United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued March 12, 2002 Decided May 14, 2002
No. 01-7163
In Re: Lorazepam & Clorazepate Antitrust Litigation
Appeal from the United States District Court
for the District of Columbia
(No. 99ms00276)
John G. Roberts, Jr. argued the cause for petitioners.
With him on the briefs were Catherine E. Stetson, Michael R.
Grynberg, Christopher K. Tahbaz, Irving Scher and David A.
Hickerson. James B. Weidner entered an appearance.
Michael D. Hausfeld argued the cause for respondents.
With him on the brief were Arthur M. Kaplan and Thomas
Campbell.
Before: Ginsburg, Chief Judge, Rogers and Garland,
Circuit Judges.
Opinion for the Court filed by Circuit Judge Rogers.
Rogers, Circuit Judge: This appeal presents for the first
time in this circuit the threshold question of when interlocu-
tory review of a class certification decision is appropriate
under Federal Rule of Civil Procedure 23(f). We take the
opportunity to offer general guidance on the scope of our
discretion under Rule 23(f) in considering the petition for
Rule 23(f) review by Mylan Laboratories, Inc., Mylan Phar-
maceuticals, Inc., UDL Laboratories, Inc., Profarmaco S.r.l.,
Cambrex Corporation, and GYMA Laboratories of America,
Inc. (collectively "Mylan"), of the district court's certification
of a class of direct purchasers of the generic anti-anxiety
drugs lorazepam and clorazepate from Mylan or UDL. My-
lan contends that the district court erred in ruling that
despite the Federal Trade Commission's ("FTC") procure-
ment of a settlement against Mylan on behalf of a class of
indirect purchasers, a class of direct purchasers had antitrust
standing under Illinois Brick Co. v. Illinois, 431 U.S. 720
(1977), and, in the alternative that the certified class consists
of both direct and indirect purchasers in violation of Illinois
Brick. We conclude that interlocutory appeal pursuant to
Rule 23(f) typically is appropriate in three circumstances: (1)
when there is a death-knell situation for either the plaintiff or
defendant that is independent of the merits of the underlying
claims, coupled with a class certification decision by the
district court that is questionable, taking into account the
district court's discretion over class certification; (2) when the
certification decision presents an unsettled and fundamental
issue of law relating to class actions, important both to the
specific litigation and generally, that is likely to evade end-of-
the-case review; and (3) when the district court's class certifi-
cation decision is manifestly erroneous. Applying these stan-
dards we deny Mylan's petition for interlocutory review.
I.
The class action now pending in the district court was
preceded by two lawsuits brought by the FTC and several
States' Attorneys General against Mylan that were ultimately
consolidated and ended in a settlement. On December 21,
1998, the FTC filed suit, pursuant to ss 5 and 13(b) of the
Federal Trade Commission Act ("FTC Act"), 15 U.S.C. ss 45,
53(b), against Mylan, Cambrex, Profarmaco, and GYMA Lab-
oratories, seeking injunctive and equitable relief, including
disgorgement of $120 million plus interest. FTC v. Mylan
Labs., Inc., 62 F. Supp. 2d 25, 32, 34 (D.D.C. 1999). The
amended complaint alleged that the defendants had engaged
in unfair methods of competition in violation of s 5(a) of the
FTC Act, 15 U.S.C. s 45(a), by Mylan's entering into exclu-
sive licensing agreements with the other defendants, allowing
Mylan to control the supply of the active pharmaceutical
ingredients ("API") for generic lorazepam and clorazepate
tablets so that Mylan could increase the price of these generic
drugs. On December 22, 1998, the Attorneys General of ten
States, later joined by an additional 22 States and the District
of Columbia, brought suit against the same defendants and
SST Corporation, seeking equitable relief and treble damages
for violations of ss 1 and 2 of the Sherman Act, 15 U.S.C.
ss 1, 2, and various State antitrust laws. Mylan, 62 F. Supp.
2d at 32; see also In re Lorazepam & Clorazepate Antitrust
Litig., 205 F.R.D. 369, 373 (D.D.C. 2002). As to the FTC, the
district court denied the defendants' motion to dismiss, which
argued that the district court lacked subject matter jurisdic-
tion because the FTC was not authorized to seek either
monetary relief or a permanent injunction in an antitrust
case. Mylan, 62 F. Supp. 2d at 35-37. As to the States, the
district court partially granted the defendants' motion to
dismiss, inter alia, narrowing the States' federal claims to
claims under s 4 of the Clayton Act for direct purchases and
limiting restitution and disgorgement on behalf of indirect
purchasers on a State-by-State basis. Id. at 37-53; see also
FTC v. Mylan Labs., Inc., 99 F. Supp. 2d 1, 4-10 (D.D.C.
