Medical & Chiropractic Clinic, Inc. v. David M. Oppenheim

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[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 18-13714
________________________
D.C. Docket No. 8:16-cv-01477-CEH-CPT
MEDICAL & CHIROPRACTIC CLINIC, INC.,
Plaintiff - Appellant,
versus
DAVID M. OPPENHEIM,
an individual,
BOCK LAW FIRM, LLC,
d.b.a. Bock, Hatch, Lewis & Oppenheim, LLC,
Defendants - Appellees.
________________________
Appeal from the United States District Court
for the Middle District of Florida
________________________
(December 1, 2020)
Before WILSON, NEWSOM, Circuit Judges, and PROCTOR, * District Judge.
*
Honorable R. David Proctor, United States District Judge for the Northern District of
Alabama, sitting by designa
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PROCTOR, District Judge:
In 1966, the modern version of the class action rule was born. See Fed. R.
Civ. P. 23. The new rule was intended to make it easier for parties to litigate
complex lawsuits involving many claimants. Under that new rule, when a
defendant engaged in conduct that violated the rights of others, it could find itself
defending against a single class action involving hundreds or thousands of class
members instead of facing hundreds or thousands of individual suits. That was in
1966. Things have continued to evolve since then. Now, over 50 years later, when
a defendant engages in questionable business practices on a widespread basis, it
may not only face one class action, but several. And, when there are multiple
competing class actions against a defendant, there are usually multiple lawyers
competing to be appointed as class counsel. That is what occurred in this case.
Buccaneers Limited Partnership (“the Buccaneers”) does business as the
Tampa Bay Buccaneers. Well before it signed Tom Brady and Rob Gronkowski to
play in the 2020 football season, it was sued in at least five class action
complaints.1 Each one alleged that the Buccaneers sent telefax advertisements in
violation of the Telephone Consumer Protection Act (“TCPA”). 47 U.S.C. § 227.
1
Cin-Q Autos., Inc. v. Buccaneers Ltd. P’ship, No. 8:13-cv-1592-AEP (M.D. Fla.);
Technology Training Assocs., Inc. v. Buccaneers Ltd. P’ship, No. 8:16-cv-1622-AEP (M.D. Fla.)
(originally filed but dismissed in state court); Accounting To You, Inc. v. Buccaneers Ltd. P’ship,
No. 8:13-cv-2929-AEP (M.D. Fla.); Stein, D.D.S., M.S.D., P.A. v. Buccaneers Ltd. P’ship, No.
8:13-cv-2136-AEP (M.D. Fla.); and Cinque v. Buccaneers Ltd. P’ship, No. 09-CA-21839 (Fla.
Circuit Ct., Hillsborough County).
2
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Two of those class actions are relevant here. In the first, lawyers at the firm of
Anderson & Wanca (“the AW Firm”), who had previously filed suit on behalf of a
different plaintiff, added another class action representative, Medical &
Chiropractic Clinic, Inc. (“M&C”). A mediation was conducted but it was
unsuccessful. Shortly after it concluded, David Oppenheim, an attorney at the AW
Firm who was principally involved in the mediation, jumped ship to join the Bock
Law Firm, LLC (“the Bock Firm”). Within a month of Oppenheim’s departure
from the AW Firm, the Bock Firm filed a separate class action against the
Buccaneers raising the same TCPA claims. And, within two months of filing the
second class action, the Bock Firm reached a proposed settlement with the
Buccaneers.
M&C and its attorneys were not happy. Brian Wanca, a principal at the AW
Firm, encouraged M&C to sue the Bock Firm in state court and allege they had
breached fiduciary duties owed to it as a named class representative. M&C and its
counsel claimed Oppenheim gave attorneys at the Bock Firm confidential
information about settlement negotiations in the AW Firm’s class action, which
assisted the Bock Firm in settling their class action quickly and to the detriment of
the class.
After the case was removed, the parties filed cross-motions for summary
judgment. The district court concluded that Oppenheim and the Bock Firm did not
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violate any fiduciary duty and, in any event, no damages resulted from any such
breach. Therefore, the district court granted summary judgment in favor of
Oppenheim and the Bock Firm. This appeal followed.
