HIGGINSON, Circuit Judge:
Plaintiffs-Appellants, the Funeral Consumers Alliance, Inc. ("FCA") and eleven
For the following reasons, we reverse and remand the dismissal of Plaintiff-Appellants' § 4 claims for lack of subject matter jurisdiction, affirm the dismissal of Consumer Appellants' and FCA's action for injunctive relief for lack of subject matter jurisdiction, and affirm the denial of class certification.
FCA is a non-profit consumer rights organization devoted to advocating consumers' right to choose a meaningful, dignified, and affordable funeral that claims 400,000 individuals as members of its national organization or its local affiliates. Consumer Appellants are eleven individuals who each purchased a Batesville casket from SCI, Alderwoods, or Stewart. No ICD is a party to this matter.
On November 24, 2008, Magistrate Judge Calvin Botley recommended that the Plaintiffs' Motion for Class Certification be denied in a 30-page Memorandum and Recommendation ("M&R"). On December 29, 2008, Plaintiffs filed objections to the M&R, attaching two additional expert reports from Dr. Gregory Vistnes.
On March 26, 2009, United States District Judge Kenneth Hoyt adopted the M&R denying class certification.
Following the denial of class certification, Plaintiffs settled their claims against Stewart on June 15, 2010 (the "Stewart settlement"). In response, Defendants filed an expedited motion to strike Plaintiffs' jury demand, which was denied by Judge Hoyt on July 13, 2010. Two days later, Plaintiffs filed an expedited motion to dismiss for lack of subject matter jurisdiction. After briefing and oral argument on August 2, 2010, the district court granted Plaintiffs' motion on September 27, 2010. The district court determined that because of the settlement with Stewart, Plaintiffs had lost standing to continue to sue the remaining Defendants.
When reviewing a dismissal for lack of subject matter jurisdiction, we review factual findings for clear error and legal conclusions de novo. Krim v. pcOrder.com, Inc., 402 F.3d 489, 494 (5th Cir. 2005).
Article III standing requires: (1) that Appellants have suffered an injury-in-fact; (2) a causal connection between the injury-in-fact and Appellees' conduct; and (3) that it is likely, not merely speculative, that a favorable decision will redress the injury-in-fact. James v. City of Dallas, 254 F.3d 551, 563 (5th Cir.2001) (internal citations omitted).
The record is clear that Appellants are not seeking compensatory damages beyond those agreed to in the Stewart settlement. Appellants argue, nonetheless, that the Stewart settlement did not cover the attorneys' fees and costs available to them under § 4 of the Clayton Act in this ongoing suit against multiple Defendants other than Stewart. Appellants seek to proceed with this cause of action to prove that the remaining Defendants, Appellees herein, violated federal antitrust laws triggering Appellants' statutory right to attorneys' fees and costs whether or not the Consumer Appellants seek further compensatory damages. The district court held that Appellants did not have standing to recover such attorneys' fees and costs because:
Under our precedent, however, Consumer Appellants have standing to resolve § 4 antitrust claims to decide entitlement to attorneys' fees and costs even if a settlement with one defendant means that no additional compensatory damages will be assessed.
The Clayton Act provides any successful plaintiff a mandatory award of costs and attorneys' fees. 15 U.S.C. § 15(a). Section 4 of the Clayton Act states that, "any person who shall be injured in his business or property by reason of anything forbidden in the antitrust laws may sue therefor... and shall recover threefold the damages by him sustained, and the cost of suit, including a reasonable attorney's fee." Id.
The plaintiffs have a right under § 4 to sue for the statutorily mandated costs and reasonable attorneys' fees even if a settlement with one defendant means that no additional compensatory damages actually will be recovered. The plaintiffs' right to recover attorneys' fees from the defendants depends on whether the plaintiffs can succeed in "demonstrating that the defendant[s] violated the antitrust laws and can establish the fact of damage." Sciambra v. Graham News (Sciambra II), 892 F.2d 411, 415 (5th Cir.1990). The plaintiffs' settlement with one defendant does not prevent them from recovering costs and attorneys' fees to which they may be entitled from the remaining defendants because, by entering into a settlement agreement, "a party releases only those other parties whom he intends to
We addressed whether actual recovery of compensatory damages is required for a plaintiff to recover attorneys' fees and costs in Sciambra II, 892 F.2d at 413-14.
