*1 as And when a defendant very process. his guess second Bowman to attempt by an reason, manip- serts, to withdraw a of a motion support for whatever plea, guilty con- evidence beneficial ulating pleading known that he lied guilty plea, report toxicology in the tamed provides so—he an repeatedly guilty—and court. The lied to the that he claiming manipulation, of such example its discretion was well within district court is judgment The district this effort. reject to AFFIRMED. III pro to designed is colloquy Rule 11 the defendant protect a structure vide and invol making an uninformed pro and to plead guilty
untary decision judgment of unjust public from
tect the not been trial has public
guilty when not held a trial is Because
conducted. guilty, the court pleads a defendant
when rely on the defendant’s able to
must be testimony and his truthful
self-interest based guilty to find the defendant
deciding Moreover, avoid de guilty plea.
on a statements, pre-colloquy
pendence on Mary GUNNELLS; A. Gun B. William advice, misunderstand agreements, Cyn Corporation; nells; Tech Tele is colloquy Rule 11 at the ings, the court Mullinax; Truck and de & W the defendant thia W to review with required Jerry Incorporated; components Company, material all of the novo Tractor when a consequence, guilty plea. As Transmissions, Freeman; Incor AAA Rule 11 lied at says he defendant Robertson; B. porated; Pamela heavy burden seek he bears a colloquy, International, In Avionics/Seaonics what process. repeat We nullify the ing to Cassleman; corporated; E. James before, con appropriately that an we said Workman; Strickland; Larry Brenda can serve colloquy Rule 11 ducted Buchanan; Clark; Bobby F. Helen rely if is entitled meaningfully the court Hansen; Buchanan; Brian Joanne made under statements on the defendant’s Stanley; Wise; N. E. John James plea. United States accept guilty oath Vowels; Driggers; Brenda Daniel L. (4th 1389, 1394 Cir. Lambey, 974 F.2d v. Vowels; Livingston Auto David J. (en 1992) banc); see also United States Philip Living Parts, Incorporated; Cir.1996) (4th Wilson, F.3d Cycle Services, Incorpo ston; Lukes a motion key to whether (noting that Lucarelli; rated; HH Moorman Jeff grant guilty plea should to withdraw Moorman; Sons; Oakland Harold & proceed or not the Rule ed “whether Buxton; Stylon Of Club; B. Mark conducted”). To view ing properly was Parker; Terry Charleston; Mary colloquy procedural as a plea the Rule 11 Single Singletary; Hensley; Ora Earl moved and ma pieces are game which Representa Individually tary, and as that can beat to achieve a result nipulated Simi and Entities all Persons tives of due providing system established for Plaintiffs-Appellees, Situated, larly undermines to the defendant process *2 Spooner; Bradley; v. L. Charles Ter Rhue; Shaw; rence E. Noel D. Paul SERVICES, HEALTHPLAN INCORPO- Askew; Phillip Stashin; Averies, Ken individually RATED, and as successor Mary Gunnells; Defendants. B. Party in interest to Third Claims Gunnells; Cynthia William A. Mulli Management, Incorporated; Third nax; Jerry Freeman; Pamela B. Rob Party Management, Incorpo- Claims ertson; Cassleman; Larry E. James rated, Defendants-Appellants, Strickland; Workman; Brenda Helen Clark; Bobby Buchanan; F. Joanne Fidelity Group Inc.; International Buchanan; Hansen; Brian E. James Guild, Incorporated; Workers Nation Wise; Stanley; H. L. John Daniel al Association Business Of Owners Driggers; Vowels; Brenda J. David Professionals; Iwg And Health and Vowels; Philip Livingston; Jeff Lu Fidelity Fund; Welfare Claims Man carelli; Moorman; Harold Mark B. agement, Incorporated; Executive Buxton; Mary Parker; Terry Hens Agency; Ray Consultants Insurance ley; Singletary; Singletary, Earl Ora Olivi; Branham; mond R. John Ste Individually Representatives Broughton; Collins; ven John Rex Similarly of All Persons Entities Culbertson; Davies; Robert Richard Situated; & W Truck And W Tractor Dextaze; Every Andrews; Kenneth Company, Incorporated; Cycle Lukes Fort; German; Gary Frankie Robert Services, Incorporated; AAA Trans Geitler; Geitler; Melissa Martin T. missions, Incorporated; Livingstоn Geitler; Geitler; George Michael D. Parts, Incorporated; Auto HH Moor Gradek; Greene; Phillip Hubert G. S. Sons; Company, man & Tech In Tele Isabell; Hodgsen; Stephen Lacy; Earl corporated; Avionics Inter Seaonics Malone; Martin; Frederick David E. national, Incorporated; Oakland Massey; Henry Merchant; Michael Club; Stylon Charleston, entities Messinger; Requa; Tina R. Michael similarly situated, Plaintiffs-Appel Rowan; Regopoulus; Bruce Pamela lees, Ryals; Scott; Bruce A. Barbara Hen ry Skinner, Jr.; Stone; K. Elmer Ken Taylor; Tallmadge; neth R. Lee Valentine; Requa; Michael R. Arnold H. Thomas; Todd; Michael Scott Arnold Benefits, Incorporated; Financial Valentine; Vann; H. Richard M. Wade; Ryals; George Lewis H. Bruce Wade; White; Lewis H. David M. Gradek; Messinger; Tina Kenneth Williams; Wells; Herbert L. Ben L. Every Andrews; Raymond Olivi; R. Wilson, Individually E. Jack Executive Consultants Insurance Representative Capacity; his Anchor Agency; Massey; In- Michael Anchor Agency; Insurance Branham And Agency; Collins, surance John indi- Associates; Geitler Diversified Insur vidually representative and in their ance; Legend Equities Corporation; capacities, Defendants-Appellants, Benefits, Incorporated; Financial Taylor Agency Incorporated; Associates; Fort; Fidelity
Truett and Group Inc.; Colonial Frankie Life In Company, Guild, & Accident Insurance A Incorpo ternational Workers Dwayne Company; rated; Unum A. Samu National Association of Busi els; Eugene Duncan; Professionals; Iwg O. David ness Owners and Fidelity Fund; And Health Welfare Incorporated; Management,
Claims Broughton; Branham; Steven
John Davies; Culbertson; Robert
Rex *3 German; Dextaze; Robert
Richard Gary Geitler; Geitler;
Gary Martin T. Geitler;
Geitler; Hubert Michael D. Greene; Phillip Hodgsen; Earl S.
G. Stephen Lacy; Ma
Isabell; Frederick Henry Martin; Mer
lone; E. David Rego Rowan;
chant; Bruce Pamela Henry Scott; K. A.
poulus; Barbara Jr.; Stone;
Skinner, Kenneth Elmer Taylor; Tallmadge; Lee 5 Michael
R. Todd; M.
Thomas; Richard Scott White; L.
Vann; M. Herbert David
Williams; Wells; L. E. Wil Ben Jack Associates;
son; Branham Geitler Equi Insurance; Legend
Diversified Taylor Agency, Corporation; The
ties Associates;
Incorporated; Truett and Life & Insurance Accident
Colonial Company;
Company, A Health- Unum Services, Incorporated, Individu
plan
ally in Interest Successor Party Management, In Claims
Third Party Man
corporated; Third Claims Incorporated; Dwayne
agement, A. Duncan;
Samuels; Eugene David O. Bradley; Ter
Spooner; L. Charles Rhue; Shaw; D. Paul E. Noel
rence Averies, Stashin;
Askew; Phillip Ken
individually representa and in their capacities, Defendants.
tive 01-2419,
Nos. 01-2420. Appeals, Court of States
United
Fourth Circuit. Sept. 2002.
Argued:
Decided: Oct. *4 Carolina;
dale, Charleston, Thomas South II, Keaveny, Keaveny, Simons & J. Carolina, Charleston, Appellants. South MOTZ, NIEMEYER, Before KING, Judges. Circuit part, part, reversed Affirmed Judge by published opinion. remanded wrote DIANA GRIBBON MOTZ KING concurred. Judge in which opinion, opinion Judge NIEMEYER wrote part. dissenting concurring part OPINION *5 MOTZ, Circuit DIANA GRIBBON Judge: question appeal presents
This its dis- the district court abused whether certifying a class conditionally cretion brought by purchasers action in a suit health multi-employer of a beneficiaries growing out plan for care court condi- collapse. The district plan’s certification tionally granted class administrator, Healthplan plan’s claims Inc., in interest as successor Services (col- Inc. Management, Party Claims Third “TPCM”) against individual lectively, mar- Nelson, agents who Lewis, corporate insurance R. William ARGUED: prop- L.L.P., plan. The and sold the keted Mullins, Scarborough, Riley & principles controlling legal Carolina; erly applied Y. Charleston, James South findings factual P.A., well-supported made Boyd, Becker, Haynsworth Sinkler certify a class decision to Carolina, supporting its Columbia, Appellants. for South thus, TPCM; no we see Richardson, Hartley, Hancock Christian How- in that decision. Brickman, L.L.C., of discretion Patrick, abuse & Westbrook its class ever, court rested Carolina; because the Charleston, Justin S. South agents the individual Firm, Charleston, certification Kahn, South Kahn Law misapprehension in a findings grounded BRIEF: on Carolina, ON Appellees. law, conclude we must Mullins, governing Norris, Nelson, Riley of R. Charles in certi- its discretion Charleston, did abuse L.L.P., the court South Scarborough, & Ac- actions. separate class Tiller, fying those Carolina; Elizabeth J.V. John H. reverse P.A., part, we affirm cordingly, Boyd, Sinkler Haynsworth Speidel, proceedings for further and remand Carolina; part, Columbia, H. Michael South opinion. Clement, with this Bowers, Tis- consistent Rivers & Young, Plan. many gone I. As 2900 claims have as unpaid, amounting to millions of dollars in interlocutory Since this appeal, unpaid medical bills. parties filed even before complet- have August Fidelity Plaintiffs sued discovery, ed surrounding the facts (col- NABOP, IWG, Group, and the Fund purchasers claims of the and beneficiaries Defendants”) lectively, Fidelity “the “Plaintiffs”) (collectively, have not been state court in South Carolina. defen- Thus, fully developed. the record to date dants removed the case federal court. following reveals rough outline of year, Later in the Plaintiffs amended their leading present the events to the up law- complaint to add and the agents suit. complaint, defendants. In that Plaintiffs 1995, Fidelity Inc., Sometime in Group, allege that one or more the defendants the National Association Business Own- engaged fraud, negligent undertaking, (“NABOP”), ers and Professionals and the negligent misrepresentation, breach of Guild, (“IWG”), International Workers Inc. contract, conspiracy, civil and violated the created the Health and Welfare IWG Fund South Carolina Unfair Trade Practices (the “Fund”), in turn which offered a Act, (1985), § S.C.Code Ann. 39-5-140 (the “Plan”) plan health care and dental Title IX Organized Crime Control purchasers. August interested From (West §§ Act of 1961-68 U.S.C.A. until June when South Carolina (“RICO”).1 short, Supp.2000) & Department of Insurance ordered market- agents Plaintiffs assert that the breached cease, ing to agents marketed and sold fiduciary contractual and duties owed to Although Plan. purportedly was *6 the misrepresented Plaintiffs and the marketed plan, as an ERISA the Plan through Plan’s attributes then."marketing never complied requirements. with ERISA efforts, which Plaintiffs purchase caused to 1995, In April Fidelity hired TPCM to woefully TPCM, the Plan. deficient As to process claims the Plan under as a third allege Plaintiffs mismanaged that it admin- party keep administrator. TPCM failed to Plan, istration of the a huge created back- pace received, with the creating claims log claims, unpaid not timely did trans- huge backlog unprocessed claims. In information, fer impossible made it and 1997, May Fidelity fired TPCM for incom- forecast accurately, rate increases result- petence and attempted transfer ing collapse pay Plan’s and failure to management claims process to an in-house hundreds, thousands, if not of health care operation. Assertedly, difficulties ob- relief, prayer claims. their for Plain- taining data from TPCM and the massive tiffs backlog it had ultimately created led to the seek recovery legally for all allowable collapse. Plan’s damages refunds of including premiums Approximately employees paid, payment their outstanding medi- families coverage bills, contracted for under the reimbursement for medi- cal/dental 1. Department Also in the United States case. After the New York court clarified that Defendants, against Fidelity Group stay Labor filed suit Fidelity reached for relating actions the Fund in the Eastern district case at court in the hand lifted the District of stay respect New York. That court issued "non-Fidelity with to the Defen- January staying pending agents. order on Ultimately, all dants” —TPCM and the against court-appointed actions fiduciary, Fund. Pursuant to this on the advice of a order, the district court in South Carolina the New York court ordered the Plan termi- stay proceedings prеsent issued a January of the in the nated effective claim TPCM. mismanagement treat- where by Plaintiffs paid bills cal Moreover, although the court declined to Plaintiff [s were] while ment occurred Plan, conspiracy for civil compensation certify Plaintiffs’ covered credit, injury agents, it did claims compensation RICO injury to credit, spent time permit subclasses to Plaintiffs ability certify to obtain to the difficul- attending liability— four theories of pursue incurred their costs fraud, the failure resulting undertaking, negligent from negligent ties attendant of life Plan, enjoyment breach of con- loss of misrepresentation, by the failure caused separate to the stress class actions tract —via agents that as- twenty-three Plan. each of the sertedly insurance to a named class sold damages. punitive Plaintiffs also seek withholding “ruling on representative, Plaintiffs discovery, initial After some agent classes for which certification of class, pursuant of a for certification moved currently representative.” no [wa]s there Procedure Rule of Civil to Federal 1265 n.21. J.A. who 23(b)(3), people “all entities Plan or who were Fidelity Proce- to Federal Rule of Civil purchased Pursuant Fidelity under the coverage 23(f), with and a number of provided dure both TPCM time.” Carolina (collectively, Agents”) peti- Plan South “the agents2 “agent- addition, to certain respect with to file an interlocu- permission tioned for claims, moved for certi- Plaintiffs specific” granted. we tory appeal, which consisting of “all en- fication of subclasses II. Fi- purchased who persons
tities and provided or were delity Plan from criteria. must meet several Class actions agent Fidelity particular Plan First, the four comply must the class South Carolina.” 23(a): (1) in Rule established prerequisites (2) commonality parties; numerosity un- certify any claims refusing to
After issues; typicality of legal Trade factual and Unfair Carolina der the South representa- of class and defenses § Act, Ann. 39-5- see S.C.Code Practices *7 representation. 1985) (a tives; adequacy 140(a) (West bring and “may person 23(a). Second, ac- the class Fed.R.Civ.P. repre- not individually, but an action of the three cate- fall within one tion must actual dam- capacity, to recover sentative 23(b); here in Rule enumerated gories Plain- granted court the district ages”), under Rule proceed to Plaintiffs seek large motion class certification tiffs’ is- Inc., 23(b)(3), requires that common which Fidelity Group, part. Gunnells ones and 2001) individual (D.S.C. 28, over predominate sues Sept. No. 2:98-2639-23 1244-1271). superior other class action be (located that a at J.A. Fed. adjudication. methods of available motion for granted Plaintiffs’ conditionally 23(b)(3). respect to their R.Civ.P. with certification 23(e); opinion. Fed.R.Civ.P. See light of this agents appealed the Originally, fourteen Windsor, Prods., Inc. v. 521 Amchem appeal see also order. While class certification 2231, 620, 591, L.Ed.2d 117 S.Ct. 138 U.S. eight agents moved to withdraw pending, was (1997) (articulating for different standard a set- 689 appeal they had reached because their certification). settlement-only Our hold- grant We now the class. tlement with certifi- respect the district court's ing with appeal withdraw their eight agents’ motion to agents, against individual cation of subclasses court for consider- to the district and remand therefore, agents only the six pertains proposal pursuant to of the settlement ation 23(e) appeals before us. remain whose and in Rule of Civil Procedure Federal 424
If a
requirements,
reаsons,
lawsuit meets these
very
we have expressly “em
impor-
certification as
class action serves
braced the view that the mass tort action
purposes.
tant
public
pro-
addition to
damages may
be appropriate for class
moting judicial economy
efficiency,
action, either
partially or whole.” Cen
class actions also “afford aggrieved per-
Wesleyan
Co.,
tral
Coll. v. W.R. Grace &
remedy
sons a
if it
economically
is not
177, 185 (4th Cir.1992) (citation,
F.3d
inter
through
feasible
obtain relief
the tradi-
marks,
quotation
nal
ellipses, and altera
tional
multiple
framework of
omitted).
tions
damage actions.” 5 James Wm. Moore et
Furthermore,
courts
“[district
al.,
(3d
§
Moore’s Federal Practice
23.02
have wide discretion in deciding whether
ed.1999). Thus,
federal courts
should
certify
or not to
a class and their decisions
“give Rule 23 a liberal rather than a re-
may be
reversed
for abuse of discre
construction,
strictive
adopting
standard
(internal
tion,” id.
quotation marks omit
flexibility
application
which will in the
ted),
course,
recognizing, of
that this “dis
particular case ‘best serve the ends of
cretion
within
must be exercised
justice
parties
for the affected
and ...
