In re Samsung Galaxy Smartphone Marketing and Sales Practices Litigation.

Background

This proposed class action concerns various Samsung smartphone models. The plaintiffs alleged that Samsung Electronics Co., Ltd. and Samsung Electronics America, Inc. knew about overheating problems in certain phones but did not fix the problems or warn customers about the dangers. The First Amended Complaint was brought by 15 named plaintiffs who had purchased at least one of six models: the Galaxy S7, Galaxy S7 Edge, Galaxy S6, Galaxy S6 Edge, Galaxy S6 Edge+, and Galaxy Note5.

The court had previously compelled arbitration for six named plaintiffs, including Omar Atebar as to the Galaxy S7, and dismissed those plaintiffs’ class-action claims because the arbitration agreement waived class actions. The court denied arbitration as to the remaining named plaintiffs and as to Atebar’s Galaxy Note5 claim. In March 2018, the court dismissed the claims that had not been compelled to arbitration but allowed the plaintiffs to amend. The court then stayed the entire case while arbitration proceeded and administratively closed the file.

Motions

Six named plaintiffs moved to reinstate the case as to the claims that were not compelled to arbitration: Omar Atebar as to the Galaxy Note5, Dior Dee, Tomas Hernandez, Eric Pirverdian, Tomig Salmasian, and Jesus Sanchez. They represented that the claims sent to arbitration were either no longer being pursued or had been resolved.

Samsung opposed reinstatement and moved under Federal Rule of Civil Procedure 41(b), which allows dismissal for failure to prosecute a case. Samsung argued that nothing had happened for almost two years because the plaintiffs had not pursued the claims sent to arbitration. The plaintiffs acknowledged delays but explained that their attorneys had been consulting with other plaintiffs’ firms and clients about whether to pursue individual arbitration. Their counsel also acknowledged that the reinstatement motion should have been filed sooner.

Court’s Analysis

The court treated reinstatement as an administrative matter and analyzed Samsung’s dismissal request under the five factors used in the Ninth Circuit for dismissal based on failure to prosecute: the public interest in resolving cases promptly, the court’s need to manage its docket, possible prejudice to the defendants, the policy favoring decisions on the merits, and whether less severe sanctions were available. The court also considered whether the delay was unreasonable.

The first two factors favored dismissal because the case had been pending for more than three years without moving beyond the pleading stage and could require substantial court resources. The third factor also favored dismissal, but only weakly. The court found that the plaintiffs had delayed unreasonably, but Samsung had not shown significant actual prejudice. The court was not persuaded that relevant technical documents were likely to be unavailable, and Samsung had long known about the allegations.

The fourth factor weighed strongly against dismissal because the law favors resolving cases on their merits. The court found that the six plaintiffs seeking reinstatement were less responsible for the delay because they had been required to wait while other plaintiffs’ claims proceeded through arbitration. The fifth factor—whether a less severe sanction was available—did not strongly favor either side. The court also noted that it had not warned the plaintiffs about possible dismissal before considering Samsung’s motion.

Disposition

The court concluded that the circumstances were not sufficiently extreme to justify dismissal, even though the plaintiffs’ conduct had not been diligent. The court DENIED Defendants’ motion to dismiss and GRANTED Plaintiffs’ motion to reinstate the case. The stay was lifted, and the plaintiffs were ordered to file their Second Amended Complaint by May 11, 2020.