1999). Subsequently, the parties entered into a settlement
agreement, which the district court approved on February 1,
2002. Mylan, 205 F.R.D. at 402. The settlement agreement
provided, in part, that Mylan would pay disgorgement in the
amount of $71,782,017 to satisfy the consumer claims in the
States' lawsuit and $28,217,983 to satisfy the States' agency
claims. The settlement agreement also provided that the
FTC, States, State agencies, and consumers who did not
exclude themselves from the settlement, would release their
claims against the defendants.
On August 16, 1999, the Judicial Panel on Multidistrict
Litigation transferred to the United States District Court for
the District of Columbia a Northern District of Illinois lawsuit
pending against Mylan. This lawsuit was consolidated, on
March 9, 2000, with a lawsuit brought by St. Charles Rehabil-
itation Center against Mylan. The named plaintiffs in the
consolidated action were Advocate Health Care, St. Charles
Hospital and Rehabilitation Center, Dik Drug Company, and
Harvard Pilgrim Health Care, and they sought class certifica-
tion as direct purchasers of lorazepam and clorazepate. The
amended complaint alleged that Mylan had engaged in price
fixing and monopolization in violation of ss 1 and 2 of the
Sherman Act, and the plaintiffs sought treble damages pursu-
ant to s 4 of the Clayton Act. Mylan moved to dismiss the
complaint pursuant to Federal Rules of Civil Procedure
12(b)(1) and 12(b)(6), on the ground that the plaintiffs' pro-
posed class of direct purchasers lacked antitrust standing to
assert their claims. In Illinois Brick, the Supreme Court
held that, with narrow exceptions, only direct purchasers may
recover damages for illegal overcharges under s 4 of the
Clayton Act. Illinois Brick, 431 U.S. at 746-47. Essentially,
Mylan argued that the usual direct purchaser rule of Illinois
Brick should not apply because the FTC had won a monetary
recovery for the benefit of a class of indirect consumer
purchasers pursuant to s 13(b) of the FTC Act for alleged
antitrust violations, and to allow both purchaser classes to
obtain relief would undermine the policy rationales behind
Illinois Brick. In the alternative, Mylan opposed the class
certification arguing, inter alia, that the class consisted of
direct and indirect purchasers in violation of Illinois Brick's
direct purchaser rule. On July 2, 2001, the district court
denied the motion to dismiss, and, in accord with the plain-
tiffs' request, certified the following class:
All persons and entities in the United Sates who pur-
chased generic lorazepam tablets and/or generic cloraze-
pate tablets directly from Defendants Mylan and UDL
during the period January 12, 1998 through the present,
excluding Defendants, their respective parents, subsid-
iaries and affiliates, any co-conspirators of Defendants,
and all governmental entities.
In re Lorazepam & Clorazepate Antitrust Litig., 202 F.R.D.
12, 21 (D.D.C. 2001). The district court appointed Advocate
Health Care, St. Charles Hospital, Dik Drug, and Harvard
Pilgrim as class representatives.
Mylan now petitions for interlocutory review of the district
court's denial of its Rule 12(b)(6) motion to dismiss and the
district court's certification of a class of direct purchasers.
Asserting that "[t]his is not the typical case," Petitioners' Br.