”
framework
promote judicial
of Rule 23.”
efficiency.’
Dry
In re A.H.
Lienhart v.
Robins,
(4th Cir.1989).
Inc.,
(4th
vit Sys.,
880 F.2d
255 F.3d
Cir.
2001) (quoting
Inc.,
Sys.,
re Am. Med.
sure,
23(b)(3)
To be
class actions
(6th
Cir.1996)).
75 F.3d
Our
predominance
must meet
superiority
review is particularly deferential in a case
requirements
imposed
on other kinds
like
involving
interlocutory appeal
of class actions. This is because these
this—
of a conditional class certification. See
suits involve situations where “classaction
Wesleyan,
Central
6 F.3d
(noting
at 186
clearly
treatment
is not as
called for.”
tentative,
that “[t]he
limited nature
advisory
Fed.R.Civ.P.
committee’s note
(1966
(b)(3)).
Amendment,
conditional certification ... counsels in fa
subdivision
However,
affirmance.”).3
noted,
as the Supreme Court
vor of
has
predominance
superiority
require
mind,
principles
With these
we turn
23(b)(3)
ments in Rule
do not foreclose the
case at hand. Plaintiffs’ claims
possibility
actions,
of mass tort class
but
Agents
TPCM and the
rest on
merely ensure that class certification in different
Accordingly,
bases.
like the dis-
time,
such cases “achieve economies of
ef
court,
trict
we consider class certification
fort,
expense,
promote
... unifor
respect
to TPCM and the Agents
mity of decision as to persons similarly
separately.
situated, without
sacrificing procedural
*8
bringing
fairness or
about other undesir
III.
Amchem,
615,
able results.”
425 of the Plaintiffs’ recognized “that that some single claim: pursue the class duties, damages might require both contractual “individual violatеd its TPCM law, that, administrator party necessary, as third found if those inquiry” and but was a cause of and such conduct the Plan issues could be bifurcated for individual failure,” and that “fail- Fidelity Plan’s they Wesleyan, in Central trials as were and the ab- directly injured Plaintiffs ure 1254. re- F.3d at 188-90. See J.A. With 1249. class members.” J.A. sent 23(a)(4) adequacy, to Rule the court gard
recognized
representatives”
that “class
A.
pos-
of the same class and
part
must “be
sess the same interest and suffer
same
both that
note at the outset
We
injury as the class members” and found
concerning TPCM is
certification order
in this
the named
satis-
that
case
certification order
strikingly similar
requirements, noting particular-
and that
fied these
Wesleyan
in
upheld
we
Central
carefully followed
conflict existed”
ly
“potential
the district court
that no
Wesleyan,
1257;
approved
framework
Central
among class members.
Id. at
cf.
Here,
Meineke,
at 183-186.
as
Central
6 F.3d
155 F.3d
337-
Broussard
“the district court conducted
Wesleyan,
(4th Cir.1998)
“manifest con-
(holding
the class certi
analysis of
straightforward
of class
among
flicts of interest”
members
under Fed.R.Civ.P.
requirements
fication
certification).
precludes class
23(a)
23(b)(3),”
that each
and
determined
Finally,
again
Wesley-
and
as in
As in
Wesleyan,
Central
Central
we must ac
an,
6 F.3d at
the district court ac- knowledge that
an approach has its
“[s]uch
knowledged “particular concern” with the
First,
promise.”
427
concept
estoppel
apply
of collateral
cannot
a trial on these com
already reveals that
likely
lengthy,
to be
party against
alone is
when the
whom the earlier
mon issues
exploration
extensive
requiring
not have a ‘full
decision is asserted did
issue.”)
and TPCM’s role.
collapse
Plan’s
opportunity’
litigate
fair
trial,
possibility
with the
long
of a
prospect
States,
(citing
Montana United
U.S.
may also encour
large damage
award
147, 153,
collateral
should not be
courts).
necessity
proof
of individual
some
ble
victory by
A
federal
damages by
the claimed
plaintiff,
an individual
howev
action
prevents
meeting
Plaintiffs from
er,
members
on
binding
would have no
effect
future
Initially, TPCM
requirements.
Rule 23’s
would not
plaintiffs
because the
damages de-
contends that individualized
party
original
have been
to the
suit. See
90, 95,
destroy commonality, typical-
101 terminations
McCurry,
Allen v.
449 U.S.
(1980) (“[T]he
Rule 23 con-
ity,
predominance.5 But
to be the cause of that member’s Rule 23. ments of *12 Inc., 1069, Sys., re Med. 75 F.3d trials in Amer. of individual cessity for hundreds (6th Cir.1996) that (stating as TPCM’s asser 1080 common- issues—such which core cause of rather than proximate ality “qualitative quanti- it was not test is tion that (citation omitted)). relitigated, be collapse it is here. the Plan’s tative” So —would wit testimony by the same requiring inquiry that individualized possibility efforts, nesses, discovery etc. duplicative damages into claims will be re- Plaintiffs’ establishing in that it succeeds If TPCM quired does not defeat Plan’s cause of the proximate not the was pre- common issues nevertheless because enjoy the effects collapse, preclusive it will dominate. members, against all class of this decision Moreover, calculations in damage asym disadvantaged by the rather than be appear particularly this do not to be case estoppel. of collateral application metric in complex, unlike the calculations those 23(c)(2)(B) (making Compare Fed.R.Civ.P. in nu- cases which courts have found that members) with binding on all class action in- complicated damagе individual merous 95, 101 449 U.S. at S.Ct. McCurry,
Allen v.
over common issues.
quiries predominated
“cannot
(noting
estoppel
411
that collateral
Am.Brands, Inc.,
v.
565 F.2d
Windham
Cf.
whom the
party against
when the
apply
Cir.1977)
(4th
59, 66-67,
(affirming
72
de-
is asserted did not have
earlier decision
of over-
nial of class certification because
litigate
that
opportunity’
‘full and fair
whelming predominance of thousands
(citations omitted)).
issue”
fact,
damage questions).
In
individualized
Third,
the extent that TPCM’s causa-
punitive damages
Plaintiffs’ claims for
do
argument
inquiry
tion
is that individual
inquiry
individualized
at
require
collapse
whether the
necessary to establish
this
calculation would
damage
all because
any damages,
of the Plan caused Plaintiffs
solely
be based
on TPCM’s conduct.
argument made
the same
precisely
this is
addition,
appears
court-appointed
that a
all
in mass tort
by almost
defendants
already
most of
fiduciary has
calculated
require
determining damages will
cases:
using
claims for medical bills
the Plaintiffs’
inquiry. Courts have
an individualized
program that TPCM
computer
the same
rejected
argument,
conclud-
routinely
claims.
Fidelity
used to evaluate
cases,
previous
ing, as we have
Thus, many
likely
there is
to be
cases
damages
proof
need for individualized
over the amount to
dispute
little or no
certification.
alone will not defeat class
enti-
an individual class member is
which
189;
Hill
Wesleyan,
Central
6 F.3d
See
Similarly,
unpaid medical claims.
tled for
(4th
Co., Inc.,
381,
672 F.2d
v. W. Elec.
that Plaintiffs are
if the court determines
Cir.1982) (“Bifurcation of ... class action
paid,
premiums
to a refund of
entitled
...
hearings
damages
on
proceedings
easily
quickly
amounts could be
these
v. Tran-
commonplace.”);
is now
Chisolm
determined.
556, 566
Corp.,
Fin.
184 F.R.D.
South
damages claims—those
Plaintiffs’ other
cases).
(E.D.Va.1999) (collecting
As one
lost,
credit, time
relating
injury
“Quantitatively,
almost
explained,
court
in-
may require
enjoyment
loss
always be more indi-
definition there will
life—
considering
But even
inquiry.
dividualized
liabili-
damages issues than common
vidual
as a
against TPCM
Plaintiffs’ claims
however,
...
Qualitatively,
ty issues....
whole,
that the district
we cannot conclude
may “far
in com-
liability issues”
exceed
finding
its discretion
mundane individual dam-
abused
plexity the more
predomi-
Co.,
juncture common issues
at this
In re
Motor
ages issues.”
Honda
may
(D.Md.1997);
see
nate over the individual
F.Supp.
also
Donaldson,
resolving
involved in
these claims.
&
Corp.,
We
Jenrette Secs.
