61 F.R.D. 558 | S.D. Fla. | 1973
This cause has come before the Court on a motion by plaintiffs to certify this case as a class action pursuant to F.R.Civ.P. 23(b)(1)(A) and (B) and/or 23(b)(3) and Local Rule 19 subd. A(3). A brief recitation of the circumstances giving rise to this motion will elucidate the vexatious issue before the Court. On June 23, 1973 the Motor Vessel “Skyward” departed from the Port of Miami with 655 passengers aboard on what was to be a seven day pleasure cruise. The trip turned into a nightmare for many of those aboard, however. Most of the passengers and crew were taken seriously ill allegedly because of their exposure to contaminated food or water on the ship. The illness generally manifested itself by severe vomiting and diarrhea. The crippled ship returned to Miami on June 30,1973.
On July 11, 1973 the plaintiffs Miguel A. Hernandez, Beatriz Hernandez, Leopold Del Calvo, Beatriz Del Calvo, Christina Del Calvo and Ariel Hernandez filed suit in admiralty against the above-styled defendants. The plaintiffs as prospective representatives of a class comprised of all passengers taken ill during the voyage assert four causes of action in support of their claim — breach of contract, negligence in exposing the passengers to contaminated food or water, breach of implied warranty of fitness of the food and water and negligence in providing inadequate medical
Upon receipt of the motion by plaintiffs to certify the cause as a class action, the Court instructed the Clerk of the Court to issue a, notice to all prospective claimants. \ That notice, annexed hereto as Exhibit A, informed the passengers that the defendants were prohibited from '^^mmunicating with any passenger -regarding prospective or actual claims.! This action was taken by thWTldurf'to preserve the efficacy of the proposed class action by preventing unauthorized communications which inadvertently or otherwise would misrepresent the status, purpose and effects of the action or would solicit the opting out of various class members. See Manual, for Complex Litigation. Rule 1.41 (1973).
The defendants raise numerous objections to the maintenance of the case as a class action. Initially, the defendants assert that considerations of improper claims solicitation and other potential abuses of the class action technique mandate denial of certification in a mass tort or mass disaster situation.
The defendants also focus upon the administrative burdens that would befall this Court and plaintiffs’ counsel if the motion to proceed as a class action were granted. The plaintiffs rightfully point out, however, that the Court has numerous alternatives available under Rule 23 by which it can facilitate an expeditious resolution of the lawsuit. Moreover, in light of the approach taken by the Court on the class action issue in this cause, no major administrative or procedural difficulties are foreseen.
The thrust of the defendants’ objection to the motion for certification lies in principle. The defendants contend that a mass tort or mass accident case is unsuitable for class action treatment. Since the filing of this lawsuit, the defendants have received approximately 350 inquiries relative to redress of claims. They proffer to the Court that, but for the imposition of the class action petition, most of the claims would have been amicably settled.
In passing upon the defendants’ objections, the Court must be guided by the purposes underlying the class action technique. To be viable a class action must offer economy of effort and uniformity of result without imposing undue debilitation of procedural or substantive safeguards for members of the class or for persons opposing the class. Avoidance of multiplicity of suits, and prevention of inconsistent or varying adjudications are benchmarks of a valid class action.
At first glance, the approach taken by the district courts in the above-mentioned cases appears to conflict with the Advisory Committee’s comments on the applicability of Rule 23 to a mass tort. The Committee stated:
A “mass accident” resulting in injuries to numerous persons is ordinarily not appropriate for a class action because of the likelihood that significant questions, not only of damages but of liability and defenses to liability, would be present, affecting the individuals in different ways. In these circumstances an action conducted nominally as a class action would degenerate in practice into multiple lawsuits separately tried. Advisory Committee’s Note to Proposed Rule of Civil Procedure 23, 39 F.R.D. 69, 103.
Upon closer scrutiny, however, it is apparent that the approach taken by Judges Hall and Decker and urged by the commentators
To determine whether the issue of negligence in the preparation of food and water may be resolved by class treatment the requirements of Rule 23 must be met. The four prerequisites to a class action are present in this case. First, there are 655 prospective claimants. Thus, the class is so numerous that joinder of all members is impracticable. Secondly, there are questions of law and fact common to the class, especially in reference to the issue of negligence discussed above. Thirdly, the claims of the plaintiffs as representative parties are typical of the claims of the class. Fourthly, it is clear from the record in this cause that the representative parties will fairly and adequately protect the interests of the class.
The Court also finds that the prosecution of separate actions by individual members of the class would create a risk of inconsistent or varying adjudications with respect to individual members of the class which would establish incompatible standards of conduct for the parties opposing the class.
Based upon the foyegoing, it is
Ordered and adjudged that a class action be maintained under F.R.Civ.P. 23(b)(1)(A) and (c)(4)(A) on the issue of the negligence of the defendants in preparing or making available to the passengers aboard the M/V “Skyward” contaminated food and/or water. In view of the defendants’ apparent willingness to settle with many of the claimants, and because the class action attaches to the negligence issue only, the Court will permit the defendants to reach amicable agreements with those who wish to so resolve their disputes.