at 16, Mylan contends that, in light of the flexible standards
for review developed in the circuits, appellate review of its
petition under Rule 23(f) is warranted: not only does Mylan's
petition raise the novel issue of law of "how properly to
calibrate antitrust standing where two antitrust cases collide,"
id. at 20, the outcome of which is potentially dispositive of the
case, but also the district court's decision is particularly
susceptible to challenge and there may be no further opportu-
nity to review its decision. Reviving its Rule 12(b)(6) conten-
tion, Mylan challenges the district court's certification deci-
sion by contending first that under Illinois Brick, the FTC's
s 13(b) enforcement action on behalf of the ultimate consum-
ers of lorazepam and clorazepate precludes suit by a direct
purchaser class. Allowing a direct purchaser class to sue the
same defendants for antitrust damages following the FTC's
suit and settlement would, in Mylan's view, "topple every
rationale" supporting Illinois Brick's rule confining potential
antitrust plaintiffs to one level of purchasers. Id. at 17. In
"these uncommon circumstances," Mylan concludes, "the di-
rect purchaser class should be denied recovery." Id. Sec-
ond, as to the certified class, Mylan maintains that, even if
direct purchasers may sue for antitrust damages in addition
to the consumer class, the district court erred in ruling that
the class had antitrust standing under the direct purchaser
rule and its narrow exceptions. According to Mylan, many
members of the class, including three of the four class
representatives, bought lorazepam and clorazepate, not from
Mylan, but from pharmaceutical wholesalers, who also pur-
port to be members of the direct purchaser class. Mylan
asserts that this purchasing chain makes these class members
who purchased from intermediaries "quintessential indirect
purchasers," who, under Illinois Brick, cannot sue for anti-
trust damages. Hence, Mylan maintains, the district court
erred in not determining, prior to certifying the class, wheth-
er the class and its representatives had antitrust standing
under Illinois Brick.
We first set forth the standards that we will ordinarily
apply in exercising our discretion under Rule 23(f), and then
we address the contentions in Mylan's petition.
II.
Rule 23(f), added by amendment in 1998, provides that "[a]
court of appeals may in its discretion permit an appeal from
an order of a district court granting or denying class action
certification under this rule if application is made to it within
ten days after entry of the order." Fed. R. Civ. P. 23(f).
Although other circuit courts of appeals have addressed the
scope of Rule 23(f) review, this is a question of first impres-
sion for this court. The advisory committee's note to Rule
23(f) states that "[a]ppeal from an order granting or denying
class certification is permitted in the sole discretion of the
court of appeals" and is "akin to the discretion exercised by
the Supreme Court in acting on a petition for certiorari."
Fed. R. Civ. P. 23(f) advisory committee's note. The advisory
committee's note also indicates that not all class certification
issues warrant review, noting that "many suits with class-
action allegations present familiar and almost routine issues
that are no more worthy of immediate appeal than many
other interlocutory rulings" and accordingly directs the
"courts of appeals [to] develop standards for granting review
that reflect the changing areas of uncertainty in class litiga-
tion." Id. The advisory committee's note offers this further
guidance:
Permission to appeal may be granted or denied on the
basis of any consideration that the court of appeals finds
persuasive. Permission is most likely to be granted
when the certification decision turns on a novel or unset-
tled question of law, or when, as a practical matter, the
decision on certification is likely dispositive of the litiga-
tion.
Id. Thus, the advisory committee's note identifies two in-
stances in which Rule 23(f) review would likely be appropri-
ate: (1) when a class certification decision as a practical
matter terminates the litigation; and (2) when a class certifi-
cation decision raises a novel issue of law. Relying on this
guidance, other circuits have examined the appropriate scope
of Rule 23(f).
First among the circuits to address the scope of appellate
review pursuant to Rule 23(f), was the Seventh Circuit in
Blair v. Equifax Check Services, Inc., 181 F.3d 832 (7th Cir.
1999). In Blair, the Seventh Circuit rejected the adoption of
a bright-line rule as imprudent and, looking to the reasons for
the addition of Rule 23(f), identified three categories of cases
in which appellate review would be appropriate. Id. at 834.
First, for some cases, denial of class status would sound the
"death knell" of the litigation because the "representative
plaintiff's claim is too small to justify the expense of litiga-
tion." Id. Second, the grant of class status can put substan-
tial pressure on the defendant to settle independent of the
merits of the plaintiffs' claims. Id. Third, an appeal may
facilitate the development of the law of class actions. Id. at
835. Regarding the first two categories, the Seventh Circuit
added that the petitioner must demonstrate that the district
court's certification decision was "questionable" and "must do
this taking into account the discretion the district judge
possesses in implementing Rule 23, and the correspondingly
deferential standard of appellate review." Id. It explained,
if the district court's decision is "impervious to revision,"
there is no point to an interlocutory appeal no matter how
"dramatic the effect of the grant or denial of class status [is]
in undercutting the plaintiff's claim or inducing the defendant
to capitulate." Id. Regarding the third category of cases,
which it noted is likely to include fundamental issues about
class actions that have been poorly developed because so
many class actions settle or are resolved in a manner that
overtakes procedural matters, id., the Seventh Circuit ob-
served that it is less important to show that the district
court's certification decision is questionable, explaining that
law can be advanced through affirmances as well as reversals;
rather, the more important the question under the second
factor is and the "greater the likelihood that it will escape
effective disposition at the end of the case," the more appro-
priate the appeal. Id.
