Compare 593 F. 3d, at 724 (“[T]he denial of class certification is
binding on unnamed [putative] class members” because they are “in
privity to [the parties] in the prior action”) and In re Bridge
stone/Firestone, Inc., Tires Prods. Liability Litigation, 333 F. 3d 763,
768–769 (CA7 2003) (same), with In re Ford Motor Co., 471 F. 3d 1233,
1245 (CA11 2006) (holding that “[t]he denial of class certification”
prevents a court from “binding” anyone other than “the parties appear
ing before it”) and In re General Motors Corp. Pick-Up Truck Fuel Tank
Prods. Liability Litigation, 134 F. 3d 133, 141 (CA3 1998) (holding that
putative “class members are not parties” and so cannot be bound by a
court’s ruling when “there is no class pending”).
6 SMITH v. BAYER CORP.
Opinion of the Court
neers, 398 U. S. 281, 282 (1970). That edict is subject to
only “three specifically defined exceptions.” Id., at 286.
And those exceptions, though designed for important
purposes, “are narrow and are ‘not [to] be enlarged by
loose statutory construction.’ ” Chick Kam Choo, 486 U. S.,
at 146 (quoting Atlantic Coast Line, 398 U. S., at 287;
alteration in original). Indeed, “[a]ny doubts as to the
propriety of a federal injunction against state court pro
ceedings should be resolved in favor of permitting the
state courts to proceed.” Id., at 297.
This case involves the last of the Act’s three exceptions,
known as the relitigation exception. That exception is de
signed to implement “well-recognized concepts” of claim
and issue preclusion. Chick Kam Choo, 486 U. S., at 147.
The provision authorizes an injunction to prevent state
litigation of a claim or issue “that previously was pre
sented to and decided by the federal court.” Ibid. But in
applying this exception, we have taken special care to
keep it “strict and narrow.” Id., at 148. After all, a court
does not usually “get to dictate to other courts the preclu
sion consequences of its own judgment.” 18 C. Wright,
A. Miller, & E. Cooper, Federal Practice and Procedure
§4405, p. 82 (2d ed. 2002) (hereinafter Wright & Miller).
Deciding whether and how prior litigation has preclusive
effect is usually the bailiwick of the second court (here, the
one in West Virginia). So issuing an injunction under the
relitigation exception is resorting to heavy artillery.5 For
that reason, every benefit of the doubt goes toward the
state court, see Atlantic Coast Line, 398 U. S., at 287, 297;
an injunction can issue only if preclusion is clear beyond
——————
5 That is especially so because an injunction is not the only way to
correct a state trial court’s erroneous refusal to give preclusive effect to
a federal judgment. As we have noted before, “the state appellate
courts and ultimately this Court” can review and reverse such a ruling.
See Atlantic Coast Line R. Co. v. Locomotive Engineers, 398 U. S. 281,
287 (1970).
Cite as: 564 U. S. ____ (2011) 7
Opinion of the Court
peradventure.
The question here is whether the federal court’s rejec
tion of McCollins’ proposed class precluded a later adjudi
cation in state court of Smith’s certification motion. For
the federal court’s determination of the class issue to have
this preclusive effect, at least two conditions must be met.6
First, the issue the federal court decided must be the same
as the one presented in the state tribunal. See 18 Wright
& Miller §4417, at 412. And second, Smith must have
been a party to the federal suit, or else must fall within
one of a few discrete exceptions to the general rule against
binding nonparties. See 18A id., §4449, at 330. In fact,
as we will explain, the issues before the two courts were
not the same, and Smith was neither a party nor the ex
ceptional kind of nonparty who can be bound. So the
courts below erred in finding the certification issue pre
cluded, and erred all the more in thinking an injunction
appropriate.7
——————
6 We have held that federal common law governs the preclusive effect
of a decision of a federal court sitting in diversity. See Semtek Int’l Inc.
v. Lockheed Martin Corp., 531 U. S. 497, 508 (2001). Smith assumes
that federal common law should here incorporate West Virginia’s
preclusion law, see Brief for Petitioners 15–16, whereas Bayer favors
looking only to federal rules of preclusion because of the federal inter
ests at stake in this case, see Brief for Respondent 18. We do not think
the question matters here. Neither party identifies any way in which
federal and state principles of preclusion law differ in any relevant
respect. Nor have we found any such divergence. Compare, e.g.,
Montana v. United States, 440 U. S. 147, 153–154 (1979) (describing
elements of issue preclusion), with State v. Miller, 194 W. Va. 3, 9, 459
S. E. 2d 114, 120 (1995) (same). We therefore need not decide whether,
in general, federal common law ought to incorporate state law in
situations such as this.