Lufkin
(2d Cir.2000) (“The
fully
note that the district court was
aware
222 F.3d
Su-
issues,
possibility
preme
Court
Surowitz Hilton Hotels
363, 370-74,
currently
although
Corp.,
subordinate to
com-
383 U.S.
86 S.Ct.
issues,
liability
damage
might
mon
expressly disap-
Specifically, argues TPCM that the named To adequacy require defeat repre- constitute ment of Rule a conflict “must be more inadequate they purportedly sentatives because lack merely speculative than or hypothetical.” knowledge, sufficient alleged and because Moore’s Federal Practice (2002). case, § insurmountable conflicts exist within the 23.25[4][b][ii] no class. also contends that the inter- conflict exists that renders rep the named est of certain individual class members inadequate. resentatives TPCM has not pursuing individual litigation defeats single support cited a case of its conten argument provides that a class action employees tion that the would have viable superior adjudication vehicle for of the against their employers unpaid arguments claims. These also fail. medical bills caused the failure of a plan, employee non-ERISA no has filed The lack of knowledge contention is claim, such and South Carolina’s three- particularly law, meritless. It is hornbook year statute of limitations now bars such recognized, district court “[i]n § claims. See 7 S.C.Code Ann. 15-3-530 lawsuit, complex such as one which the (West Supp.2002) (applying three-year liability defendant’s can be established for, statute limitations to actions among great after a deal investigation fraud). other things, breach of contract and discovery by counsel background legal knowledge, Furthermore, representative if employee even could need not have extensive knowledge bring of the such a claim employer, facts of the case in order to an adequate require this would not decertification. For representative.” (quoting J.A. 1256 32B a conflict of prevent plaintiffs interest § Federal Am.Jur.2d Courts from meeting requirement of Rule (footnotes omitted)); 23(a), see also that conflict “must be fundamental. Baffa damages 6. TPCM reprise argument testify reasserts its individualized the same to the fun- argument contending when the certified damental weakness its contention that numerosity superiority. class lacks conditional class certification order constitut- argument persuasive is no more in those con- ed an abuse of discretion. Indeed, repeated attempts texts. TPCM's doctrine,” litigation.” theory the heart go pleadings It must which Newberg, complaint B. held that “a must proceed upon 6 Alba Conte & Herbert (4th theory, § some Newberg theory on Actions 18:14 definite on that Class ed.2002). succeed, Here, must plaintiff and em- or not succeed employers Wright at all.” 5 Charles Alan objectives and the & Arthur ployees share common Miller, R. Federal Practice & Procedure They legal positions. same factual and (2d ed.1990) (internal § at 188-89 establishing have the same interest omitted). quotation marks and citation Thus, liability any potential con- TPCM. Cf. (“[W]e post at 463 should take the com- go flict does not to the heart of their roles written.”). plaint as This observation representatives. as class See Uniondale particularly seems apropos pro- to actions Inc., Anheuser-Busch, Beer Co. v. *14 23, ceeding under Rule provides which that (E.D.N.Y.1987) 340, (finding F.R.D. 343 “an action bemay brought or maintained competitor that economic conflict between respect particular as a class action with members in antitrust action did not 23(c)(4)(A) (empha- issues.” Fed.R.Civ.P. representatives inadequate render because added). sis sought prove all that class members Furthermore, fix conspired prices).7 defendants even if the Plaintiffs want- proceed ed to with direct against claims addition, suggests the dissent con- TPCM, only claim that the district flict thosе who were not between Plaintiffs court against certified TPCM is based on Plan, injured by collapse of the but the theory collapse that TPCM caused the against have “direct” claims TPCM for a (“Plaintiffs of the Plan. See J.A. 1249-50 delay payment, those Plaintiffs alleged mismanagement have that TPCM’s that against “indirect” claims TPCM de- processing of claims to the contributed collapse rive from the of the Plan. Post at Fidelity of Plan.... failure Plaintiffs 461-464. As the Plaintiffs have made if allegations, proven, any will vitiate need however, abundantly appeal, they clear on particular to demonstrate claim was do not seek class certification for di- prior expiration submitted to the of the See, e.g., rect claims TPCM. Brief Fidelity.”). contract between TPCM and Appellees (“Contrary at to TPCM’s Thus, did Plaintiffs’ counsel not so much assertions, Plaintiffs do not claim that ... questionable make “a decision to aban- adjudicated improperly particular don,” theory liability appeal, on as the injured all claims. TPCM Plan insureds suggests, post accept dissent see at collapse because it was the cause of the scope of the claim that the district Plan.”). sure, To be position ap- this court certified class treatment. at pears somewhat odds with the Plaintiffs’ However, original complaint. Finally, suggests feder- “[t]he dissent errs effectively ing “pre al rules abolish the restrictive the district court’s order omitted); Bogosian 7. The dissent insists that an additional con- citation see Oil Gulf employer Cir.1977) (find (3d flict exists between the class mem- Corp., 561 F.2d employee bers and the members based ing representation adequate was even sought by on the different remedies each though gas current station lessees and former However, group. post "[p]o- See 466-467. ultimately lessees would seek different reme relating tential conflicts to relief issues which dies); generally Newberg see on Class Ac plaintiffs arise would if the succeed on 3:25, (collecting § at 422-23 & n.4 tions liability common claims on behalf cases). Therefore, any conflict in the forms of finding adequacy.” bar a class will not recovery sought by groups these Britt, Hanrahan v. 174 F.R.D. warrant decertification. does not (E.D.Pa.1997) (internal quotation marks and involving in the the sale and eventual fail- recovery dudes for those who were olina ure of Plan.” The district court collapse Fidelity circumstance where the First, injury.” carefully Id. within Plan did not cause considered acted well argument premised rejecting argument. seems on the its discretion dissent’s assumption false under the district The court found that while Ms. Gun- order the Plaintiffs’ direct claims $70,000 unpaid nells claims medical ex- would be barred the rule claim- penses, alleged “not all of the Plaintiffs’ course, action, But a class “of is splitting. damages high damages are so and the recognized exceptions to the one of gamut fig- could run the to much lower against claim-splitting.” rule 18 Moore’s ures.” Nothing J.A. 1260. the record § Federal Practice 131.40[3][e][iii] finding judi- refutes this and we can take (Second) Judg (citing Restatement many cial notice of the fact that health 26(1)(c) (1982)). Second, § ments care claims will involve dollar amounts 23(c)(2) permits members of a class main Moreover, that are much lower. we note (b)(3) opt tained under section out of the recovery that the size of class members’ class, providing option Plain for those hardly superiority. determinative of See pursue tiffs who wish § 5 Moore’s Federal Practice 23.48[2][a] *15 inqui requiring TPCM more individualized (1997) (noting “a that when class action Thus, aside, ry. rhetoric Plaintiffs with provide will the most fair and efficient claims being direct are not case, adjudication may of a an such “[j]amm[ed],” “caught” “sacrificed” or in superior be though even class members against class action their will. Post at have sufficient pro- means or incentive to 463.8 individually”). ceed As to seventeen actions, argument already-commenced TPCM’s final is that class the district members’ asserted “interest in individual court concluded that their existence did litigation purported pos- of the claims” and make in superior not individual actions a “large damage session of claims” renders involving potential case over 1400 liti- pursuit gants. their of individual actions superior Again, nothing the record to certification a any way class action.. This en- contradicts this common-sense argument tire rests on one fact—that a finding. TPCM itself notesthat it “has Gunnells, single plaintiff, Mary named B. been named as a Defendant a sin- $70,000 actions,” in unpaid gle medical ex- one of [seventeen] those thus penses' raising questions one contention —that “at least as to whether the exis- —-and 17 actions filed in [have been] South Car- tence of those actions is even relevant to Crown, disingenuous 8. We find somewhat the dis- would be successful. Cork & Seal Cf. Co., Parker, 345, 353-54, suggestion we Inc. v. 462 U.S. sent's that have "done a disser- (1983) (holding S.Ct. L.Ed.2d 628 group plaintiffs,” by vice to an identifiable " 'the commencement of a class action exposing suspends applicable statute of limitations arguments them to that their claims are now as to all asserted members of the class who First, untimely. Post at 463 n.7. Plaintiffs parties have would been had the suit been ” against with direct claims TPCM would action,' permitted to continue as a class equally subject arguments to these under the that "[o]nce the statute of limitations has been proposed dissent's resolution tolled, of the case. it remains tolled for all members of the Second, is, course, while dissent cor- putative class until class certification is de Utah, rect that TPCM could raise a statute of limita- (quoting Pipe nied” Am. & Constr. Co. v. 538, 554, asserting tions defense Plaintiffs di- 414 U.S. 94 S.Ct. 38 L.Ed.2d claims, (1974))). rect it is clear far from that TPCM 713 problems class certification TPCM. Accord- of administering a lawsuit ‘than ” ingly, hardly we can conclude that in ren- appeals.’ does court of (quoting Wind dering findings these the district court ham, 65)). 565 F.2d at If the district its discretion.9 abused court’s current assessment turns out to be
inaccurate, and it
apparent
becomes
damage
predominate
issues will
C.
or render
the case unmanageable,
sum,
court
district
followed the
undoubtedly
recognize
will
its re
course we charted in
Wesleyan.
Central
sponsibility to decertify the class.
analysis
Its careful
of Rule
require-
23’s
factual findings sup-
ments and its detailed
We note also that in conditionally certi-
porting
grant
decision to
conditional cer-
fying the class the court specifically stated
tification
TPCM reveal no abuse of
it intended to “heed[]
the Fourth
course,
discretion.
recognize,
Of
we
as the
warning
keep
Circuit’s
vigil
watchful
did,
may
district court
that this case
ulti-
complicated
case such as this one to
mately present manageability problems.
‘make certain
manageability
and other
Nonetheless,
say
we cannot
at this inter-
types
problems
do not overwhelm the
locutory stage that the decision to condi-
”
advantage of conditional certification.’
tionally certify a class action against
(quoting
J.A. 1260
Wesleyan,
Central
discretion,
constitutes
abuse of
189). Indeed,
F.3d at
expressly
the court
particularly
light
special
defer-
noted that “should such concerns render
ence due trial courts on this issue. See
ineffective,
the class mechanism
the dis-
(“Issues
Wesleyan,
Central
ing, orga- of contract. The court and breach why issues do The first reason common claims into certification of these nized its Plaintiffs’ predominate twenty- for each subclasses—one need for individ against Agents is the had marketed insurance agents three who rebanee. In ual into the issue of inquiry Each subclass was plaintiff. named misrepresentation disputably, negligent pursue its four theoriеs permitted proof of reliance. See require and fraud liability action. separate via a Bank, Nat’l v. First Union Robertson (Ct.App. 565 S.E.2d 313-14 we accord the district S.C. again, Once 2002) negligent elements of (recounting substan class certification decision court’s Nevertheless, under misrepresentation in and fraud claims tial deference. law). fraud, stance, To establish we the court abused South Carolina believe alia, that plaintiff prove, must inter The individual class actions discretion. truth of a fraudulent simply cannot hearer relied on the Agents certified statement, rely there right and com and had satisfy predominance Rule 23’s negligent misrepre To This be on. Id. estabbsh monality requirements.11 is so sentation, inter plaintiff prove, must Plaintiffs’ claims the individ cause alia, “justifiably relied plaintiff elements not Agents require proof ual ... representation; necessary single [a false] claim on their *17 TPCM; loss as the plaintiff pecuniary suffered a and a number of these additional upon his rebanee proximate can after con result of elements established Thus, at both representation.” Id. 314. inquiry. Although siderable babibty require plain that the recognized this as theories of apparently district court (2) matter, actual reliance and ig it misunderstood or tiff demonstrate general a rely on plaintiff right that had a controlling legal principles hold- nored addition, (1997) (noting governmental that "if a unit In we note our reservations 11. issue, brought court’s determination as to a about the district suit on the same has compliance numerosity requirement, with the may proposed action is decide that the class (noting Agent that some sub- see J.A. 1265 adju- unnecessary inferior method of and an members), eight classes have as few as dication”). We need not address these is- compare superiority requirement, and the however, sues, of Rule 23's re- because all (holding the South Carolina De- J.A. 1271 Therefore, quirements be met. our must partment of Insurance's current administra- to meet the conclusion that the class fails Agents’ proceeding tive to revoke the licenses require- commonality predominance proceeding”) bearing ... on this has "no dispositive in case. ments is this § 23.49[3] Federal Practice with 5 Moore's
435 fraud) (in Basic, any nor precedent, misstatement the case of other supports justifiable presumption was under of actual such reliance reliance the case that (in at hand. negligent the case of the circumstances inevitably, Almost es-
misrepresentation).
Basic involved a
suit alleg-
shareholders’
requires an indi-
tablishing these elements
ing
company
material misrep-
made
inquiry.
vidualized
resentations about
status of merger
Broussard,
reliance
As we held
“the
certification,
opposing
talks.
...
negligent misrep
fraud and
element
argued
company
that common issues did
suscepti
readily
[is]
resentation claims
not
predominate
because each shareholder
rather,
proof;”
“proof
to class-wide
ble
had to establish
on the misrepre-
reliance
depend[s] upon
...
reasonable reliance
in making
sentation
to buy
decisions
or sell
into what
informa
inquiry
fact-intensive
rejected
The Supreme
the stock.
Court
actually
Brous
[plaintiff]
tion each
had.”
argument, reasoning that “[b]ecause
this
sard,
Nor are
alone in
when
*18
1.
misrepresentation
pletely unaware of the
(let
First,
in
suggest
in
“relied” on it
the district erred
alone
traditional
Levinson,
sense).
contrast,
ing
By
allegations
that Basic Inc. v.
Plaintiffs’
485 U.S.
224,
978,
(1988),
misrepresentation
108
representations nevertheless any falsity damages. reasonably Absent this have discovered mate cause of her not inquiry will by reading policy, individualized presumption, representation actually Plaintiffs to show that required bearing “assumption” has no the Giles misrepresen- Agents’ alleged relied on noted, it As even the Giles here. tations. long been the law South Carolina has
that: repre- upon or not reliance [w]hether court also erred con The district justifi- particular in a case is sentation inquiry would cluding that individualized excusable, rea- or what constitutes able the second necessary not be to establish prudence diligence sonable Plaintiffs had element of reliance —that reliance, and what con- respect such Agents’ alleged on the mis right rely or constitutes a reckless conscious duct justi that reliance was representations or will prudence, failure to exercise such fied. various circum- depend upon the The court held that South Car “[u]nder involved, as the form and such stances law, an insurance olina such reliance on (sic) materialty representations, reasonable,” (citing J.A. 1268 agent intelligence, experience, respective Co., Farm Mut. Auto. Ins. Trotter v. State physical condition agе, and mental and 465, 343, (Ct.App. 297 377 S.E.2d 351 S.C. re- and the relation and parties, 1988), that it is “reason proposition for the knowledge and means of spective to assume the truth [an] able for insured knowledge parties. represen agent’s fulness of’ an insurance tations). fact, law But in South Carolina v. (quoting at 918 Thomas Am. Work- Id. that “it is reasonable for the holds men, 178, 886, 14 S.E.2d S.C. truthfulness of’ his insured assume the added)). Thus, (emphasis the dis- cir under limited agent’s representations Carolina trict court misconstrued South and, present in this cumstances not case— right law when it concluded Plaintiffs’ indeed, in Trotter either. present See rely Agents’ misrepresentations on the Trotter, (concluding at 350-51 377 S.E.2d into inquiring be assumed without could that reliance was not and dis reasonable plain- circumstances of each the individual from those of tinguishing circumstances tiffs case. Gibson, Inc., 285 S.C. Giles & Lanford Therefore, that the district we conclude (Ct.App.1985)). 328 S.E.2d in finding court abused discretion Giles, Thus, in South Carolina’s interme- or justifiable reliance could be assumed appellate court held that when the diate in this this as- presumed case. Absent language agree- of a written unintelligible sumption presumption, individual issues an from prevent ment would insured dis- clearly predominate. Supreme As the covering falsity agent’s insurance Basic, U.S. at recognized Court in- it is reasonable for the representation, “[Requiring proof S.Ct. individ- sured the truthfulness of the to assume member of the ualized reliance from each agent’s misrepresentation insurance oral *19 effectively would proposed plaintiff class Giles, agreement. 328 S.E.2d the written [plaintiffs] proceed- prevented have from hand, like at Because the case at 918-19. action, since individual Trotter, ing with of oral allegations not involve does overwhelmed the agree- then would have misrepresentations, or written issues
437 Broussard, objectively 155 agent common ones.” Accord reasonable insurance on being sought 341.12 notice that his advice is F.3d at Trotter, relied on.” Id. 377 (citing S.E.2d 347). Obviously, at B. consideration of these thus proof any factors —and implied A why second reason common issues do duty requires an inquiry into the facts of — predominate not Plaintiffs’ claims particular each case. duty relates Agents the to the certifying "When subclasses owed to Plaintiffs the Plain- the Agents. however, Agents, ignored district court of negligent undertaking tiffs’ contentions legal principles. appeal, these On Plain- Agents’ are alleged based on the failure do, must, They tiffs cannot. acknowl- “duty properly their Plaintiffs inform maintain, They however, edge them. and other members class about principles value, articulated Trotter quality, pro- coverage” and extent apply Carolina Production Plan. insur- vided under the These contentions agents and Agents ance that the defendant require inquiry. also individualized brokers, who, are insurance Plaintiffs as- Generally, under South Carolina sert, duty have a special “do to their law, agent an insurance does not have clients.” duty Pitts to advise an insured. v. See Co., Jackson Nat’l S.C. But Insur. Plaintiffs’ argument Life —that 319, 502, (S.C.Ct.App.2002) Agents really 574 S.E.2d were “insurance brokers”— 347). Trotter, (citing dutyA premise. 377 S.E.2d at rests flawed Under on South however, law, may imposed, agent, “if an repre Carolina “insurance broker” nevertheless, insurance, in people seeking undertakes to advise the sents while an Maint., agent” sured.” Prod. Inc. v. represents Carolina “insurance the insur Co., company. 38-1-20, §§ & United States Fid. Guar. 310 S.C. ance See S.C.Code (1992) 39, Trotter, (2002); 425 S.E.2d (citing 38-43-10 see also Allstаte Ins. Co. 347). Smoak, express Absent an S.E.2d S.C. 182 S.E.2d (and (1971) duty undertaking assume such a (distinguishing 753-54 between in Agents Plaintiffs do contend that brokers on agents surance basis of here), expressly a duty employed by person seeking undertook such a whether in duty can be But in impliedly company created. Id. surance insurance solicit insurance). case, implied if an been determining duty has and write In this created, must specifically consider fac found that courts several district “(1) tors, “insurance including agent Agents agents” whether: are licensed pay Plan. beyond received consideration a mere who marketed and sold the Plaintiffs (2) ment premium, point nothing ... insured record to support advice, request Agents made a clear ... or their contention that were ac dealing Accordingly, there is a over an extend “insurance tually course brokers.”13 period put hardly ed which ignore of time would we can Trotter and Carolina course, agent proof 12. Of reliance broker of individual Plaintiffs’ versus distinction need not given heavy overwhelm common issues in surprising reliance their on However, every considering case. the cen- Trotter, agent, involving case an insurance trality allegations involving of the Plaintiffs’ argument in Part for the discussed IV.A.2. reliance, requiring other indi- and the inquiry, clearly vidual common issues do not predominate in this case. *20 438 require not without merit would proof are and the individualized
Production in at least some inquiry individualized require. those cases inquiries indeed, Therefore, “de- they may, cases. C. plaintiffs to each peculiar on facts pend Accordingly, “class certification case.” deter to the individualized In addition Id. at 342. erroneous.” [wa]s in Plaintiffs’ claims inherent minations defens Agents, the affirmative against the negligence, assumption comparative es D. risk, Agents asserted and setoff inquiry the need for individual Given obstacles to class certifica pose significant issues, hold that we must into these actual, justifiable if Similarly, even tion. court certified the district class actions Agents presumed, could be reliance not the com- Agents do meet to introduce evi permitted
would still requirements monality predominance with re presumption rebut dence to Thus, Rule 23. the district See Banca plaintiffs. to individual spect conditionally certi- abused its discretion Sons, Inc., Alex. Brown & 132 Cremi fying these class actions. (4th Cir.1997) 1017, (citing Car F.3d 1036 (4th 251, Burns, F.2d 257 Cir. ras v. 516 V.
