Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_13-cv-02310/USCOURTS-casd-3_13-cv-02310-1/pdf.json

Nature of Suit Code: 110
Nature of Suit: Insurance
Cause of Action: 28:1332in Diversity-Insurance Contract

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

ERNEST O. ABBIT, on behalf of

himself and on behalf of all persons

similarly situated,

Plaintiff,

CASE NO. 13cv2310-GPC-WVG

ORDER GRANTING IN PART AND

DENYING IN PART MOTION FOR 

CLASS CERTIFICATION,

APPOINTMENT OF

REPRESENTATIVE AND 

APPOINTMENT OF CLASS

COUNSEL

[ECF No. 39]

v.

ING USA ANNUITY AND LIFE

INSURANCE COMPANY, et al.

Defendants.

Plaintiff Ernest O. Abbit brings this action, on behalf of himself and all others

similarly situated, alleging that Defendants ING USA Annuity and Life Insurance

Company and ING U.S., Inc. (“Defendants” or “ING”) unlawfully targetsenior citizens

bymarketing indexed-annuity contracts that purportto protectretirement savings while

hiding an undisclosed complex embedded derivative structure. (FAC ¶¶ 3-9, ECF No.

20.) Plaintiff asserts that the design and execution of the derivatives have caused him

and putative class members harm. 

Presently before the Court is Plaintiff’s Motion for Class Certification,

Appointment of Class Representative and Appointment of Class Counsel. (ECF No.

39.) ING opposed Plaintiff’s motion on May 15, 2015. (ECF No. 43.) Plaintiff filed

a reply on May 29, 2015. (ECF No. 46.) A hearing was held on June 25, 2015. Having

considered the parties’ submissions and oral arguments, as well as the applicable law,

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the Court GRANTS in part and DENIES in part Plaintiff’s motion.

BACKGROUND

Plaintiff, an 83-year-old retired senior citizen, purchased an “ING (fixed)

indexed-annuity with an effective date of September 28, 2010.” (FAC ¶ 21.) Plaintiff

purchased the annuities through independent financial advisor Matthew Copley. (ECF

No. 43-7 at 11:15:20-11:16:57.) 

An annuity is a contract between an investor and an insurance company in which

the investor pays premiums to the insurance company in exchange for the insurance

company’s promise to return the deposit via periodic payments. (FAC ¶ 26.) Annuity

contractstypically undergo two primaryperiods:the “full accumulation period,” during

which the investor deposits funds with the insurance company, and the “annuitization

period,” during which the investor withdraws funds in the form of periodic payments.

(FAC ¶ 27.)

Fixed index annuities (“FIAs”) are annuities that “generally earn interest

linked-to, or derivative-of the price movements of, an equity index or other index,such

asthe S&P 500® Index. Indexed annuities can also guarantee interest.” (FAC ¶ 28(c).)

The policy parameters (such as “caps,” “participation rates” and “spreads”) are

periodically declared by the insurance company. (FAC ¶ 29.) ING used the term

“Secure Index” in their fixed index annuities (“FIAs”) to portray their FIAs protective

investmentsthat have earnings “linked” to the S&P 500 Index (or similar market index)

under brand names “ING Secure Index Opportunities Plus,” “ING Secure Index Five,”

“ING Secure Index Seven,” and ING Secure Index Outlook.” (FAC ¶ 4.) ING offers

five different index-crediting “strategies” from which indexed-annuity investors may

select. (FAC ¶ 61.) 

Plaintiff maintains that ING produced uniform sales materials for FIAs which

promised “protection” of assets and “Index Opportunities” for Plaintiff and members

of the Class. (FAC ¶ 6, ECF No. 39-21, 70:2-16.) At his deposition, Plaintiff was

asked about the ING USA sales brochure described in his complaint. Plaintiff testified

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that he did not read or review the brochure in detail prior to purchasing the annuity and

did not understand it. (ECF No. 43, Ex. 5 at 54:7–12.) During his deposition, when

asked to review the brochure and highlight any false statement by ING, Plaintiff said

“[n]o. I would prefer not to.” (Id. at 95:22–96:8.) In a post-purchase survey (ECF No.

43, Ex. 7), Plaintiff reported that he relied more on independent financial advisor

Matthew Copley than on any written materials in deciding to purchase his contract.