ARA claimed that Sciambra could not be awarded attorneys' fees and costs when an earlier settlement offset all compensatory damages. Id. at 413-14. We rejected that argument, writing that, "if a plaintiff can prove an antitrust violation and the fact of damage, the plaintiff is entitled to recover attorneys' fees pursuant to section 4." Id. at 415. "Our holding merely recognizes that the structure of section 4 and the fact of damage analysis make the actual recovery of compensatory damages irrelevant to the recoverability of attorneys' fees." Id.
Appellees argue that our holding in Sciambra II does not apply to the present case because it is factually distinguishable. The default judgment against Graham News established the existence of an antitrust violation and the fact of damage before the district court determined that the Graham settlement precluded a compensatory damage award. Id. Appellees point to a sentence of ours in Sciambra II to support their contention that this factual discrepancy distinguishes Sciambra II from the present case:
Id. at 416-17. To be sure, unlike Sciambra II, antitrust liability has never been ascertained in this case. The Stewart settlement explicitly stated that no liability was being admitted by Stewart, and no liability determination was made by the district court. The settlement and subsequent stipulated dismissal of plaintiffs' claims against Stewart with prejudice precludes a liability finding, and hence, any further recovery from Stewart. However, as to the remaining Defendants, Appellees herein, Sciambra II's logic applies for the narrow, but decisive, reason that no clear amount or allocation of attorneys' fees and costs was assessed.
Again, our reasoning in Sciambra II validated Congress's imperative in § 4 for mandatory attorneys' fees and costs. These attorneys' fees and costs are mandatory, Congress decided, in order to encourage individuals to bring suits to enforce the antitrust laws and to discourage potential defendants from violating antitrust laws. Cargill, Inc. v. Monfort of Colo., Inc., 479 U.S. 104, 129 & n. 6, 107 S.Ct. 484, 93 L.Ed.2d 427 (1986) (citing Zenith Radio Corp. v. Hazeltine Research, Inc., 395 U.S. 100, 130-31, 89 S.Ct. 1562, 23 L.Ed.2d 129 (1969)); Pfizer, Inc. v. Gov't of India, 434 U.S. 308, 314, 98 S.Ct. 584, 54 L.Ed.2d 563 (1978); see also Sciambra II, 892 F.2d at 416. We explained in Sciambra II that, "[b]ecause of the importance of the policy of encouraging private parties to
The Third Circuit, in addition to highlighting the statutory priority of encouraging private parties to settle, pointed out that, "[a]lthough in almost all cases an award of compensatory damages will accompany an award of Section 4 attorneys' fees, the latter is not dependent upon the former.... Any other holding would not only deter the private prosecution of antitrust violations, which is a critical element in the antitrust enforcement scheme and the primary reason attorneys' fees are mandatory under the statute, but could also deter plaintiffs from early settlements with some defendants." Gulfstream I, 995 F.2d at 419; see also id. ("hold[ing] that the district court did not err in awarding [plaintiffs] attorneys' fees even though the trebled verdict was entirely offset by the prior settlements").
Appellees cite Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1998), Lewis v. Cont'l Bank Corp., 494 U.S. 472, 110 S.Ct. 1249, 108 L.Ed.2d 400 (1990), and Vermont Agency of Natural Res. v. United States, 529 U.S. 765, 120 S.Ct. 1858, 146 L.Ed.2d 836 (2000). The Supreme Court, in that line of cases, however, clarified the well-settled proposition that plaintiffs cannot sue merely for the "byproducts" of litigation, but neither the Supreme Court, nor courts applying that case law, have extended "byproducts" reasoning to include, indeed preclude, Congressionally mandatory attorneys' fees and costs.
