Shannon Noelle – Class Action Defense

May 8, 2025May 8, 2025 by Gerald L. Maatman, Jr.

Class Action Issues In 2025 – Report From The 9th Annual Class Action Conference In New York City

By Gerald L. Maatman, Jr., Jennifer A. Riley, Shannon Noelle, and Anna Sheridan

Duane Morris Takeaways: On May 8, 2025, the Beard Group sponsored the Class Action Money & Ethics Conference in New York City. During the conference, over 200 attendees discussed key issues impacting class action litigation in 2025. We were privileged to chair the Conference and present the keynote address on class action litigation trends for the past year and what 2025 has in store for Corporate America. The discussion at the program underscores the cutting-edge issues facing companies in this area of law.

Key Trends For The Past Year

In our keynote address, we discussed the top ten developments in the class action litigation space. The leading trends center on the new era of heightened risks and elevated exposures that pivot on record-breaking settlement numbers, the high conversion numbers for class certification motions into certified classes, and the rise in privacy and data breach class actions.

On the settlement front, 2022 saw $66 billion in total proceeds when measured by the top ten settlements in all areas of law. In 2023, that figure totaled $51 billion, for a combined total of $117 billion over the past 24 months. And in 2024, those numbers came in at $42 billion, which pushed the settlement numbers to $159 billion for the past 36 months.

In terms of class certification motions, the Plaintiffs bar successfully secured certification in 63% of cases over the past year. Those figures ranged from nearly 83% in WARN lawsuits to 37% in RICO cases. That said, the plaintiffs’ bar has proven its track record to convert class action lawsuit filings in to certified classes at a high rate.

In the privacy and data breach space, such claims became ubiquitous in 2024, with a virtual explosion in those types of lawsuits. While certification rates were quite low in data breach situations, the plaintiffs’ bar secured certification in privacy class actions at a higher rate.

We also discussed how class actions over environmental. social, and governance issues went mainstream in the past year. We predicted that ESG class actions will continue to increase, especially as the plaintiffs’ bar refines their theories of recovery and begin to monetize their claims. In particular, securities fraud class actions over DEI commitments are increasing as a result of the U.S. Supreme Court’s recent decision in Students For Fair Admissions, Inc., et al. v. President And Fellows Of Harvard College, 600 U.S. 181 (2023). Both plaintiffs’ lawyers and defense counsel anticipate more litigation in this space.

Data Breach Panel

An interesting panel discussion – consisting primarily of plaintiffs’ lawyers – ensued after the keynote address on wiretapping class claims under the Video Privacy Protection Act and data privacy class action litigation. They reflected on the patchwork quilt of rulings in these areas over the past year and the low certification rates due to problems in surmounting standing issues based on lack of injury-in-fact showings.

The panelists predicted a subtle shift in privacy and data breach lawsuits to effectuate a “work around” to these impediments. Multiple plaintiffs’ counsel predicted more reliance on state law claims and litigation of class-wide claims in state court.

Panel On Class Notice Strategies

The next panel focused on trends for class notice in 2025 and how artificial intelligence is now mainstream in terms of its use to facilitate the notice send to class members. The panelists expressed how these practices are quite innovative and rapidly evolving. Notice through social media and/or texts or email also is considerable cheaper than U.S. Mail, which is driving down settlement administration costs.

The challenge, however, is to prevent fraudulent claims from individuals seeking a share of the settlement pot. As to take rates, social media advertising is driving the rates upward, but the rates in data breach cases remain low at 1% to 5% (as compared to other types of settlements).- Class member demographics also impact the take rate, as older individuals are apt to view social media notice as “junk mail” or a scam. Conversely, staying ahead of fraudsters has created an imperative for settlement administrators (e.g., where settlement shares are claimed by an IP address of a bot).

Panel On Fraud In The Class Action Process

Another panel discussed the rise of fraudsters in the class action space. Some involve “deep fakes” of persons who seek to assert false claims as named plaintiffs or class members. Others involve cyber-criminals who infiltrate the settlement administration process through artificial intelligence software and seek class settlement shares on a false basis.

Judicial responses have run the gamut from shutting down the settlement administration process and rebooting it with enhanced security measures to referrals to law enforcement personnel to combat fraud. Panelists predicted that judges are apt to ratchet up the scrutiny of final settlement approval of class actions, and possibly promote direct mail notice over digital communications.

Implications For Companies

Class action litigation is a fact of life for corporations operating in the United States. Today’s conference underscored that change is inevitable, and class actions litigation is no exception.

April 14, 2025 by Gerald L. Maatman, Jr.

