United States: Supreme Court Hears Arguments In Microsoft v. Baker To Address When A Named Plaintiff Can Appeal The Denial Of Class Certification

Earlier today, the Supreme Court heard oral argument (pdf) in Microsoft Corp. v. Baker, a case that raises complicated questions about federal appellate jurisdiction and Article III standing, but ultimately involves an important practical question in class action litigation: Can a named plaintiff engineer a right to an immediate appeal of the denial of class certification by voluntarily dismissing his or her claims with prejudice and appealing from the resulting judgment?

From the argument, it was clear that a number of Justices believe that the answer should be "no." As Justice Ginsburg pointed out several times, the committee charged with amending the Federal Rules of Civil Procedure crafted Rule 23(f) to give courts discretion to decide whether to allow immediate appeals of orders granting or denying class certification. But plaintiffs maintain that they should be free to challenge the denial of certification immediately by appealing from what their counsel described as a "manufactured final judgment." In other words, as Justice Ginsburg put it, "any time ... that a class action is brought against a corporation, [Rule] 23(f) is out the window."

As discussed below, there are many ways in which the Court could decide the issue. That said, businesses should be cautiously optimistic that the Court will reverse the Ninth Circuit and thus reject a dysfunctional regime in which class-action plaintiffs can appeal the denial of class certification while defendants remain able to appeal orders granting class certification only by grace.


As most lawyers who litigate class actions know, the decision whether to certify a class is often the make-or-break decision in a class-action lawsuit. If a district court certifies a class—whether correctly or not—a defendant is far more likely to settle on a class-wide basis to avoid the risks of a potentially massive verdict at trial (whether the claims have merit or not). Conversely, if a district court denies class certification (whether rightly or wrongly), a named plaintiff in a class action must decide whether to pursue his or her individual claim in order to obtain a final judgment on the merits and appeal the denial of class certification or instead either abandon the claim or (more typically) accept an individual settlement, bringing the case to a close.

Given these stakes, it's unsurprising that both plaintiffs and defendants would prefer an unfettered right to immediately appeal an adverse decision concerning class certification. But nearly 40 years ago, the Supreme Court held in Coopers & Lybrand v. Livesay that orders granting or denying class certification are not "final" orders within the meaning of 28 USC § 1291, the statute that gives the federal courts of appeals jurisdiction over "appeals from all final decisions of the district courts[.]"

In response, Rule 23 was amended in 1998 to add Rule 23(f), which authorizes courts of appeals to allow permissive immediate appeals of orders granting or denying class certification. The courts of appeals have sole discretion whether to hear such appeals, and the different circuits exercise this discretion with varying degrees of enthusiasm. But it is clear that Rule 23(f) does not, by its terms or in practice, permit automatic interlocutory appeals of orders granting or denying class certification.

Defendants are largely stuck with this state of affairs; if a class is certified and their attempt to appeal under Rule 23(f) fails, they must either face a class-wide trial or settle the case. But plaintiffs' counsel have developed a tactic for securing immediate appeals that the Ninth Circuit has countenanced. Specifically, if a district court denies class certification, and the plaintiff's Rule 23(f) appeal fails, the plaintiff then seeks a voluntary dismissal with prejudice—ordinarily viewed as surrendering in full—then files an appeal aimed at challenging the order denying class certification, contending that the dismissal amounted to a "final" judgment within the meaning of Section 1291. In the process, the plaintiff leapfrogs over a trial on the merits of his or her own claims.

In practical terms, then, the plaintiff has executed an end-run around Rule 23(f). Is that permissible? Today's arguments in Microsoft Corp. v. Baker may answer that question. The issue presented in Baker, as formulated by the Court, is: "Whether a federal court of appeals has jurisdiction under both Article III and 28 U.S.C. § 1291 to review an order denying class certification after the named plaintiffs voluntarily dismiss their claims with prejudice."

Procedural history

Baker involves the latest in a set of putative class actions about Microsoft's popular Xbox 360 video game console. In these cases, the plaintiffs contended that the Xbox 360 was designed in a manner that causes game discs to be scratched due to vibrations, in breach of both express and implied warranties. In the first round of cases, the district court denied class certification, the Ninth Circuit rejected a 23(f) appeal, and the individual cases were resolved individually. Subsequently, the plaintiffs in Baker, represented by the same plaintiffs' counsel, filed a new suit. Microsoft won a motion to strike the class allegations, and the Ninth Circuit denied plaintiffs' Rule 23(f) petition to appeal. This time, the plaintiffs dismissed their claims "with prejudice" with the goal of generating a seemingly "final" judgment that they could appeal to the Ninth Circuit as of right.