In Steel Co., Citizens for a Better Environment sued Steel Company under the Emergency Planning and Community Right-to-Know Act of 1986 (EPCRA) for failure to file reports as required under EPCRA. 523 U.S. at 86-88, 118 S.Ct. 1003. Under the EPCRA, any damages from an EPCRA violation are awarded to the United States Treasury, not the party bringing suit. Id. at 106-07, 118 S.Ct. 1003. The statute made it permissible, but not mandatory, for the district court to award "the prevailing or substantially prevailing party" the costs of litigation in a final order. Id. at 107 n. 8, 118 S.Ct. 1003. The Supreme Court determined that the plaintiff did not have standing because the plaintiff was not seeking any relief that would remedy the injury it suffered. Id. at 107-10, 118 S.Ct. 1003. The Court explained that since Citizens for a Better Environment was not eligible for any relief under the EPCRA, they could not bring a suit merely to obtain discretionary attorneys' fees and costs. In contrast, Appellants are eligible for mandatory fees and costs under the Clayton Act if their antitrust claims are proven valid. Again, under § 4 of the Clayton Act, attorneys' fees and costs are not left to the discretion of the judge. They are part of a tripartite award Congress has mandated for plaintiffs to encourage private enforcement of antitrust actions. Attorneys' fees and costs are awarded even if an otherwise successful plaintiff is awarded no compensatory damages by the jury. Ducote Jax Holdings LLC v. Bradley, 335 Fed.Appx. 392, 402 (5th Cir.2009) (unpublished) (citing Sciambra II, 892 F.2d at 414-16). The award is mandatory and not limited to merely litigation costs.
In Lewis, the plaintiff secured an injunction and declaration that a Florida banking law violated the Commerce Clause and then brought a separate statutory claim for attorneys' fees under 42 U.S.C. § 1988, contending that it had prevailed on its 42 U.S.C. § 1983 claim because the state's prior enforcement of the law deprived the plaintiff of its constitutional rights. 494 U.S. at 474-76, 110 S.Ct. 1249. Section 1988 allows courts, again, in their discretion, to grant parties who prevail on certain federal claims to obtain attorneys' fees as part of their costs. The Supreme Court held that the plaintiff was no longer a "prevailing party" and, thus, no longer entitled to attorneys' fees because the underlying § 1983 claim became moot on appeal.
Finally, in Vermont Agency, the defendant challenged the standing of a qui tam relator to bring suit. 529 U.S. at 771-72, 120 S.Ct. 1858. The Supreme Court held that, "[a]n interest unrelated to injury in fact is insufficient to give a plaintiff standing. The interest must consist of obtaining compensation for, or preventing, the violation of a legally protected right." Id. at 772-73, 120 S.Ct. 1858 (internal citations omitted). The qui tam relator had not suffered an invasion of any right; he was suing on behalf of the United States for a violation of one of its rights. Id. at 773, 120 S.Ct. 1858. As a result, he was suing for a mere "byproduct" of the suit that would not materialize until the relator prevailed at the end of litigation. Id. In the present case, Appellants have alleged that they directly have suffered an invasion of their right to be free from violations of federal antitrust laws. The interest at issue (mandatory attorneys' fees and costs) is related to this injury-in-fact because the plain language and undisputed purpose of the mandatory attorneys' fees and costs provision (to discourage potential defendants from violating antitrust laws) helps prevent the violation of the legally protected right (the violation of federal antitrust laws). Sciambra II, 892 F.2d at 416.
To have standing to sue for injunctive relief, a party must: (1) have suffered an injury-in-fact; (2) establish a causal connection between the injury-in-fact and a complained-against defendant's conduct; (3) show that it is likely, not merely speculative, that a favorable decision will redress the injury-in-fact; and (4) "demonstrate either continuing harm or a real and immediate threat of repeated injury in the future." James, 254 F.3d at 563 (internal citations omitted); Soc'y of Separationists, Inc. v. Herman, 959 F.2d 1283, 1285 (5th Cir.1992); see also City of Los Angeles v. Lyons, 461 U.S. 95, 111, 103 S.Ct. 1660, 75 L.Ed.2d 675 (1983). The threat of injury must be "concrete and particularized; the threat must be actual and imminent, not conjectural or hypothetical...." Summers v. Earth Island Inst., 555 U.S. 488, 493, 129 S.Ct. 1142, 173 L.Ed.2d 1 (2009) (internal citations omitted).
