Key Takeaways
A non-responsive lead plaintiff should raise immediate red flags for defense attorneys and prompt a strategic reassessment. This may indicate serious issues with class representation under Rule 23, providing defendants an opportunity to challenge class certification or seek dismissal.
In an antitrust class action lawsuit pending in the Western District of Washington, U.S. District Judge Kymberly K. Evanson recently sanctioned former lead plaintiff's counsel, Hagens Berman Sobol Shapiro LLP, for failing to accurately disclose that the lead plaintiff, Steven Floyd, no longer wished to pursue the action. Floyd v. Amazon.com, Inc., No. 2:22-CV-01599-KKE, 2025 WL 1447792, at *1 (W.D. Wash. May 20, 2025). The judge ordered Hagens Berman to pay $223,000 in attorney fees to defendants for concealing their client's decision to abandon the litigation.
Floyd was named as the lone plaintiff when the putative class action was filed in 2022. The complaint alleges that defendants stifled competition through a 2018 agreement that limited third-party resellers on one of the defendant's online marketplace. Among other defenses, the companies maintain that their "global tenets agreement" ensures consumers are protected from counterfeit products.
Last month, following a flurry of motion practice, Judge Evanson dismissed Floyd from the litigation. Defendants had actively and repeatedly made timely requests for discovery and served requests for production and interrogatories, which had gone unanswered. The court found that Floyd's counsel had prolonged the case by suggesting he might return to the suit despite a lengthy disappearance. In addition, the court determined that Floyd had clearly signaled his intent to exit as early as January 2024. Defendants then sought reimbursement for fees incurred pursuing a motion to compel and a motion for discovery sanctions, which the judge granted.
The court's sanctions order could also impact defendants' pending motion to reconsider the court's prior decision allowing two new plaintiffs to join the case. According to the defendants, Floyd's withdrawal had already undermined the initial basis for the amendment. They contend that keeping secret Floyd's intent to drop out amounts to a "back-door attempt to begin the action anew" and that new plaintiffs cannot simply be substituted without first disclosing that there was no active complaint once Floyd was no longer a willing participant in the litigation. Floyd v. Amazon.com, Inc., No. C22-1599-KKE, 2024 WL 1998315, at *2 (W.D. Wash. May 6, 2024).
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