1975), that the inference proposition rebuttable). The district court reliance contention Finally, we turn to a for class certi again ignored problems our by any parties: raised never posed by fication these defenses. argu dissenting colleague’s “threshold” that “nu- Plaintiffs maintain appeal, On ment, 450, that if common post at even rejected the notion courts” have merous in Plaintiffs’ cause predominate issues do of affirmative defenses that the assertion i.e., action, whole, against TPCM — inappropriate. class certification renders duties, both con “that TPCM violated its However, re they only cite Visa law, party and at as third adminis tractual Litig., Check/MasterMoney Antitrust of the Plan and such conduct was trator (2d 124, Cir.2001), in which F.3d failure,” Fidelity Plan’s cause of merely stated Second Circuit injured Plaintiffs and directly that “failure does not of affirmative defenses presence members,” 1249—the the absent class J.A. “automatically” certification render class confining predo court erred in district Rather, like other consid- inappropriate. of action. inquiry to that cause minancе erations, affirmative defenses must be fac- steadfastly contends that The dissent into the calculus of whether common tored evaluat district court should instead have Id. at predominate. predominated whether common issues ed a whole.” Moreover, in- in the entire “action taken as regardless of other courts’ see post (emphasis original); at 446 flatly of Rule we have See terpretations (“the whole”); case as affirma- also id. held that “when the defendants’ (“the whole”); 450, 451, as a action may depend ... on facts tive defenses action”). (“the According case, entire class certi- to each peculiar dissent, Broussard, must first a district court 155 to fication is erroneous.” (citation [a] that” an law suit “as “determine entire quotation at 342 and internal F.3d (i.e. action omitted). the cause of to whole” Although it is difficult marks very different against TPCM but also the any precision, appears determine asserted causes Agents’ here the affirmative defenses
439 predominance and su- Agents) predominance satisfies fíes the and superiority re- 23(b)(3) 23(b)(3)” periority requirements imposed quirements imposed by only employ 23(c)(4), then only satisfy the entire lawsuit does subsection post at if 453, 23(c)(4)’s simply ignores requirements may “manage[ these a court Rule express ] 23(c).” course, command.14 through orders authorized Of courts have See no dis- cretion ignore plain argument language id. at The dissent’s of a finds See, statute or federal rule. e.g., United support no the law—not Rule 23 itself States Indeed, Oregon Nat’l Bank v. Indep. Ins. nor case or treatise. Am., 439, Agents 454, 508 U.S. 113 S.Ct. ignoring plain language addition to 2173, 124 L.Ed.2d (noting rendering Rule subsection of the “plain meaning enforced, must be superfluous, rule dissent’s argument is course”). contrary Supreme to the interpre- Court’s precedent
tation of Rule
our own
Moreover,
the dissent’s approach would
every
(including eight
(c)(4)
that of
other court
render subsection
of Rule
super-
courts),
appellate
federal
and every schol-
fluous. The
require
dissent would
a court
arly
treatise
has addressed the issue.
considering the manageability of a class
action—a requirement
for predominance
First,
rigidly
ap-
the dissent’s
sequential
23(b)(3)(D)
under Rule
pretend that
—to
proach ignores
plain language
(c)(4)
provision
subsection
specifically
—a
23(c)(4) provides
rule.
that:
included to make a class action more man-
(A)
appropriate
action may
[w]hen
ageable
not exist until after
—does
brought
be
or 'maintained as a class manageability
determination
is made.
issues,
respect
particular
action with
Thus, under the
reading
dissent’s
of Rule
(B)
may
a class
be divided into sub- 23,
(c)(4)
a court
could
use subsection
classes and each
treated
subclass
as a
manage
cases that
the court had al-
class,
provisions
and the
rule
ready determined would
manageable
be
applied
shall then be construed and
ac-
(c)(4).
without consideration of subsection
cordingly.
(c)(4)(A)
reading
This
leaves subsection
23(c)(4)
added).
(emphasis
Fed.R.Civ.P.
any practical
without
application, thereby
Thus,
specifically
Rule 23
dictates that
rendering
superfluous.
See In re Tetra-
Cases,
appropriate”
may
cycline
“[w]hen
class action
107 F.R.D.
726-27
and,
(W-D.Mo.1985)(“If
“particular
“maintained” as to
issues”
requirement
under
done,
23(c)(4)(A)
provisions
“the
of this Rule
was that
... one or more
after
rule,”
predominance
such as the
require-
‘predominate’
issues
in the usual Rule
(b)(3),
23(b) sense,
ment of
“shаll
...
then
be construed
compared
when
with all the
added).
applied.”
(emphasis
case,
Id.
The
issues
there would obviously
dissent’s approach
23(c)(4)(A).”
a court
de-
place
first
be no need or
for Rule
—that
termine “that the action
(emphasis
as whole
in original)).
[a]
satis-
Such an interpre-
Advisory
14. Committee on
resolving
Civil Rules has
certain claims and defenses on a
(c)(4)’s
recognized
despite
subsection
force
leaving
while
basis
other controversies
Thus,
(b)(3).
placement after
in 1995 the
separate
for resolution in
actions.” See Ed-
Advisoiy
amending
Committee considered
Cooper,
ward H.
Class Actions and the Rule-
read,
(c)(4)
may
"an action
be certified as a
making
Challenges
Process: Rule 23:
to the
claims,
respect
particular
class action with
Process,
13, 56,
Rulemaking
71 N.Y.U. L.Rev.
defenses, or
place-
issues ...” because "the
(1996) (quoting Proposed
Amendments to
(c)(4)
ment
provision
in subdivision
Procedure,
(Feb.
Rules of Civil
Class Actions
permitting
particular
class actions for
Draft)).
potential
has tended to obscure the
benefit of
*22
representation
requirement
of Rule
the well-es-
of Rule 23 contravenes
tation
23(a)(4),
reading
therefore never
prohibition
“pass
tablished
and would
23(a).
make
provision in a manner
would
through
of Rule
at
gate[
Post
]”
sentence,
“clause,
super-
or word ...
450;
(noting
see also id. at 449
that an
fluous, void,
insignificant,”
TRW Inc.
requirements
satisfy
action must first
“the
Andrews,
19, 31,
441,
122
534 U.S.
S.Ct.
23(a)”
employ
of Rule
a court can
before
(internal
quotation
151
339
L.Ed.2d
(e)(4)).15
lengthy
Despite
attempt
its
omitted).
citations
marks and
hand,
analogize
case at
in
Amchem to the
support
ga-
an effort to find some
plain
ignoring
In addition to
Rule 23’s
449-451,
at
tekeeper theory,
post
see
rendering
part
super-
of it
language
dissent
to take into account the
fails
Su-
fluous,
rigid, sequential
the dissent’s
read-
preme
own characterization and
Court’s
ing
controlling
the rule conflicts with
application
in
of Amchem Ortiz.
re-
precedent.
Supreme
The
Court has
strictly
to read Rule 23
se-
fused
Moreover,
acknowledges,
the dissent
but
quential fashion advocated
the dissent.
disregards
import
then
conclu
contrary,
To
in its most
discus-
recent
sion of the
itself that
Amchem Court
“set
23(c)(4),
sion
Ortiz v. Fibreboard
of Rule
certification,”
tlement
relevant to a class
815, 856,
2295,
Corp., 527 U.S.
119 S.Ct.
23(e)
and that
a court’s
Rule
affects
evalu
(1999),
suggest-
Again, adopted no has the dis- 23(b)(3)’s predominance Rule 23; requirement sent’s of Rule no court interpretation our respect dictated reversal with required lawsuit-specific predomi- has Plain- Thus, analysis. nance the dissent’s attacks tiffs’ claims Agents decision —a they on our are as are approach baffling as with which the dissent concurs. ill-founded. The dissent’s contention The dissent offers an equally perplexing our approach “bypasse[s]” and “sub- response to the wealth authority cited 23(b)(3)’s predominance re- vert[s]” above, First, including cases from Sec- 23(b)(3) quirement, “strips Rule ond, Third, Fourth, Fifth, Sixth, Ninth, meaning,” post 450 and Circuits, and Eleventh of which all have simply scrupulously false. have ana- We rejected the dissent’s contention that a lyzed whether Plaintiffs’ claims *25 if class can be certified the common Agents satisfy predo- TPCM and the ie., issues in “the entire every action” — requirement. minance See at 425- ante against every cause of action defendant— 426, 427-428, so, doing 434-438. After we predominate over individual issues “the have concluded Plaintiffs’ cause of entire action.” dissent does not dis- against action TPCM —“that violat- TPCM cuss, distinguish, let alone most of the party ed its ... as third duties administra- cite; it Plan,” simply cases we maintains that tor of the which caused Plan’s “the (dissent they not at “directly injured post do exist. See 63 failure” and so Plaintiffs” whole, can noting “identify” prece- a all no circuit J.A. 1249—taken as satisfies of requirements, including predomi- majority’s holding).17 Rule 23’s dent supporting " Thus, contention, contrary to the and is dissent’s "defined factual contours” ‘co 16. post at is no “wonder regardless there reason to with the terminous transaction of exactly what” the common issues certi- in the the number of substantive theories ... ” against "predomi- fied cause of action TPCM may plaintiff.’ be available to the CoreS over;” they predominate nate over the indi- Bank, America, Inc., tates N.A. v. Huls 176 vidual issues involved in that cause action. 187, 194, 1999) (3d of (quoting F.3d 200 Cir. (Second) Judgments § 24 cmt. Restatement of Pointing liability to the various theories of a). part of the Thus "claims are same cause alleged complaint against twen Plaintiffs’ they out of of action when arise the same TPCM, ty-three surpris agents dissent operative ... or the same core of transaction ingly each of con asserts that these theories Englander, v. 321 F.3d facts.” Grausz stitutes a action and certified cause that the of (4th Cir.2003) (internal quotation 473 marks simply claim TPCM is a "common casеs, omitted). Certainly, in some each the question.” post at were See 452. Even if this liability ory arises from a different set of of so, it is aids the unclear how this contention part operative facts and so constitutes a predominance inquiry would dissent—for the here, although different cause of action. But still be within the of these conducted confines liability whole, Plaintiffs assert several theories of "causes of action” not the lawsuit as TPCM, Allison, See, arise from all of these theories e.g., as the dissent would. 151 fact, "operative single a set of facts” so are F.3d at conten 421-22. dissent’s herring. single part tion is a A is a red cause of action cause of action—that 444 Allison, 421-22; Castano, F.3d at 151 84 confounding, as is dissent’s con
Just
sure,
21.18
has
F.3d at 745 n.
To be
as the
adopted
the Fifth Circuit
tention
we,
noted,there is a
approach and that
in Second Circuit has
circuit
the dissent’s
refusing
predominance
the Fifth
conflict as to whether
must
assertedly
to follow
Cir
respect
cuit,
See
at
be shown with
to an entire cause of
post
create
circuit conflict.
Texaco,
446-447,
action,
specific
to a
merely
respect
v.
or
(citing
452-453
Smith
(c)(4).
(5th
issue,
Inc.,
Cir.2001),
in order to invoke
See Robin
263 F.3d
Allison
(5th
Co.,
R.R.
Finally, predicting the dissent errs “procedural on remand. See nightmare”
post class action 448. The certified VI. the district court TPCM involves conclusion, prece- we note that circuit single, straightforward cause of action con- guidance resolving dent clear provided questions to all sisting of three common presented case. On one “TPCM Plaintiffs —whether violated *27 hand, against Plaintiffs’ class action ... party duties as third administrator of many the Plan,” bears similarities to class action the “such was a whether conduct failure,” in Fidelity Wesleyan, and we approved cause of the Plan’s Central and injured promises many advantages: of the directly whether “that failure the theory advance'a of liabili- single Plaintiffs and the absent class members.” 19. While the bemoans need for trict court did not its discretion in dissent the abuse 1,400 conditionally separate certifying on the one cause of ac- individual full trials the claims, would, TPCM, faithfully approach against non-certified fact, its in tion we have adhered against purpose add of the to text and of Rule and chosen claims—all claims the time, that TPCM—to it describes as a a course effort, will "achieve economies of what "minefield expense, legal Denying promote uniformity for Post at class error.” and and require persons similarly against as to situated.” certification TPCM would of decision prove advisory note Plaintiffs to the same See Fed.R.Civ.P. committee’s elements Amendment, (1966 (b)(3)). against certified of action TPCM in subdivision In do- cause 1,400 trials, so, we possibility ing believe we removed from the individual have findings contradictory one-way pre- and "minefield” those mines could issue dissent’s contrast, holding be properly that the dis- removed. clusion. inquiry; apply respect fails to law with
ty, individualized hends or requiring no issues, likely to conserve it its underlying class certification seems to abuses discre- litigation judicial resources conserve we that the dis- Accordingly, tion. hold relitigate by reducing costs need in granting trict court abused its discretion trials; multiple in in the liability issues against conditional class certification appears certification absence class Agents. against claims many Plaintiffs’ PART, AFFIRMED IN REVERSED brought; and class TPCM would not be PART, IN AND REMANDED FOR defendant, protects certification FURTHER PROCEEDINGS TPCM, adjudications from inconsistent NIEMEYER, concurring Judge, Circuit Moreover, one-way preclusion. issue part in dissenting part: Wesleyan, Central as the district court all of 23’s
carefully require- assessed I part judgment concur in that ments a class action and for issued detailed its holding the district court abused findings explaining decision in factual in certifying discretion individual “sub- Indeed, conditionally certifying the class. I against Agent classes” defendants. significant to the extent there are differ- I dissent from the remainder. would hold ences the class action certified between that the district court abused its discretion against action certifi- TPCM and class certifying single for claims Central Wesleyan— cation approved against representative TPCM because the Wesleyan the need in Central such as parties requirements have not satisfied the fault, comparative appli- determine and the Federal Rules Civil Procedure jurisdic- cation of the laws of different 23(b)(3). 23(a)(3), 23(a)(4), and weigh tions—these differences even more majority The case able opinion heavily in favor of class certification here. a partial class-action certifica- approve Wesleyan virtually sum, Central com- full faibng tion account pels the conclusion the district court range plaintiffs’ claims the ex- conditionally did abuse its discretion in tent to which most of their claims must certifying Plaintiffs’ class TPCM. concededly adjudicated anon individual hand, proposed On the other Plaintiffs’ basis, ignoring the effect that the erosive Agents class actiоns have adjudications of these additional many to the action parallels we re- predominance require- claims has on the in Broussard: jected 23(b)(3) ment of Rule that common issues Agents require proof individualized predominate ques- over the individualized rebanee and individualized of a proof spe- a whole. raised in tions taken Agents’ cific undertaking advise. example, For the majority never addresses affirmative also require defenses would the practical legal difficulties that will Thus, inquiry. further individualized from the arise certification of a class action *28 Broussard would seem to require the con- respect only or TPCM with to one predom- clusion that not common do leaving two issues while for individual ad- inate, that is and class certification 1,400 judication in separate individual tri- Indeed, appropriate. the district court and, als the damages issues of some Broussard’s force recognized there- cases, causation, as web as: to attempted mightily distinguish fore the 1) all claims under the South Carolina however, so, case. The court could do Act; Unfair Trade Practices by misconstruing ignoring controlling 2) legal alleging conspiracy; a all principles. misappre- When claims civil
447 3) (c)(4) involving housekeeping is a that all claims violations rule allows
RICO; courts to sever the common issues for a class trial. 4) plaintiff each qualify all issues Plan; applicable under the for claim Co., v. Castano American 84 Tobacco F.3d (5th Cir.1996); 734, n. 21 see also 5) sold agents all the who claims v. Citgo Allison Corp., Petroleum 151 F.3d (5th Cir.1998). Plan.