The district court determined Consumer Appellants did not have standing to sue for injunctive relief because they could not "establish an irreparable injury or a future threat." Specifically, the district court concluded that (1) any harm would be reparable by a monetary award, like the Stewart settlement, and (2) based on the particular allegations here, the chance of one of the Consumer Appellants purchasing another Batesville casket or his or her family purchasing a Batesville casket upon the Consumer Appellant's death did not create a "`real' immediate" or potential future injury.
Consumer Appellants did not establish that there was a real and immediate threat that any of the eleven remaining Consumer Appellants will purchase an allegedly overpriced Batesville casket from a SCI or Alderwoods funeral home.
The fact that death is inevitable is not sufficient to establish a real and immediate threat of future harm.
It is well-established law that an association has Article III standing to bring a suit on behalf of its members when "(a) its members would otherwise have standing to sue in their own right; (b) the interests it seeks to protect are germane to the organization's purpose; and (c) neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit." Hunt v. Wash. State Apple Adver. Comm'n, 432 U.S. 333, 343, 97 S.Ct. 2434, 53 L.Ed.2d 383 (1977). The Supreme Court has held that in order to satisfy the first prong of the Hunt test, "an organization suing as representative [must] include at least one member with standing to present, in his or
Appellants alleged in their first amended consolidated class action complaint only that, "FCA's members include consumers that have purchased, or in the future will likely purchase, caskets from funeral homes owned and operated by Stewart, Alderwoods, and SCI." Because Appellants do not allege that there was a real and immediate threat that any of FCA's members will purchase an allegedly overpriced Batesville casket from a SCI or Alderwoods funeral home, FCA lacks injunctive standing on behalf of its members.
We review a denial of class certification for abuse of discretion and
The requirements for certifying a class action are set forth in Fed.R.Civ.P. 23. "To obtain class certification, parties must satisfy Rule 23(a)'s four threshold requirements, as well as the requirements of Rule 23(b)(1), (2), or (3)." Maldonado v. Ochsner Clinic Foun., 493 F.3d 521, 523 (5th Cir.2007).
Appellants contest the district court's findings that they failed to meet Rule 23(a)(3)'s typicality threshold requirement and Rule 23(b)(3)'s predominance and superiority requirements.
To determine whether class certification is appropriate, courts "must conduct intense factual investigation." Robinson v. Texas Auto. Dealers Ass'n, 387 F.3d 416, 420 (5th Cir.2004). Notably, "there are no hard and fast rules ... regarding the suitability of a particular type of antitrust case for class action treatment." Id. at 420-21 (quoting Bell Atl. Corp. v. AT&T Corp., 339 F.3d 294, 301 (5th Cir.2003)). Rather, "[t]he unique facts of each case will generally be the determining factor governing certification." Id. "The party seeking class certification bears the burden of demonstrating that the requirements of rule 23 have been met." O'Sullivan v. Countrywide Home Loans, Inc., 319 F.3d 732, 737-38 (5th Cir.2003) (citing Allison v. Citgo Petroleum Corp., 151 F.3d 402, 408 (5th Cir. 1998)).
"A district court must rigorously analyze Rule 23's prerequisites before certifying a class." Spence v. Glock, Ges. m.b.H., 227 F.3d 308, 310 (5th Cir.2000) (internal citation omitted). This requires an understanding of "the relevant claims, defenses, facts, and substantive law presented
Appellants contend the district court's Rule 23 analysis inappropriately assessed likelihood of success on the merits. We find, however, that the district court's merits inquiries were appropriate for Rule 23 analysis.
