THE INADEQUATE SEARCH FOR ADEQUACY IN CLASS-ACTIONS - A CRITIQUE OF EPSTEIN V. MCA, INC

Professors Kahan and Silberman offer a doctrinal and policy critique o f the Ninth Circuit's 1997 remand decision in Epstein v. MCA, Inc. (Ma tsushita II), which held that class counsel in a state court class act ion failed to adequately represent the class, and thus the class was n ot bound by the global settlement approved by the state court. As a re sult of the Matsushita II decision, absent class members have an unfet tered ability to collaterally attack the ''adequacy'' of their represe ntation by class counsel. The authors argue that this holding, premise d on a misreading of the Supreme Court's decision in Phillips Petroleu m Co. v. Shutts, threatens to impede both state and federal class acti on settlements, create the potential for multiple and wasteful litigat ion of the issue of ''adequacy of representation, '' and motivate a ne w kind of forum shopping in the class action context Although multi-ju risdictional class actions give rise to potential ''plaintiff shopping '' and ''forum shopping'' abuses, the authors contend that a broad rig ht to collateral attack created by Matsushita LI is not a good way to deal with these problems. In place of the Ninth Circuit rule, Professo rs Kahan and Silberman propose providing incentives to all parties to participate in the settlement action coupled with a narrower, process- based standard for collateral attack.