M&C and Wanca argue the district court erred in granting summary
judgment. We disagree. In explaining our decision, we are required to address a
unique question: does class counsel owe a duty of loyalty and confidentiality to a
named class representative that is distinct from the duty owed to the putative class?
We conclude, consistent with our precedent, that the duties owed to a class
representative do not differ from the duties owed to a class. We also take this
opportunity to clarify the duties owed by class counsel in class actions generally
and in the context of this case specifically. And, we determine that in filing this
action M&C and Wanca launched an impermissible collateral attack on the Bock
Firm’s attempt to certify and settle a class action. Their assertions should have
been made only before the court that was exercising jurisdiction over the Rule 23
putative class action — the court in which the request to certify a settlement class
and approve the settlement was made.
I. Background
Because, as we have noted above, the fiduciary duty claims in this case are
intertwined with two previously-referenced class actions (and Oppenheim’s
successive employment at the two of the law firms that worked on those actions),
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we begin our discussion with a more fulsome description of those cases and
Oppenheim’s move from the AW Firm to the Bock Firm.
A. The Cin-Q Class Action
In June 2013, Cin-Q Autos, Inc. filed a putative class action against the
Buccaneers for alleged TCPA violations. Cin-Q Autos, Inc. v. Buccaneers Ltd.
P’ship, No. 8:13-cv-1592-AEP (M.D. Fla), (Doc. # 1) (“Cin-Q”). The original Cin-
Q complaint was filed by Michael Addison of the Addison & Howard firm and
Wanca and Ryan Kelly of the AW Firm. M&C was not an original plaintiff in that
class-action complaint but was later joined in the Cin-Q class action as one of
several named class representatives. Like other plaintiffs in Cin-Q, M&C is
primarily represented by the AW Firm.
Although the AW Firm was a major player in litigating the Cin-Q class
action, Oppenheim played a relatively minor role during much of that litigation.
But, that changed after the parties agreed to mediate. Addison and Wanca retained
final authority over whether to accept any settlement offer, but the record indicates
that Oppenheim took over the role of “closer.” 2
2
The record is unclear as to whether Oppenheim took over an increased role when the
parties began mediating or whether his larger role only occurred with regard to the mediation
before Judge Anderson (there were several rounds of mediation). However, the record is more
clear on this point: during the course of those negotiations, Oppenheim never received any
information that was proprietary, unique, or specific to M&C. In fact, Oppenheim’s only
Cin-Q-related communications with M&C occurred at dinner the night before the mediation and
the next day during the mediation.
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Mediating Cin-Q proved difficult because Wanca wanted a larger settlement
than the Buccaneers were willing to pay. Wanca refused to settle for less than a
$99,000,000 “settlement fund” and a $24,750,000 attorney fee (25% of the
settlement fund). 3 When talks stalled, Addison suggested the parties negotiate the
fund in a bracket between $10,000,000 and $50,000,000. Wanca was less than
enthusiastic and responded, “I am NOT going down to $50 million on this case.”
Mediation failed soon thereafter, and the Cin-Q plaintiffs moved for class
certification. That publicly-filed motion included an expert report by Robert
Biggerstaff (“the Biggerstaff Report”), which listed the telephone numbers used by
the Buccaneers in sending the fax advertisements. Cin-Q, No. 8:13-cv-1592-AEP,
(Docs. # 207-5; 207-6).
B. Oppenheim’s Move from the AW Firm to the Bock Firm
A week after the Cin-Q plaintiffs moved for class certification, Phillip Bock
recruited Oppenheim to leave the AW Firm and join the Bock Firm. Bock and
Oppenheim met on April 3, 2016, to work out the details. At that time, they did not
discuss the Cin-Q case or any of the other class actions filed against the
Buccaneers. Four days after meeting with Bock, Oppenheim gave notice to the
3
The TCPA allows recovery of actual monetary loss or statutory damages of $500 per
telefax, whichever is greater. 47 U.S.C. § 227(b)(3)(B). The parties negotiated on the basis of a
virtual “settlement fund” against which class members could make claims, with any unclaimed
monies reverting to Buccaneers. With approximately 343,000 faxes at issue, Buccaneers’ total
estimated potential exposure was $170,000,000. But the parties estimated that the claims rate
would be no more than ten per cent (10%) of the fund.