7 Because we rest our decision on the Anti-Injunction Act and the
principles of issue preclusion that inform it, we do not consider Smith’s
argument, based on Phillips Petroleum Co. v. Shutts, 472 U. S. 797(1985), that the District Court’s action violated the Due Process Clause.
8 SMITH v. BAYER CORP.
Opinion of the Court
A
In our most recent case on the relitigation exception,
Chick Kam Choo v. Exxon, we applied the “same issue”
requirement of preclusion law to invalidate a federal
court’s injunction. 486 U. S., at 151. The federal court
had dismissed a suit involving Singapore law on grounds
of forum non conveniens. After the plaintiff brought the
same claim in Texas state court, the federal court issued
an injunction barring the plaintiff from pursuing relief in
that alternate forum. We held that the District Court had
gone too far. “[A]n essential prerequisite for applying the
relitigation exception,” we explained, “is that the . . . is
sues which the federal injunction insulates from litigation
in state proceedings actually have been decided by the
federal court.” Id., at 148. That prerequisite, we thought,
was not satisfied because the issue to be adjudicated in
state court was not the one the federal court had resolved.
The federal court had considered the permissibility of the
claim under federal forum non conveniens principles. But
the Texas courts, we thought, “would apply a significantly
different forum non conveniens analysis,” id., at 149; they
had in prior cases rejected the strictness of the federal
doctrine. Our conclusion followed: “[W]hether the Texas
state courts are an appropriate forum for [the plaintiff’s]
Singapore law claims has not yet been litigated.” Ibid.Because the legal standards in the two courts differed, the
issues before the courts differed, and an injunction was
unwarranted.
The question here closely resembles the one in Chick
Kam Choo. The class Smith proposed in state court mir
rored the class McCollins sought to certify in federal court:
Both included all Baycol purchasers resident in West
Virginia. Moreover, the substantive claims in the two
suits broadly overlapped: Both complaints alleged that
Bayer had sold a defective product in violation of the
State’s consumer protection law and the company’s war
Cite as: 564 U. S. ____ (2011) 9
Opinion of the Court
ranties. So far, so good for preclusion. But not so fast:
a critical question—the question of the applicable legal
standard—remains. The District Court ruled that the
proposed class did not meet the requirements of Federal
Rule 23 (because individualized issues would predominate
over common ones). But the state court was poised to
consider whether the proposed class satisfied West Vir
ginia Rule 23. If those two legal standards differ (as
federal and state forum non conveniens law differed in
Chick Kam Choo)—then the federal court resolved an
issue not before the state court. In that event, much like
in Chick Kam Choo, “whether the [West Virginia] state
cour[t]” should certify the proposed class action “has not
yet been litigated.” 486 U. S., at 149.
The Court of Appeals and Smith offer us two competing
ways of deciding whether the West Virginia and Federal
Rules differ, but we think the right path lies somewhere in
the middle. The Eighth Circuit relied almost exclusively
on the near-identity of the two Rules’ texts. See 593 F. 3d,
at 723. That was the right place to start, but not to end.
Federal and state courts, after all, can and do apply iden
tically worded procedural provisions in widely varying
ways. If a State’s procedural provision tracks the lan
guage of a Federal Rule, but a state court interprets that
provision in a manner federal courts have not, then the
state court is using a different standard and thus deciding
a different issue. See 18 Wright & Miller §4417, at 454
(stating that preclusion is “inappropriate” when “different
legal standards . . . masquerad[e] behind similar legal
labels”). At the other extreme, Smith contends that the
source of law is all that matters: a different sovereign
must in each and every case “have the opportunity, if it
chooses, to construe its procedural rule differently.” Brief
for Petitioners 22 (quoting ALI, Principles of the Law,
Aggregate Litigation §2.11, Reporters’ Notes, cmt. b,
p. 181 (2010)). But if state courts have made crystal clear
10 SMITH v. BAYER CORP.
Opinion of the Court
that they follow the same approach as the federal court
applied, we see no need to ignore that determination; in
that event, the issues in the two cases would indeed be the
same. So a federal court considering whether the relitiga
tion exception applies should examine whether state law
parallels its federal counterpart. But as suggested earlier,
see supra, at 6, the federal court must resolve any uncer
tainty on that score by leaving the question of preclusion
to the state courts.