Visualize This: The Sixth Circuit Holds That The VPPA Applies Only To Consumers Of Audio-Visual Materials

By Gerald L. Maatman, Jr., Shannon Noelle, and Ryan T. Garippo

Duane Morris Takeaways: On April 3, 2025, in Salazar, et al. v. Paramount Global, d/b/a 247Sports, Case No. 23-5748, 2025 WL 1000139 (6th Cir. Apr. 3, 2025), the Sixth Circuit departed from two other federal circuits (i.e., the Second and Seventh Circuits) in its interpretation of “consumers” covered by the Video Privacy Protection Act (“VPPA”), and affirmed the district court’s dismissal of a putative class action on the basis that only consumers of audio-visual related materials are covered by the protections of the Act. The Sixth Circuit’s holding narrows the scope and reach of the statute and is a welcome reprieve for companies offering video content on their websites in connection with advertising technology (“adtech”).

Background

In September 2022, Michael Salazar brought a putative class action against Paramount Global (i.e., the owner of 247Sports.com), claiming that the media company violated the VPPA because it installed Meta Pixel on its website. Salazar alleged that Meta Pixel, a form of adtech, tracked his and putative class members’ video viewing history and disclosed it to Meta without his consent. He sought to represent a putative class of subscribers to 247Sports.com’s newsletter which contained links to articles (that could contain videos), photographs, and other content.

Salazar, however, did not allege that he was a subscriber of audio visual materials as contemplated by the statute. 18 U.S.C. § 2710(a)(1)-(4). To the contrary, he alleged that he was a subscriber of 247Sports.com’s newsletter, and that 247Sports.com separately provided audio visual materials to its customers. Salazar v. Paramount Global, 683 F.Supp. 3d 727, 744 (M.D. Tenn. 2023). But, the district court determined that Salazar’s interpretation of the VPPA was “unavailing.” Id. Indeed, “there [was] no allegation in the complaint that Plaintiff accessed audio visual content through the newsletter (or at all, for that matter). The newsletter [was] therefore not audio visual content, which necessarily means that Plaintiff [was] not a ‘subscriber’ under the VPPA.” Id.

Salazar is no stranger to this legal issue. Last year, in a virtually identical case, the U.S. District Court for the Southern District of New York, dismissed a putative VPPA class action brought by Salazar on the basis that “signing up for an online newsletter did not make Salazar a VPPA ‘subscriber.’” Salazar v. National Basketball Association, 118 F.4th 533, 536-37 (2d Cir. 2024). Salazar appealed that decision to the Second Circuit, which reversed the lower court, and held that the VPPA protects “consumers regardless of the particular goods or services rented, purchased, or subscribed to.” Id. at 549. If blog readers would like to learn more about the Second Circuit’s decision, a link to our post is included here.

Salazar appealed this case on the same grounds as his Second Circuit win and asked the Sixth Circuit to determine whether he was considered a “subscriber” and thus, a “consumer” under the VPPA.

The Sixth Circuit’s Decision

The Sixth Circuit affirmed the district court’s ruling and agreed that to be considered a “consumer” under the VPPA an individual must purchase goods or services of an audio-visual nature.

Judge John Nalbandian, writing for the Sixth Circuit, reasoned that the term “subscriber” must be viewed in its broader context, and in harmony with the other words in the statute such not to render associational words inconsistent or superfluous. Applying these canons, the Sixth Circuit explained that the words “goods and services” informed the meaning of the term “subscriber.” By using the terms together, the statute was intended to encompass only audio-visual goods or services provided by a video tape service provider, as opposed to any and all goods and services, provided by that company. In other words, if a video tape service provider makes “hammers” or a “Flintstones sweatshirt or a Scooby Doo coffee mug,” a consumer of such goods would not fall under the purview of the VPPA. Paramount Global, 2025 WL 100139, at *10.

In so holding, the Sixth Circuit departed from the Second and Seventh Circuits, including the near-identical lawsuit brought by Salazar himself, that found the phrase “goods or services” to encompass all goods and services that a provider places in the marketplace. Judge Rachel Bloomekatz, penning the dissent, reached the same conclusion. She opined that, under the majority’s interpretation, a provider could “stitch[] together” non-video transactions to provide information about audio-visual transactions that could reveal a consumer’s personal information. Id. At *12. The majority found such concerns unavailing and reasoned that the type of information available from the videos on Paramount Global’s website was not inherent to the newsletter and was “accessible to anyone, even those without a newsletter subscription.” Id. at *7.

As a result, the Sixth Circuit affirmed the district court’s decision to dismiss the complaint without leave to amend.

Implications For Companies

Circuit splits in the federal courts are increasingly rare. It is nearly unprecedented, however, to have a situation where one litigant has created a federal circuit split with himself. Salazar could file one lawsuit in New York and his claims would go forward. But, if the exact same lawsuit was filed in Tennessee, then dismissal would be the proper remedy.

