U.S. Supreme Court to tackle issue of no-harm class actions

On November 28, 2011, the U.S. Supreme Court will hear argument in First American Financial Corporation, et al. v. Edwards, U.S. Supreme Court Docket No. 10-708, October 2011, on appeal from Edwards v. First American Corporation, 610 F.3d 514 (9th Cir. 2010). The Court’s decision in this case is significant in that it has the potential to curtail the recent rise of no-harm class actions.

The Court will review the Ninth Circuit’s decision finding that a plaintiff had standing to sue under the anti-kickback provision of the Real Estate Settlement Procedures Act (RESPA), 12 U.S.C. § 2607, even though she did not allege she was overcharged for title settlement services relative to her Ohio home purchase, or that the quality of her insurance policy was diminished or impaired. Indeed, no one in Edwards’ putative Ohio class could allege they were overcharged because the applicable fees are fixed by statute in Ohio. See also Edwards v. First Am. Corp., 385 Fed. Appx. 629, 631 (9th Cir. 2010) (companion case finding that the U.S. District Court for the Central District of California abused its discretion in denying certification of the Ohio class).

Federal Class Action Law, Standing, U.S. Supreme Court