The First Circuit in Waste Management Holdings, Inc. v.
Mowbray, 208 F.3d 288 (1st Cir. 2000), agreed that Blair
"captured the essential principles on which Rule 23(f) rests."
Id. at 293. However, because of the ease with which issues of
law can be characterized as "fundamental," id. at 294, and
because so many class certification decisions turn on "familiar
and almost routine issues," id. (quoting Fed. R. Civ. P. 23(f)
advisory committee's note), the First Circuit narrowed the
third category to include only "those instances in which an
appeal will permit the resolution of an unsettled legal issue
that is important to the particular litigation as well as impor-
tant in itself and likely to escape effective review if left
hanging until the end of the case." Id. At the same time,
however, the First Circuit duly noted the broad discretion
ceded to the appellate courts by the rule, and cautioned that:
While we hope that these general comments will be
helpful to parties deciding whether to pursue applications
under Rule 23(f), we do not foreclose the possibility that
special circumstances may lead us either to deny leave to
appeal in cases that seem superficially to fit into one of
these three pigeonholes, or conversely, to grant leave to
appeal in cases that do not match any of the three
described categories.
Id. Stating as well that it "intend[s] to exercise [its] discre-
tion judiciously," however, the First Circuit observed that
"[b]y their nature, interlocutory appeals are disruptive, time-
consuming, and expensive," and that notwithstanding the
access to the appellate courts provided by Rule 23(f), the
court "should err, if at all, on the side of allowing the district
court an opportunity to fine-tune its class certification order,
rather than opening the door too widely to interlocutory
appellate review." Id. (citing Fed. R. Civ. P. 23(c)(1)). The
Second Circuit, in In re Sumitomo Copper Litigation, 262
F.3d 134 (2d Cir. 2001), appears to have adopted the approach
set forth in Mowbray. Id. at 139-40. It stated that Rule
23(f) petitioners ordinarily must show either that the certifi-
cation order (1) "will effectively terminate the litigation and
there has been a substantial showing that the district court's
decision is questionable," or (2) "implicates a legal question
about which there is a compelling need for immediate resolu-
tion." Id. at 139.
Other circuits have elaborated on the Mowbray approach.
The Eleventh Circuit, in Prado-Steiman v. Bush, 221 F.3d
1266 (11th Cir. 2000), adopted five guideposts for Rule 23(f)
review: (1) whether the certification ruling is likely to sound
the death knell of the litigation; (2) whether the district
court's certification decision contains a substantial weakness,
such that it likely was an abuse of discretion; (3) whether the
appeal presents an unsettled legal question that is of specific
and general importance, e.g., issues likely to evade review,
issues that are involved in related actions, and interests that
affect the public interest; (4) the nature and status of the
litigation before the district court, e.g., the status of discov-
ery, the pendency of relevant motions, and how long the
matter has been pending; and (5) the likelihood that future
events will make immediate appellate review more appropri-
ate, e.g., a change in financial status of a party or ongoing
settlement negotiations. Id. at 1274-76. The second factor
serves as a sliding scale: the more questionable the district
court's decision, the less the remaining four factors need
weigh in. Id. at 1274-75 & n.10. The Eleventh Circuit
recognized the possibility that when the district court's certi-
fication decision is clearly wrong, Rule 23(f) review "may be
warranted even if none of the other factors supports granting
the Rule 23(f) petition." Id. at 1275. The Fourth Circuit, in
Lienhart v. Dryvit Systems, Inc., 255 F.3d 138 (4th Cir.
