January 2019Volume 49Number 5PDF icon PDF version (for best printing)

Efficiency, economy, and consistency: 2018-2019 amendments to the Federal Rules

The Advisory Committee on Civil Rules (Advisory Committee) further demonstrated its commitment to rule amendments that are responsive to modern realities of litigation in its recent changes made to Rules 5, 23, 62, and 65.1 of the Federal Rules of Civil Procedure.  The updates to these Rules, approved by the U.S. Supreme Court last April, and made effective December 1, 2018, are straightforward and narrow. The 2018 amendments continue to focus on practicality. 

Amended Rule 5: Serving and Filing Pleadings and Other Papers

Most important among the 2018-2019 amendments are the changes made to Rule 5 and the Advisory Committee’s further embrace of electronic efficiency. 

Rule 5(b)(2)(E) previously required consent in writing to electronic service, based on an historic concern that electronic communication could be unreliable and sporadic.  The 2018-2019 amendments remove this requirement for written consent as it relates to registered users of the federal court’s electronic filing system (“ECF”).  Worth noting is that the ultimate responsibility as to the success of ECF service still lies with filer – service may be completed but won’t be effective if the filer or sender learns that the document did not reach the person to be served.  As the Advisory Committee Notes make clear, the court is not responsible for notifying the filer in the event of a failed ECF transmission.  Also, written consent to electronic service is still required in instances when service is made by electronic means outside of ECF (e.g., for discovery responses).

The Rule 5(d) amendments reflect the predominance of electronic filing in today’s federal practice.  For starters, it is the end of an era (and an extra page): revised Rule 5(d)(1)(B) removes the requirement of a certificate of service for filings that are served via ECF.  For all non-ECF service, a certificate of service identifying the date and manner of service still must be filed with the document or within a reasonable time after service.  Under the former Rule 5(d)(3), documents could be filed, signed, or verified by electronic means if permitted by local rule, and as long as the local rule contained reasonable exceptions.  In practice, most courts’ local rules had already evolved to require registered users to file electronically.  (See e.g. N.D. Ill. LR5.2(a)). As the Advisory Committee Notes proclaim regarding the revamped Rule 5(d)(3)(A), “[t]he time has come to seize the advantages of electronic filing by making it generally mandatory in all districts for a person represented by an attorney.”  The local practice of so many courts thus has been universalized.  Finally, Rule 5(d)(3)(C) instructs that a valid signature is executed when a person authorizes a filing made through her or his ECF account and her or his name appears on the signature block.

New Rule 5 Recap

  • Serve registered ECF users using ECF. 
  • No certificate of service is needed for an ECF filing. 
  • Parties represented by counsel must use electronic filing absent a contradictory local rule or good cause.

Amended Rule 23: Class Actions

The amendments to Rule 23 economize resources devoted to class settlement by expanding methods for providing notice to class members, revising factors a district court should consider in approving a proposed class settlement, removing the need for court approval to withdraw class settlement objections, and asserting the finality of district court approval of class notice procedures.

In another nod to the reality of modern of communication, Rule 23(c)(2)(B) now expressly acknowledges that the court employing “the best notice that is practicable under the circumstances” to communicate a proposed settlement to class members may entail notice through electronic means in addition to United States mail or “other appropriate means.”  The Advisory Committee Notes instruct courts to “consider the capacity and limits of current technology” when selecting a notice method.  Rule 23(c)(2)(B) also makes evident that Rule 23(e)(1) notice initiates the opt-out period in Rule 23(b)(3) class actions.

Rule 23(e)(1) now requires the court to direct notice of proposed settlement, dismissal, or compromise to class members if giving notice is justified by the parties’ showing that the court will likely (i) approve the proposed resolution under Rule 23(e)(2) and (ii) if it has not previously certified a class, certify the class for purposes of judgment on the proposal.  Effectively, this provision conditions the court providing class notice of a proposed settlement on the likelihood of final approval, which underscores an understanding articulated in the Advisory Committee Notes that “[t]he decision to give notice of a proposed settlement to the class is an important event … [that] should be based on a solid record.”  

The amendments make clear that parties are responsible for submitting sufficient information for the court to use in determining whether to notify the class of the proposed resolution.  In making its determination, the court should focus on the extent and types of benefits a proposed settlement would give class members and consider such factors as the contemplated claims process, anticipated rate of claims, distribution of unclaimed funds, the range and risks of protracted litigation, and attorneys’ fees.

In an effort to decrease the potential for unjustified or half-cooked objections that can slow down and even dismantle settlements, amended Rule 23(e)(5)(A) now allows an objector to withdraw objection without court approval.

The remaining Rule 23 amendment comes in Rule 23(f), which makes a ruling under Rule 23(e)(1) regarding the form of notice to a class of a proposed settlement un-appealable, at least until the district court decides whether to certify a class.

New Rule 23 Recap

  • The court should only give notice of a proposed settlement if settlement approval is likely and the class has been certified or likely will be certified.
  • Parties are responsible for providing the court with information to determine whether sending notice of a proposed settlement is justified. 
  • Settlement objectors can withdraw their objections without court approval.

Amended Rule 62: Stay of Proceedings to Enforce a Judgment and Rule 65.1: Proceedings Against a Security Provider

Consistency is a mark of good rule making: Rules 62 and 65.1 have been amended to resolve previously confusing timing issues.  Fixing an “apparent gap,” Rule 62(a) now extends an automatic stay from 14 days to 30 days following the entry of a judgment (unless the court orders otherwise).  This change to 30 days coincides the time for filing most appeals, thereby giving a would-be appellant the full appeal time period to also benefit from an automatic stay.  Amended Rule 62(a) cautions however, that a court has authority to dissolve or supersede an automatic stay.
 

Rule 65.1 was amended by replacing “surety” with “security” to track Rule 62’s tweaked language allowing a party to obtain a stay or judgment “by providing a bond or other security.”

New Rules 62 and 65.1 Recap

  • The automatic stay after judgment is 30 days unless the court orders a different stay period.

Conclusion

The 2018-2019 amendments to the Federal Rules of Civil Procedure communicate a steady resolve to have the Rules evolve with the times through principles of efficiency, economy, and consistency.  

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