(ECF No. 43, Ex. 5 at 53:5–11.) 

Defendant replies that ING USA fixed index annuities are sold by a variety of

individuals and organizations, including independent agents, retail broker-dealers,

marketing organizations, and banks. (ECF No. 43, Ex. 4 at ¶ 18.) Further, ING

contends that the only ING USA materials provided to all purchasers are the

application and a disclosure form, and that no ING USA sales material are provided to

all prospective purchasers. (ECF No. 43 at 6.) 

Plaintiff alleges ING embedded derivatives into the retirement savings without

disclosing them to Plaintiff and members of the Class. (FAC ¶ 4.) “Embedded

derivatives” are described by Plaintiff as exotic financial structures that are complex,

opaque, and illiquid market-linked instruments. (FAC ¶ 5.) Plaintiff claims ING

exercised its investment discretion under the contracts in a manner that ensured that its

FIAs did not protect or build up retirement savings. ING responds that the “embedded

derivatives” assertion stems solely from the fact that the annual interest rate may be

based on changes in the S&P 500 Index (ECF No. 43 at 2.), and that this information

is disclosed in the contract. 

Plaintiff also alleges ING offered Secure Index Opportunities Plus annuity

investors a five percent (5%) bonus which purportedly added to investors’ total

premiumat contract inception as an immediate head start on earnings. (FAC ¶ 34; FAC

Ex. A at 5.) The 5% bonus was not available to investors in “ING Secure Index Five”

and “ING Secure Index Seven” annuities. Id. 

On March 27, 2014, Plaintiff filed the operative pleading, a First Amended

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Complaint, alleging eleven causes of action against Defendant: (1) Breach of Contract

(against ING); (2) Breach of the implied covenant of good faith and fair dealing

(against ING); (3) Breach of Fiduciary Duty (against ING) and Aiding and Abetting

a Breach of Fiduciary Duty (against ING U.S.); (4) Financial Elder Abuse in violation

of California Welfare & Institutions Code § 15600, et seq. (against ING); (5) Actual

and Constructive Fraud (against ING); (6) Unlawful, Deceptive, and Unfair Business

Practices in violation of California Business & Professions Code § 17200, et seq.

(against ING); (7) Unfair, Deceptive, and Misleading Advertising in violation of

California Business & Professions Code § 17500, et seq.; (against ING); (8) Failure to

Supervise (against ING); (9) DeclaratoryRelief re Qualifying Securities (against ING);

(10) violations of the California Securities Act (against ING); and (11) Control Person

Liability (against ING U.S.). (ECF No. 20.) On May 1, 2014, Defendants filed an

Answer to the First Amended Complaint. (ECF No. 24.)

OnMarch 27, 2015, Plaintiffs filed the instant Motion toCertify Class. (ECF No.

39). Plaintiff’s proposed classes consist of:

The Multi-State Class

All persons or entities that, when a resident of either the state of California,

Florida, Illinois, Pennsylvania or Texas, purchased a Secure Index fixed index annuity

contract from ING USA Annuity and Life Insurance Company within the applicable

statute of limitations. 

Plaintiff proposes to certify this Multi-State Class for violation of breach of

contract relating to ING’s alleged failure to maintain the contracts’ minimum

guaranteed contract values. (ECF No. 39 at 10.)

The California Class

All persons or entities that, when a resident of California, purchased a Secure

Index fixed index annuity contract from ING USA Annuity and Life Insurance

Company within the applicable statute of limitations. 

Plaintiff proposes to certify this California Class for:

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(1) Breach of the implied covenant of good faith and fair dealing;

(2) Breach of Fiduciary Duty;

(3) Fraudulent concealment;

(4) Violation of UnfairCompetition Law under Cal. Bus. & Prof.Code, § 17200, etseq;

(5) Violation of False Advertising Law (“FAL”) under Cal. Bus.& Prof. Code § 17500,

et seq.; 

(6) Declaratory Relief re Qualifying Securities;

(7) Violations of the California Securities Act under Cal. Corp. Code §25401.

(ECF No. 39 at 10.)

The California Seniors Subclass

All members of the California Class that were age 65 or older on the date of

purchase. (ECF No. 39 at 11.)