2001), adopted the Eleventh Circuit's approach with the slid-
ing scale, but firmly stated that when a class certification
decision is manifestly erroneous, review is warranted regard-
less of the remaining factors. Id. at 145-46. The court
explained that stringent standards for review are inappropri-
ate as "Rule 23(f)'s purpose [was] to eliminate the unduly
restrictive review practices which obtained when mandamus
was the only available means to review a class certification
prior to final judgment in the absence of a district court's
decision to voluntarily certify the issue for immediate re-
view...." Id. at 145. Hence, the Fourth Circuit observed
that "[i]n addition to addressing 'death knell' situations and
promoting the resolution of legal questions of general impor-
tance, a careful and sparing use of Rule 23(f) may promote
judicial economy by enabling the correction of certain mani-
festly flawed class certifications prior to trial and final judg-
ment." Id. at 145. Following the Eleventh and Fourth
Circuits' decisions, the Third Circuit, in Newton v. Merrill
Lynch, Pierce, Fenner & Smith, 259 F.3d 154 (3d Cir. 2001),
identified four categories of cases in which Rule 23(f) would
be appropriate: the three set forth by the Seventh Circuit in
Blair and the advisory committee's note plus the Eleventh
and Fourth Circuits' inclusion of a category of likely errone-
ous class certification decisions. Id. at 165.
The differences among the circuits, which are subtle, are of
three types. First, two circuits permit appeal if the district
court's decision is erroneous, regardless whether the other
factors governing appeal under Rule 23(f) are present. Com-
pare Newton, 259 F.3d at 165; and Lienhart, 255 F.3d at
145-46; with Mowbray, 208 F.3d at 293-94; and Blair, 181
F.3d at 834-35. Second, two circuits allow appeal when a
petition raises an unsettled and fundamental question of law,
regardless whether the district court likely erred. See Mow-
bray, 208 F.3d at 293; Blair, 181 F.3d at 835. Third, those
same circuits caution that interlocutory appeal of an unsettled
question of law is appropriate only when that question may
evade effective appellate review at the end of the trial court
proceedings. See Mowbray, 208 F.3d at 293-94; Blair, 181
F.3d at 835.
In our view, interlocutory appellate review under Rule 23(f)
is properly directed by the guidance set forth in the advisory
committee's note. The note reflects, on balance, a reluctance
to depart from the traditional procedure in which claimed
errors by the district court are reviewed on appeal only upon
the conclusion of the proceedings in the district court. Al-
though the rule ceded broad discretion to the appellate
courts, it is understood, if not presumed, that appellate courts
will act with cognizance of both the concerns underlying
interlocutory appeals generally and the specific purposes for
the allowance of interlocutory appeals of class certification
decisions in Rule 23(f). Delay caused by interlocutory ap-
peals under Rule 23(f) may be less of a concern because filing
a petition does not automatically stay the litigation, see Blair,
181 F.3d at 835; in the instant case, the docket indicates that
the case proceeded until the district court granted Mylan's
motion for a stay on April 15, 2002. Still, interlocutory
appeals are generally disfavored as "disruptive, time-
consuming, and expensive" for both the parties and the
courts, Mowbray, 208 F.3d at 294, and the more so in a
complex class action where the district court may reconsider
and modify the class as the case progresses. Prado-
Steiman, 221 F.3d at 1276-77; Fed. R. Civ. P. 23(c)(1). As
the Eleventh Circuit aptly commented, the exception provided
by Rule 23(f) should be exercised in a manner that avoids
both micromanagement of complex class actions as they
evolve in the district court and inhibition of the district
court's willingness to revise the class certification for fear of
triggering another round of appellate review. See Prado-
Steiman, 221 F.3d at 1273-74. Thus, petitions for Rule 23(f)
review are likely to be granted sparingly in cases that fall
within neither the guidelines in the advisory committee's note
nor the standards we adopt today. Nonetheless, the circuit
courts addressing Rule 23(f) are in agreement that restric-
tions on review should not preclude review in special circum-
stances that neither the advisory committee's note nor the
courts foresaw. See, e.g., Mowbray, 208 F.3d at 294; Blair,
181 F.3d at 834.
With these considerations in mind, we offer the following
guidance. Rule 23(f) review will ordinarily be appropriate in
three circumstances: (1) when there is a death-knell situation
for either the plaintiff or defendant that is independent of the
merits of the underlying claims, coupled with a class certifica-
tion decision by the district court that is questionable, taking
into account the district court's discretion over class certifica-
tion; (2) when the certification decision presents an unsettled
and fundamental issue of law relating to class actions, impor-
tant both to the specific litigation and generally, that is likely
to evade end-of-the-case review; and (3) when the district
court's class certification decision is manifestly erroneous.
