OPINION
Jerry and Dianne Randleman appeal the district court’s decision to decertify the class in an action that they brought against Fidelity National Title Insurance Company. The Randlemans allege that Fidelity failed to provide a discount, as required by its filed rates, when issuing title insurance to homeowners who had purchased a title insurance policy for the same property from any other insurer within the previous ten years. Dean and Aimee Hickman brought an action alleging the same claims against First American Title Insurance Company, but the district court denied their motion to certify a class. Neither district court abused its discretion in concluding that, as the classes are presently defined, common issues do not predominate. We therefore AFFIRM both orders.
I.
A. The Randlemans.
When Jerry and Dianne Randleman purchased a home in New London, Ohio in 2001, they also purchased both a lender’s title insurance policy and an owner’s policy. In 2004 the Randlemans refinanced their home and their new mortgagee required that they purchase a new title insurance policy for its benefit. Fidelity issued the new policy but failed to give the Randlemans the discounted “refinance” rate applicable when another insurer has issued a title insurance policy on the property within the previous ten years. The Randlemans assert that Fidelity overcharged them $213.57 by failing to provide the discount.
Ohio law requires that Fidelity file its rates with the state, which it does through the Ohio Title Insurance Rating Bureau. The Bureau filed a “Rate Manual” with Ohio, which is binding on Fidelity, and requires that Fidelity charge a discounted premium rate for policies issued in connection with refinancing transactions. This discount appears to be based on there being less risk to the current underwriter, and less investigation required, because some other entity has recently investigated *350 and insured the title to the property. Provision PR-10 of the Rate Manual states:
When a refinance loan is made to the same borrower on the same land, the following rate will be charged ... provided the Insurer is given a copy of the prior policy, or other information sufficient to enable the Insurer to identify such prior policy upon which reissue is requested, and the amount of the unpaid principal balance secured by the original loan:
Age of Original Loan Policy Rates
10 years or under 70% of original rate
Over 10 years 100% of original rate
Provision PR-9 of the Rate Manual is similarly worded and offers the same thirty percent discount to homeowners who purchased an owner’s title insurance policy for the property within the previous ten years.
Although the Randlemans’ prior title insurance purchase made them eligible for this discount, they were unaware it existed. Consequently, the Randlemans never requested the discount or submitted the necessary documentation to establish that they had recently purchased title insurance. After considering all of the requirements for class certification in Federal Rule of Civil Procedure 23, the district court, pursuant to Rule 23(b)(3), initially certified a class consisting of:
Ml persons who (i) paid for title insurance issued by defendant Fidelity National Title Insurance Company in connection with the refinancing of a residential mortgage loan on property located in Ohio that was completed on or after February 15, 2000, (ii) were entitled to receive the “reissue” or “refinance” rate for title insurance pursuant to Section 8 or Section 9 of the Filed Rates (for transactions prior to February 1, 2002) or PR-9 or PR-10 of the Filed Rates (for transactions February 1, 2002 to the present), and (iii) paid more than the “reissue” or “refinance” rate for such title insurance.
Because Fidelity must have received a copy of the prior policy or the file must have contained “other information sufficient to enable [Fidelity] to identify such prior policy upon which reissue is requested” in order for the individual to be eligible to receive the discount, the key question as this litigation is currently framed and the class is defined is what each application for title insurance contained. The district court’s initial conclusion that this question is common to all class members and predominates over all other issues was based largely on its view that “a prior mortgage invariably, or nearly so invariably as to make any variation meaningless, meant that a prior policy had issued.”
Randleman v. Fidelity Nat’l Title Ins. Co.,
B. The Hickmans.
When Dean and Aimee Hickman purchased a home in Elyria, Ohio in 1999 they also purchased both a lender’s title insurance policy and an owner’s policy. The Hickmans then refinanced their home in 2001 and again in 2004. The Hickmans purchased a new title insurance policy for each transaction, with First American issuing the 2004 policy. The Hickmans were apparently unaware that they were eligible to receive the refinance discount, and there is no evidence that they requested the discount or submitted documentation to First American establishing that they had previously purchased title insurance. The Hickmans claim that by not providing the discount First American overcharged them $134.40.
