are state rules limiting class actions in consumer protection cases procedural or substantive?

Jones v. Varsity Brands, LLC, 2023 WL 5662590, No. 2:20-cv-02892-SHL-tmp (W.D. Tenn. Aug. 31, 2023)

Varsity is a “prominent host of competitive cheerleading competitions and camps,” aka a monopolist. I’m just going to focus on the consumer protection-related claims, because antitrust is a hairball under current rules. Of interest, plaintiffs sought to pursue violations of the consumer protection laws of over 30 states as a class action. Several of these state consumer protection acts—including Tennessee’s, Montana’s, and Colorado’s—do not permit class actions. But, under Shady Grove Orthopedic Assocs., P.A. v. Allstate Insurance Co., 559 U.S. 393 (2010), these state procedural rules could not override FRCP 23, and thus class actions were permitted in federal court. Although the class action bar in Shady Grove appeared in NY’s procedural code, and these were embedded in their respective states’ consumer protection statutes, that didn’t make a substantive difference. I’m just going to quote:

A divergence from the Federal Rules of Civil Procedure that makes it so economically onerous for a litigant to vindicate her rights that she elects to sleep on them does not create a substantive difference in remedies. To conflate procedural laws that have practical effects on the ability to seek relief with substantive laws that alter the remedies themselves is to dissolve the procedural-substantive distinction altogether. Moreover, Defendants’ argument that the state law class action bars are substantive runs counter to Rule 23’s central policy justification of providing for greater justice by establishing the procedures for a collective action vehicle for small plaintiffs lacking incentives to litigate on their own because the costs of litigation outweigh the potential value of their claims.

Moreover, the bars at issue were not “so intertwined with a state right or remedy that it functions to define the scope of the state-created right.” “The provisions impose categorical bans on maintaining class actions brought under certain statutes, but do not work a change to the substantive law; indeed, one can comprehend the thrust of the statutes here with or without the class action provisions whereas class action bars in other states do make substantive changes.” (Comparing a Colorado statute that changes the remedies available for class actions.)

However, a Tennessee nationwide damages class was kicked out; individual state damages classes could proceed.