Plaintiff proposes to certify this California Class for:

(1) Violation of Financial Elder Abuse Law under Cal. Welf. & Inst. Code § 15600, et

seq.

LEGAL STANDARD

“The class action is an exception to the usual rule that litigation is conducted by

and on behalf of individual named parties only. In order to justify a departure from that

rule, a class representative must be a part of the class and possess the same interest and

suffer the same injury as the class members.” Wal-Mart Stores, Inc. v. Dukes, 131 S.

Ct. 2541, 2550 (2011) (internal quotation marks and citations omitted). To fit within

the exception, “a party seeking to maintain a class action ‘must affirmatively

demonstrate his compliance’ with [Federal Rule of Civil Procedure] 23.” Comcast

Corp. v. Behrend, 133 S. Ct. 1426, 1432 (2013) (quoting Dukes, 131 S. Ct. at 2551-52).

Rule 23 contains two sets of requirements. First, “Rule 23(a) ensures that the

named plaintiffs are appropriate representatives of the class whose claims they wish to

litigate. The Rule’s four requirements—numerosity, commonality, typicality, and

adequate representation—effectively limit the class claims to those fairly encompassed

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by the named plaintiff's claims.” Dukes, 131 S. Ct. at 2550 (internal quotation marks

and citations omitted). Second, “[w]here a putative class satisfies all four requirements

of 23(a), it still must meet at least one of the three additional requirements outlined in

23(b).” United Steel, Paper & Forestry, Rubber, Mfg. Energy, Allied Indus. & Serv.

WorkersInt’l Union AFL-CIO, CLC v. ConocoPhillipsCo., 593 F.3d 802, 806 (9thCir.

2010). 

On a motion for class certification, the Court is required to “examine the merits

of the underlying claim . . . only inasmuch as it must determine whether common

questions exist; not to determine whether class members could actually prevail on the

merits of their claims.” Ellis v. Costco Wholesale Corp., 657 F.3d 970, 981 n.8 (9th

Cir. 2011) (citations omitted).

DISCUSSION

I. Rule 23(a)

The Court first examines Plaintiff’s showing on each of the requisite prongs of

Federal Rule of Civil Procedure 23, starting with Rule 23(a) requirements of

numerosity, commonality, typicality, and adequate representation. 

A. Numerosity

The numerosity requirement is satisfied if “the class is so numerous that joinder

of all members is impracticable.” Fed. R. Civ. P. 23(a)(1). Here, Plaintiff’s proposed

class numbers in the thousands. (ECF No. 39-1 at 11.) Defendants do not dispute this

and have not specifically challenged Plaintiff’s motion on numerosity grounds. In this

case, joinder of all members clearly would be impracticable. The Court, therefore,

finds that Plaintiff’s proposed class meets the numerosity requirement. See In re Nat’l

W. Life Ins., 268 F.R.D. 652, 660-61 (S.D. Cal. 2010) (finding numerosity requirement

clearly satisfied where class encompassed over 16,000 annuity policies).

B. Commonality

With regard to commonality,Rule 23(a)(2) requires Plaintiff to demonstrate that

“there are questions of law or fact common to the class.” Fed. R. Civ. P. 23(a)(2). The

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claims of the proposed class members must be based on a common contention that is

“of such a nature that it is capable of classwide resolution—which means that

determination of its truth or falsity will resolve an issue that is central to the validity

of each one of the claims in one stroke.” Dukes, 131 S. Ct. at 2551. 

Plaintiff asserts that the class members’ claims are based on the common

contention “that ING’s product design and execution utilized a hidden derivatives

structure to transfer risks to Plaintiff and the Class, causing them to overpay for their

Secure Index FIA contracts.” (ECF No. 39-1 at 12.) Plaintiff also claims that ING

failed to maintain the FIAs at the minimum guaranteed value as provided in the

contracts and required by law. (Id. at 14-15.) ING does not challenge Plaintiff’s

motion on commonality grounds.

