After oral argument on a appeal from judicial approval of a class action settlement, the appellants asked the court of appeals to dismiss the appeal pursuant to Fed. R. App. P. 42(b). Because the litigation was a class action, the circuit court was concerned that the settlement might adversely affect class members that were not before the court. Judge Easterbrook, writing for himself and Judge Manion, determined that the settlement would not jeopardize the interests of the unrepresented class members and dismissed the appeal.
But Judge Posner was not so sure. In a lengthy dissent (especially lengthy in the context of a decision dismissing an appeal by agreement), he opposed the dismissal because it “is based on speculation rather than on evidence, is insensitive to the risks of class action sell-out, and makes critical errors.” In particular, Judge Posner was concerned that the settlement that would stand absent an appeal may be collusive and detrimental to some class members. To deal with that possibility, Judge Posner proposed that the court of appeals “conduct our own investigation of whether to approve the settlement[.]”
Whether Judge Posner would have taken the same position had he not been secure in the knowledge that it was a minority view is, of course, unknown. But his comments add an interesting twist to the usually routine procedure under Fed. R. App. P. 42(b).
Safeco Ins. Co. of America v. Liberty Mutual Ins. Co., Case No. 12-1157 (7th Cir. Mar. 25, 2013).