the 421-22 separate The need for these individualized addition, opinion In the majority at- trials is conceded. case, to tempts shoehorn this even with its issue, single limited focus on a into the overwhelming predominance
Despite the parameters of our distinguishable holding of these issues and claims individualized Wesleyan College Central v. W.R. Grace majority over the common issue that the (4th Co., Cir.1993), & F.3d 177 treatment, which for ma- now class the certifies we affirmed the conditional certification of jority adopted approach an inventive has this, litigants. doing a class of asbestos of a to Rule 23 allows certification majority fails consider the broad predominance requirement class where 23(b)(3) complexities raised admittedly unmet in the unaddressed is- Rule According litigation apply sues in this and fails to context of the case as a whole. later and more majority, require specifically applicable to the the certified con- trolling case to predominate ruling Supreme issue in this over Court Products, Windsor, in the Inc. individualized issues action as Amchem 23(c)(4)(A), it ignores whole Rule which U.S. 117 S.Ct. L.Ed.2d (1997). appears to view as fourth avenue certification, footing on equal Finally, majority meaningfully fails 23(b)(3). 23(b)(1), 23(b)(2), Rules to address overt conflicts of interest exist- so, doing majority glorifies Rule ing among conditionally members 23(c)(4)(A) au- housekeeping rule that —a example, certified class. For does not certify thorizes a court to for class treat- how attempt explain conditionally ment “particular issues” case may include, certified class on the one 23(a) 23(b)— otherwise satisfies Rule hand, employers seeking rescission materially rewriting
with the effect pre- insurance contract the return of 23(b)(3)’s requirements 23 such that Rule and, hand, paid, miums on other their action,” longer applied no need be “[a]n employees seeking enforcement 23(b), see Fed.R.Civ.P. but rаther to insurance same contract to obtain benefits single issue, no small. matter how discounts, majority it. The also on under Not only majority’s approach does the deposition testimony, potentiality scant reach, expand beyond Rule 23 its intended aggrieved employee-class members but conflict it also creates a direct with the damaged nonpayment who were or de- Fifth which has Circuit held: payment may implead layed employers,
A cannot their who are also pre- district court manufacture defendants through the members and who made the decision dominance nimble use (c)(4). proper woefully inadequate plan. interpre- purchase subdivision antagonistic posture tation of the interaction between subdi- Even aside from the *29 (b)(3) (c)(4) employee of and class mem- employer visions and is a of the cause action, whole, satisfy bers, injured employees’ pre- as a must the claims them- the (b)(3) will be an- requirement aggregated dominance of in that selves have to into subclasses, mismanagement a when their whether was tagonistic based on TPCM’s whom, Answering cause of the Plan’s failure. this mismanaged by claims and were on dif- no class member’s claim premised question to relief resolves with entitlement of only questions these the difficult By lumping ferent all of and invites theories. proceed question once the is an- employees apparently into one class and how Little, informally any, if time can casting “disavowed” swered. or effort aside as by answering this in the theory question of best of recov- saved group employees’ be on ery, inherent- because full individual trials majority the deindividualizes abstract lops liability will have to be conducted for ly individual claims off substantial still members’ each individual class member. limbs from the various class the conglomeration order to bless I would the certification of the reverse disabled, similar, now class of of albeit in this the class case for litigants. reasons that follow. by Had problems these been addressed I distinguish- majority opinion aspects Wesleyan, able of as well Central majority Because the dis- holds that Amchem, controlling analysis as of of a trict court’s conditional certification explored, ap- been it would have become single issue TPCM constituted parent satisfy, under cannot 23(c)(4), application of Rule ante at proper any applicable require- precedent, 425-427, it at necessary address ments Federal Rule Civil Procedure why outset the fundamental issue of 28(1) that claims be of the typical their 23(b)(3) requirement of Rule predominance they claims of so that can act as the class Rule bypassed by cannot be reliance on representative fairly and ade- parties, able 23(c)(4). short, I ma- believe that the quately protect the interests of the jority, expansive interpreta- an adopting 23(a)(3) class, (4); by Rule required as 23(c)(4), enlarged tion of Rule has (2) questions that common of law and fact in a manner contem- reach Rule 23
predominate questions affecting over con- plated by the Rule’s drafters and not members, required by individual class as Supreme approach sistent Court’s 23(b)(3); Rule the class calling for an “undiluted” application superior methods for other available 23(b)(3)’srequirements every case. adjudication fair of the and efficient Amchem, 2231; U.S. S.Ct. controversies, numerous claims and as re- written, Rule, (noting see id. that the 23(b)(3). quirеd the requirements “sets are bound [courts] “judicial majority’s counseling against As result of the limited to enforce” and Rule). on single application focus the facts related to a issue inventiveness” in Thus, case, I history this it has left a difficult and would conclude text, complex procedural light structure created the Rule and its read in Amchem, try Supreme holding the need numerous individual claims Court’s re- quire involving for each member that will result in that even in cases the certi- classes, unnecessary, ultimately unhelpful, issue-only fication of the common procedural nightmare. predominate questions And on a broad issues must over level, judgment question affecting only one has to individual members of the utility of morass in the as a enduring procedural context the action single majority's to the purpose answering for the whole. conclusion unhesitating to invite an question contrary certified for class treatment: seems
449 granting 23(a)’s In approach class certification addition satisfying procedural where other devices would suf- prerequisites, parties seeking class certi- fice, so, doing in a opens conflict fication must show that the action is Thus, Fifth only with the Circuit. after I 23(b)(1), (2), maintainable under Rule my elaborate the basis of conclusion that a (3).
predominance analysis is mandated ev- 23(b)(3)
ery Rule class action do I then
proceed required analysis by with the look- qualify To
ing at
for certification
pre-
the various issues and claims
under Rule
23(b)(3),
sented
this case.
class must meet
require-
two
23(a)
beyond
ments
the Rule
prerequi-
Of the Rule 23
adopted
amendments
questions
sites: Common
must “pre-
23(b)(3)
1966, the addition of Rule
was “the
any
dominate over
questions affecting
most adventuresome innovation.” Am
only
members”;
individual
and class res-
chem,
614,
at
U.S.
useful
tools
too,
satisfy
case, they,
individually
upon
parties
must
the
provisions
sought
which
23(a)
and,
of
and
a
requirements
settlement-only
the
Rule
certification
class
23(c)(4)
23(b)(3).
(pro-
See
ultimately, approval
negotiated
Fed.R.Civ.P.
set-
that,
issue-only
if a court utilizes
viding
settling parties
The
viewed the
tlement.
subclasses,
or
provisions
classes
“the
as a
predominance requirement
require-
ap-
then
this rule shall
be construed
action
applicable only
ment
to an
that was
us,
plied accordingly”). In the case before
trial,
they
destined
and therefore
ar-
however,
dispute
the threshold
I have with gued that
of the action and fair-
cohesion
majority
single-
is not whether
the
the
ness for settlement was better determined
that
issue class
has been certified here
23(e)
by
hearing
ap-
a
under Rule
when
23(b)(3),1
Rule
rather whether
satisfies
but
Supreme
Because the
proving settlement.
main-
issue-only
may
class action
analyzed
in
the
Court
Amchem
relation-
23(c)(4)
Rule
com-
tained under
when the
ship
predominance require-
between the
predominate
does not
over
mon issue
the
23(b)(3)
ment of Rule
and the settlement
in the
that
litigation
other issues
affect
23(e),
authority
analysis
ap-
Rule
is
only individual members.
posite
analysis
pre-
of whether the
23(b)(3)
requirement of Rule
dominance
I
conclude
when the text
Rule
23(c)(4)(A).
by
can be subverted
Rule
23(b)(3)
provides
“questions of law or
to the
fact common
members of the class
The district
in Amchem
certified
af-
predominate
any questions
over
[must]
objectors’
settlement-only
class over
in
fecting only individual
“[a]n
members”
23(b)(3)
objections
strenuous
that the Rule
action,” “action” means the action as a
requirements
did not
class
meet
I
whole. And
do not believe that
23(a)
(b)(3).
Third
Rule
Circuit
possibility
maintaining an
bringing
certification,
the class
holding
vacated
respect
particular
action “with
issues”
settlement-only
class satisfied neither
23(b)(3)
expand
was ever meant to
Rule
23(a)
23(b)(3)
Rule
nor
and that the cases
allow class certification
when the
proceed
through
should
either
consolida-
the class members’ case
42(a)
under Rule
smaller
tion
or as
comparably
defendant tower over
in-
actions under
23. 521 U.S. at
Rule
common
significant
issue or issues. The
2231. Affirming
117 S.Ct.
the Third Cir-
majority disagrees
my reading,
which
cuit,
Supreme
“emphasize[d]”
Court
it disparages
“rigidly sequential,”
ante
23(a)
requirements
that the
of Rule
at
reading
instead
adhering to
(b)(3)
“impractical
are
“safeguards,”
23(c)(4) that
Rule
allows a district court
disregarded
impediments”
that can be
certify any
litigation,
common issue in the
perceives
court that
a measure of fairness
view,
my
no matter how small.
overlooking
partic-
standards
these
23(c)(4)
majority’s interpretation of Rule
ular case.
Id.
The core Su- the court contemplated, addressed trial was noted preme Rule, Court Amchem was the inter- that the other specifications satisfy requirements 23(a) explain infra, I For reasons that I would of Rule 23(b)(3). hold that the class certified does not even issues, 23(b)(3)’s requirement, vital including predominance prescription *32 undiluted, stripped in heightened meaning even an even more “demand[ed] way dramatic than it was in at 2231. Amchem. attention.” Id. S.Ct. majority The in boldly this case holds that settlement-only satisfy class to Requiring a individualized claims and in 23(b)(3)’s this ac requirements, the Court Rule tion are not a factor in analyzing whether held, appraisals to inhibit “serve[s] predominate common issues in the certi chancellor’s foot kind —class certifications TPCM, claim leaving one to dependent upon gestalt judg the court’s fied exactly wonder what the isolated common overarching impression ment or of the set predominate issue must over. For if Rule Importantly, fairness.” Id. tlement’s 23(c)(4)(A) allows a court to omit from its concluded that “it is not the mission Court predominance analysis any claims or issues 23(e) of Rule to assure class cohesion members, affecting only individual it would in legitimizes representation action predominance seem that the of the select 623, 117 place.” the first Id. at S.Ct. 2231. ed issue is a foregone conclusion since the compromise “If a interest in a fair common question common of law or fact would al require satisfy predominance could ways predominate over the individual is 23(b)(3),” the ment of Rule Court contin sues that are not a factor. And in the rare ued, prescription “that vital would be majority might instance where the find a in stripped any meaning the settlement predominate common issue not in a context.” Id. case, given it could simply narrow the 23(e) Just as it is not the mission of Rule until, view, pinhole its the selected issue supply legitimizes the cohesion that a predominates over the other issues it action, settlement-only class neither is it Indeed, nothing chooses to see. in the 23(c)(4)(A) of Rule to supply mission majority’s opinion supplies any lower limit legitimize issue-only the cohesion to just on how narrow a common may issue situations, class action. In both the cohe- analysis be yield before its must to com 23(b)(3) legitimize sion essential to a By mon adopting sense. a view of Rule action can shown when the action be 23(c)(4)(A) 23(b)(3) strips Rule predominance as a whole satisfies the re- meaning, necessitating the aid of additional 23(b)(3). quirement principle of Rule itself, principles found nowhere in the Rule 23(b)(3) every is that Rule Amchem majority has for Rule “substitute[d] satisfy provi- class action must all of the 23’s certification criteria a standard never 23(a) (b)(3), sions of Rule and the adopted,” a substitution that “[f]ederal Rule, provisions including other authority” courts ... lack to make. Am 23(e), cannot be used to dilute the chem, 2231. U.S. S.Ct. requirement proposed that each class must legal authority In an effort to enlist satisfy predominance requirement ac- interpret Rule 23 to authorize a class view, major- merit In my certification. issue, single majority, tion on a Part 23(c)(4) ity’s reading of Rule allows for a V, interpreted how I have misconstrues 23(b)(3) application diluted of Rule re- appreciate Rule 23 and fails to the conse- moving from the predominance calculus quences reading the Rule a manner most of the individualized issues 23(c)(4) gate a lets Rule serve as case. determining house for whether class ac- majority’s analysis,
Under
which tion should
certified. Even as an action
action”
may
looks at the common issue
the case
include different “causes of
recovery,
all causes of
through
pinhole
ignores
all other
different theories
a “cause of
Naming
question
this certified
be related to form
or claims must
18-21,
action,”
any specific
it to
tying
but
Fed.R.Civ.P.
the action. See
that,
majority makes
qualify
complaint,
“an
in the
claim
provides
And Rule
action,
question
prerequisites
analysis
of what this common
action” as
(b)
(a)
particularly
over
ab
predominate
and subdivision
must
of both subdivision
23(b).
analysis seemingly
majority’s
Sub
struse. The
be satisfied. See Fed.R.Civ.P.