MIGUEL A. HERNANDEZ, BEATRIZ HERNANDEZ, and the children of BEATRIZ HERNANDEZ, to-wit LEOPOLD DEL CALVO, BEATRIZ DEL CALVO, CHRISTINA DEL CALVO, and ARIEL HERNANDEZ, who sue by and through their mother, natural guardian, and next best friend, BEATRIZ HERNANDEZ, Plaintiffs, -vs-The Motor Vessel "SKYWARD", NORWEGIAN CARIBBEAN LINES, and LAURITZ KLOSTER, Defendants,
1973 Mlf* O'1 197ft¡-:r¡l I. BOGART . , cru. o. cist. ct. . lOSEi’l V VWFril D!iT. OF FIA CLTR'.V 3.-'l 18 5. -G.i V- CA ^UHiF.iui msr. of rtA.
NOTICE TO CLAIMANTS
A lawsuit has been filed against the owners of the M/V "Skyward" by a passenger who was aboard that vessel during the cruise of June 23rd through June 29th, 1973.
The Court has been advised that you have contacted Norwegian Caribbean Line regarding your claim for illness which you suffered during that voyage. Because of certain legal procedures Norwegian Caribbean Line is prohibited from communicating with you relative to your claim until certain matters have been resolved by the Court.
Once the Court has ruled upon the legal issues before it, consideration will be given as to whether Norwegian Caribbean Line may again contact you. ■
EXHIBIT A
Page Two
In any event, you will promptly receive further information from the Court regarding your claim.
JOSEPH I. BOGART Clerk of Court
By_
Deputy Clerk
ORDER DENYING MOTION FOR ATTORNEYS’ FEES
On January 16, 1974, this Court partially denied the plaintiffs’ motion for attorneys’ fees in this limited class action. That Order denied recovery of such fees from either the defendants or any class member who settled his claim prior to the trial in this cause. The Court" reserved ruling on the propriety of awarding attorneys’ fees with respect to (1) any members of the class who settled their claims after a successful prosecution of the class issue by the named plaintiffs; (2) any members of the class who might benefit in a subsequent trial from a favorable judgment on the class issue in the instant cause.
Since the January 16 Order, the following significant events have occurred. The defendants have admitted negligence in taking aboard the M/V “Skyward’’ contaminated water and/or food during the applicable period. The defendants have reserved, however, the right to contest the issue of causal relationship, or proximate cause, with respect to each claim. (Admission of liability filed January 21, 1974). Furthermore, the named plaintiffs have amicably resolved their claims with the defendants.
Upon consideration of the applicable case law and the arguments propounded by counsel and the Court being otherwise duly advised, it is ORDERED AND ADJUDGED as follows:
1. Plaintiffs’ motion for discovery on the issue of attorneys’ fees is denied.
2. Plaintiffs’ motion for an award of attorneys’ fees against those class members who either settle their claims henceforth or prosecute their claims and utilize the admission of negligence obtained in the instant cause is denied.
The Court concludes that the nexus between the plaintiffs’ efforts to obtain an admission of negligence and the potential decision by a class member to
Undoubtedly, any claimant who proceeds to trial and utilizes the admission of negligence offered by the defendants in this case will benefit from the efforts of plaintiffs’ counsel.
' Secondly, the decision not to permit the assessment of attorneys’ fees against other class members in this mass tort litigation hás been reached only after a careful balancing of conflicting policy considerations. On the one hand, the Court should provide stimuli to the utilization of the class action technique in meritorious situations. On the other hand, the Court must avoid the impression of judicial generosity which could lead to unfortunate results. This caveat was adequately expressed by one commentator :
“In considering the propriety of awarding attorneys’ fees and fixing the amount thereof in a particular action, the court must exercise caution lest it deplete the recovery when the class is successful or unduly encourage the institution of class suits by creating an impression of judicial generosity in these cases. The class action device must be protected against the taint that it is a source of strike suits promoted by attorneys who simply are seeking fat fees or that it fosters an unseemly race to the courthouse among lawyers who represent different members of the class and wish to acquire representative and lead counsel status.”
7A Wright and Miller, Federal Practice and Procedure, § 1803 at 292 (1972). Because the likelihood of success on the class action issue was apparently great from the outset, and because the negligence issue was not complex, the latter consideration must prevail. The Court concludes, then, that distribution of attorneys’ fees among an isolated segment of class members is unwarranted under the circumstances of this case.
. Plaintiffs originally set forth the doctrine of unseaworthiness as a fifth cause of action. This claim was stricken, however, by Order of the Court on September 13, 1973.
. The defendants affirmatively refrain from ascribing any improper motives or actions to counsel for the plaintiffs. Indeed, the Court endorses defendants’ appraisal of the work of plaintiffs’ counsel who has approached his clients’ cause with the utmost diligence and industry. Defendants’ attack focuses on the precedential implications inherent in any ruling by the Court.
. In support of the defendants’ good faith intentions in this regard, the Court notes that immediately after this suit was filed, the defendants filed a motion for leave to consummate settlement with approximately 100 passengers who contacted the cruise line regarding their claims. This motion was in effect denied by the Notice to Claimants (Exhibit A).