"[C]lass determination generally involves considerations that are enmeshed in the factual and legal issues comprising the plaintiff's cause of action." General Telephone Co. of Southwest v. Falcon, 457 U.S. 147, 160, 102 S.Ct. 2364, 72 L.Ed.2d 740 (1982) (internal quotation marks and citations omitted); Oscar Private Equity Invs. v. Allegiance Telecom, Inc., 487 F.3d 261, 268 (5th Cir.2007), abrogated on other grounds by Erica P. John Fund, Inc. v. Halliburton Co. (Halliburton), ___ U.S. ___, 131 S.Ct. 2179, 180 L.Ed.2d 24 (2011) (holding that a district court "must give full and independent weight to each Rule 23 requirement, regardless of whether that requirement overlaps with the merits."). Ultimately, the court must consider "how a trial on the merits would be conducted if a class were certified." Bell Atl., 339 F.3d at 302 (internal citations omitted). When there are disputed facts relevant to Rule 23 requirements, overlap with the merits "should not be talismanically invoked to artificially limit a trial court's examination of the factors necessary to a reasoned determination of whether a plaintiff has met her burden of establishing each of the Rule 23 class action requirements." Castano, 84 F.3d at 744 n. 17 (quoting Love v. Turlington, 733 F.2d 1562, 1564 (11th Cir. 1984)).
Appellants contend that the Supreme Court's June 6, 2011 decision in Halliburton, 131 S.Ct. 2179, precludes district courts from rendering merits-based conclusions at the class stage. We disagree. In Halliburton, the Supreme Court does not state that merits inquiries or conclusions cannot occur, or must be ignored, in the fact-intensive Rule 23 analysis. Instead, the Supreme Court's holding was specific to the securities fraud context in Halliburton. 131 S.Ct. at 2183 (holding that we erred by requiring securities fraud plaintiffs to prove loss causation in order to obtain class certification).
At the same time that Appellants argue that the district court's Rule 23 analysis too rigorously assessed merits issues, they separately contend that the district court's Rule 23 analysis was not rigorous enough
First, Dr. Vistnes' reports were included as Exhibits 1 and 2 to Plaintiffs' Objections to Judge Botley's Memorandum and Recommendation Denying Class Certification and were filed on December 29, 2008, after the magistrate judge's M&R was filed on November 24, 2008, but well before the district court's March 26, 2009 Order Denying Class Certification. The district court's Order Denying Class Certification states, "[t]he Court has reviewed the plaintiff's objections...." The district court had almost three months to do so, and we find no reason to assume this review did not include the exhibits containing Dr. Vistnes' reports that were filed with Plaintiffs' objections.
Second, on close analysis, Appellants' speculation that Dr. Vistnes' opinions were "ignored" is not supported. A review of the portions of Dr. Vistnes' December 29, 2008 reports cited by Appellants in their briefs and in their objections to the M&R reveals that cited portions of the reports contain little new quantitative analysis and restate facts already covered by Appellants and their expert, Mr. Romaine.
Third, Appellants' contention that the district court erred by not reviewing the evidence and issues de novo is unsupported. It is only required that, "`[a] judge of the court shall make a de novo determination of those portions of the [magistrate's] report or specified proposed findings or recommendations to which objection is made.'" Hernandez v. Estelle, 711 F.2d 619, 620 (5th Cir.1983) (quoting 28 U.S.C. § 636(b)(1)).
Rule 23(b)(3) requires a party seeking class certification to "demonstrate
In the 30-page M&R adopted by the district court, the magistrate judge correctly began the predominance and superiority analysis by laying out the elements of Appellants' claims and what must be shown to prove antitrust liability in a class action context. The magistrate judge continued his Rule 23(b)(3) analysis by finding that Appellants failed to present class-wide proof of the various elements of their private antitrust claims. Ultimately, the magistrate judge concluded that individualized issues affecting each of the roughly one million purported class members nationwide would predominate over common ones, given the lack of a national market or a nationwide conspiracy.