First American, like Fidelity, files its rates through the Ohio Title Insurance Rating Bureau and is subject to provisions PR-9 and PR-10, which provide the “refinance discount” of thirty percent when issuing a title insurance policy if some other title insurer has issued a policy for the property in the previous ten years.
The Hickmans proposed that the district court certify a class of:
All persons who (i) paid for a lender’s policy of title insurance issued by defendant First American Title Insurance Company in connection with the refinancing of a residential mortgage loan on property located in Ohio that was completed on or after February 2, 2000; (ii) where the subject property previously had been mortgaged within the applicable look-back period; and (iii) paid more than the discounted “reissue” or “refinance” rate for such title insurance.
Unlike the Randlemans’ proposed class, membership in the Hickmans’ class does not turn on an individual’s “entitlement” to receive the discount, but includes all individuals who refinanced a mortgage within the ten-year look-back period.
The district court considered the requirements in Rule 23 for certifying a class action and concluded that the Hickmans’ proposed class failed to meet the commonality or typicality requirements. Additionally, the district court held that even if the commonality requirement of Rule 23(a) were met, common questions did not predominate as required to maintain a class action under Rule 23(b)(3). Thus, the district court denied the motion for class certification.
II.
A. Standard of Review.
This Court reviews a district court’s decision to deny class certification for abuse of discretion.
Ball v. Union Carbide Corp.,
Although this Court has not previously addressed the standard of review applicable to orders decertifying classes, other circuits use the same, highly deferential, abuse-of-discretion review applied to certification orders.
See, e.g., Voss v. Rolland,
B. Whether the District Courts Abused Their Discretion by Concluding that Common Issues Do Not Predominate.
In light of the relatively small sums of money involved in each individual transaction, a class action appears to be the only way in which homeowners who were improperly denied the discount on title insurance may be able to recover. However, under the plaintiffs’ theory of liability and proposed class definitions, neither district court abused its discretion by concluding that common issues do not predominate and refusing to allow class-wide litigation to proceed. 1
1. The Randlemans.
The class the district court initially certified was flawed in that it only included those who are “entitled to relief.” This is an improper fail-safe class that shields the putative class members from receiving an adverse judgment. Either the class members win or, by virtue of losing, they are not in the class and, therefore, not bound by the judgment.
2
See Genenbacher v. CenturyTel Fiber Co. II, LLC,
In addition to the numerosity, commonality, typicality and adequacy prerequisites necessary for all class actions, Fed. R.Civ.P. 23(a), in order to bring a damages class action under Rule 23(b)(3) the court must find that common questions predominate and that a class action is a superior way to resolve the controversy, Fed. R.Civ.P. 23(b)(3). To meet the predomi
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nance requirement, a plaintiff must establish that issues subject to generalized proof and applicable to the class as a whole predominate over those issues that are subject to only individualized proof.
Beattie,
The district court initially certified the class assuming that Fidelity would have discovered a prior mortgage in the process of issuing title insurance, and a pri- or mortgage necessarily means that the applicant purchased title insurance in connection with that prior mortgage.
Randleman,
In light of how the Randlemans have framed the issues and defined the class, without the initial presumption, determining liability would require an examination of each individual policy Fidelity issued to determine if Fidelity had received a copy of the prior policy or “other information” suggesting that a policy had previously been issued. Under this framework, establishing that Fidelity received this information is essential to proving liability and, as the district court found, a highly individual inquiry. Similarly, in a lawsuit alleging nearly identical claims against a title insurer in Texas, the Fifth Circuit recently recognized that determining an individual’s eligibility to receive the refinance discount is highly individual and affirmed a district court’s decision denying class certification based on a failure to meet the predominance requirement.