Under this approach, the West Virginia Supreme Court
has gone some way toward resolving the matter before us
by declaring its independence from federal courts’ inter
pretation of the Federal Rules—and particularly of Rule
23. In In re W. Va. Rezulin Litigation, 214 W. Va. 52, 585
S. E. 2d 52 (2003) (In re Rezulin), the West Virginia high
court considered a plaintiff’s motion to certify a class—
coincidentally enough, in a suit about an allegedly defec
tive pharmaceutical product. The court made a point of
complaining about the parties’ and lower court’s near
exclusive reliance on federal cases about Federal Rule 23
to decide the certification question. Such cases, the court
cautioned, “ ‘may be persuasive, but [they are] not binding
or controlling.’ ” Id., at 61, 585 S. E. 2d, at 61. And lest
anyone mistake the import of this message, the court went
on: The aim of “this rule is to avoid having our legal
analysis of our Rules ‘amount to nothing more than Pav
lovian responses to federal decisional law.’ ” Ibid. (italics
omitted). Of course, the state courts might still have
adopted an approach to their Rule 23 that tracked the
analysis the federal court used in McCollins’ case. But
absent clear evidence that the state courts had done so, we
could not conclude that they would interpret their Rule in
the same way. And if that is so, we could not tell whether
the certification issues in the state and federal courts were
the same. That uncertainty would preclude an injunction.
But here the case against an injunction is even stronger,
Cite as: 564 U. S. ____ (2011) 11
Opinion of the Court
because the West Virginia Supreme Court has disap
proved the approach to Rule 23(b)(3)’s predominance
requirement that the Federal District Court embraced.
Recall that the federal court held that the presence of
a single individualized issue—injury from the use of
Baycol—prevented class certification. See supra, at 3. The
court did not identify the common issues in the case; nor
did it balance these common issues against the need to
prove individual injury to determine which predominated.
The court instead applied a strict test barring class treat
ment when proof of each plaintiff’s injury is necessary.8
By contrast, the West Virginia Supreme Court in In
re Rezulin adopted an all-things-considered, balancing
inquiry in interpreting its Rule 23. Rejecting any “rigid
test,” the state court opined that the predominance re
quirement “contemplates a review of many factors.” 214
W. Va., at 72, 585 S. E. 2d, at 72. Indeed, the court noted,
a “ ‘single common issue’ ” in a case could outweigh “ ‘nu
merous . . . individual questions.’ ” Ibid. That meant, the
court further explained (quoting what it termed the “lead
ing treatise” on the subject), that even objections to certifi
cation “ ‘based on . . . causation, or reliance’ ”—which typi
cally involve showings of individual injury—“ ‘will not bar
predominance satisfaction.’ ” Ibid. (quoting 2 A. Conte &
H. Newberg, Newberg on Class Actions §4.26, p. 241 (4th
ed. 2002)). So point for point, the analysis set out in In re
Rezulin diverged from the District Court’s interpretation
of Federal Rule 23. A state court using the In re Rezulin
standard would decide a different question than the one
——————
8 The District Court’s approach to the predominance inquiry is consis
tent with the approach employed by the Eighth Circuit. See In re St.
Jude Medical, Inc., 522 F. 3d 836, 837–840 (2008) (holding that most
commercial misrepresentation cases are “unsuitable for class treat
ment” because individual issues of reliance necessarily predominate).
We express no opinion as to the correctness of this approach.
12 SMITH v. BAYER CORP.
Opinion of the Court
the federal court had earlier resolved.9
This case, indeed, is little more than a rerun of Chick
Kam Choo. A federal court and a state court apply differ
ent law. That means they decide distinct questions. The
federal court’s resolution of one issue does not preclude the
state court’s determination of another. It then goes with
out saying that the federal court may not issue an injunc
tion. The Anti-Injunction Act’s re-litigation exception does
not extend nearly so far.