In the present case, the following common factual and legal questions exist: 

(1) whether FIA contract forms were uniform and substantially similar as to the

claimed protection of FIAs at guaranteed values, ING’s exclusive investment

discretion, and material omission of the embedded derivatives; (2) whether ING

embedded its FIAs with complex derivative structures that caused Class members to

lose retirement savings; (3) whether ING owed a special and/or fiduciary obligation to

senior citizens and retirees who purchased ING FIAs; (4) whether ING targeted retirees

and seniors for sale of its FIAs; (5) whether ING abused its investment discretion in

making adjustments to the interest crediting strategy factors and parameters which

caused Class members to be harmed; (6) whether ING failed to properly report the

FIAs actual present values to the Class members; (7) whether ING falsely reported the

FIA contract values in periodic statements mailed to Class members; and (8) whether

FIAs qualify as securities under California securities law. 

Here, though the parties dispute the intent, propriety, and effect of the

derivatives imbedded in the Secure Index FIA contracts, the parties do not appear to

dispute that there are derivatives included in each Secure Index FIA contract.

Moreover, the evidence presently before the Court supports Plaintiff’s view that

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putative class members were not informed of the derivatives structure of their Secure

Index FIA contracts at the time they entered into the contracts. As to Plaintiff’s

contention that this structure resulted in class members overpaying for their contracts,

whether this contention is true or false, the formula Dr. McCann devised to value the

contracts and assess damages appears to apply equally to all class members. For

purposes of commonality, to the extent Plaintiff contends the putative class members

overpaid, they did so at the same time, in the same way. The Court, therefore, finds the

commonality requirement is satisfied. 

C. Typicality

Under the third Rule 23(a) requirement, the Court must determine whether “the

claims or defenses of the representative parties are typical of the claims or defenses of

the class.” Fed. R. Civ. P. 23(a)(3). “Under the rule’s permissive standards,

representative claims are ‘typical’ if they are reasonably co-extensive with those of

absent class members; they need not be substantially identical.” Hanlon v. Chrysler

Corp., 150 F.3d 1011, 1020 (9thCir. 1998). “The purpose ofthe typicality requirement

is to assure that the interest of the named representative aligns with the interests of the

class.” Hanon v. Dataproducts Corp., 976 F.2d 497, 508 (9th Cir. 1992) (citation

omitted). “The test of typicality is whether other members have the same or similar

injury, whether the action is based on conduct which is not unique to the named

plaintiffs, and whether other class members have been injured by the same course of

conduct.” Id. (quotation omitted). 

Defendants contend that Plaintiff’s experience was unique because he relied on

an independent agent, Mr. Copley, to tell himthe relevant characteristics of the annuity

and made his decision based on those oral statements (as opposed to basing his

decision on brochures or other materials prepared by ING). (ECF No. 43 at 17-18.)

Plaintiff responds that the Secure Index FIA contract, which included hidden

derivatives and a related hedging structure, was uniform and issued to Plaintiff and

each class member, regardless of what agent they used. (ECF No. 39-1 at 12; ECF No.

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46 at 8.) No agent constructed or executed these FIAs. (ECF No. 46 at 8.) Thus,

Plaintiff argues that “Mr. Abbit’s claims are not only typical of the Class claims, they

are identical: every contract contained the complained-of derivatives that transmitted

market risk to the Class; every contract was improperly priced, every contract was

breached; and ING ensured that every consumer and every agent did not receive any

information about the hidden derivatives structure that transmitted market risk.” (Id.)

Looking again at Plaintiff’s common contention—“that ING’s product design

and execution utilized a hidden derivatives structure to transfer risks to Plaintiff and

theClass, causing themto overpay for their Secure Index FIA contracts,” (ECF No. 39-

1 at 12)—it is apparent that Plaintiff’s alleged injury is typical of the class. The

evidence Plaintiff presented in support of his motion supports his assertion that all of

the contracts contained the derivative structure (ECF No. 49-4 at 16) and were

relatively uniform. (ECF No. 39-19 at 2; FAC ¶¶44, 63-64, and 114-119; FAC, Ex. A.)

Moreover, the evidence before the Court at this time shows that Defendants do not

specifically inform sales agents of the derivative structure embedded in the annuities

and do not require them to understand how the options structure works. During the

deposition ofChad Tope, ING’s President of Annuity Distribution, Mr. Tope explained

that “[t]here’s not a need for them [sales agents] to understand the options and the

derivative market place to understand how our product works . . .” and “there is no

need for them [class members] to understand the hedging.” (ECF No. 39-10 at 104:4-

19 - 105:1-7.) Thus, it is largely immaterial to the typicality analysis that Plaintiff’s

sales agent may have made unique oralstatements during the sales process because the

evidence at this point suggests that none of the sales agents were aware of the

derivative structure and thus, none of them would have made material statements on

this issue. In regard to the final portion of Plaintiff’s common contention, that all of

the class members overpaid, Plaintiff’s overpayment theories are uniform and

plausible. 

