Article by Samuel Issacharoff
A major unresolved issue in consumer class actions is how individual reliance may be proven in the context of an aggregate lawsuit. The certifiability of consumer claims as class actions often depends on a court's assessment of the manageability of class treatment of reliance, particularly since a parade of individual witnesses attesting to their state of mind is inconceivable. Although this issue is typically presented as a procedural issue concerning the proper application of the class action device, this Article argues that in fact the debate is one of substance concerning the actual elements needed to prove reliance. By examining the way that reliance is handled in the tort law of strict liability, the Uniform Commercial Code treatment of express and implied warranties, and the question of fraud in securities law, the Article asks whether the procedural debates over class certification have not in fact missed the key doctrinal developments in the substantive law of reliance. The review of the substantive law of reliance shows that reliance is most often proven inferentially or based on an objective reasonable person standard, as opposed to being proven through direct evidence of subjective individual understandings. Under such circumstances, the Article concludes, there are no significant procedural hurdles to aggregate treatment of most consumer claims. Rather, what exists is an incompletely developed substantive understanding of the law of reliance.
About the Author
Samuel Issacharoff. Professor, Columbia Law School. B.A. Binghamton University; J.D. Yale Law School. This Article reflects many conversations over the years with Professors William Powers and Charles Silver, although the views expressed are mine alone.
Citation
74 Tul. L. Rev. 1633 (2000)