Young v. Nationwide Mutual Insurance
2012 U.S. App. LEXIS 18625
6th Cir.2012Background
- Defendants are Kentucky-insurance companies challenging district court certification of statewide subclasses under Rule 23(a) and (b)(3).
- Kentucky imposes local government premium taxes on insurers and allows a collection fee; insurers pass taxes to insureds.
- Named Plaintiffs allege they were charged local taxes incorrectly or at higher rates than permitted.
- The district court subdivided the action into ten subclasses for separate actions and certified them.
- Certification relied on geocoding software compatibility with Defendants’ data to identify proper tax jurisdictions.
- The class definitions hinge on objective criteria (insured location, local boundaries, applicable tax, and charged amount).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the class definition is sufficiently definite and feasible | Plaintiffs claim the definition uses objective criteria and is administratively feasible. | Defendants argue the definition is a failing 'fail-safe' class and not administratively feasible. | Not a fail-safe class; administratively feasible. |
| Whether Rule 23(a) prerequisites are satisfied | Plaintiffs show numerosity, commonality, typicality, adequacy via common policy and injunctive relief. | Defendants contest uniform policy and seek individualized inquiries. | All four requirements satisfied. |
| Whether common questions predominate under Rule 23(b)(3) | A single practice—not using geocoding—caused most class injuries; common proof applies. | Individualized liability issues predominate due to policy-specific misassignments. | Predominance satisfied; common issues predominate. |
| Whether class is a superior method for adjudication | Administrative remedies are unlikely to provide redress for small per-member losses; class is superior. | Admin process exists; class is not necessary. | Class action is a superior method. |
Key Cases Cited
- Sprague v. Gen. Motors Corp., 133 F.3d 388 (6th Cir.1998) (commonality and typicality guide class adequacy)
- In re Am. Med. Sys., Inc., 75 F.3d 1069 (6th Cir.1996) (rigorous analysis; satisfy Rule 23; not merely pleadings)
- Beattie v. CenturyTel, Inc., 511 F.3d 554 (6th Cir.2007) (predominance with common questions)
- Dukes, 131 S. Ct. 2541 (S. Ct. 2011) (Rule 23 requires rigorous analysis and not mere allegations)
- Powers v. Hamilton County Pub. Defender Com’n, 501 F.3d 592 (6th Cir.2007) (common issues may predominate despite some individualized defenses)
- Randleman v. Fidelity Nat'l Title Ins. Co., 646 F.3d 347 (6th Cir.2011) (distinguishes Slapikas on state law grounds)
- Sterling v. Velsicol Chem. Corp., 855 F.2d 1188 (6th Cir.1988) (adequacy of representation; common interests and counsel)