(c)
manage
causation issue and
then addresses the
identifies
common
division
*33
23(c)(4)(A)
authorizing
immediately
the
to Rule
jumps
of the
action
then
ment
issue-only
newly
insulate the
certified
certification of either issues
sub-classes.
to
respect
scrutiny
predomi
to an
the
of the
But a class certification with
class from
23(b),
cannot,
Rule
in the context of the
bypassing
requirement
without
nance
issue
whole,
as the
impor
undertaken unless the issue is so
case as a
even
be
that it
the entire action
urged
tant to
of “the action”
consideration of
disposition
affect
a
any questions
over
and certification of the action as whole.
“predominates
at 4
only
members.” Rule See Pls.’ Mot. for Class Certification
ing
23(b)(3).
by
single
cases cited
the
of a
class for
(seeking
None of the
certification
majority
bypassing
such a
all
causes of action
advocate
seven
defendants).
entirely
majority now advances as an
and certain other
the
proposition.
novel
failing
to examine the various other
majority
my
The
criticizes
demand
in the entire action to
presented
issues
conducted,
predominance analysis
a full
required “cohesive
determine whether the
Amchem,
required by
both
Rule 23
present
“legitimize!
represen
]
ness” is
rely
insisting
single
that it can
on a
issue
man
place”
tative action
the first
—as
notwithstanding a
certify
the
23(b)(3), Amchem, 521
at
see
U.S.
dated
class—
predominance
test
conclusion
by jumping
2231—and
S.Ct.
not be satisfied in the context of
would
23(c)(4),
only
majority
bypasses
stating
action
a
that I have
as whole—and
impor
one of the most essential
most
plain language
“ignore[d]
[Rule
certify
imposed by
checks
Rule 23 on
tant
23(c)(4)
438-439,
],”
my
ante at
and that
23(b)(3) classes,
a
ing
opens
it also
a subsection of the rule
analysis “render[s]
among
conflict
the circuits on
issue.
at
superfluous,” ante
applied
Fifth
has
the Rule
The
Circuit
dogged requirement
satisfying
with
very
I disagree. This
case illustrates
considering other as
predominance before
importance my conceptual disagree
23(b)(3)
in a
class.
pects of the Rule
See
inviability
majority
with the
and the
ment
Texaco, Inc.,
394, 409
263 F.3d
Smith
case,
In this
majority’s position.
of the
(5th Cir.2001) (later
pursuant
withdrawn
class members have asserted seven causes
parties,
see 281 F.3d
settlement
an unfair
of action
TPCM:
trade
(5th Cir.2002)); Allison,
151 F.3d
claim,
undertaking
practices
negligent
Co.,
421-22;
v. American Tobacco
Castano
claim,
claim,
negligent misrepre
fraud
Cir.1996).
(5th
n. 21
84 F.3d
claim,
claim, a
of contract
sentation
breach
Smith,
on
explained
position
the court
claim, and a
claim.
conspiracy
a civil
RICO
predo
between the
proper relationship
majority,
idеntifying
without
to which
The
23(c)(4):
requirement and Rule
minance
these seven causes
certified
inquiry involves a
belongs,
predominance
certified for class treat
The
issue
has
among
common
vague question
comparison
whether TPCM
ment
Plan.
and the issues indi-
“a
of the failure of the
the class members
was
cause”
consistency
remains
with
Fifth
analysis
This
Circuit
vidual
them.
face-
tious,
majority’s
a class is certified
at best. The
unchanged whether
wordsmith-
23(b).
ery
respect
one or more sections
rule
to the term “cause of
under
constancy
disguise
plain
serves as
action” does not
conflict
inquiry’s
holding
limitation on the use of bifur between the Fifth Circuit’s
important
and its
sure,
by preventing
holding.
majority
a district court
To be
cation
identi-
manufacturing
predominance
court opinions,
fies some district
commen-
from
taries,
that,
of Rule
and a
through
citing
the “nimble use”
student note
one
23(c)(4).
Co., another,
Am.
in favor
argue
majority’s
Castano v.
Tobacco
(5th Cir.1996).
I
interpretation.
disagree
F.3d
745 n. 21
But
respectfully
authorities,
so,
with the cited
in doing
Therefore,
action,
the cause of
as a
I
adhere to the view of the
other
23(b)(3)’s
whole,
satisfy
predo
rule
must
circuit court to address the issue.
Id.
requirement.
minance
Once
re
23(c)(4)
met,
rule
is avail
quirement
I would hold therefore that under the
*34
able to sever the common issues for
proper analysis, the district court must
To read the
not as a
class trial.
rule
determine that the action as whole satis-
rule,
housekeeping
but instead as allow
predominance
fies the
superiority
and
re-
pare
to
ing
repeatedly
23(b)(3),
imposed
quirements
by
and ac-
achieved,
predomination
until
would
satisfying
requirements may
tions
these
23(b)(3)’s predominance
obliterate rule
managed through
by
orders authorized
in
requirement, resulting
automatic cer
23(c). Thus,
23(c)(4),
under Rule
a court
in
every
any
tification in
case
which
could create subclasses or even bifurcate
exists,
common
a result drafters of
issue
issues,
by
grouping
claims
them for class
rule could not have intended.
complicated
action treatment. But in this
case,
predominance
superiority
and
re-
409;
Allison,
see also
151 F.3d
263 F.3d
quirements cannot be
even
satisfied
at 421-22.
Valentino v. Carter-Wal
Cf.
manageability
supplied
the aid of the
tools
(9th Cir.1996)
lace, Inc.,
1227, 1234
97 F.3d
23(c),
I
by
proceed
as now
to demon-
(reversing
rely
a district court’s effort to
strate
some detail.
23(c)(4)
23(b)(3)
bypass
on
but ac
knowledging
“appropriate
that
cases”
II
predominance requirement
could be
overlooked).
The
in this
purchasers
case are
identify
prece
We can
no
a multi-employer
and beneficiaries of
Supreme
dent from the
Court or from our
(the “Plan”)
plan
sponsored and
healthcare
support
majority’s
fellow Circuits to
marketed in
Carolina
the Fideli-
South
holding.
demise, they
ty Group, Inc. On the Plan’s
majority’s breathtaking
assertion
commenced this class action under Federal
23(c)(4)
that
of Rule
not in
reading
its
does
23(b)(3) against
Rule of
Procedure
Civil
way
contravene the Fifth Circuit’s
Fidelity Group
companies
and related
simply
cases is
not true. The Fifth Cir-
individuals, against
agents
who
cuit, by
very language, only
its
consults
Plan,
and sold
marketed
“housekeeping” provisions
of Rule
administrator, alleg-
the Plan’s first claims
23(c)(4)
predominance]
“once
require-
[the
fraud,
contract,
ing
mismanage-
breach of
Smith,
is met.”
ment
We adjudicated. that should not have been Rule of review this order under Federal it a suffi- TPCM admits that did not have 23(f). Civil Procedure number of trained claims examiners cient discovery has com- Although not been filed, stay being current with claims yet fully have not been pleted and facts and, result, pro- backlog as a appears Fidelity it developed, developed grew to six to cessing to create and market a Group intended began Plan members eight months. multi-employer plan healthcare would widely delays pro- in the complain and indi- be available to small businesses cessing of their claims. subject to regu- and that would be viduals To do provisions lation ERISA. During period the same TPCM was this, it both the National Associa- created case, administering the Plan was Business Owners and Professionals tion of *35 experiencing backlog also a claims for (“NABOP”) potential to act on behalf least ten other clients. There is evidence customers and the International business part caused in problems that TPCM’s were Guild, Inc., a union to act on Workers that, during fact by approximately the the employ- of the business customers’ behalf claims un- administering 20 months was might elect ees and other individuals who Plan, moved its claims ad- der the TPCM the coverage under the Plan. NABOP and twice, each time operations ministration International Workers Guild thereafter requiring new notifications to healthcare “negotiated” provide the Plan to health- claims to providers of the need to forward Plan partici- care and dental benefits to address. After failed to re- new TPCM Fidelity The pants and beneficiaries. backlog continuing the and fulfill its duce NABOP, then entered into Group, through NA- Fidelity Group assurances to the and Party with Third Claims Man- contract deficiencies, that it would correct the BOP (“TPCM”)2to agement, Inc. administer terminated the contract with NABOP Plan con- process and claims. Under this cause, 1,May for effective tract, 1, 1995, April effective TPCM be- Fidelity Group claims ad- and the moved responsible processing incoming came for “in-house,” by handled ministration to be claims, determining eligi- each claimant’s Inc. Fidelity Management, Claims bility coverage, computing benefits paying and claims out of a bank payable, backlog Because there was a serious and Fidelity Group maintained account Fidelity Management, lacking both Claims and NABOP. apparently and was experience expertise, administrator, step not to allege prepared that over the next three
Plaintiffs delayed Plan continued to suffer years, the Plan’s administration became members convenience, contract, I refer to or all of these 2. At the time TPCM’s name was For of. Healthcare, Inc., and later TPCM Millennium collectively as “TPCM.” entities Services, by Healthplan Inc. was succeeded nonpayment of their claims. рayment sentations made about the formation of the year After than a of additional more frus- Plan, benefits, administration, its its and members, Plan Secretary tration (4) value; negligent misrepresentation, Labor commenced an action in 1998 which plaintiffs alleged induced them to Group against Fidelity and related purchase and pay Plan; continue to for the companies and individuals the Eastern (5) (6) contract; breach of civil conspiracy District of New York to take control of the form, market, to and sell a “substantially Plan’s assets and to shut down the Plan’s health worthless care dental” plan; operations. The district court New (7) RICO, violations of 18 U.S.C. stay, York enjoining prosecu- issued 1961 et seq. § gravamen plaintiffs’ The against Fidelity Group, tion of suits TPCM, against claims TPCM is under Plan, corporations in- related circumstances that vary plaintiff from dividuals, appointed and it an independent plaintiff, breached duties pay plaintiffs’ fiduciary manage the assets. On the timely claims provide in- accurate fiduciary’s request that the Plan be termi- concerning formation pending status of nated, the New York district court ordered claims. plaintiffs allege The these terminated, the Plan January effective breaches not only inju- caused them direct ry but also contributed ultimate plaintiffs commenced this action on Plan, failure of the causing injury them on 11, 1998, September and the district court this indirect gravamen basis. The followed New York court and likewise (1) plaintiffs’ agents claims stayed claims the Fidelity defen- agents that the sold worth- But, by dants.3 an order dated December less insurance that did comply 27, 1999, the district court stay lifted the (2) statutory requirements, South Carolina Defendants,” “all non-Fidelity as to allow- agents were not licensed to sell ing prosecution of the Plan, *36 the and that they fraudulently TPCM for or mismanagement claims and against selling for agents misrepre- negligently the misrepresented the Plan and senting agents the Plan. The selling are 43 provided negligent regarding advice the companies individuals and that sold the Plan. Fidelity Plan on behalf of Group the relief, For the employer-plaintiffs and during peri-
businesses individuals the provided the Plan benefits to their employ- August od from when the Plan com- ees seek premiums paid return for menced, to July when the agents “worthless insurance” as well as conse- by were ordered Carolina South De- quential damages. The employee-plain- partment of Insurance to marketing cease tiffs in the Plan payment enrolled seek the Plan. they benefits to which were entitled In their complaint against TPCM and and consequential damages, including selling agents, the 43 the plaintiffs alleged damages anguish, enjoy- for mental loss of (1) violations the South Carolina Unfair life, injury ment of reputations to their and Act, § Trade Practices S.C.Code Ann. 39- (2) ratings, rectifying credit and costs of de- seq.; 5-10 et negligence in undertaking administer, market, layed payments. All represent puni- seek (3) Plan; repre- fraud connection with tive damages. Plan, Fidelity
3. The Fidelity Fidelity Management, defendants include the Claims and in- NABOP, formed, Group, employees. the union that it volved executives and acknowledged The court employees. a class plaintiffs sought represent “[wjhile definitely these numbers do 1,400 consisting persons of all persons, numerosity, Plain- finding Plan on constitute coverage under the purchased who agent Defendants failed 15, 1995, tiffs note claims August who have or after significant number to take into account the agеnts as a against against dependents that were also covered employees and all and beneficiaries group, including depen- It found that the Plan.” three-year peri- during had claims who dents, of the class there were members sought to operating. They od it was also agent the one and 21 for the other. agent-specific subclasses with represent numerosity with The court did not examine and fraud particular negligence respect agent other 21 classes but it respect to the particular agents. claims ' they contained more mem- observed they alleged: explanation, concluded, num- It these “[w]hile bers. claims the Defendant Certain may fall on the borderline of numer- bers conspiracy and Agents, including civil osity, numerosity the court finds that claims, can be treated on a class- RICO agents.” met as to these the de- wide basis. Other agents may agent-spe- be more fendant pro- The court next concluded that the may cific and exist between those commonality classes satisfied the posed particular and the Defen- class members requirements of Rule typicality marketed, sold, oth- Agent dant who 23(a)(2) (a)(3), noting that the common provided coverage erwise under the (1) included whether TPCM mis- plaintiffs. fund to (2) claims, whether managed plaintiffs’ negligence proximately alleged TPCM’s agents whom there As to the other —for Plan, and caused the failure of the plaintiffs-— no named" corresponding were agents misrepresented whether requested. no subclasses were The court acknowl- plaintiffs. Plan to the problems Troubled somewhat however, that all edged, claims for “mental granting class treatment as to all asserted anguish damage distress” and or emotional claims, granted part the district ratings reputation to credit would part plaintiffs’ and denied in motion for individually. have to be decided The court so, doing class certification. the court need for acknowledged potential also between, complex individual- left division cau- proximate individualized mini-trials on subject ized claims and claims to class- *37 specifically relating sation to the reason Assessing the motion action treatment. claim. This nonpayment given for against require- for class certification the true, noted, as to especially was the court ments of Rule the court first concluded “non-adjudicated medical unpaid claims for “ap- that the number of class members is bills,” i.e., had been those which never 1,400,” proximately which it concluded sat- analyzed by adjuster. a claims numerosity requirement of Rule isfied 23(a)(1). evaluating adequacy-of-represen- proposed agent- But on the 23 “subclasses,” forth in Rule requirement the court acknowl- tation set specific 23(a)(4), rejected the court TPCM’s con- edged numerosity that issue was a agent, represent the court tention that could not question. close As to one adequately in- the class because of conflicts of only employees noticed were volved, among members. TPCM already of them had filed interest be- against agent. argued An- had that there was conflict individual actions pur- who employer-plaintiffs 13 to 14 tween the agent other had enrolled eating the issues of rebanee where indi- coverage for their em- chased insurance inquiries proper. who vidual would be employee-plaintiffs ployees employers their against a claim might have superiority requirement On the of Rule seeking any event be and who would 23(b)(3), acknowledged the court The court ruled that the different relief. “[mjanageabibty of this class action is of claims their employee-plaintiffs’ court,” particular pointing concern to the “viable,” and, employers were of individual particularly necessity event, employer employee' However, the court “mini-trials.” then opt out of the class.” members “could concluded requirements of Rule considering presently The record before the court 23(b)(3), concluded that the court first of individual- suggests bifurcation issues predominated common issues over damages possibly proxi- ized issues only some of the class members. affecting non-adju- regarding mate cause issues that, because most of The court reasoned present dicated claims would not unpaid already claims had plaintiffs’ unmanageable scenario for the court. “adjudicated,” inquiries individualized been Addressing conspira- separately the civil plain- proximate cause of relating to counts, cy and RICO the court concluded not be neces- unpaid claims would tiffs’ predominated, that individualized defenses that causation sary. The court reiterated claims and therefore excluded those claims unadjudicated relating It from class-action treatment. said: resolved the individualized could be significant problem court notes a [T]he to resolve dam- necessary also mini-trials inherent regarding individualized issues ages. (in fact a where numerous defendants “subclasses,” agent-specific As to the 23 defendants) being class of are accused acknowledged rep- that oral the court also as the part conspiracy of a vertical such and individual reliance tended resentations alleged in These issues one this case. suggest treatment individualized primarily due to individualized de- arise Nonetheless, agents. claims may to the fenses which be available court concluded that those defenses Agent Defendants. generalized presumptions could be treated on a class-wide basis: therefore approach presuming common sense
