Recent rulings may redefine class action

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awsuit reform is a hot topic in Oklahoma. While much of the focus has been on legislative xes, recent rulings from nations highest court have dramatically changed the landscape for an often-misused aspect of our legal system: the class action lawsuit. The last decade has seen signicant numbers of class action lawsuits led in and certied by Oklahoma courts, in particular against companies who operate oil and gas wells. The plainti s in those actions are typically mineral owners, recruited by class action attorneys, asserting claims that the well operator underpaid their royalties. Oklahoma courts have historically been quick to certify these types of cases as class actions. But the U.S. Supreme Courts ruling earlier this year in Comcast Corp. v. Behrend, coupled with its landmark 2011 ruling in the Wala question that drives the litigation certication of a class is improper. In a class acMia Vahlberg tion challenging (left) and an energy companys royalty Tammy Barrett payments for Oklahoma wells, Mart v. Dukes gender discriminait is now not enough to say that the tion case, leaves no doubt that a common question is whether the new era in class action litigation company is paying royalties prophas arrived. With these two cases, erly to all of its mineral owners the court has emphasized the strin- because the answer to that question gent requirements for establishing could vary between royalty owna class action. ers under the specic terms of his/ In Wal-Mart, the court ruled her lease. The lack of a common that commonality, a fundamental answer should preclude courts prerequisite in class action cases, from certifying a case as a class must focus on whether a common action preventing a court from answer to the central questions for deciding the claims of a large group all potential plainti class members of mineral owners based on facts exists. Absent a common answer to related to only a few.

BUSINESS VIEWPOINT

Comcast, involving a dispute with a cable TV provider, reversed a class certication decision, emphasizing that the di culty of calculating damages on a class-wide basis can preclude certication. In the past, some courts have decided that di culties in calculating damages would not prevent certication of a case as a class action. The rulings have already had an impact. The Tenth Circuit Court of Appeals recently vacated two federal district court decisions, including one in Oklahoma that had certied mineral owner claims. The Tenth Circuit directed that the class action requirements be more carefully analyzed given the recent changes in the law. Several Oklahoma federal courts have likewise denied certication in recent royalty class actions. The Supreme Courts emphasis on certifying only those cases that

truly meet the requirements of a class action will help to spare businesses the threat of coercive class action litigation that, in many cases, has padded the pockets of plainti s attorneys while doing little to provide justice for the plainti s. This change should be a plus for Oklahomas business climate.
Mia Vahlberg and Tammy Barrett regularly defend class action lawsuits as part of their commercial litigation practice with the law rm of GableGotwals, where they are both shareholders.
The views expressed here are those of the authors and not necessarily the Tulsa World. To inquire about writing a Business Viewpoint column, email a short outline of the article to Business Editor Rod Walton at rod.walton@tulsaworld.com. The column should focus on a business trend; the outlook for the city, state or an industry; or a topic of interest in an area of the writers expertise. Articles should not promote a business or be overly political in nature.

Beige book shows strong auto factory hiring and sales.

BY MARTIN CRUTSINGER
Associated Press

Fed survey nds growth across nation

WASHINGTON Economic growth held steady across the United States from July through late August, as Americans bought more cars and homes and auto factories added workers. A Federal Reserve survey released Wednesday showed that all 12 of the Feds regional banking districts reported modest to moderate growth. Thats roughly in line with the Feds previous survey of those districts from late May through early July. Attractive nancing options helped boost demand for new cars and trucks in most districts, with many reporting robust sales. The survey, known as the beige book, said that job growth was steady and that hiring in manufacturing improved modestly, especially at auto and auto-parts factories. But the Kansas City and San Francisco districts said federal spending cuts had caused production cutbacks at some defense plants. The beige book is based on anecdotal reports from businesses gathered by the Feds regional banks. The information was gathered for the Feds next meeting on Sept. 17-18. The overall economy grew at a modest annual rate of 2.5 percent in the AprilJune quarter. Many analysts believe that growth in the July-September quarter will be around an annual rate of 2 percent to 2.5 percent. Some economists believe growth and hiring are strong enough for the Fed to begin slowing its bond purchases at the September meeting. Others say the Fed may hold o at that meeting because they want to see more data. The $85 billion a month in purchases of Treasury and mortgage bonds have kept long-term interest rates low. Low rates have encouraged more people to buy cars, trucks and homes this year. That helped the auto industry in August to its best sales in six years. In addition to autos, consumers stepped up purchases of home furnishings and other products related to home sales, the beige book noted. Home sales continued to rise in many areas. And some districts noted that recent increases in home price mortgage rates were spurring fence sitters to close deals out quickly. Several districts reported a rebound in tourism, noting increases in camping permits and visits to state and national parks. New York reported a pickup in ticket sales at Broadway theaters. Despite steady hiring, the Fed report noted that workers are seeing limited pay increases. Some districts noted that workers with specialized skills are seeing larger pay increases, particularly in construction and high-tech industries. The most critical report left before the Fed meets is the August employment report, which is due Friday. Economists forecast that the economy created 177,000 jobs in August. Thats slightly higher than the 162,000 created in July, but below the average of 192,000 jobs a month added this year. The unemployment rate is expected to stay at 7.4 percent. Still, other signs have been mixed. Manufacturing expanded in August at the fastest pace since June 2011, according to the Institute for Supply Management, an encouraging sign. But U.S. businesses cut back on their orders for long-lasting manufactured goods in July. And U.S. consumers barely increased spending, held back by weak income growth.