Whether the district court's decision is questionable need not
affect the appropriateness of Rule 23(f) review in the second
category, as issues of law can be advanced through affir-
mances as well as reversals. Blair, 181 F.3d at 835. But we
conclude, unlike Mowbray and Blair, that error in certifying
a class should not entirely be ignored outside the first catego-
ry. Where a district court class certification decision is
manifestly erroneous, for example, Rule 23(f) review would be
warranted even in the absence of a death-knell situation if for
no other reason than to avoid a lengthy and costly trial that is
for naught once the final judgment is appealed. Although
these standards are meant as guidance on when Rule 23(f)
review ordinarily will be granted, we caution that the stan-
dards represent guidance, not a rigid test.
As is true for all the circuits, we are of the view that Rule
23(f) review should be granted rarely where a case does not
fall within one of these three categories. The sheer number
of class actions, the district court's authority to modify its
class certification decision, see Fed. R. Civ. P. 23(c)(1), and
the ease with which litigants can characterize legal issues as
novel, all militate in favor of narrowing the scope of Rule 23(f)
review. See Prado-Steiman, 221 F.3d at 1273-74; see also
Mowbray, 208 F.3d at 294. At the same time, there neces-
sarily should be some hesitancy in creating a rigid test for the
exercise of an appellate court's discretion to grant a Rule
23(f) petition for review because circumstances may arise that
cannot now be anticipated in which review would be appropri-
ate, and conversely, in which review would be inappropriate
notwithstanding the fact that a petition falls within the cate-
gories of cases in which review would ordinarily be appropri-
ate. As the advisory committee's note indicates, the circuit
court standards should "reflect the changing areas of uncer-
tainty in class litigation." Fed. R. Civ. P. 23(f) advisory
committee's note. Each circuit, thus, has reserved some
leeway in its standards. See, e.g., Newton, 259 F.3d at 165;
Prado-Steinman, 221 F.3d at 1276; Mowbray, 208 F.3d at
294; Blair, 181 F.3d at 834. So do we. That said, we
nevertheless conclude that, absent special circumstances, this
court's consideration of petitions for interlocutory review
under Rule 23(f) should ordinarily fall within the three cir-
cumstances that we have identified.
III.
Mylan contends in its Rule 23(f) petition for review that,
although certification of a class of direct purchasers is consis-
tent with the direct purchaser rule of Illinois Brick, it
conflicts with what Mylan regards as the underlying policy of
Illinois Brick--that only one purchaser class has antitrust
standing to sue under s 4 of the Clayton Act--when, as here,
the FTC has brought suit and obtained a settlement on behalf
of a class of consumer indirect purchasers. Mylan also
contends that the certified class consists of both direct and
indirect purchasers in contravention of Illinois Brick and
Rule 23's class certification requirements. Seeking to bring
itself within the flexible standards for Rule 23(f) adopted by
the circuit courts, Mylan maintains that its petition for review
should be granted because "important issues of antitrust
standing [are] raised by the District Court's class certification
ruling" that are novel, significant, and potentially dispositive,
and because the class as certified is particularly suspect and
may avoid later review given the potential liability Mylan
faces. We conclude that Rule 23(f) review is inappropriate
because Mylan's arguments in support of its Rule 12(b)(6)
motion to dismiss are unrelated to class certification, and
because Mylan's only challenge to the class certification deci-
sion falls outside the categories for Rule 23(f) review set forth
in Part II.
A.
Rule 23(f) interlocutory review is limited to issues that
relate to class certification. See Fed. R. Civ. P. 23(f); Bertul-
li v. Indep. Ass'n of Cont'l Pilots, 242 F.3d 290, 294 (5th Cir.
2001); Carter v. W. Publ'g Co., 225 F.3d 1258, 1262 (11th Cir.
2000). Thus, under Rule 23(f), this court can review the
merits of an appeal only insofar as they bear upon the
propriety of class certification, that is, whether the proposed
class satisfies the prerequisites of Rule 23. The threshold
requirements of class certification under Rule 23(a) are: (1)
numerosity (a large enough class such that "joinder of all
members is impractical"); (2) commonality ("questions of law
or fact common to the class"); (3) typicality ("claims or
defenses of the representative parties are typical of the
claims or defenses of the class"); and (4) adequacy of repre-
sentation ("representative parties will fairly and adequately
protect the interests of the class"). Fed. R. Civ. P. 23(a);
Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 613 (1997).