The Ninth Circuit approved this tactic and, in analyzing class certification, reversed the district court's decision, remanding the case for further consideration of the parties' class certification arguments.

The Supreme Court granted certiorari in early 2016, and (after the passing of Justice Scalia) announced that it would defer oral arguments until the following Term.

Discussion of oral argument

The theme I took away from today's oral arguments was that many Justices seemed concerned with the use of a tactic that respondents' own counsel characterized as a "manufactured final judgment."

As noted above, Justice Ginsburg pointed to Rule 23(f) repeatedly, stating, for example:

Let me ask you, because you mentioned Rule 23. The rule makers went through a lot of work to figure out what to do with an interlocutory ruling on class action status. And [they] came up with 23(f). And this device seems to be just a way to get around 23(f)."

She went on to say: "If the rule makers wanted to have these class action decisions go up on appeal as of right, they could have made it, or asked Congress to make it, one of the interlocutory orders that is immediately appealable, like a preliminary injunction. Along similar lines, Justice Breyer suggested that "looking to try to simplify procedure, we [could] say ... people in your position [should] [a]sk the [c]ourt of appeals for permission under [Rule 23(f)]. Now, sometimes they'll wrongfully deny it. Well, if they wrongly deny it, here's what you do. Go litigate your case and lose, or give up"—for example, by accepting an adverse summary judgment on the merits—"and then appeal that final judgment for [defendants]."

Asked to identify his best case, counsel for respondents pointed to United States v. Procter & Gamble Co., in which the Government—the plaintiff in an antitrust case—had been ordered to produce a grand jury transcript in discovery. As Justice Kennedy pointed out, "the Court was very careful to say when the government proposed dismissal for failure to obey [the order to turn over the transcript], it had lost on the merits." He followed up telling respondents' counsel: "That is not your case"—presumably because denial of class certification is not the same thing as losing on the merits.

The issue of Article III standing received comparatively little express discussionThe Chief Justice seemed the most interested in the issue, telling respondents' counsel: "The reversal that you're looking for does not go to the merits of the judgment that you voluntarily agreed to have entered against you. ... [T]hat's what raises the Article III question. Nothing that you're arguing on appeal is going to change the fact that you lose. .... [Y]ou told the district court to enter a judgment against you, so you can't argue that it shouldn't have done that."

To be sure, both sides received hard questions. Justice Breyer posited a hypothetical circumstance where the named plaintiff had only a claim for "10 cents"; if class certification were denied, Justice Breyer asked, "what is the plaintiff supposed to do?" Would the plaintiff's counsel proceed to trial on "a claim that's only going to be worth 10 cents, because, of that, he's most likely to get no more than two cents for the lawyer himself"? And the Chief Justice noted that, in light of litigation costs, even a claim for $10,000 might not motivate a plaintiff who lost class certification to proceed to trial. In response, Microsoft's counsel pointed out that (1) in fact, named plaintiffs often do proceed ahead with their individual claims when class certification has been denied; (2) the state-law claims at issue come with fee-shifting provisions that would provide attorneys' fees for a prevailing individual plaintiff; and (3) "if the plaintiffs believe in their case, ... there's every reason to go ahead"—presumably because after prevailing on the merits at trial, they could pursue a reversal of the order denying class certification.

Final thoughts

There is a legitimate policy debate over whether the approach taken by Rule 23(f)—authorizing only permissive interlocutory appeals of orders granting or denying class certification—is preferable to allowing either party aggrieved by a class certification order to have an automatic right to an immediate appeal (the proposed approach in the class action reform bill (pdf) recently passed by the House of Representatives.) But an approach to appellate jurisdiction that gives only one side (plaintiffs and their counsel) the ability to secure an immediate appeal at will would unfairly increase the already outsized leverage that plaintiffs have in class-action litigation.

Originally published March 21, 2017

Visit us at mayerbrown.com

Mayer Brown is a global legal services provider comprising legal practices that are separate entities (the "Mayer Brown Practices"). The Mayer Brown Practices are: Mayer Brown LLP and Mayer Brown Europe – Brussels LLP, both limited liability partnerships established in Illinois USA; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales (authorized and regulated by the Solicitors Regulation Authority and registered in England and Wales number OC 303359); Mayer Brown, a SELAS established in France; Mayer Brown JSM, a Hong Kong partnership and its associated entities in Asia; and Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. "Mayer Brown" and the Mayer Brown logo are the trademarks of the Mayer Brown Practices in their respective jurisdictions.

© Copyright 2017. The Mayer Brown Practices. All rights reserved.

This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.