[A] may acceptable in this reliance exists be Therefore, that indi- the court concludes Therefore, in certain circumstance. con- regarding vidual issues Plaintiffs’ cases, may presumed “reliance rendering spiracy predominate claims law claims when fraud-based common conspir- class treatment of all Plaintiffs’ misrepresen- alleged omissions Agent all Defendants acy and material and the tations are uniform unadvisable. *38 in a consis- class members acted manner Unfair Trade On the South Carolina tent with reliance.” count, again re- Practices Act individual trials because statute
quired See mandates such treatment. itself analy- if erred in its Even the court has 39-5-140(a). §Ann. S.C.Code predo- does threaten the sis and reliance case, division be- making this overall in this After minance of common issues for class-action claims and issues by can be eliminated bifur- tween that threat 458 8)all relating to questions on hand and claims and whether
treatment the one other, “adjudicated” plaintiffs’ on claims were issues for individual trials delayed and to the cause of certify- payment following court entered the order adjudi- nonpayment for those not as a ing this case class action: cated. ordered, is, therefore, forego- It for the ing agent-defendants that Plaintiffs’ for the 23 reasons Motion against whom actions conditionally Certification is were certified Class by Spe- filed a motion under Federal Rule of granted as modified this Order. Civil 23(f) cifically, permission appeal class of all Plain- Procedure proposed order, interlocutory the district court’s against tiffs for claims TPCM is condi- 30, 2001, tionally (excluding certified claims under order dated November we granted Unfair Trade Prac- that motion. South Carolina Act). However, treat- tices class-wide Ill conspiracy
ment of Plaintiffs’ claims Agent all Defendants is denied. It appropriate set forth the estab- Instead, conditionally the court certifies principles applicable lished to consider- proposed currently Plaintiffs’ subclasses previously ation of the issues. We have representatives Agent with based on the held that “[district courts have ‘wide dis- Defendants as individual for all classes deciding cretion in or not to whether certi- (excluding the Plaintiffs’ claims claims class,”’ fy proposed Wesleyan Central under the South Unfair Trade Carolina Co., 177, Coll. v. W.R. Grace & 6 F.3d 185 Act). Practices (4th Cir.1993) (quoting In re A.H. Robins (4th Co., 709, Cir.1989)), F.2d 880 728-29 sum, the court certified 24 distinct but we have noted that this discretion actions, parallel having rejected “ must be ‘within exercised the framework any overarching class action ”23,’ Inc., Dryvit Sys., of Rule v. Lienhart agents, try range a limited of claims and (4th Cir.2001) (quoting 255 F.3d issues. The court ruled that individual Inc., Sys., In re Am. Med. 75 F.3d trials would have to be conducted on: (6th Cir.1996)). Where, here, as 1) all claims under the South Carolina plaintiffs have sought class certification Act; Unfair Trade Practices pursuant to Federal Rule of Civil Proce- 2) all claims alleging conspiracy; civil 23(b)(3), plaintiffs dure bear the bur- 3) all involving claims violations of proving “numerosity, den of that the com-
RICO; monality, typicality, representativeness, predominance, require- and superiority 4) not, any reliance issues that could 23(a) (b)(3) ments of both Rule are law, presumed; a matter of placement met.” Id. The of this burden 5) issues; all damage upon parties seeking class certification 6) agents the 20 principle reflects a class action is no whom named had deal- exception “an to the litiga- usual rule that ings; tion is conducted behalf of and on 7) all regarding parties only.” the fact and na- named Califano Yamasaki, 682, 700-01, injury specifically ture of plain- as to 442 U.S. (1979). anguish
tiffs’ claims of mental and S.Ct. L.Ed.2d Though distress, emotional injury manageability proposed to credit the issue of of a *39 rating, injury reputation; and and is “peculiarly class action within dis- [the]
459
court,
superior
v.
action is
the district
Windham
other available meth-
eretion” of
(4th
Inc.,
59,
adjudication
ods for the fair
Brands,
and efficient
565 F.2d
65
Am.
23(b)(3).
controversy.”
Fed.R.Civ.P.
Cir.1977),
will nonetheless vacate the
we
predominance
requirement
is “far
plaintiffs
of a class when
have
certification
23(a)’s
demanding”
more
than Rule
com-
sufficiently
presence
of all
not
shown
monality requirement and “tests whether
23(a)
(b)(3) requirements.
and
of the Rule
proposed
sufficiently
classes are
cohesive
satisfy
Every class action must
the four
adjudication by representa-
to warrant
23(a):
in Rule
numerosi
criteria set forth
Amchem,
623,
tion.”
521
at
117
U.S.
S.Ct.
adequacy
ty, commonality, typicality, and
opinions,
2231. Our recent
decided after
23(a).
representation.
Fed.R.Civ.P.
Amchem, recognize
demanding
this more
Numerosity requires that the class be so
standard.
“joinder
of all members is
numerous
Broussard,
judgment
we vacated a
23(a)(1).
Fed.R.Civ.P.
impracticable.”
against a defendant
and
franchisor
ruled
requirements
The “final three
Rule
franchisee-plaintiff
that certification of the
23(a)
merge,’
commonality
‘tend to
class was error in an action where the
[ing]
guideposts
for
typicality
and
‘serv
had
franchisees
asserted claims for breach
...
of a
determining whether
maintenance
contract,
fraud,
fiduciary duty,
breach of
economical and whether the
class action is
negligent misrepresentation,
among
plaintiffs claim and the class claims
named
Despite
others.
in-house
require
many
members that
so
in January
until the
of 1997
Plan’s demise
issues,
trials on the most difficult
the com-
Having
delayed payment of
suffered
question
mon
the class members’ claims
nonpayment allegedly
or
due
claims
alleged mismanage-
of whether TPCM’s
injuries rang-
mismanagement,
claims
ment of claims “contributed to” or was “a
ratings
credit
to emo-
ing
damaged
from
“predomi-
of the
failure
cause”
Plan’s
distress, plaintiffs
recovery
tional
seek
any
over
questions affecting only
nate[s]
Plan,
of the
from the administrators
individual members”
beсause Rule
itself, and the 43
who sold the
agents
Plan
23(c)(4)(A) authorizes the certification of
diversity
Plan. It is the
of the factual
individual issues. But this
not fulfill
does
underlying
that
legal bases
these claims
requirement
that whole “action” be
plaintiffs’
bold effort to re-
confounds
scrutinized to determine whether individu-
pro-
through
solve them
the class action
predominate.
al claims
Indeed,
majority recognizes
that
cess.
I
that
Although
recognize
many-—but
inquiries
pervade
the individualized
not all—of the class members’ claims re-
the individual
plaintiffs’
against
claims
quire
of whether
contrib-
resolution
TPCM
agents preclude
certification of
classes
Plan,
collapse
uted to the
this is an
majority
And both the
against them.
underwhelming commonality
light of the
plaintiffs’
recognized
the district court
inquiries
individualized
neces-
substantial
based on the South Carolina Unfair
claims
sary
liability,
not to mention
determine
Act, RICO, and civil con-
Trade Practices
If
damages.
proceeds
the court
under the
That
spiracy
proceed individually.
must
proposed
class structure as
and deter-
certification
potential
leaves for
four
mismanage-
mines
TPCM’s claims
TPCM,
against
seven
which
was,
fact,
a cause of the Plan’s
ment
in negligence
sound
and contract. Yet the
failure,
liability inquiry
will
have
presented
evidence that will need to be
just
begun.
subsequent
more
the class action
TPCM will need to
litigated
difficult
to be
individu-
questions,
repeated to
in the
be
some extent
individu-
claims were
ally by
members whose
example,
al
trials
TPCM. For
by
Fidelity
either
handled
be-
TPCM,
complaint alleges
among
other
persist,
tween 1996 and
would
name-
defendants, violated the South Carolina
ly,
Plan caused
whether the failure
provid-
Unfair Trade Practices Act
injury
the class member’s
and the more
ing timely coverage
explaining
and not
fault.
complex question
comparative
claim,
why payment
delayed.
was
This
must,
Although
presumes
class as certified
statute,
which
tried individual-
member,
group
plaintiffs proceeding
a unified
on
ly by each class
will of course
theory
liability,
single legal
of indirect
require proof
responsible
that TPCM was
complaint
good
for
reasons asserts dif-
making payments
and did not make
plaintiff
fering
recovery requiring
to that individual
theories of
payments
such
different,
clearly asserts di-
complaint,
which
conflicting,
even
presentation
evidence,
predominance.
which undermines
rect claims
TPCM:
the-
Specifically,
complaint alleges
two
duty
breached their
[TPCM]
Defendant
*42
(1)
liability against
direct
ories of
TPCM:
[by]
failing
timely pay
...
claims
who,
liability,
example,
suf-
as to those
them;
charging
...
fees in
submitted to
ratings solely
injury
fered
to credit
be-
by agree-
excess of what was allowed
during the
delayed payment
cause of a
ment;
failing
plaintiffs
to inform
and
claims,
indi-
managed
time TPCM
members of the class of their lack
other
liability,
rect
as to those whose claims
of
experience
mismanagement
unpaid
paid
by Fidelity
or were
late
went
failing
provide
processing;
claims
claims mis-
prior
as a result of TPCM’s
and other members of the class
plaintiffs
management.
majority, recognizing
concerning
with accurate information
theory” analysis
“single
“appears
that its
submitted;
in other
the status of claims
complaint
somewhat at odds” with the
failing to exercise due care in the
words
analogy
inconveniences its
to Central Wes-
...;
processing of claims submitted
leyan,
apparently accepted
has
an informal
misleading,
fraud-
providing
false and/or
theоry
liability in
disavowal of the direct
why
ulent information about
claims were
But
clari-
appellees’
argument
brief.
oral
being paid....
not
As a direct result of
anything
appellees
fied that
do not disavow
conduct,
negligent
Defendants’
the
complaint
regard.
in their
in this
At oral
injured
Plaintiffs have been
in numerous
argument,
appellees’
argued:
counsel
ways.
claim,
single
they
“There is not a
can’t
allegations
direct claims
These
assert
one,
point
suggest
where we
that Third
against
based on
failures
Party
Management
anything
Claims
did
encompass
that
more than the alternative
But
any specific
wrong.”
with
claim
coun-
theory
liability flowing
of indirect
from the
claims;
liability
sel did not disavow direct
Plan’s failure.
simply portrayed
liability
he
direct
claims
something
they
other than what
are.5
Because counsel did not disavow the
it,
argument betrays
language
mischaracterized
complaint,
simply
Counsel’s
the
but
Questioning by
argument
prefer
proceed
the court at oral
not
on an
not—or
indirect
to—
plaintiffs’
liability theory
revealed that
counsel was not disa-
to file their own individual
actions,
vowing anything
complaint,
but
exposes
arguments
rather
that
them to
making
demonstrably
argument
untimely.
false
Although eq-
are
their claims
now
complaint
alleged any
theory
never
direct
tolling might arguably
uitable
rescue these
liability against
TPCM:
plaintiffs
having
unwanted
from
their claims
dismissed,
potentially
employ
the need
Judge
argument
Motz: You have a direct
when
extraordinary
only bespeaks
such an
measure
TPCM is still in there.
peculiarity
majority’s cutting
these
Honor,
making
Counsel: Your
we're
plaintiffs’
complaint
certi-
claims out of the
argument at all.
fy
surviving allegations. Perhaps recog-
Judge
Okay,
you’re disavowing
Motz:
so
nizing
severity
holding
plain-
that the
argument.
claims,
majority
assert
tiffs do not
direct
argument.
Counsel: We never made that
alternatively
plaintiffs
now
states that the
"do
By embracing
plaintiffs’
a disavowal that even
not seek class certification for
direct
making, major-
counsel disclaimed he was
TPCM,”
conclusion,
against
claims
but this
ity
plaintiffs
leaves the
with
direct liabili-
too,
complaint
ty
against
flies in the face of the
and the
TPCM out
claims
in the cold. As
certification,
out,
both of
majority points
motion for class
which
the South Carolina
appears to
seek certification of all claims
TPCM.
statute of limitations
have run on
fraud,
quite clearly
actions for breach of contract and
ante
The direct claims
inconvenience
majority’s analysis.
at 431. That leaves these
who can-
any recovery by any
cludes
class member
that these claims
unwilling to concede
I am
case.
It
theory
liability
from the
on a direct
have been removed
plain- TPCM,
decision for
questionable
regardless
be a
of the merits of their
would
theory
429-430(“[C]lass
to abandon
tiffs’ counsel
case. Ante
seg-
an identifiable
liability that best suits
...
single theory:
TPCM rest on a
instance,
For
ment of the certified class.
mismanagement
of claims
TPCM’s
de-
simply
whose claim was
class member
collapse
to the ultimate
contributed
when
ultimately paid,
but
layed,
damage....
Plan and so caused Plaintiffs’
administrator, would
the sole
TPCM was
[Although] somewhat at odds
*43
claim
TPCM for
only
have
a direct
original complaint
Plaintiffs’
... Plaintiffs
that
mismanagement,
damage
as the
to
abundantly
appeal
have made
clear on
...
way
related to the col-
plaintiff was
no
they
do not seek class certification for
Plan.6
these unfortu-
lapse
Jamming
TPCM”).
direct claims
single-
members’ claims into the
nate class
By
plaintiffs’
the
mischarac-
accepting
pur-
here —which
theory class certified
the
the ma-
complaint
terization of
—which
theory
on the
of
ports
proceed only
to
jority
treats as
disavowal of the direct
liability
only requires
rep-
indirect
—not
theory
liability
majority
of
also tacit-
—the
shoulder the more
party
resentative
to
ly recognizes the conflict that
inheres
of
theory
recovery
of
for some
attenuated
a single
proceeding
single
when
class
on a
actually
but also
her fellow class members
theory
represent
purports
who were in
recovery for those
precludes
recovery.
with dissimilar theories of
This
the
collapse
circumstance where the
of
to a
class action
response
complex
court’s
injury. And even as to
Plan did not cause
complaint alleging differing theories of re-
claims were ulti-
class members whose
covery
prune
allegations
should not be
might have a
mately unpaid, persons who
recovery
theories of
until a
and entire
TPCM find themselves
direct claim
remotely
emerges.
certifiable
Al-
caught in class
Cf.
by counsel and
sacrificed
(“[W]e
lison,
n.
existence of
plaintiffs’
failure
ery
only
reveals
exceeded that of the ad-
negligence
to demonstrate that
the common issues
Davenport v.
ministrator.