Appellants contend that they should not have been required to prove national market or nationwide conspiracy at the class certification stage because these are not required elements of their antitrust claims. Recovery under § 4 of the Clayton Act, however, requires proof of antitrust impact, which in turn requires proof of the relevant market. Ala. v. Blue Bird Body Co., Inc., 573 F.2d 309, 328 (5th Cir.1978) ("we do not understand how the plaintiffs can make this proof [of anti-trust impact] without examining the relevant school bus market where each individual plaintiff is located"); see Heerwagen v. Clear Channel Comms., 435 F.3d 219, 229 (2d Cir.2006) (holding that "a plaintiff claiming monopolization is obligated to establish the relevant market because the power to control prices or exclude competition only makes sense with reference to a particular market"); Republic Tobacco Co. v. N. Atl. Trading Co., Inc., 381 F.3d 717, 737 (7th Cir.2004) (holding that "[e]conomic analysis [in anti-trust context] is virtually meaningless if it is entirely unmoored from at least a rough definition of a product and geographic market"). Because Appellants brought this case as a nationwide class action, the recovery they seek under § 4 of the Clayton Act requires that they show the relevant geographic market is national (i.e., that it corresponds with the geographic scope of the proposed class). See Heerwagen, 435 F.3d at 229, 235 (affirming denial of certification of national antitrust plaintiff class in part because relevant markets were local and therefore proof specific to individual class members in different geographic markets would predominate). Defining the relevant market is also an element of Appellants' § 1 Sherman Act claim. Wampler v. Sw. Bell Tel. Co., 597 F.3d 741, 744 (5th Cir.2010). Finally, Appellants' nationwide conspiracy claim must be proven with common, class-wide evidence for the Rule 23(b)(3) predominance requirement to be satisfied. Blue Bird, 573 F.2d at 321 (reversing the district court's grant of class certification because the court was "presently unable to agree" with the district court's conclusion that "proof of national
The factual determinations pertaining to national market and national conspiracy, detailed in the extensive M&R, were necessary for the district court to decide whether to certify a class for Appellants' antitrust claims. The M&R analysis applied our well-settled approach set forth in Blue Bird, where the district court's certification of a national class was in fact reversed because "neither the products involved nor the purchasers appear to be standardized." 573 F.2d at 322. In Blue Bird, while recognizing that antitrust price-fixing cases are particularly suitable for class action treatment, we determined that plaintiffs failed to prove that common issues of law or fact predominated over individual issues because the proposed national class included different sizes of buyers operating under different conditions in various regions throughout the United States and the products involved, school bus bodies, were marketed under different arrangements at different times. Id. at 321-23.
Following our analysis in Blue Bird, the M&R here noted that caskets may be sold separately or as part of a bundled package; buyers may purchase caskets either on a "pre-need" basis (before death) or "at-need" basis; consumer casket preferences vary by region, religion, ethnicity, age, and community tradition; prices vary significantly across geographic markets and even within the same funeral home chain; and caskets are generally sold and marketed locally. Specifically, Appellees' expert, Dr. Sibley, testified "that most consumers shop for caskets locally; ICDs rarely shipped their products out of state; ICDs generally sold and advertised locally; and ICDs did not consider internet prices in setting their own prices." The M&R also noted the differences in marketing arrangements between funeral home defendants ("FHDs"), observing that some FHDs offer package discounts for caskets and funeral services but other do not, that not all locations require the purchase of a casket, and that the package discounts vary among locations. Appellants attempt to distinguish the instant case from Blue Bird by contending that we denied class certification in Blue Bird because the Blue Bird plaintiffs planned "to proceed state by state and prove by varying evidence fifty different price-fixing conspiracies." Here, however, the magistrate judge found Appellants' evidence to be similarly localized, stating that "[p]laintiffs fail to explain how statements made by one association in one area of the country equates to a nationwide conspiracy."
Appellants also rely on United States v. Grinnell Corp., 384 U.S. 563, 86 S.Ct. 1698, 16 L.Ed.2d 778 (1966), to show that "the Supreme Court flatly rejected the argument ... that localized sales activity defeated [the] key features of national markets." This reliance, however, is misplaced. In Grinnell, the Supreme Court affirmed a finding of national market where a company that supplies fire and burglar alarm services had national operations, a national schedule of prices, rates and terms, national contracts, and national agreements with competitors, even though the company could sell its product only to local customers. 384 U.S. at 575-76, 86 S.Ct. 1698. In contrast, here the evidence shows that (1) the prices FHDs charged were not national and instead varied considerably by funeral home; (2) each of the FHDs and independent funeral homes have different contracts with Batesville and with consumers; and (3) that marketing strategies vary greatly among FHDs. See Heerwagen, 435 F.3d at 230 (distinguishing Grinnell by noting that there was no evidence that Heerwagen defendants
Appellants contend separately that the district court "ignored" the evidence of national market and nationwide conspiracy presented by their expert.