B
The injunction issued here runs into another basic
premise of preclusion law: A court’s judgment binds only
the parties to a suit, subject to a handful of discrete and
limited exceptions. See, e.g., 18A Wright & Miller §4449,
at 330. The importance of this rule and the narrowness of
its exceptions go hand in hand. We have repeatedly “em
phasize[d] the fundamental nature of the general rule”
that only parties can be bound by prior judgments; accord
ingly, we have taken a “constrained approach to nonparty
preclusion.” Taylor v. Sturgell, 553 U. S. 880, 898 (2008).
Against this backdrop, Bayer defends the decision below
by arguing that Smith—an unnamed member of a pro
——————
9 Bayer argues that In re Rezulin does not preclude an injunction in
this case because the West Virginia court there decided that common
issues predominated over individual issues of damages, not over indi
vidual issues of liability (as exist here). See Brief for Respondent 25–
26. We think Bayer is right about this distinction, but wrong about its
consequence. Our point is not that In re Rezulin dictates the answer
to the class certification question here; the two cases are indeed too
dissimilar for that to be true. The point instead is that In re Rezulin
articulated a general approach to the predominance requirement that
differs markedly from the one the federal court used. Minor variations
in the application of what is in essence the same legal standard do not
defeat preclusion; but where, as here, the State’s courts “would apply a
significantly different . . . analysis,” Chick Kam Choo v. Exxon Corp.,
486 U. S. 140, 149 (1988), the federal and state courts decide different
issues.
Cite as: 564 U. S. ____ (2011) 13
Opinion of the Court
posed but uncertified class—qualifies as a party to the
McCollins litigation. See Brief for Respondent 32–34.
Alternatively, Bayer claims that the District Court’s
judgment binds Smith under the recognized exception to
the rule against nonparty preclusion for members of class
actions. See id., at 34–39. We think neither contention
has merit.
Bayer’s first claim ill-comports with any proper under
standing of what a “party” is. In general, “[a] ‘party’ to
litigation is ‘[o]ne by or against whom a lawsuit is
brought,’ ” United States ex rel. Eisenstein v. City of New
York, 556 U. S. ___, ___ (2009) (slip op., at 4), or one who
“become[s] a party by intervention, substitution, or third
party practice,” Karcher v. May, 484 U. S. 72, 77 (1987).
And we have further held that an unnamed member of a
certified class may be “considered a ‘party’ for the [particu
lar] purpos[e] of appealing” an adverse judgment. Devlin
v. Scardelletti, 536 U. S. 1, 7 (2002). But as the dissent in
Devlin noted, no one in that case was “willing to advance
the novel and surely erroneous argument that a non
named class member is a party to the class-action litiga
tion before the class is certified.” Id., at 16, n. 1 (opinion of
SCALIA, J.). Still less does that argument make sense once
certification is denied. The definition of the term “party”
can on no account be stretched so far as to cover a person
like Smith, whom the plaintiff in a lawsuit was denied
leave to represent.10 If the judgment in the McCollins
——————
10 In support of its claim that Smith counts as a party, Bayer cites two
cases in which we held that a putative member of an uncertified class
may wait until after the court rules on the certification motion to file an
individual claim or move to intervene in the suit. See Brief for Respon
dent 32–33 (citing United Airlines, Inc. v. McDonald, 432 U. S. 385(1977); American Pipe & Constr. Co. v. Utah, 414 U. S. 538 (1974)). But
these cases, which were specifically grounded in policies of judicial
administration, demonstrate only that a person not a party to a class
suit may receive certain benefits (such as the tolling of a limitations
period) related to that proceeding. See id., at 553; McDonald, 432
14 SMITH v. BAYER CORP.
Opinion of the Court
litigation can indeed bind Smith, it must do so under
principles of nonparty preclusion.
As Bayer notes, see Brief for Respondent 37, one such
principle allows unnamed members of a class action to be
bound, even though they are not parties to the suit. See
Cooper v. Federal Reserve Bank of Richmond, 467 U. S.
