Shady Grove and Class Actions: Part Two of the Effect of Recent SCOTUS Decisions on Arbitration in South Carolina
By Shaun Blake This post is the second in a series discussing the South Carolina Supreme Court’s decision in Herron in the context of recent United State Supreme Court decisions addressing arbitration. Click here for part one. Update: you may want to click here and listen while you read. Shady Grove In Shady Grove the Petitioner filed a putative class action in Federal District Court under CAFA to recover from Allstate interest on an insurance claim allowed under a New York law. The District Court dismissed the action after concluding it lacked jurisdiction because N.Y. Civ. Prac. Law Ann. §901(b) explicitly bars claimants from pursuing a class action to recover a "penalty" such as statutory interest. However, the U.S. Supreme Court ultimately reversed this decision in a plurality decision, holding that Rule 23 of the Federal Rules of Civil Procedure and §901(b) conflicted, and therefore Rule 23 allowed the Petitioner to pursue a federal class action despite