Commercial Division Blog

Current Developments in the Commercial Divisions of the
New York State Courts
Posted: May 15, 2016

Notice of Impending Dismissal of Putative Class Action Required Even if Class Not Yet Certified

On May 12, 2016, the First Department issued a decision in Vasquez v. National Securities Corp., 2016 NY Slip Op. 03817, holding that the proposed class of a putative class action must be given notice of the dismissal of the action even if the class is not yet certified, explaining:

The motion court correctly required notice of the impending dismissal of the putative class action even though the class had not been certified. The court correctly relied on our decision in Avena v Ford Motor Co. (85 AD2d 149 [1st Dept 1982]), the subsequent amendment of Federal Rule of Civil Procedure 23(e) to restrict the notice requirement to dismissals, discontinuances and compromises of “certified class” actions notwithstanding. The legislature, presumably aware of the law as stated in Avena, has not amended CPLR 908 to conform to the federal statute. Although defendant-appellant raises policy arguments in support of its position, its remedy lies with the legislature and not with this Court.

(Internal quotations and citations omitted).

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