The rule also limits class actions to cases where: (1) separate
actions would risk "establish[ing] incompatible standards of
conduct for the party opposing the class" or individual adjudi-
cations "which would as a practical matter be dispositive of
the interests" of nonparty members or "substantially impair
or impede their ability to protect their interests"; (2) injunc-
tive or declaratory relief is sought and "the party opposing
the class has acted or refused to act on grounds generally
applicable to the class"; or (3) "the court finds that the
questions of law or fact common to the members of the class
predominate over any questions affecting only individual
members, and that a class action is superior to other available
methods for the fair and efficient adjudication of the contro-
versy." Fed. R. Civ. P. 23(b)(1), (2), & (3); Amchem, 521
U.S. at 614-16.
Although Mylan is correct that whether a class of direct
purchasers has antitrust standing under the particular cir-
cumstances at issue is a novel question of law, the question is
unrelated to class certification under Rule 23. As Mylan
styled its filing in the district court, its novel question of law
is properly raised in a Rule 12(b)(6) motion to dismiss; the
denial of a motion to dismiss is generally not subject to
interlocutory review under Rule 23(f) because whether the
plaintiffs state a cause of action is only relevant to class
certification to the extent the inquiry relates to the require-
ments of Rule 23. See Gen. Tel. Co. of the Southwest v.
Falcon, 457 U.S. 147, 160 (1982); Eisen v. Carlisle & Jacque-
lin, 417 U.S. 156, 177-78 (1974). Mylan's effort to recast its
Rule 12(b)(6) arguments as a challenge to class certification
on the ground that a class of direct purchasers lacks antitrust
standing, is to no avail. That Mylan's argument as to anti-
trust standing may dispose of the class as a whole and
thereby preclude a lawsuit by direct purchasers goes well
beyond the purpose of Rule 23(f) review because it is unrelat-
ed to the Rule 23 requirements. The fact that Mylan's
challenge would be dispositive of the class action is not unlike
a variety of issues of law on the merits of a class action
because of the very nature of commonality, see Fed. R. Civ. P.
23(a)(2); review of such issues would expand Rule 23(f)
interlocutory review to include review of any question raised
in a motion to dismiss that may potentially dispose of a
lawsuit as to the class as a whole. This result would inappro-
priately mix the issue of class certification with the merits of
a case, which do not warrant interlocutory review pursuant to
Rule 23(f). What matters for purposes of Rule 23(f) is
whether the issue is related to class certification itself, and
Mylan makes no showing that its antitrust standing claim is
so related.
The cases on which Mylan relies do not advance its cause.
To the extent that appellate courts have considered constitu-
tional standing pursuant to Rule 23(f), the inquiry has been
limited to whether the court has subject matter jurisdiction to
review the class certification issue, or whether the claims of
the representatives of the class have the requisite typicality.
Neither inquiry is applicable to the antitrust standing issue
that Mylan presents. In the first category of cases cited by
Mylan is Bertulli v. Independent Association of Continental
Pilots, 242 F.3d 290 (5th Cir. 2001), in which the Fifth Circuit
explained that, because Article III standing is one element of
the court's subject matter jurisdiction, this requirement must
be met before the court can even examine whether the class
has met the Rule 23 requirements. Id. at 294; see also
Rivera v. Wyeth-Ayerst Labs., 283 F.3d 315, 319 (5th Cir.
2002); Isaacs v. Sprint Corp., 261 F.3d 679, 682-83 (7th Cir.
2001). Unlike constitutional standing, this court's jurisdiction
does not turn on antitrust standing. See Associated Gen.
Contractors of Cal., Inc. v. Cal. State Council of Carpenters,
459 U.S. 519, 535 n.31 (1983). The question of constitutional
standing, which is a prerequisite to Rule 23 class certification
because it goes to the court's jurisdiction, is not at issue here.
In the second category of cases cited by Mylan is Prado-
Steiman, in which the Eleventh Circuit considered, pursuant
to Rule 23(f), whether the named representatives had consti-
tutional standing, explaining that the question of standing was
appropriate for review under Rule 23(f) only to the extent it
was relevant to Rule 23's typicality requirement for "[w]ith-
out individual standing to raise a legal claim, a named repre-
sentative does not have the requisite typicality to raise the
same claim on behalf of a class." Prado-Steiman, 221 F.3d at
1279-80; see also Piazza v. EBSCO Indus., Inc., 273 F.3d
1341, 1346-55 (11th Cir. 2001); Carter, 225 F.3d at 1262-63.