6
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AW Firm that he had accepted employment with the Bock Firm. When Oppenheim
left the AW Firm, he believed that he and Wanca would continue to work together
amicably on cases jointly handled by the Bock Firm and the AW Firm. 4 As it turns
out, Oppenheim was wrong.
Oppenheim’s departure from the AW Firm was the catalyst that set the stage
for this lawsuit. Before leaving, Oppenheim copied the hard drive on his AW Firm
computer to the computer he planned to use at the Bock Firm. The hard drive
contained briefs, pleadings, and other documents he had worked on at the Bock
Firm along with a year’s worth of his e-mails.
But, most important to this appeal, Wanca complains that within weeks of
beginning at the Bock Firm, Oppenheim shared inside knowledge of the Cin-Q
litigation with Bock. Bock had e-mailed Oppenheim to ask why Wanca had
rejected Judge Anderson’s proposal in another mediation involving the AW Firm
and the Bock Firm. Oppenheim responded that Wanca likely rejected the proposal
because he “doesn’t like how the Tampa Bay Bucs mediation process went and
resents Andersen’s continued efforts [in that case].” Oppenheim later elaborated,
“Yeah. [Wanca] wants to set a record above the Capital One $75 million
4
The Bock Firm and the AW Firm had previously appeared together in dozens of TCPA
class actions. Indeed, before 2009, Wanca and Bock, the two firms’ principals, agreed to
prosecute all of their TCPA class actions jointly. And, although Wanca decided to stop
partnering with the Bock Firm with regard to new cases, the firms planned to remain co-counsel
on previously-filed, pending cases.
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settlement. The magistrate judge it’s in front of is squeamish and is giving the
Defendants a broad shot at disproving [vicarious liability]. Sort of like Sarris.”5 At
the end of this exchange, Bock remarked, “[Buccaneers’ counsel] is a settler.”
Oppenheim replied, “That was Andersen’s read.”
C. The TTA State and Federal Class Actions
Before hiring Oppenheim, the Bock Firm conducted several mail-marketing
campaigns to identify potential plaintiffs for future TCPA class actions. Some of
the recipients of those communications -- including Technology Training
Associates (“TTA”) -- already had expressed interest in pursuing TCPA claims
before Oppenheim moved to the Bock Firm. By cross-referencing those that
responded to their marketing efforts with the names listed on the Biggerstaff
Report, the Bock Firm was prepared to file a TCPA class action against the
Buccaneers to compete with the AW Firm’s efforts in Cin-Q.
About a month after hiring Oppenheim and two weeks after Oppenheim’s
email exchange with Bock, the Bock Firm filed a class action in a Florida state
court against the Buccaneers. Technology Training Assocs., Inc. v. Buccaneers Ltd.
P’ship, No. 16-CA-4333 (Fla. Cir. Ct.) (Doc. 1) (“the TTA state class action”).
5
Oppenheim was apparently referring to a TCPA case in which a district court granted
summary judgment to defendants, in part, because of its determination that plaintiffs failed to
establish liability under an agency theory. See Palm Beach Golf Center-Boca, Inc. v. Sarris, 981
F. Supp. 2d 1239, 1253 (S.D. Fla. 2013). A panel of this court later reversed and remanded. See
Palm Beach Golf Center-Boca, Inc. v. Sarris, 781 F.3d 1245, 1257-58 (11th Cir. 2015).
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Like the Cin-Q class action, the TTA state class action alleged TCPA claims
against the Buccaneers. Although the Bock Firm represented the named plaintiffs
and putative class in the TTA state class action, the firm screened Oppenheim from
any involvement.