Scott Garberding, senior vice president of manufacturing for Chrysler Group LLC, stands between a 1992 Grand Cherokee (right) and the automakers 5 millionth vehicle produced recently at the Je erson North Assembly Plant in Detroit. Chryslers U.S. sales rose 12 percent in August as strong truck sales pushed the company to its best month in six years. CARLOS OSORIO/Associated Press le

The major brands all had double-digit increases for the month of August.
BY TOM KRISHER AND DEE-ANN DURBIN
Associated Press

Automakers post sales gains

DETROIT The major U.S. and Japanese automakers all posted double-digit U.S. sales gains last month as car buyers snapped up pickup trucks and small cars to lead the industry toward its best month in six years. Honda reported the biggest gain with sales up almost 27 percent over August of last year. Toyota sales rose nearly 23 percent, while Nissan was up 22 percent. At General Motors, sales were up almost 15 percent for the companys best month since September of 2008. Chrysler and Ford each reported 12 percent gains. Auto stocks rose, with Ford and GM up about 4 percent. U.S.-traded shares of the Japanese automakers all rose more than 1 percent. Sales in August ran at an annual rate of 16.1 million cars and trucks, a pace not seen since November of 2007, a month before the start of the Great Recession. Mustafa Mohatarem, GMs chief economist, predicted that rate of sales is here to stay. History, he said, shows that auto sales follow a trend, and that trend is now back above pre-recession levels. With the underlying economy fairly solid and with the still very high average age of the eet, I have full expectations that we will continue to see a fairly steady industry, Mohatarem said. The average age of a vehicle on U.S. roads today is a record 11.4 years according to the Polk research rm. That means more people have to replace cars and trucks that they kept through the recession. GM didnt o cially raise its sales forecast for the year from 15.5 million, but Mohatarem said he expects the year to end with sales closer to 15.8 million vehicles. Also, the industry is on better footing than it was in 2007. Prices are high, and automakers arent resorting to huge discounts to pull customers into showrooms, Mohatarem said. Consumers are spending at record levels to buy loaded-up vehicles, according to the TrueCar.com auto pricing website. The average U.S. vehicle sold for an estimated $31,252 last month, up almost $1,000 over August of last year and $24 higher than the previous record in December of 2012. Five automakers Chrysler, Ford, Honda, Nissan and Volkswagen all had record-high selling prices last month, according to TrueCar. High trade-in values are allowing automakers to o er attractive low-cost lease deals. And low interest rates are

giving buyers room to add options and still keep monthly payments relatively low. The industry tracking rm Experian said earlier this week that nearly 28 percent of people who nanced cars in the second quarter leased them, a record high. LMC Automotive, an industry consulting rm, is predicting that total U.S. sales last month were close to 1.5 million, about 12 percent higher than a year ago. Thats the highest number since May 2007. Hondas sales were led by a record month for the popular CR-V. The company sold nearly 35,000 of the crossover SUVs. Toyota sold almost 45,000 Camry midsize cars, up 22 percent from August of last year. The Camry is the top-selling car in the U.S., and sales had been down slightly this year through July. Ford sold more than 70,000 F-Series pickups last month, the second month this year that sales have topped 70,000 for the nations top-selling vehicle. Sales of Chryslers Ram pickup rose 31 percent to more than 33,000. GMs Chevrolet Silverado was up 14 percent to nearly 44,000. At Chrysler, Jeep sales rose 8 percent for the brands best August in 11 years. Grand Cherokee SUV sales were up 40 percent. Toyota passed Ford in August sales to take the No. 2 spot behind GM.

The deal would be worth $5.6 billion at list prices.

BY JOSHUA FREED
Associated Press

Delta to buy 40 more Airbus planes

MINNEAPOLIS Delta Air Lines said on Wednesday that it will buy 40 more Airbus planes, once again grabbing jets that may have been under-appreciated by other airlines. Delta said it signed a rm order for 30 Airbus A321s, which tend to be used on domestic ights, and 10 A330s, a larger plane used for international ights. Delta already has 158 planes from those two families of jets by way of its 2008 purchase of Northwest Airlines. The deal would be worth some $5.6 billion at list prices, although discounts are common. Both of the Airbus types ordered by Delta are widely-used and well-thoughtof. But demand is slowing. Delta is buying a version of the A321 that is being phased out in favor of a new engine option that Airbus plans to begin delivering in 2015. The new

A Delta Airlines jet ies past the companys billboard at Citi Field in New York. Delta announced Wednesday that it has signed an order to buy 40 more Airbus planes.
MARK LENNIHAN/Associated Press le

been getting the bulk of new orders. But the old version that Delta is buying costs $10 million less per plane. For the A330, Airbus had booked just 11 orders through the end of July, while delivering 57 of the passenger version of that

280 of those jets, but it has been building them faster than orders are coming in. Delta CEO Richard Anderson called the Airbus deal another opportunistic eet transaction for Delta in which we acquire economically e cient, proven-

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