. The Court has found only four cases which deal with the applicability of the revised Rule 23 to a mass tort situation: Petition of Gabel, 350 F.Supp. 624 (C.D.Cal.1972); Daye v. Commonwealth of Pennsylvania, 344 F.Supp. 1337 (E.D.Pa.1972); Hobbs v. Northeast Airlines, Inc., 50 F.R.D. 76 (E.D.Pa.1970); American Trading and Production Corp. v. Fishbach and Moore, Inc., 47 F.R.D. 155 (N.D.Ill.1969). A hybrid of the mass tort situation under consideration in the case sub judice has received greater treatment by the courts. In civil rights suits pursuant to 42 U.S.C. § 1983, prisoners have sought to invoke the class action rule with varying success. See, e. g., Worley v. Bounds, 355 F.Supp. 115 (W.D.N.C. 1973); Ray v. Rockefeller, 352 F.Supp. 750 (N.D.N.Y.1973); Wright v. McMann, 321 F.Supp. 127 (N.D.N.Y.1970), cert. denied, 409 U.S. 885, 93 S.Ct. 115, 34 L.Ed.2d 141.
. See generally, 7A Wright and Miller, Federal Practice and Procedure, § 1783 (1972 ed.).
. See, 3B. J. Moore, Federal Practice § 23.-45(3) at 811 n. 35 (2d ed. 1969); 7A Wright and Miller Federal Practice and Procedure § 1783 (1972 ed.).
. In securities fraud cases, a class action is properly maintainable if some uniform misrepresentations are found. See Green v. Wolf Corporation, 406 F.2d 291 (2d Cir. 1968). Proof of individual reliance and damages in those cases are subject to severance and treatment in subsequent proceedings. See e. g., Vernon J. Rockler and Co. v. Graphic Enterprises, Inc. 52 F.R.D. 335 (D.Minn.1971); Fogel v. Wolfgang, 47 F.R.D. 213 (S.D.N.Y.1969).
. The scope of an action maintainable under Rule 23(b)(1)(A) is unclear. One commentator suggests that the provision contemplates more than a risk that the party opposing the class might be liable to some members of the class and not liable to others. 7A Wright and Miller Federal Practice and Procedure § 1773 (1972). But see, Petition of Gabel, 350 F.Supp. 624 (C.D.Cal.1972); Berman v. Narragansett Racing Ass’n, Inc., 48 F.R.D. 333, 337 (D.R.I.1969). In light of the collateral estoppel effects that may ultimately attach to defendant’s position, however, (See discussion below), the Court finds that the spirit of Rule (b) (1) (A) is fulfilled in that a class action will “provide a ready and fair means of achieving unitary adjudication.” Advisory Committee Comments 39 F.R.D. 95, 100. Additionally, a (b) (1) (A) action is viable when a common fund exists that may be evaporated by an award to some of the prospective claimants. See, Berman v. Narragansett Racing Ass’n, Inc., supra; See also, F.R.Civ.P. 23(b)(1)(B). Under the limitation of liability provision in 46 U.S.C. § 183, such a common fund exists. Although it is unlikely that an aggregation of the claims of the passengers will exceed the value of the vessel “Skyward” the theoretical possibility exists.
The finding that a class action on the limited negligence issue is maintainable under (b) (1) (A) renders unnecessary a discussion of the appropriateness of the (b) (3) provisions in the instant cause. See, Berman v. Narragansett Racing Ass’n, Inc., supra; 3 B. J. Moore, Federal Practice, § 23.31 [3] (1969).
. This conclusion is suggested by relatively recent decisions of the United States Supreme Court and the United States Court of Appeals for the Fifth Circuit which have to a great extent repudiated the doctrine of mutuality heretofore inherent in the principles of res judicata and collateral estoppel. See, Blonder-Tongue Laboratories, Inc. v. University of Illinois Foundation, 402 U.S. 313, 91 S.Ct. 1434, 28 L.Ed.2d 788 (1971); Rachal v. Hill, 435 F.2d 59 (5th Cir. 1970) cert. denied 403 U.S. 904, 91 S.Ct. 2203, 29
It is worthwhile to note, however, that since the plaintiffs are not entitled to a jury trial in the instant cause which lies in Admiralty, the defendants may, in a different federal action based on diversity jurisdiction or in a state proceeding, overcome the application of the collateral estoppel rule in the event of an adverse judgment under the Rachal v. Hill rationale. In Baehal, the Fifth Circuit held that a finding in an injunction action brought by the Security and Exchange Commission that the defendants had violated securities laws did not, under the doctrine of collateral estoppel preclude relitigation of that issue in a civil action which was brought by parties who were strangers to the injunction action. Although the factual issues were identical, the Court determined that collateral estoppel was not appropriate in view of the fact that the defendants had a right to a jury trial in the civil action but did not have such a right in the injunction action.
. Of course, it is possible, although unlikely, that an attorney representing another claimant in a different forum may for strategic or dramatic purposes choose not to utilize the admission.