See Benavides v. Chicago Title Ins. Co.,
While the need to prove damages or establish class membership on an individual basis is not fatal to class certification, liability is a central issue in this matter and the Randlemans’ claims can only be determined on an individual basis. In
Beattie,
for example, this Court affirmed a district court’s order certifying a class under Rule 23(b)(3) alleging that the defendant violated federal and state law by engaging in deceptive billing practices.
Similarly, the need to prove entitlement to participate in the class on an individual basis will also not necessarily mean that
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common issues do not predominate. In
Daffin v. Ford Motor Co.,
The Randlemans attempt to fit their claim within
Beattie
and
Daffin,
but the requirements in the Ohio rate rules necessitate substantial, individual inquiries to determine liability under their theory of the case and class definition that are incompatible with the predominance requirement of Rule 23(b)(3). Unlike these claims, liability in
Beattie
could be determined on a class-wide basis: if the billing practices were deceptive, they would be deceptive for all class members.
Id.
at 564;
accord Hohider v. United Parcel Serv., Inc.,
Some district courts in other jurisdictions have certified similar class actions but, in those states, mortgagees appear to regularly require title insurance and it
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may be reasonable to presume that a prior recorded mortgage constitutes sufficient “other information” to warrant giving the reissue discount. For example, recent revisions to the rate manual in Pennsylvania provide that the refinance rate applies if the title search reveals a prior mortgage from an institutional lender or even just a prior deed to a bona fide purchaser for value.
Slapikas,
2. The Hickmans.
Similarly, the district court did not abuse its discretion in denying the Hick-mans’ motion for class certification. For the same reasons that the Randlemans failed to establish that common issues predominate, the Hickmans also did not establish that common issues predominate with respect to the class they proposed, and the district court’s decision to deny class certification was not an abuse of discretion.
C. Whether the District Court Abused Its Discretion by Not Adopting the Randlemans’ Proposed Case Management Plan.
The Randlemans argue that any individual issues could be resolved easily through creative case management procedures. They outline a multistep process that, in their view, would have enabled the district court to resolve these claims on a class-wide basis.
3
District courts have broad discretion in determining whether to bifurcate proceedings or divide a class action into subclasses.
See In re Ins. Brokerage Antitrust Litig.,
For example, the Randlemans assert that one of the purportedly class-wide issues to resolve at trial under their plan is whether “information in a particular property’s chain of title” is sufficient “other information” to qualify the homeowner for the discount. This is a highly individual *356 ized inquiry into each particular property. Because the Randlemans’ case management plan still requires resolving numerous individual issues, we find no abuse of discretion in the district court’s decision not to adopt it.
Additionally, Fidelity argues that sub-classing and bifurcation cannot be used to overcome a lack of predominance. Some other circuits have adopted this view and held that creative subclassing and bifurcation procedures cannot be used to remedy a lack of predominance.
See, e.g., Sacred Heart Health Sys., Inc. v. Humana Military Healthcare Servs., Inc.,
III.
The relatively small amount of money that each individual plaintiff could possibly recover suggests that a class action is the only real meaningful way to afford relief in this case. While our holding does not extend to a class that might be differently defined to satisfy the requirements in Rule 23, as these claims are presented and classes are defined, resolving each individual homeowner’s entitlement to the refinance rate requires a highly individual inquiry. Therefore, the district courts did not abuse their discretion in concluding that the claims presented in these two putative classes are not amenable to class-wide resolution. Accordingly, we AFFIRM the district courts’ decisions.
Notes
. Both district courts also held that the putative classes did not meet the commonality or typicality requirements. However, because we hold that the district courts did not abuse their discretion in concluding that the predominance requirement is unsatisfied, we do not address whether the district courts abused their discretion in finding these other requirements unsatisfied.
. While we cannot redefine the class on appeal, at oral argument, counsel argued for a class like that proposed in the Hickman case, where membership included all those who purchased title insurance for a property that had a prior mortgage within the look-back period.
. The Hickmans did not propose a case management plan to the district court and, therefore, do not argue that the district court abused its discretion in refusing to adopt one.