See
Cotton
inadequa-
predominate but also reveals
Prop.
Horizontal
Re-
Hope Plantation
cy
single representative
of a
for these dis-
gime, 325 S.C.
482 S.E.2d
parate theories.
(“[A]
(Ct.App.1997)
plaintiff
South Car-
majority
addresses
also never
if
may
negligence
olina
recover
his
complex question
comparative
fault.
defendant’s”).
does not exceed that of the
example,
pay-
For
a class member whose
from
apart
Even
the direct-indirect
delayed
ultimately
paid
ment was
but
problem and
com-
the individualized
1996, when TPCM was the sole claims
parative liability questions, which include
administrator, might prove that TPCM’s
inquiries
intervening
into
causes malad-
mismanagement
rendered it 100% liable
cases,
injury,
particular
for the class member’s
whether it ministration in
the indi-
damage
rating
to credit
or emotional
questions
payment
vidual
of entitlement to
case,
distress.
the failure of the
under
the terms of the Plan and the
*44
Plan would be irrelevant
to the
of
cause
any
amount of
such entitlement also loom.
delayed payment.
Another class mem-
surely require, among
This would
other
ber,
payment
delayed
whose
was
or went
things,
proof relating
submission of
to
in
unpaid
shortly
the summer of
claim,
timely
filing
proof
of
of medical
management
after claims
went in-house at
rendered,
Indeed,
services
and the like.
Fidelity,
ultimately
might
prove that
qual-
some claimants have had their claims
liable,
or
TPCM was 42% 70%
or even 0%
coverage
payment,
ified for
but not
if
proved
indepen-
liable TPCM
some
qualified
coverage.
some have not been
for
inadequacy
Fidelity
dent
of
par-
caused a
adjudicated
Those whose claims have been
go
ticular claim to
unpaid. Yet another
determination,
may challenge the benefits
member,
unpaid
whose claim went
in
already
TPCM has
indicated that
it
years
almost two
after claims admin-
accuracy
intends to look
of individu-
in-house, might
istration went
be able to
adjudications,
they
al claims
if
de-
will be
prove
responsibility
even lesser
on
liability.
terminative of
Those whose
part.
TPCM’s
necessary
evidence
to
yet
adjudicated
claims have not
been
comparative
establish
fault —evidence re-
would have to establish the facts that
garding
wrong
what
in a partic-
TPCM did
qualify
coverage,
would
them for
which
ular
Fidelity
wrong
case versus what
did
would include the nature of the illness or
in that case—would
a second
require
pres-
made,
claim
injury for which the
is
deduct-
during
entation
individual trials much
of
exclusions,
documentation,
ibles and
doctor
evidence,
individualized,
albeit
And,
course,
and similar matters.
majority
believes
certified class struc-
noted,
in
district court
addition to all of
ture
presented only
allows to be
once.
this,
inquiry
necessary
“an individualized
is
And,
course,
given
class member’s
damages
damage
such as
to one’s cred-
negligence
getting
paper-
the proper
rating
it
as well as emotional distress and
work to the insurer could
constitute
delayed payment
cause of
or
mental
nonpayment,
anguish.”
pleaded theory
recovery
give
from the com-
would rather
the benefit of
plaint, leaving any plaintiffs wishing
timely plead,
assert
fullness of their claims as
theory they thought they
alleged
theory
plead-
had
accordance with the
liberal
anew,
plead
likely untimely.
ings.
albeit now
I
what
It
thus difficult to conceive
ad-
claims. The combination of
is
the various
vantage
gained by certifying
1,400 mini-trials,
a class
up to
individual
trials —
commonality.
on such a sliver of
premised
full trials as to all defendants on civil
necessary
evidence
The individualized
violations,
conspiracy, RICO
and South
(1) comparative liability
determine
violations,
Carolina statutory
and a class-
based,
Fidelity
part,
versus
on
action trial involving
differing
(or
the date the class member
medical
produce
TPCM—will
a hodge-
(2)
claim,
provider) filed a
the class mem- pоdge
findings
of factual
legal rulings,
(or
if
provider’s) negligence,
ber’s
medical
perhaps conflicting, that will have to be
any,
causing
delayed
the claim to be
or
applied
sorted out and
jury
either
(3)
unpaid,
go
intervening causes of
the court as the law of the case.
(4)
maladministration,
the class member’s This will create a minefield for legal error.
payment
entitlement
based on the na-
the overwhelming
Given
breadth of the
ture of the services received and whether
issues
separate
reserved for
full trials and
(5)
covered,
they are
the amount of entitle-
mini-trials,
I
conclude
ment,
due,
considering copayments
deduct-
common
predom-
this case do not
ibles,
benefits,
and other sources of
Amchem,
inate over the individual ones.
the existence and amount of other dam-
(“Given
Because the seven dis- presented individually to the court both tinct causes of action and the district court justified by and on a classwide basis is not approximately has determined that one- the minimal contribution to the case that half of these claims will have to be re- an answer question pro- to the certified trials, through solved individual the result- whether, fact, questionable It vides. ing complexity itself should counsel against any by certifying time will be saved the class-action treatment. Neither the dis- event, against class TPCM. the trict nor the majority have even procedural nightmare such a certification begun to address how the trials and mini- invites cannot to come proceed; thought trials will how the close to law of the case 23(b)(3) judicata satisfying requirement or res Rule applied; will be and how the superior evidence will be received when it the class structure be most of adjudicating will relate to various individual other available methods of plaintiffs, defendants, 23(b)(3). See Fed.R.Civ.P. controversy.8 and individual case, majority running 8. The finds comfort in to the of the and ... in the certification unlike- certification, aspect stating ly 'procedural "conditional” event the case becomes a mo- rass,’ only approving that "we are a conditional ... we are that the district confident Thus, hand, seeking on one taking employers the class rescission Sep- has defined in its of the contract and return district court it insurance order, and, hand, only premiums paid, tember one con- on the can other (1) employees seeking clude that the fact enforcement of the in- questions law or common to members class do not surance contract and benefits due under it. conflict, predominate questions affecting employee over the addition to this potential individual members and that the class- class have members common-law superior process employers, pur- is not in this case. their who Plan, majority’s proceed negligence conclusion to chased for or mis- one or the contrary, through representing two issues to the Plan.9The incompatible 23(c)(4)(A) by employers class under Rule in relief sought treatment and the view, my enlarges employees precludes adequate repre- reach of alone 23(b)(3) beyond proper scope groups by because sentation of both one represen- tative, only predominance supe- constraints of and this concern is heightened riority applied. potential by employees have not been for lawsuits employers. majority While the class, I also believe that as condi only pre- addressed some of the conflicts certified, tionally satisfy does not the re sented, gave any notion that are conflicts quirement representatives representation the back untenable in fairly adequately protect the interests of its hand. of all of the class members. See Fed. 23(a)(4). view, In my majori recognized R.Civ.P. The district court also some ty ignores overt conflicts interest exist of these conflicts but resolved them ing among conditionally they with the members observation that could be Fundamentally, certified class. it does not cured members’ right opt the class attempt explain mention how the out the class action. But this observa- include, conditionally may certified class tion does address a fundamental defi- therefore, decertify suggest, court will ... the class.” Ante at alternative I is that this *46 responsibility proceed according 445. This view defaults our case to the usual rule that employs and a backward in be asserted the individual burden demon- strating superiority parties, availability named and I note the of procedure to majority apparently our rules of civil achieve econo- device. The believes that my Benja- complex, even without a class action. complaint no how See matter comes Continuing Kaplan, min Work bearing the Civil to an entitlement to certifi- Committee: 1966 Amendments the Federal prove can why cation unless the court (I), Rules Civil Procedure 81 Harv. L.Rev. should not be certified. This view is reflected (1967)("[T]he procedural alterna- willingness in the to court's inconven- excise action, hardly tives are confined to the class recovery ient complaint theories of from the side, on the and the 23(c)(4) one individual uncoordi- willingness and elevate other; lawsuits, issue, nated on there are often allow pre- certification of common possibilities ranging other from use of a mod- unspoken sumably subject limiting to some el action to consolidation or coordination principle. the fact But remains that a class the numerous individual actions for all "exception to the action is an usual rule” that (citation omitted). purposes”) selection litigation pursued by is to be the individual 700-01, parties, Califano, 442 atU.S. 99 S.Ct. added), be, (emphasis seeking notes, the party may that majority It well that as proving many certification bears the burden of satis- employees may of the claims the have class-qualifying faction of the employers criteria of Rule their are now barred 23(a) (b), limitations, depending and that the court is to measure statute of on what the- plaintiff's ability ory third-party to meet that burden of when a claim is accrues alleged complaint. applied. the action as in the The concerted efforts to conceal cieney among of a conflict class members this knowl- plaintiffs edge, burden that must or even nor the whether certain of defen- carry seeking represent in the class as a products dants’ crumble and release dust whole, who, for whatever including those under pressure.” hand Id. at 185. reason, opt never out. Federal Rule of Wesleyan. This case is unlike Central 23(a)(4) requires plaintiffs, Civil Procedure This is not a massive nation-wide litigation class, purported representatives as in resolving which certain primarily factual they fairly can to demonstrate questions on a classwide basis would sub- adequately protect the claims of class stantially reduce repetitive factfinding. They obviously cannot fulfill members. only question The certified here is whether if responsibility this some class members’ failure, TPCM was “a cause” of the Plan’s in claims are conflict with others’ claims. law, question which is a mixed of fact and See Amchem, 626-28, 117 521 U.S. S.Ct. which, noted, as step is the first (finding fairly could not in a inquiry steeped causation that is where, represent a class adequately necessary individualized determinations class, a “disparity within the there was requiring presentation duplica- of often currently injured expo between the tive evidence. While the court Central sure-only categories plaintiffs” making Wesleyan in- countenanced individualized claims). asbestos quiries to damages, it noted that relatively Given the insubstantial com- potential inquiries individualized relat- by only mon shared some of the ing liability “pose management could con- class members and the irreconcilable judicial difficulties and reduce the efficien- inhering flicts of interest the certified cy sought through to be achieved certifica- class, agree majority I do not with the tion,” indicating might decertification “strikingly similar” to Central case Here, be warranted. Id. at 189. the need Wesleyan Wesleyan. Central was as- for individualized determinations as to cau- bestos removal case which 16-23% of hypothetical unique sation is not or even colleges America’s and universities were rather few class members but is a char- in- potential class members and which every every acteristic of claim of volved dozens of defendants and hundreds member. products of asbestos sold over decades. 6 complexity case of this counsels conditionally F.3d at 189. The issues our decisions Broussard and Lien- “primar- certified for class treatment were apt comparisons hart are far more than factual,” ily id. at in a context where Wesleyan, portions may of which Central *47 litigation” “the sheer volume of in the area superseded by even have been the Su- impelled many courts nationwide to con- preme analysis in Amchem. Court’s tentatively that clude class treatment of Lienhart, and we both Broussard conclud- very certain common factual issues in this ed that the district court abused its discre- particular type litigation judi- advanced in certifying tion the class. neither of settlement, economy cial and fostered id. 181-83, array those actions was there such an Conditionally certifying at 185. required individual actions that primarily questions factual for class treatment, adjudication presented in held, as those this the court relieve would Indeed, case. in Lienhart we stated that colleges and of the need universities requirement of individual trials on prove “to over and over when defendants damages require causation alone would knew or should have known of asbestos’ hazards, predominance require- engaged finding or whether defendants
468 23(b)(3) look at the predominance Rule not met. 255 conduct a “close ment of was Amchem, criteria.” 521 majority superiority over glosses F.3d at 149. 615, case, Disapproving 117 2231. overlooking U.S. at S.Ct. complexities rule, metamorphosis the Court clearly distinguishes what this case from 23(b)(3) that, stated in Amchem while a Wesleyan. Central thought class action was to be the most 23(b)(3) effi- designed Rule was to effect adventuresome innovation of the 1966 procedural fair- sacrificing ciencies without 2231, amendments, 614, id. S.Ct. Advisory *48 28, 2001, and this case for further remand through prescribed it except process proceedings. Act.” Congress Enabling the Rules added). (Emphasis already Because of its contours, original
adventuresome un- 23(b)(3)
derstanding of class actions would
clearly contemplated that courts
Notes
ness. As the
Committee
decades since the 1966 revision of
“[i]n the
state:
to the 1966 amendments to Rule 23
23,
practice
Rule
class action
has become
(b)(3) encompasses those
Subdivision
”
‘adventuresome,’
even
an example
more
cases
which a class action would
Court,
617,
of which was before the
id. at
effort,
time,
economies of
achieve
2231.
S.Ct.
promote uniformity
of deci-
expense,
Although
the district court’s efforts
situated,
persons similarly
sion as to
patching together
certifiable
sacrificing procedural
without
fairness
well-intended,
may
TPCM
ener
bringing
or
other
re-
about
undesirable
indeed,
creative,
getic, and
even
the class
sults.
is nonetheless far too adventuresome sim
understandably
The drafters
Rule 23
issues,
ply
few
to resolve a
common
seri
respect
a cautious
approach
counseled
ously risking
procedural
the creation of
23(b)(3) classes,
recognizing
to Rule
Predict
we can
unfairness.
as
how this
understanding
even under their limited
structured,
it
might
case
be tried as
is now
broadly might apply,
how
the idea
only queue
problems
I see
that sacri
was adventuresome and was not “as clear-
procedural
po
fice
fairness and have the
(b)(1)
ly called for” as class actions under
creating legal
tential for
error. Without
(b)(2).
Amchem,
615,
See
521 U.S. at
forecasting how
numerous
cautious and
S.Ct.
This
con-
adjudicated
“just,
might be
to secure the
23(b)(3)
stricted
envi-
approach
speedy,
inexpensive
determination” of
by
authors
relaxed
sioned
its
should not be
claim,
1,
each
Fed.R.Civ.P.
I conclude that
simply
passage
now
of time and the
the plaintiffs’
proceed against
effort
experience
courts have had
additional
under Federal Rule of
Civil Proce
tend to
with the Rule. Such comfort would
23(b)(3),
dure
as certified
the district
transmogrify
already
what
is
an adven-
28, 2001,
September
court in its order of
experiment
applied
turesome
into one
“desirable,”
neither “convenient” nor
Am
proce-
its own
and not for
sake
the sake of
chem,