Soon after the Bock Firm filed the TTA state class action, the Buccaneers
filed a Notice of Pendency of Related Action in the Cin-Q case, which disclosed
the existence of the TTA state class action to the Cin-Q plaintiffs. The turf war
began. The Cin-Q plaintiffs moved to intervene in the TTA state class action and,
in Cin-Q, filed a Motion to Enjoin Defendant from Proceeding in a Competing
Case. The Bock Firm responded by voluntarily dismissing the TTA state class
action. However, though the Bock Firm dismissed the TTA state class action, the
firm began mediating with the Buccaneers. And, in June 2016, the Bock Firm
reached a proposed settlement with the Buccaneers.6
The Bock Firm refiled this class action complaint in federal court and
immediately sought preliminary approval of the class settlement. Technology
Training Assocs., Inc. v. Buccaneers Ltd. P’ship, No. 8:16-cv-1622-AEP (M.D.
Fla.) (Docs. # 1, 18). M&C and Cin-Q, both plaintiffs in the Cin-Q action, moved
to intervene in the now federal TTA action. The district court denied the motion
6
Under the terms of the settlement agreement, the Buccaneers agreed to create a $19.5
million settlement fund and pay the Bock Law Firm $4,875,000 in attorneys’ fees.
9
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and granted preliminary approval of the class settlement. On interlocutory appeal,
however, this court reversed the district court’s decision on the motion to intervene
before remanding the case for further proceedings. Tech. Training Assocs., Inc. v.
Buccaneers Ltd. P’ship, 874 F.3d 692, 697 (11th Cir. 2017). That decision allowed
M&C and Cin-Q to intervene in the federal TTA case to protect their interests.
D. The Filing of this Case and the Subsequent Conclusion of the TTA
Federal Case
On June 1, 2016, less than two weeks before the Buccaneers filed for
preliminary approval of the settlement in the federal TTA case, M&C filed this
breach of fiduciary duty suit against Oppenheim and the Bock Firm in Florida state
court. M&C alleged that Oppenheim breached the fiduciary duties owed to it as a
named class representative—specifically the duties of loyalty and confidentiality.
The complaint also asserted that the Bock Firm aided and abetted Oppenheim in
the breach. M&C sought money damages, attorney’s fees, and (quite oddly) an
injunction preventing the Bock Firm from representing clients in the TTA action or
reaching a settlement in any matter substantially related to the Cin-Q action. To be
clear, M&C agreed to pursue fiduciary breach litigation, but Wanca promised to
pay all of their fees and expenses in doing so. He did so because he thought the
Bock Firm and Oppenheim had stolen “his” case. The record indicates Wanca and
the AW Firm have spent over $500,000 financing this action.
10
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Oppenheim and the Bock Firm removed the case to the Middle District of
Florida, and the parties filed cross motions for summary judgment. The district
court found (1) that Oppenheim did not owe an individual fiduciary duty to M&C,
(2) that even assuming such a duty existed, M&C failed to show Oppenheim or the
Bock Firm breached that duty, and (3) that, in any event, M&C failed to prove
damages. Consistent with these findings, the district court granted Oppenheim’s
and the Bock Firm’s motion for summary judgment, denied M&C’s motion for
summary judgment, and entered judgment in favor of Oppenheim and the Bock
Firm. M&C appealed.
Soon after filing this appeal, the Cin-Q intervenors (including M&C) in the
federal TTA action filed a renewed motion to decertify the settlement class. TTA,
No. 8:16-cv-01622-AEP, (Doc. # 131). The court in that action granted the motion
and decertified the TTA class under Rule 23(a)(4), after finding that (1) class
counsel in the federal TTA action may have undercut Cin-Q’s counsel’s negotiating
position and (2) unlike the plaintiffs in Cin-Q, the TTA plaintiffs’ claims were
potentially barred by the statute of limitations. Id., (Doc. # 169). Although the
federal TTA action is now decertified, this appeal remains.
II. Standard of Review
We review a district court’s order granting summary judgment de novo.
Jones v. UPS Ground Freight, 683 F.3d 1283, 1291 (11th Cir. 2012). Summary
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judgment is appropriate where “there is no genuine dispute as to any material fact
and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a).
