Class Certification Vacated In Extant Claims Litigation Stemming From Madoff Ponzi Scheme.

In consolidated interlocutory appeals, defendants (financial companies and accountants) challenged the district court's certification of a class of investors in four funds created and managed by the Fairfield Greenwich Group, which sustained billions of dollars in lost value following the collapse of the Madoff Ponzi scheme. In vacating the district court’s order, the court ruled that the order did not indicate how common evidence could show (1) the existence of a duty of care applicable to the class or (2) reliance by the class on alleged misrepresentations. Both were required to show that individual issues did not predominate and that the class should be certified under Fed. R. Civ. P. 23(b)(3). The court noted that Rule 23 did not set forth a pleading standard, but that the "party seeking class certification must affirmatively demonstrate compliance with the Rule.” A district court could only certify a class if it was “satisfied, after a rigorous analysis,'" that the requirements of Rule 23 were met.  Stephen's Sch. v. PricewaterhouseCoopers Accountants N.V., Nos. 13-2340-cv(L), 13-2345-cv(Con), 2014 U.S. App. LEXIS 11515 (2d Cir. N.Y. Jun. 19, 2014).