51 So. 3d 673
La.2010Background
- Hurricane Katrina damaged Southeast Louisiana; homeowners insured by Lafayette sued for bad-faith adjustments and misadjustments.
- Plaintiffs sought class certification under La. Code Civ. Proc. art. 592 for wind-damage claims denied or under-adjusted.
- Trial court certified a class including homeowners across eight parishes with defined wind-damage misadjustment practices.
- Appellate court affirmed the certification but remanded to remove a clause about arbitrary, capricious conduct.
- Court granted writ to review whether common questions predominate and if class treatment is superior.
- This Court reverses, finding no common issues predominate and class action is not superior in these facts.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether common questions predominate | Dupree argues common misadjustment theories prevail | Lafayette contends claims are individualized | No; predominance not shown |
| Whether common questions exist for specific misadjustments (pricing, GCOP, ALE, civil authority) | Plaintiffs assert uniform misadjustment practices across claims | Defendant asserts each claim turns on claim-specific facts | No; no common nucleus of operative facts for these categories |
| Whether class is superior to individual actions | Class treatment savesjudicial resources | Individual issues and high variability predominate | No; uneven damages and individualized proofs negate superiority |
| Whether statutory penalties claims can be certified on a class basis | Penalties should be uniform across class | Penalties depend on individual grounds and evidence | No; penalties require individual determinations |
| Whether timely payment penalties under 22:658/22:1220 fit class treatment | Penalties arise from arbitrary, capricious misadjustments | No uniform proof; individual claims differ | No; not suitable for class-wide adjudication |
Key Cases Cited
- Brooks v. Union Pacific R. Co., 13 So.3d 546 (La. 2009) (rigorous analysis required for certification; deference to trial court abuses standard of review)
- Banks v. New York Life Ins. Co., 737 So.2d 1275 (La. 1999) (class prerequisites and predominance principles in Louisiana)
- Ford v. Murphy Oil U.S.A., Inc., 703 So.2d 542 (La. 1997) (relevance of commonality and predominance in certification)
- McCastle v. Rollins Environmental Services of Louisiana, Inc., 456 So.2d 612 (La. 1984) (early articulation of class action prerequisites and cohesive issues)
- Castano v. American Tobacco Co., 84 F.3d 734 (5th Cir. 1996) (federal guidance on class actions and commonality/predominance)
- O’Sullivan v. Countrywide Home Loans, Inc., 319 F.3d 732 (5th Cir. 2003) (predominance and manageability considerations in class actions)
- Allison v. Citgo Petroleum Corp., 151 F.3d 402 (5th Cir. 1998) (illustrates limits of Rule 23b(1)(a) for individualized damages)