We “tak[e] all of the facts in the record and draw[] all reasonable inferences in the
light most favorable to the non-moving party.” Peppers v. Cobb Cty., 835 F.3d
1289, 1295 (11th Cir. 2016) (citations omitted).
III. Analysis
M&C asserts the district court erred in finding (1) Oppenheim did not owe
an individual fiduciary duty to M&C separate from the duty owed to the class and
(2) M&C failed to prove damages resulting from Oppenheim’s breach. We agree
with the district court on both counts and take this opportunity to clarify class
counsel’s fiduciary obligations in this unique context.
A federal court sitting in diversity jurisdiction applies the substantive law of
the forum state (in this case, Florida) alongside federal procedural law. Global
Quest, LLC v. Horizon Yachts, Inc., 849 F.3d 1022, 1027 (11th Cir. 2017). M&C
claims that Oppenheim violated a fiduciary duty owed to it and that the Bock Firm
aided and abetted that violation. So, we turn to Florida law to evaluate the merits of
those claims. We note that to establish a breach of fiduciary duty under Florida
law, a plaintiff must prove three elements: the existence of a fiduciary duty, a
breach of that duty, and that the plaintiff’s damages were proximately caused by
the breach. Gracey v. Eaker, 837 So.2d 348, 353 (Fla. 2002). Further, to prove
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aiding and abetting a breach of fiduciary duty, a plaintiff must show: “(1) a
fiduciary duty on the part of the primary wrongdoer, (2) a breach of this fiduciary
duty, (3) knowledge of the breach by the alleged aider and abettor, and (4) the
aider and abettor’s substantial assistance or encouragement of the wrongdoing.”
AmeriFirst Bank v. Bomar, 757 F. Supp. 1365, 1380 (S.D. Fla. 1991). We begin by
examining the fiduciary obligations owed by counsel in class action litigation.
A. Duty
The parties all agree that, as putative class counsel, Oppenheim owed
fiduciary duties to the class as a whole. But, that is not the issue we must address.
M&C does not argue (at least in this case) that Oppenheim violated a duty owed to
the class. Rather, M&C and Wanca assert that Oppenheim owed a heightened
fiduciary duty to M&C as a putative class representative. Therefore, in evaluating
this claim, we must first determine whether class counsel owes a fiduciary duty to
class representatives that is distinct from the fiduciary duty owed to the class. We
conclude class counsel does not.
M&C offers a simple syllogism to explain why class counsel owes a
separate and heightened fiduciary duty to class representatives: (1) if all attorney-
client relationships create duties of loyalty and confidentiality and (2) if class
counsel’s representation of class representatives (but of not the rest of the class)
creates an attorney-client relationship, then it follows that (3) class counsel’s
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representation of class representatives creates duties of loyalty and confidentiality
separate from the duties owed to the class. However, this syllogism breaks down
under proper scrutiny.
As support for its assertion that all attorney-client relationships create duties
of loyalty and confidentiality, M&C cites to Florida case law and the Florida Rules
of Professional Conduct (“Florida Rules”).7 See Fla. Bar v. Padgett, 481 So.2d
919, 919 (Fla. 1986) (“Attorneys owe a fiduciary duty to their clients….”); Florida
Rules 4-1.9(c) (stating that a lawyer who has formerly represented a client may not
afterwards “reveal information relating to the representation except as these rules
would permit or require with respect to a client”). Of course, M&C is correct that
Florida courts, interpreting the Florida Rules, have found that attorneys generally
owe duties of confidentiality and loyalty to former clients. See, e.g., Tambourine
Comercio Int’l S.A. v. Solowsky, No. 06-20682-Civ, 2007 WL 689466, at *29 (S.D.
Fla. Mar. 4, 2007) (“Florida courts have recognized that an attorney owes both a
duty of confidentiality and a duty of loyalty to former clients with respect to
matters that are substantially related.”). For example, it is obviously impermissible
for a lawyer to misuse a client’s funds or to represent adverse parties in
substantially related matters. See Fla. Bar v. Bailey, 803 So.2d 683, 694 (Fla.
