Administering Adequacy in Class Representation

I. Introduction The concept of adequate representation lies at core of contemporary debate over action. Rule 23(a)(4) of Federal Rules of Civil Procedure requires a judicial finding that the representative will fairly and adequately protect interests of class as a precondition for certification of a lawsuit to proceed on a class-wide basis.1 That drafters of Rule 23 in 1960s should have referred to adequate representation is no surprise.2 The reference includes in rule text a requirement of constitutional due process recognized by Supreme Court in its 1940 decision in Hansberry v. Lee.3 Recent commentary accurately describes adequate representation as a loyalty right within familiar taxonomy of exit, voice, and loyalty rights that individuals might have within a larger organization4-a government, a corporation, or, here, a noncontractual vehicle for litigation on a collective basis. For all agreement on centrality of adequate representation to modern action-indeed, on its constitutional status-there remains remarkably little agreement on content of that concept or how to enforce it.5 This lack of agreement arises most dramatically in ongoing debate over when a judgment rendered in a action will have preclusive effect upon members in manner of judgments in non-class civil lawsuits. In Hansberry, Court held that members may avoid preclusive effect of a judgment if they can demonstrate a lack of adequate representation in proceedings.6 The uncertainty over what makes for inadequacy in representation thus casts a shadow over finality of any judgment. Procedural law has long concerned itself with finality of judgments in many contexts. Finality takes on special significance here, however, because of way that modern action has come to operate in practice. Though Rule 23 and its state-law equivalents nominally stand as vehicles for adversarial litigation, actions characteristically do not produce verdicts after full-scale trials but, rather, settlement agreements7-often elaborate descriptions of some new set of legal rights to be substituted, through mechanism of judgment,8 for rights that members previously had vis-a-vis defendant. Transactions, not trials, are overwhelmingly endgame of lawsuits.9 And finality is what settling defendant seeks to purchase in transaction. Thus it is only fitting that Supreme Court's most recent encounter with concept of adequate representation-its inconclusive treatment this past term in Dow Chemical Co. v. Stephenson10-should concern an effort to escape preclusive effect of a settlement. In this Article, I offer both a critical assessment of existing doctrine on representation and a proposal to move law in a more productive direction. In so doing, I seek quite consciously to speak to two audiences often regarded as distinct-indeed, to demonstrate that each has much to say to other. The first audience consists of scholars, judges, and lawyers concerned with doctrinal development of adequate representation as a conceptual cornerstone of action procedure. The second consists of public law scholars acquainted with modern administrative state and regulatory policy. I seek, in short, to demonstrate how existing doctrine leaves an unsatisfying gap that administrative concepts can help to fill and, at same time, to show how one may ground a conception of modern action as an institutional rival to public governance in a reading of existing case law-in particular, a revisionist account of Supreme Court's canonical decision in Hansberry. Current law attempts to shoehorn judgments into conventional preclusion analysis grounded in status of individual litigants in non-class settings as parties to their lawsuits. …