The court thus only considered Article III standing to the
extent that it was relevant to Rule 23 class certification.
Unlike constitutional standing, whether the class representa-
tives have antitrust standing because they are direct purchas-
ers does not go to the typicality of the claims of the represen-
tatives of the class, which is composed entirely of direct
purchasers. See Fed. R. Civ. P. 23(a)(3); Prado-Steiman,
221 F.3d at 1279 & n.14. Hence, the issue of antitrust
standing is beyond the scope of the court's Rule 23(f) review.
The only case to which Mylan points in which a court consid-
ered antitrust standing to be a necessary predicate to certify-
ing the class is In re NASDAQ Market-Makers Antitrust
Litigation, 169 F.R.D. 493 (S.D.N.Y. 1996), but there the
court appears to have viewed antitrust standing as being
relevant to its subject matter jurisdiction; it was only on this
basis that the court considered antitrust standing to be a
prerequisite to class certification. See id. at 504-05.
Although the question of whether a class of direct purchas-
ers has antitrust standing when, in Mylan's terms, "two
antitrust cases collide" relates neither to this court's subject
matter jurisdiction nor to any aspect of Rule 23 class certifi-
cation, there may be occasions when threshold issues (e.g.,
statute of limitations), jurisdictional issues (e.g., Article III
constitutional standing), or issues on the merits (e.g., affirma-
tive defenses or the elements of a cause of action, see, e.g.,
West v. Prudential Securities, Inc., 282 F.3d 935, 937 (7th
Cir. 2002); Newton, 259 F.3d at 172; Mowbray, 208 F.3d at
295-99), would be appropriate for interlocutory review pursu-
ant to Rule 23(f). In such circumstances, however, those
issues would relate in some manner to the certification of the
class or the court's jurisdiction. We have no occasion to
describe the precise contours of the relationship, for here
there is no such relation.
B.
Mylan's challenge to the composition of the certified class
as assertedly, and improperly, consisting of both direct and
indirect purchasers also is inappropriate for Rule 23(f) review.
First, Mylan has not shown that certification of the class
would sound the death knell of the litigation. Other than
mere assertions, Mylan makes no showing that it will be
unduly pressured to settle because of the class's certification.
Mylan failed to submit any evidence that the damages
claimed would force a company of its size to settle without
relation to the merits of the class's claims. See Prado-
Steiman, 221 F.3d at 1274; Mowbray, 208 F.3d at 294-95.
Second, Mylan's challenge presents no unsettled question
of fundamental importance to the law of class actions. Mylan
argues that the district court erred in applying the standards
of Rule 23 to the facts of this case, but Mylan does not aver
that the district court lacked established law to guide it in
that task. Insofar as Mylan's objection is based upon the
district court's conclusion that the class representatives are
direct purchasers, the law guiding that decision also is well
settled. See Illinois Brick, 431 U.S. at 735-36.
Third, Mylan has not made a showing that, in light of the
district court's discretion, see Hartman v. Duffey, 19 F.3d
1459, 1471 (D.C. Cir. 1994), the class certification was mani-
festly erroneous. Mylan contends the certified class does not
meet the requirements of Rule 23(a)(2-4), namely, predomi-
nance, typicality, and adequacy of representation, because
members of the class occupy different levels of a distribution
relationship with Mylan. Upon the record before us, howev-
er, we can not conclude that there is manifest error in the
district court's determination that the class representatives
have standing under Illinois Brick or in the findings of fact
underlying that conclusion. As the district court comes to
know more about the relationships among Mylan, the phar-
maceutical wholesalers, and the class plaintiffs, it may further
refine the class, see Fed. R. Civ. P. 23(c)(1)--a possibility that
supports our conclusion that immediate appeal is not warrant-
ed here.
Accordingly, we hold, upon applying the standards that we
have outlined in defining when Rule 23(f) review is ordinarily
appropriate, that Mylan's challenges to the class certification
do not warrant interlocutory review pursuant to Rule 23(f).
Although Mylan would nonetheless have the court reach the
merits of the district court's certification decision as well as
the merits of its Rule 12(b)(6) motion to dismiss because the
issues have been carefully briefed, review under Rule 23(f) is
not warranted. Therefore, we deny the petition for review.