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Todd Noteboom
Todd Noteboom

The POWER 30: Todd Noteboom

Class actions are an integral part of the legal profession and of the American economy.

They are loved and hated by lawyers, and are challenging to judges.

Todd Noteboom is one of the lawyers who loves to defend against class actions. Now a partner at Stinson, he moved there laterally in order to work in the field.

Since then, he has defended against class actions and represented businesses in complex securities litigation, arbitration and regulatory investigations and proceedings involving the SEC, FINRA, state regulators and state attorneys general. There was some work for ResCap in the mortgage crisis/recession that expanded Stinson’s national footprint. ResCap went after banks that had made bad loans, Noteboom said.

His class action work has been growing since the Class Action Fairness Act took effect in 2005. The statute, known as CAFA, 28 U.S.C. Sections 1332(d), 1453, and 1711–1715, expanded federal subject-matter jurisdiction over many large class-action lawsuits and mass actions taken in the United States.

“It created mechanisms that hadn’t existed that allowed cases to be brought in federal court,” Noteboom explained.

The act permits federal courts to preside over certain class actions in diversity jurisdiction where: the aggregate amount in controversy exceeds $5 million; where the class comprises at least 100 plaintiffs; and where there is at least “minimal diversity” between the parties (e.g., at least one plaintiff class member is diverse from at least one defendant).

It also provides for more exacting review and enforcement of the requirements for class actions under Rule 23, FRCP, of numerosity, commonality, typicality and adequate representation, Noteboom said.

“It’s important to be in federal court,” he explained. There’s a more developed body of federal law, and the courts are familiar with it and its attendant rules, he said.

Some cases are well-suited for class certification, Noteboom said, but in the majority of what he has seen the issues are too individualized for a class.

The circuit courts vary in their receptivity to class certification, he said. “Class certification can be a turning point,” he said.

There is an opportunity for interlocutory review under Rule 23(f), which authorizes a court of appeals to permit an appeal from an order granting or denying class-action certification under this rule, Noteboom said. But that rule does not apply to settlement proceedings, including settlement of certification issues.

Some putative class actions involving COVID-related insurance coverage have been filed, Noteboom said, although he sees them as individualized cases.

Business-interruption cases are also being filed, but Noteboom said most insurance policies require a physical loss for coverage to kick in. Most federal courts are not finding coverage for a government shutdown, but a minority are leaving the door open, he said. If the courts find coverage or the insurers change their policies, premiums will grow, he said.

Noteboom’s background includes growing up as a musician and in performing arts. He continues to nurture that as a member of the board of the Guthrie Theater and chair of the board of the Children’s Theatre. “People are buying tickets,” he said.