7
The Preamble to the Florida Rules, however, states: “[The Florida Rules] are not
designed to be a basis for civil liability.” R. Regulating Fla. Bar 4, Preamble.
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2001) (“[Counsel]’s self-dealing constitutes a complete abdication of his duty of
loyalty to his client.”); Estright v. Bay Point Improvement Ass’n, Inc., 921 So.2d
810, 811 (Fla. 1st DCA 2006) (concluding trial court correctly disqualified
petitioners’ attorney because petitioners’ attorney represented adverse parties in
substantially related matters). M&C, however, fails to point to any class action-
specific authority extending duties of loyalty or confidentiality to an attorney’s
representation of a class representative in a class action.8 And this is where M&C’s
syllogism breaks down. M&C relies heavily on rules and decisions from outside
the class action context. But class actions, wherein lawyers represent absent
parties, involve different considerations than cases in which counsel is actually
retained by a client (or multiple clients).
8
M&C cites two district court cases for the proposition that an attorney-client
relationship exists between class counsel and class representatives that is distinct from that
between class counsel and the class. However, we are not persuaded by either decision. First,
neither decision cited by M&C applies the Florida Rules. See In re Katrina Canal Breaches
Consol. Litig., No. 05-4182, 2008 WL 4401970 (E.D. La. Sept. 22, 2008); Morisky v. Pub. Serv.
Elec. & Gas Co., 191 F.R.D. 419 (D. N.J. 2000). Second, both decisions addressed the narrow
issue of whether class counsel could assert privileges with respect to absent class member before
class certification—not the scope of class counsel’s duty to the class versus the named class
representatives. See In re Katrina Canal Breaches Consol. Litig., 2008 WL 4401970, at *2-3
(holding class counsel cannot prevent defendants from contacting absent class members before
class certification); Morisky, 191 F.R.D. at 424 (holding that the attorney-client privilege is
inapplicable to communications with absent class members).
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In Kincade v. General Tire & Rubber Co., 635 F.2d 501 (5th Cir. 1981), the
former Fifth Circuit, in a decision still binding on us,9 dealt with the ethical
quandaries specific to class actions. The Kincade court determined that attorney-
client relationships in class actions are “unique” because (1) “the ‘client’ in a class
action consists of numerous unnamed class members as well as the class
representatives” and (2) “the class itself often speaks in several voices.” Id. at 508(quoting Pettway American Cast Iron Pipe Co., 576 F.2d 1157, 1216 (5th Cir.
1978)). Because of this unique attorney-client relationship, the Kincade court
determined counsel in class actions have different ethical duties to their clients
than in ordinary cases. As an illustration of that difference, the Kincade court
decided that cases “holding that an attorney cannot settle his individual client’s
case without the authorization of the client are simply inapplicable” to class
actions. Kincade, 635 F.2d at 508. What, then, determines the scope of class
counsel’s ethical duties?
One cardinal rule defines the scope of counsel’s ethical obligations in class
actions: class counsel owes a duty to the class as a whole and not to any individual
member of the class. 10 Applying this rule, courts like Kincade have rejected
9
In Bonner v. City of Prichard, 661 F.2d 1206, 1207 (11th Cir. 1981), the en banc
Eleventh Circuit adopted as binding precedent all decisions of the former Fifth Circuit handed
down before October 1, 1981.
10
As one of our sister circuits has recognized, however, defining the outer parameters of
these duties can be difficult. See Zimmer Paper Prod., Inc. v. Berger & Montague, P.C., 758
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attempts by class members to derail settlements beneficial to the class. See
Kincade, 635 F.2d at 508. But, an important corollary stems from this principle:
class counsel does not owe a particular duty to any group comprised of class
members, such as class representatives, distinct from the duty owed to the class.