867, 874 (1984) (“[U]nder elementary principles of prior
adjudication a judgment in a properly entertained class
action is binding on class members in any subsequent
litigation”); see also Taylor, 553 U. S., at 894 (stating that
nonparties can be bound in “properly conducted class
actions”). But here Bayer faces a conundrum. If we know
one thing about the McCollins suit, we know that it was
not a class action. Indeed, the very ruling that Bayer
argues ought to be given preclusive effect is the District
Court’s decision that a class could not properly be certi
fied. So Bayer wants to bind Smith as a member of a class
action (because it is only as such that a nonparty in
Smith’s situation can be bound) to a determination that
there could not be a class action. And if the logic of that
position is not immediately transparent, here is Bayer’s
attempt to clarify: “[U]ntil the moment when class certi
fication was denied, the McCollins case was a properly
conducted class action.” Brief for Respondent 37. That is
true, according to Bayer, because McCollins’ interests
were aligned with the members of the class he proposed
and he “act[ed] in a representative capacity when he
sought class certification.” Id., at 36.
But wishing does not make it so. McCollins sought class
certification, but he failed to obtain that result. Because
the District Court found that individual issues predomi
——————
U. S., at 394, n. 15. That result is consistent with a commonplace of
preclusion law—that nonparties sometimes may benefit from, even
though they cannot be bound by, former litigation. See Parklane Ho
siery Co. v. Shore, 439 U. S. 322, 326–333 (1979); Blonder-Tongue
Laboratories, Inc. v. University of Ill. Foundation, 402 U. S. 313 (1971).
Cite as: 564 U. S. ____ (2011) 15
Opinion of the Court
nated, it held that the action did not satisfy Federal Rule
23’s requirements for class proceedings. In these circum
stances, we cannot say that a properly conducted class
action existed at any time in the litigation. Federal Rule
23 determines what is and is not a class action in federal
court, where McCollins brought his suit. So in the absence
of a certification under that Rule, the precondition for
binding Smith was not met. Neither a proposed class
action nor a rejected class action may bind nonparties.
What does have this effect is a class action approved under
Rule 23. But McCollins’ lawsuit was never that.
We made essentially these same points in Taylor v.
Sturgell just a few Terms ago. The question there con
cerned the propriety of binding nonparties under a theory
of “virtual representation” based on “identity of interests
and some kind of relationship between parties and non
parties.” 553 U. S., at 901. We rejected the theory
unanimously, explaining that it “would ‘recogniz[e], in
effect, a common-law kind of class action.’ ” Ibid. Such a
device, we objected, would authorize preclusion “shorn of
[Rule 23’s] procedural protections.” Ibid. Or as otherwise
stated in the opinion: We could not allow “circumvent[ion]”
of Rule 23’s protections through a “virtual representation
doctrine that allowed courts to ‘create de facto class ac
tions at will.’ ” Ibid. We could hardly have been more
clear that a “properly conducted class action,” with bind
ing effect on nonparties, can come about in federal courts
in just one way—through the procedure set out in Rule 23.
Bayer attempts to distinguish Taylor by noting that the
party in the prior litigation there did not propose a class
action. But we do not see why that difference matters.
Yes, McCollins wished to represent a class, and made a
motion to that effect. But it did not come to pass. To
allow McCollins’ suit to bind nonparties would be to adopt
16 SMITH v. BAYER CORP.
Opinion of the Court
the very theory Taylor rejected.11
Bayer’s strongest argument comes not from established
principles of preclusion, but instead from policy concerns
relating to use of the class action device. Bayer warns
that under our approach class counsel can repeatedly try
to certify the same class “by the simple expedient of
changing the named plaintiff in the caption of the com
plaint.” Brief for Respondent 47–48. And in this world of
“serial relitigation of class certification,” Bayer contends,
defendants “would be forced in effect to buy litigation
peace by settling.” Id., at 2, 12; see also In re Bridge
stone/Firestone, Inc., Tires Prods. Liability Litigation,
333 F. 3d 763, 767 (CA7 2003) (objecting to an “an asym
metric system in which class counsel can win but never
lose” because of their ability to relitigate the issue of
certification).
