UNITED STATES DISTRICT COURT DISTRICT OF MINNESOTA IN RE ...

CASE 0:17-md-02795-MJD-KMM Document 498 Filed 11/22/19 Page 1 of 54

UNITED STATES DISTRICT COURT DISTRICT OF MINNESOTA

_______________________________________________________________________

IN RE: CENTURYLINK SALES PRACTICES AND SECURITIES LITIGATION

MDL No. 17-2795 (MJD/KMM)

This Document Relates to:

0:17-cv-02832 0:17-cv-04613 0:17-cv-04615 0:17-cv-04616 0:17-cv-04617 0:17-cv-04618 0:17-cv-04619

0:17-cv-04622 0:17-cv-04944 0:17-cv-04945 0:17-cv-01562 0:17-cv-01565 0:17-cv-01572 0:17-cv-01573

BRIEF OF ATTORNEYS GENERAL OF DELAWARE, ARIZONA, ARKANSAS, CALIFORNIA, COLORADO, CONNECTICUT, DISTRICT OF COLUMBIA, FLORIDA, GEORGIA, HAWAII, IDAHO, ILLINOIS, INDIANA, IOWA, KENTUCKY, MAINE, MARYLAND, MASSACHUSETTS, MICHIGAN, MISSISSIPPI, NEBRASKA, NEVADA, NEW JERSEY, NORTH CAROLINA,

NORTH DAKOTA, OHIO, OKLAHOMA, OREGON, PENNSYLVANIA, RHODE ISLAND, SOUTH CAROLINA, TENNESSEE, TEXAS, VERMONT, VIRGINIA,

WASHINGTON, AND WYOMING AS AMICI CURIAE OPPOSING DEFENDANT CENTURYLINK'S MOTION FOR TEMPORARY INJUNCTION

CASE 0:17-md-02795-MJD-KMM Document 498 Filed 11/22/19 Page 2 of 54

TABLE OF CONTENTS

TABLE OF AUTHORITIES..............................................................................................iii STATEMENT OF INTEREST ........................................................................................... 1 INTRODUCTION ............................................................................................................... 1 ARGUMENT....................................................................................................................... 3

I. FEDERAL COURTS CANNOT ASSUME JURISDICTION OVER STATE LAW ENFORCEMENT ACTIONS PROPERLY BROUGHT IN STATE COURTS .......................................................................................... 3 A. CenturyLink's Proposed Injunction Would Violate the Eleventh Amendment.............................................................................................. 5 B. Younger Abstention Principles Foreclose an Injunction ......................... 9

II. THE ANTI-INJUNCTION ACT BARS CENTURYLINK'S PROPOSED INJUNCTION ............................................................................. 11 A. An Injunction Is Not "Necessary in Aid of Jurisdiction" ...................... 13 B. The Other Anti-Injunction Act Exceptions Are Inapplicable................ 20

III. CENTURYLINK'S PROPOSED INJUNCTION IS INEQUITABLE BECAUSE IT WOULD HARM THE PUBLIC INTEREST........................... 21 A. An Injunction Would Harm the Public Interest by Incentivizing Collusive "Reverse Auction" Settlements in Class Action Litigation................................................................................................ 23 B. An Injunction Would Harm the Public Interest by Ensuring Lesser Recoveries for Fraud Victims ................................................................ 26 C. An Injunction Would Harm the Public Interest by Limiting the Ability of Government Officials to Use Restitution to Deter Wrongdoing ........................................................................................... 28

IV. STATE ATTORNEYS GENERAL ARE GOVERNED BY DIFFERENT LEGAL STANDARDS AND LACK PRIVITY WITH CONSUMERS IN STATE LAW ENFORCEMENT ACTIONS .................... 30 A. The Legal Issues in Federal Class Action Lawsuits Are Often Different from Those Before State Courts Hearing Government Enforcement Actions ............................................................................. 30 B. Class Members Are Not in Privity with State Attorneys General ......... 33 i. Class Members Have No Substantive Legal Relationship with State Attorneys General...................................................... 34

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CASE 0:17-md-02795-MJD-KMM Document 498 Filed 11/22/19 Page 3 of 54 ii. Class Members Cannot Adequately Represent State Attorneys General Because The Parties Have Different Interests ....................................................................................... 34 iii. State Attorneys General Do Not Control Class Action Lawsuits or Represent Class Members in a Manner that Allows for Preclusion ................................................................. 39