See Parker v. Anderson, 667 F.2d 1204, 1211 (5th Cir. 1982) (holding the duty of
counsel in the class-action context “is to the entire class and is not dependent on
the special desires of the named plaintiffs”). To hold otherwise would threaten one
of the defining purposes of class actions—the consolidation of claims into one suit
where a class of plaintiffs may speak with one voice. See Pettway, 576 F.2d at
1176 (“The interests of the named plaintiffs and those of other class members may
diverge, and a core requirement for preventing abuse of the class action device is
some means of ensuring that the interests and rights of each class member receive
consideration by the court.”). If courts required class counsel to give special ethical
considerations to class representatives (or any other subset of the class), the
remaining class members would necessarily receive reduced ethical considerations
in comparison. And, in cases where the interests of the class representative diverge
from the interests of class members, class counsel would be required to choose the
interests of some class members over the rest of the class. Such outcomes could
F.2d 86, 91 (3d Cir. 1985) (“The bounds of fiduciary duty are undoubtedly not easy to define.”).
But, this case simply does not involve the outer parameters of the duties owed by class counsel to
the class.
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splinter class actions, lead to costly litigation between class members, and
encourage class members to opt-out.
By deciding that Oppenheim did not owe a heightened duty to M&C
because of its status as a class representative, the district court faithfully followed
the case law adopted by our circuit as set forth in Kincade. Furthermore, the
district court did not err when it rejected M&C’s request that it apply the Florida
Rules to Oppenheim’s behavior. The Florida Rules are intended to instruct
attorneys in the representation of clients outside of the class action context and are
“simply inapplicable” to this case. Kincade, 635 F.2d at 508. The precedent of our
circuit implicitly (if not explicitly) warned the district court not to apply such
ethical rules to class counsel. Pettway, 576 F.2d at 1176 (“Certainly it is
inappropriate to import the traditional understanding of the attorney-client
relationship into the class action context by simply substituting the named
plaintiffs as the client.”).
The absence of a traditional attorney-client relationship between Oppenheim
and M&C, the unique relationship between class counsel and class representatives,
and application of our Kincade precedent all lead us to affirm the district court’s
ruling. However, we are obliged to make one additional observation. M&C’s filing
of this suit in state court against Oppenheim and the Bock Firm strikes us as an
attempt to end run around the TTA court, which was solely responsible for making
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all Rule 23 determinations related to the Bock Firm’s requests to certify a class and
approve a class settlement. Rule 23 makes clear that the district court in which a
class action is filed operates as a gatekeeper. It is that court, and that court alone,
that has the task of deciding a number of Rule 23 questions, including whether to
certify a class, whether to appoint class counsel, and whether to approve a
proposed class settlement.
We are aware that, separate and apart from filing this action, M&C and
Wanca objected to the TTA settlement and attempted to intervene in the TTA
action. 11 And, although the TTA court preliminarily approved the settlement,
ultimately that court reversed course and decertified the class. But, that was not
until well after M&C and Wanca filed this action in state court. We are troubled by
that filing. We have no hesitation in calling it what it was: a thinly-veiled attempt
to derail the TTA settlement. 12 That is clear because of certain aspects of the relief
11
The district court denied the Cin-Q plaintiff’s motion to intervene ruling that the “Cin-
Q plaintiffs may assert [their] objections in the normal course of these proceedings, as
anticipated by Rule 23.” TTA, No. 8:16-cv-01622-AEP (Docs. # 56). It also preliminarily
approved the settlement. A panel of this court reversed the decision to deny the intervention
motion. Tech Training Assocs., Inc. v. Buccaneers Ltd. P’ship, 874 F.3d 692 (11th Cir. 2017).
And after remand, the objections asserted by the AW Firm proved successful as the TTA
settlement failed after the district court granted a motion filed by the AW Firm (on behalf of the
Cin-Q plaintiffs) to decertify the TTA settlement class. TTA, No. 8:16-cv-1622-AEP (Docs. #
131, 169).
12
To the extent that Wanca and the AW Firm protest that they filed this action to protect
the interests of the class and M&C, we firmly remind them that a class’s interests are due to be
protected in a manner consistent with Rule 23—that is, by filing an objection in the federal court
where the class action resides and any class settlement is proposed.
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sought in this action. M&C claimed not only money damages and attorneys’ fees,
but it also requested an injunction preventing the Bock Firm from proceeding as
class counsel in the TTA action or settling that action. So, in filing this suit, M&C
and its counsel asked a state court judge to enjoin putative class counsel in a
separate federal class action. As the saying goes, that won’t work. There is only
one gatekeeper under Rule 23 and it was wholly inappropriate for M&C and its
counsel to go to state court in an attempt to employ another one.