In sum, the district court is given great discretion in certifying a class, and the district court's adoption of the M&R in this case does not amount to an abuse of that discretion.
We REVERSE and REMAND the district court's dismissal for lack of subject matter jurisdiction of the claim for attorneys'
EDITH BROWN CLEMENT, Circuit Judge, concurring in part and dissenting in part.
Although I agree with the majority holding affirming the district court's denial of class certification, I do not agree we have jurisdiction to reach that issue. Because the plaintiffs have received all they are entitled to, this case is moot with respect to plaintiffs' claims for statutory attorneys' fees. As the majority correctly observes, the plaintiffs also lack standing to pursue injunctive relief. Consequently, I respectfully DISSENT from Section A1 and Section B and CONCUR in Sections A2 and A3.
Defendants successfully moved to dismiss in the district court due to a lack of subject-matter jurisdiction. We review the factual findings of the trial court for clear error and the legal conclusions de novo. MDPhysicians & Assocs. v. State Bd. of Ins., 957 F.2d 178, 181 (5th Cir. 1992). Plaintiffs are "required to prove the existence of subject-matter jurisdiction by a preponderance of the evidence." Middle S. Energy, Inc. v. City of New Orleans, 800 F.2d 488, 490 (5th Cir.1986).
The facts and procedural history are unique and complex. Plaintiffs concede that they are no longer seeking damages but are instead seeking only statutory attorneys' fees. At this point in the litigation, three things are abundantly clear. First, the named plaintiffs have received well over their claimed treble damages through the Stewart Settlement. Second, the only thing that can be gained in continuing this litigation is attorneys' fees and costs, which plaintiffs' attorneys admit will not go to the plaintiffs themselves. And third, any trial to award attorneys' fees and costs would only exponentially increase the attorneys' fees in question — with no more awarded to the plaintiffs.
Standing is a constitutional requirement under Article III. See Fla. Contractors v. Jacksonville, 508 U.S. 656, 663, 113 S.Ct. 2297, 124 L.Ed.2d 586 (1993). "Mootness is the doctrine of standing in a time frame. The requisite personal interest that must exist at the commencement of the litigation (standing) must continue throughout its existence (mootness)." United States Parole Comm'n v. Geraghty, 445 U.S. 388, 397, 100 S.Ct. 1202, 63 L.Ed.2d 479 (1980). In other words, a party must have standing at all points in the litigation to continue to litigate the case, or else it becomes moot. To have Article III standing a plaintiff must show an "injury in fact" and "must have a personal stake in the outcome." Lujan v. Defenders of Wildlife, 504 U.S. 555, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992) (internal quotation marks omitted). To avoid mootness, the plaintiffs' personal stake must continue throughout the litigation. Envtl. Conservation Org. v. City of Dallas, 529 F.3d 519, 524-25 (5th Cir.2008).
Here, plaintiffs cannot demonstrate any personal stake in the continuance of the litigation following the Stewart Settlement because they have none. Their claimed damages have been met multiple times over by the Stewart Settlement. The case, as it relates to the plaintiffs, is moot because their injury has been remedied.