But this form of argument flies in the face of the rule
against nonparty preclusion. That rule perforce leads to
relitigation of many issues, as plaintiff after plaintiff after
plaintiff (none precluded by the last judgment because
none a party to the last suit) tries his hand at establishing
some legal principle or obtaining some grant of relief. We
confronted a similar policy concern in Taylor, which in
volved litigation brought under the Freedom of Infor
——————
11 The great weight of scholarly authority—from the Restatement of
Judgments to the American Law Institute to Wright and Miller—
agrees that an uncertified class action cannot bind proposed class
members. See Restatement (Second) of Judgments §41(1), p. 393 (1980)
(A nonparty may be bound only when his interests are adequately
represented by “[t]he representative of a class of persons similarly
situated, designated as such with the approval of the court”); ALI,
Principles of the Law Aggregate Litigation §2.11, Reporters’ Notes, cmt.
b, p. 181 (2010) (“[N]one of [the exceptions to the rule against nonparty
preclusion] extend generally to the situation of a would-be absent class
member with respect to a denial of class certification”); 18A Wright &
Miller §4455, at 457–458 (“[A]bsent certification there is no basis for
precluding a nonparty” under the class-action exception).
Cite as: 564 U. S. ____ (2011) 17
Opinion of the Court
mation Act (FOIA). The Government there cautioned
that unless we bound nonparties a “ ‘potentially limitless’ ”
number of plaintiffs, perhaps coordinating with each
other, could “mount a series of repetitive lawsuits” de
manding the selfsame documents. 553 U. S., at 903. But
we rejected this argument, even though the payoff in a
single successful FOIA suit—disclosure of documents to
the public—could “trum[p]” or “subsum[e]” all prior losses,
just as a single successful class certification motion could
do. In re Bridgestone/Firestone, 333 F. 3d, at 766, 767. As
that response suggests, our legal system generally relies
on principles of stare decisis and comity among courts to
mitigate the sometimes substantial costs of similar litiga
tion brought by different plaintiffs. We have not thought
that the right approach (except in the discrete categories
of cases we have recognized) lies in binding nonparties to a
judgment.
And to the extent class actions raise special problems of
relitigation, Congress has provided a remedy that does not
involve departing from the usual rules of preclusion. In
the Class Action Fairness Act of 2005 (CAFA), 28 U. S. C.
§§1332(d), 1453 (2006 ed. and Supp. III), Congress enabled
defendants to remove to federal court any sizable class
action involving minimal diversity of citizenship. Once
removal takes place, Federal Rule 23 governs certification.
And federal courts may consolidate multiple overlapping
suits against a single defendant in one court (as the Judi
cial Panel on Multi-District Litigation did for the many
actions involving Baycol). See §1407. Finally, we would
expect federal courts to apply principles of comity to each
other’s class certification decisions when addressing a
common dispute. See, e.g., Cortez Byrd Chips, Inc. v. Bill
Harbert Constr. Co., 529 U. S. 193, 198 (2000) (citing
Landis v. North American Co., 299 U. S. 248, 254 (1936)).
CAFA may be cold comfort to Bayer with respect to suits
like this one beginning before its enactment. But Con
18 SMITH v. BAYER CORP.
Opinion of the Court
gress’s decision to address the relitigation concerns associ
ated with class actions through the mechanism of removal
provides yet another reason for federal courts to adhere
in this context to longstanding principles of preclusion.12
And once again, that is especially so when the federal
court is deciding whether to go so far as to enjoin a state
proceeding.
* * *
The Anti-Injunction Act prohibits the order the District
Court entered here. The Act’s relitigation exception au
thorizes injunctions only when a former federal adjudica
tion clearly precludes a state-court decision. As we said
more than 40 years ago, and have consistently maintained
since that time, “[a]ny doubts . . . should be resolved in
favor of permitting the state courts to proceed.” Atlantic
Coast Line, 398 U. S., at 297. Under this approach, close
cases have easy answers: The federal court should not
issue an injunction, and the state court should decide the
preclusion question. But this case does not even strike us
as close. The issues in the federal and state lawsuits
differed because the relevant legal standards differed.
And the mere proposal of a class in the federal action
could not bind persons who were not parties there. For
these reasons, the judgment of the Court of Appeals is
Reversed.
——————
12 By the same token, nothing in our holding today forecloses legisla
tion to modify established principles of preclusion should Congress
decide that CAFA does not sufficiently prevent relitigation of class
certification motions. Nor does this opinion at all address the permis
sibility of a change in the Federal Rules of Civil Procedure pertaining to
this question. Cf. n. 7, supra (declining to reach Smith’s due process
claim).