This patchwork system may be difficult for corporate counsel, tasked with ensuring their companies’ adtech compliance, to follow. But, the Sixth Circuit’s decision in Paramount Global is better than the alternative and could pave the way for other circuits to similarly limit the scope of the VPPA in their relevant jurisdictions.

In the meantime, however, corporate counsel for companies based in Kentucky, Michigan, Ohio, and Tennessee can rest a little easier knowing that – they can offer newsletters without worrying that adtech, installed solely on their websites – will somehow subject them to draconian VPPA liability.

March 28, 2025 by Gerald L. Maatman, Jr.

No Shot at Class Certification – Pennsylvania Federal Court Rules that Company Review of COVID-19 Vaccine Exemption Requests Requires Individualized Inquiries Not Suitable For Class Treatment

By Gerald L. Maatman, Jr., Shannon Noelle, and Anna Sheridan

Duane Morris Takeaways: In Meinert et al. v. Port Authority of Allegheny County, Case No. 2:22-CV-01736 (W.D. Pa. 2025), Judge Robert J. Colville of the U.S. District Court for the Western District of Pennsylvania denied class certification for a class of former transit company employees that were allegedly denied medical and religious exemptions to an employer-mandated COVID-19 vaccination policy. In so doing, the Court highlighted opportunities for defendants to defeat class certification by offering proof that the proposed class is amenable to ordinary joinder and that individualized inquiries predominate over common ones in terms of the qualified disabilities, sincerely held religious beliefs, and undue hardship. The ruling is a required read for corporate counsel facing workplace-related class actions.

Background

Former bus drivers and maintenance workers of Pittsburgh Regional Transit filed a class action complaint against the transit company in December 2022 alleging that a company policy issued in early 2022 requiring COVID-19 vaccinations for employees resulted in class members being denied a medical or religious exemption in violation of federal and state law prohibiting discrimination based on a disability or sincerely held religious belief. In total, the transit company received 350 accommodation requests related to its COVID-19 vaccination policy — 54 of which were for medical exemptions and 296 of which were for religious exemptions. The Company formed an Accommodation Review Committee that ultimately granted 13 medical exemption and 30 religious exemption requests to its vaccination policy.

The plaintiffs argued that the exemption review process was a “sham.” As it regards the medical exemption review process, the plaintiffs argued all proposed class members (the “medical exemption class”) were denied a medical exemption because their pre-existing conditions or disabilities did not show a contraindication to the CDC guidelines and the Company did not factor whether the conditions were a recognized disability under the ADA. As it regards its religious exemption review process, the plaintiffs maintained that the Company did not engage in any individualized analysis to determine undue hardship (the “religious exemption class”).

The Court’s Decision

In its Rule 23 analysis, the Court ruled that the medical exemption class failed to meet the numerosity and commonality prerequisites and that the religious exemption class failed to satisfy the commonality and predominance requirements for class certification. The Court found that as the plaintiffs presented no evidence to contradict the Company’s proof that only 12 individuals fell into the proposed medical exemption class, the Court opined that the plaintiffs failed to establish numerosity and demonstrate that joinder of all members was impracticable, particularly given that all class members were employees of the Company in Pittsburgh.

The Court also rejected plaintiffs’ generic arguments that class certification would promote consistent results and judicial economy. The Court further addressed the lack of commonality of the medical exemption class in dicta (as the lack of numerosity was sufficient to dismiss the proposed class) but nevertheless found that determining whether each member of the class had a cognizable disability would be an individualized inquiry that could not be considered on a class wide basis.

With respect to the religious exemption class, the Court found a lack of commonality given that the sincerity of a class member’s religious beliefs and the undue hardship to the Company are both individualized inquiries not suitable for class treatment. The Court rejected plaintiffs’ contention that the Company did not engage in any individual analysis to determine undue hardship, crediting an affidavit submitted by the Company detailing the Accommodation Review Committee’s process and attaching denial letters, which it reasoned illustrated that the Company considered undue hardship on an individual-by-individual basis. For the same reasons, the Court also reasoned that predominance was lacking as to the religious exemption class given that the sincerity of class members’ religious beliefs and undue hardship to the Company would both turn on individualized proof rather than evidence common to all class members.

Implications of the Decision

The Court’s decision underscores the opportunity for defendants to defeat certification by submitting evidence that proposed members of the class are limited and could be easily joined through ordinary joinder procedures and that the proposed class-wide proceeding is not apt to generate common answers as to whether class members are entitled to relief, as opposed to common questions.

Employers implementing similar review processes for exemption requests to company policies are well-advised to document and evidence an individualized process in evaluating and responding to such requests to defend against class action exposure.