M&C and Wanca may contend that their substantive objections were valid.
After all, once M&C was permitted to intervene, the district court eventually
decertified the class and rejected the settlement. But, that is precisely the point. It is
emphatically the role of the district court to address those matters, for it is the only
forum in which such a challenge should have been launched—certainly not a
different court. So, regardless of the merits of the objections, M&C crossed a line
by attempting to litigate them in another court.
For these reasons, we affirm the district court’s holding that M&C failed to
prove the first element of both of its claims, i.e., that Oppenheim owed a fiduciary
duty to M&C separate from the fiduciary duty he owed to the class.
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B. Damages
In the alternative, the district court determined that M&C failed to show it
suffered damages as a result Oppenheim’s alleged fiduciary breach. We also agree
with that ruling.
M&C argues that it was harmed by Oppenheim’s and the Bock Firm’s
conduct. It contends that, “[b]ut for Oppenheim’s sharing of confidential and
mediation privileged information with [the Bock Firm], [the Bock Firm] would not
have filed the TTA State Court and Federal Actions.” As a result of the Bock Firm
filing the TTA federal action, M&C claims it was injured by having its position as
putative class representative usurped and by being “forced to expend time and
other resources to prevent an improper settlement between [the Bock Firm] and the
Buccaneers resulting from [the Bock Firm] and the Buccaneer’s aligned interests.”
M&C asserts these injuries occurred only because the TTA federal action settled
for an artificially and improperly low amount due to the Bock Firm’s rush to
undercut the AW Firm’s settlement efforts in the Cin-Q action.13
But, M&C’s theory of damages in this case necessarily relies on it proving
that the proposed TTA settlement was to the detriment of the class. As we noted
above, the proper forum to raise that objection was in the federal TTA action. Our
13
This scenario is sometimes referred to as a “reverse auction.” See, e.g., Lipuma v.
American Express Co., 406 F. Supp. 2d 1298, 1305 (S.D. Fla. 2005).
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observations about M&C’s attempt to circumvent the TTA court’s handling of the
class action before it are equally applicable here. Rule 23 provides class members
and objectors like M&C with procedural mechanisms to file these types of
challenges. And, Rule 23 squarely places the responsibility for ruling on such
challenges in the district court that has jurisdiction over the class action claims, not
a state court. Again, in accordance with Rule 23, it is the district court -- and only
the district court -- that is tasked with making determinations about class
certification, class counsel, and class settlements. See Reynolds v. Beneficial Nat.
Bank, 288 F.3d 277, 280 (7th Cir. 2002) (stating that, in the context of approving
or disapproving a class settlement, some courts “have gone so far as to term the
district judge in the settlement phase of a class action suit a fiduciary of the class”).
Neither a lone putative class member, a competing putative class representative
such as M&C,14 nor competing putative class counsel, such as Wanca and the AW
Firm, may circumvent the district court’s Rule 23 role by launching a collateral
attack in another court against class counsel.
For these reasons, any objections to the federal TTA settlement, or any claim
that the TTA settlement somehow injured M&C, should have been raised before the
14
As part of its claim for monetary damages, M&C also sought to recover the loss of its
incentive award in the Cin-Q class action. However, a panel of this court recently concluded that
such service awards are foreclosed by Supreme Court precedent. See Johnson v. NPAS Solutions,
LLC, 975 F.3d 1244, 1260 (11th Cir. 2020) (en banc petition pending).
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court in the federal TTA case in accordance with Rule 23. The district court did not
permit M&C to circumvent the TTA judicial officer and the text of Rule 23. We
will not either.
We find no error in the district court’s determination that M&C failed to
establish that it was damaged by any alleged breach of a fiduciary duty owed to it
by Oppenheim.
IV. Conclusion
For all these reasons, we affirm the district court’s grant of summary
judgment in favor of Oppenheim and Bock Law Firm.
AFFIRMED.
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