CONCLUSION ................................................................................................................. 41

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TABLE OF AUTHORITIES

Cases

Page(s)

Adkins v. Nestle Purina PetCare Co., 779 F.3d 481 (7th Cir. 2015).................................................................................... 18, 19

Amchem Prod., Inc. v. Windsor, 521 U.S. 591 (1997) ................................................................................................. 14, 24

Angela R. by Hesselbein v. Clinton, 999 F.2d 320 (8th Cir. 1993)............................................................................................ 8

Atl. Coast Line R. Co. v. Bhd. of Locomotive Engineers, 398 U.S. 281 (1970) ..................................................................................... 12, 13, 19, 22

AU Optronics Corp. v. South Carolina, 699 F.3d 385 (4th Cir. 2012)............................................................................................ 9

Beck v. Levering, 947 F.2d 639 (2d Cir. 1991) ..................................................................................... 36, 37

California v. IntelliGender, LLC, 771 F.3d 1169 (9th Cir. 2014)...................................................................... 15, 20, 21, 38

Canady v. Allstate Ins. Co., 282 F.3d 1005 (8th Cir. 2002)........................................................................................ 22

Carlough v. Amchem Prod., Inc., 10 F.3d 189 (3d Cir. 1993) ....................................................................................... 14, 16

CE Design Ltd. v. King Supply Co., 791 F.3d 722 (7th Cir. 2015).......................................................................................... 24

Cedar Rapids Cellular Tel., L.P. v. Miller, 280 F.3d 874 (8th Cir. 2002).......................................................................................... 10

CFTC v. Comm'l Hedge Servs., Inc., 422 F. Supp.2d 1057 (D. Neb. 2006) ................................................................. 37, 38, 39

Chao v. A-One Med. Servs., Inc., 346 F.3d 908 (9th Cir. 2003).......................................................................................... 38

Chick Kam Choo v. Exxon Corp., 486 U.S. 140 (1988) ........................................................................................... 12, 20, 21

China Agritech, Inc. v. Resh, 138 S. Ct. 1800 (2018) ................................................................................................... 24

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CASE 0:17-md-02795-MJD-KMM Document 498 Filed 11/22/19 Page 5 of 54

Com. ex rel. Stephens v. N. Am. Van Lines, Inc., 600 S.W.2d 459 (Ky. Ct. App. 1979)............................................................................. 31

Cuomo v. Clearing House Ass'n, L.L.C., 557 U.S. 519 (2009) ......................................................................................................... 4

Curtis v. Altria Grp., Inc., 813 N.W.2d 891 (Minn. 2012) ............................................................................. 4, 31, 40

Danforth v. Minnesota, 552 U.S. 264 (2008) ......................................................................................................... 3

Dataphase Sys., Inc. v. C L Sys., Inc., 640 F.2d 109 (8th Cir. 1981).......................................................................................... 22

Doe v. Hesketh, 828 F.3d 159 (3d Cir. 2016) ........................................................................................... 36

Donovan v. Cunningham, 716 F.2d 1455 (5th Cir. 1983)........................................................................................ 36

Dover Elevator Co. v. Arkansas State Univ., 64 F.3d 442 (8th Cir. 1995).............................................................................................. 7

Duckett v. Fuller, 819 F.3d 740 (4th Cir. 2016).................................................................................... 34, 40

E.E.O.C. v. U.S. Steel Corp., 921 F.2d 489 (3d Cir. 1990) ........................................................................................... 39

EEOC v. Pemco Aeroplex, Inc., 383 F.3d 1280 (11th Cir. 2004)...................................................................................... 35

Ex parte Young, 209 U.S. 123 (1908) ......................................................................................................... 7

Fed. Trade Comm'n v. Hornbeam Special Situations, LLC, 308 F. Supp. 3d 1280 (N.D. Ga. 2018) .......................................................................... 39

Foster v. State of Minnesota, 888 F.3d 356 (8th Cir. 2018).................................................................................... 12, 32

Franchise Tax Bd. of California v. Hyatt, 139 S. Ct. 1485 (2019) ................................................................................................. 5, 6

Goodrich v. Supreme Court of S.D., 511 F.2d 316 (8th Cir.1975)........................................................................................... 22

Hauschildt v. Beckingham, 686 N.W.2d 829 (Minn. 2004) ....................................................................................... 32

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