The Supreme Court has previously stated that "a plaintiff cannot achieve standing
Although there is no Supreme Court precedent dealing with this issue in the context of a Clayton Act violation, the plaintiffs bear the burden of demonstrating that the litany of Supreme Court cases on similar statutory costs and attorneys' fees are inapplicable. They fail to do so. Their strongest argument for continuing with this litigation is a misreading of a prior case in this circuit, Sciambra, which sat in a markedly different procedural posture from the case now before us. Sciambra v. Graham News, 892 F.2d 411 (5th Cir.1990). Sciambra dealt with statutory costs and attorneys' fees under the Clayton Act, but the court had already found antitrust liability against the defendants through a default judgment. Since liability was already established, statutory attorneys' fees were awarded. Despite arguments to the contrary by the plaintiffs and the majority, Sciambra is not controlling of the outcome of this case. What the attorneys here request is completely different from Sciambra because liability, and the right to be awarded attorneys' fees, has yet to be ascertained. To be clear, the plaintiffs' attorneys are not asking for a hearing to determine the amount of their fees, a perfectly reasonable request. They are asking for a trial to determine liability itself, and therefore any right they may or may not have to be awarded fees in the first place. Unlike in Sciambra, here, the attorneys ask to hold a trial that will involve thousands of attorneys' hours, exorbitant costs, and an untold amount of judicial expense, all to determine whether or not the attorneys can get paid more than they have already received — with the result having zero impact on the plaintiffs themselves one way or another.
The majority rests much of its argument on the fact that statutory attorneys' fees are part of the tripartite scheme created by the Clayton Act. While this is certainly a true characterization of the Clayton Act, and would give plaintiffs mandatory attorneys' fees where liability was determined, the majority overlooks the clear limit of any act of Congress including the Clayton Act — the Constitution. Congress cannot confer standing on the plaintiffs and their attorneys outside the bounds of Article III. It is axiomatic that Article III requires
Unable to point to one Supreme Court case that supports this request for a trial solely for attorneys' fees, and therefore not able to meet their burden to demonstrate jurisdiction by a preponderance of the evidence, the plaintiffs' attorneys rest their argument on a warped notion of judicial efficiency under the theory that dismissing this case will deter future settlements. Although such a policy consideration is essentially irrelevant to the constitutional issue of Article III justiciability, the majority adopts this reasoning whole, all while ignoring the multitude of other policy rationales that counsel against letting this suit go forward merely to secure an award of additional attorneys' fees.
The most damning argument against the plaintiffs' theory is that, even after all remedies and recovery have been provided by the settlement to plaintiffs, the plaintiffs' attorneys will continue racking up attorneys' fees for their personal reimbursement all in an effort to find liability and recoup their spent and on-going costs, with nothing more to be gained for their clients. Once removed from the attorney-client relationship, the lawyers could litigate this case unchecked by any responsibility to represent their clients' interests. The attorneys here — devoid of the need to placate their clients' interests or heel at their clients' orders — could litigate this issue unfettered in pursuit of their personal windfall, and could continue to do so long after they have relinquished any meaningful relationship with the plaintiffs. While plaintiffs' attorneys' litigation efforts in the quest for continuous ongoing and reimbursable fees would certainly help deter future anti-competitive actions, it is inconceivable that this is the public benefit scheme intended by the Clayton Act or permitted by the Court's Article III jurisprudence. One could hardly imagine a greater cudgel to be wielded by plaintiffs' attorneys to force unmeritorious settlements than the threat of never-ending litigation by attorneys seeking attorneys' fees for litigating a case about attorneys' fees.
The majority takes great pains to try to distinguish Supreme Court precedent. To get around the clear parallels between this case and that precedent, the majority states in conclusory fashion that this case is different because "the Stewart Settlement only mooted Appellant's antitrust claims against Stewart, not as against appellees." Yet the mootness of this appeal, in toto, is exactly the issue before the court and one that the majority glosses over. Because the plaintiffs have no further "personal stake in the outcome" of this case and their attorneys are seeking a trial merely for their own self-interested "byproducts" of litigation, the Constitution and Supreme Court precedent clearly indicate that this case is moot. I respectfully DISSENT.
Id. By contrast, Appellants in the instant case allege that they were injured by the "putatively illegal conduct of the defendant." Attorneys' fees and costs are part of the compensation mandated in § 4 as a result of a defendant's provable violation of federal antitrust laws. Thus, the mandatory fee award is a part of the subject matter of the litigation and must be awarded to every successful plaintiff.
Fed.R.Civ.P. 23(b)(3) states class certification is allowed only if:
