In light of today’s column on cases testing Sotomayor’s views (and possible alliance with conservatives in key areas), this story may be of some interest. Sotomayor joined Chief Justice john G. Roberts, Jr. and Justice Anthony Kennedy in raising concerns over whether courts are violating the constitutional rights of corporations in class action cases.
As noted in the column, corporate law is one area where Sotomayor may shift the court toward the right. In the denial in DTD Enterprises Inc. v. Wells, Kennedy noted “[t]o the extent that New Jersey law allows a trial court to impose the onerous costs of class notification on a defendant simply because of the relative wealth of the defendant and without any consideration of the underlying merits of the suit, a serious due process question is raised.” It is an early indications of Sotomayor’s views in the area. This docket is heavily laden with corporate cases.
Here is the statement of Kennedy attached to the denial:
DTD ENTERPRISES, INC., AKA TOGETHER, AKA TO-
GETHER-CLARK, AKA TOGETHER DATING SER-
VICE, ET AL. v. JANICE H. WELLS, ON BEHALF OF
HERSELF AND ALL OTHERS SIMILARLY SITUATED
ON PETITION FOR WRIT OF CERTIORARI TO THE SUPERIOR
COURT OF NEW JERSEY, MIDDLESEX COUNTY
No. 08–1407. Decided October 13, 2009
The petition for a writ of certiorari is denied.
Statement of JUSTICE KENNEDY, with whom THE CHIEF JUSTICE and JUSTICE SOTOMAYOR join, respecting the denial of the petition for writ of certiorari.
This case began with a contract action brought by DTD Enterprises, Inc. (hereinafter petitioner), a commercial dating-referral service, against respondent, one of petitioner’s customers. The suit alleged that respondent refused to make payments due under a contract. Respondent answered by bringing a class action against petitioner. The trial court certified the class and ordered petitioner to bear all the costs of class notification, on the sole ground (or so it appears) that petitioner could afford to pay and respondent could not.
To the extent that New Jersey law allows a trial court to impose the onerous costs of class notification on a defendant simply because of the relative wealth of the defendant and without any consideration of the underlying merits of the suit, a serious due process question is raised. Where a court has concluded that a plaintiff lacks the means to pay for class certification, the defendant has little hope of recovering its expenditures later if the suit proves meritless; therefore, the court’s order requiring the defendant to pay for the notification “finally destroy[s] a property interest.” Logan v. Zimmerman Brush Co., 455 U. S. 422, 433-34 (1982). The Due Process Clause requires a “‘hearing appropriate to the nature of the case.’” Boddie v. Connecticut, 401 U. S. 371, 378 (1971). And there is considerable force to the argument that a hearing in which the trial court does not consider the underlying merits of the class-action suit is not consistent with due process because it is not sufficient, or appropriate, to protect the property interest at stake.
I nonetheless agree with the Court’s denial of certiorari, for two reasons. First, the petition is interlocutory; the state appellate courts denied petitioner leave to appeal the trial court’s action. Second, petitioner has filed for bankruptcy, and an automatic bankruptcy stay has issued pursuant to 11 U. S. C. §362. Respondents contend that the present action comes within the scope of the automatic stay. If we were to grant the petition we would be required to construe New Jersey law without the aid of a reasoned state appellate court decision and to confront a procedural obstacle unrelated to the question presented. Under these circumstances, it is best to deny the petition. It seems advisable, however, to note that the petition for certiorari does implicate issues of constitutional significance.
U.S. Supreme Court Justice Sonia Sotomayor has joined with two conservative justices to raise constitutional concerns about forcing a dating service to pay the costs of notifying class members in a lawsuit over failed matchmaking.
The Supreme Court denied certiorari in the case, but Justice Anthony M. Kennedy wrote that the suit “does implicate issues of constitutional significance.” Chief Justice John G. Roberts Jr. and Sotomayor both joined Kennedy’s statement (PDF posted by SCOTUSblog).
The dating service, DTD Enterprises Inc. (also known as the Dating Together Service), had sued Janice Wells for failing to make all her payments under the terms of a contract, according to Dow Jones Newswires. Wells responded with a class-action lawsuit contending that DTD failed to make appropriate matches. A judge ordered DTD to pick up the costs of notifying class members because it could afford to do so, while Wells could not pay.