For the foregoing reasons, the Court finds that Plaintiff’s claims are typical of

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the class he seeks to represent.

D. Adequacy

Finally,Rule 23(a)(4)requiresthe representative partiesto fairly and adequately

protect the interests of the class. Fed. R. Civ. P. 23(a)(4). “Resolution of two questions

determines legal adequacy: (1) do the named plaintiffs and their counsel have any

conflicts ofinterest with other class members and (2) will the named plaintiffs and their

counsel prosecute the action vigorously on behalf of the class?” Hanlon, 150 F.3d at

1020.

As an initial matter, Defendants do not object to class counsel, and the Court’s

review of the biographical information submitted regarding Hutton Law Group and

Taro & Zamoyski, LLP reveals that they are experienced and capable professionals.

As such, the Court finds class counsel to be adequate.

Plaintiff contendsthat he is an adequate representative because he isseeking the

same remedies, based on the same core of operative facts, as the putative class. (ECF

No. 39-1 at 13.) Defendants object to Plaintiff’s adequacy as a class representative,

arguing that many of Plaintiff’s claims are moot and that his claim for restitution

conflicts with other class members’ objectives. (ECF No. 43 at 13-17.)

1. Mootness of UCL, FAL, Fraud, Elder Abuse, Securities and

Restitution Claims

ING contendsthatseveral of Plaintiff’s claims are moot because Plaintiff Abbit

can never receive less than what he paid for his contract. (ECF No. 43 at 13-15.) To

the contrary, if Plaintiff surrendered his contract now, he would net a gain. (Id. at 15.)

Specifically,ING explainsthat under California’s UCL and FAL,restitution isthe only

damages model available and restitution must account for any benefits received. (ECF

No. 43 at 13.) Because Plaintiff gained more than he lost, his claim is moot. Likewise,

ING contendsthat in order to recover out-of-pocket damagesfor a fraud claim, Plaintiff

must show that he suffered an actual loss. (Id.) For his elder abuse claim, ING argues

that Mr. Abbit “must show that he lost his property and that ING is wrongfully

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retaining it.” (Id.) Finally, under California securities law, ING asserts that the

measure of damages is rescission or the “return of consideration.”

1

(Id.) Because all

of these causes of action requiring a showing of actual losses and ING contend that

Plaintiff has none, ING assert that his claims are moot and that Mr. Abbit, therefore,

is an inadequate class representative. (Id.)

Plaintiff Abbit responds that he has provided unrebutted expert opinion that he,

as well as every other member of the California Class, were harmed in that each of

them overpaid for their FIA. (ECF No. 46 at 11.) In response to ING’s contention that

supervening events must be considered, Plaintiff submits that these events are

irrelevant and points out that, asthe court held in In re Nat’l W. Life Ins.,“[t]he fact that

Plaintiffs’ accountsincreased in value does not mean that the Plaintiffs would not have

received more value absent Defendants[’] alleged reduction in the credited interest

rate.” (Id. (quoting In re Nat’l W. Life Ins., 268 F.R.D. 652, 666 (S.D. Cal. 2010)).

Defendants argue that in determining whether Plaintiff is an adequate

representative for claims seeking out-of-pocket losses, the Court should not look just

at the value of the asset at the time of the transaction, but also at supervening

circumstances. (ECF No. 43 at 14.) Defendants contend that the fact that Plaintiff has

earned more money on his contract than other class members, essentially recouping

some of his losses, puts him at odds with other class members in terms of the out-ofpocket damages calculation. 

Recently, the Ninth Circuit held that damages calculations in UCL and FAL

actions need not account for benefits received after purchase of the service because the

focus is on the value of the service at the time of purchase. Pulaski & Middleman, LLC

v. Google, Inc., No. 12-16752, 2015 WL 5515617, at *8 (9th Cir. Sept. 21, 2015). The

court observed that, instead, in calculating restitution under the UCL and FAL, the

1

ING also notes that they believe Plaintiff’s securities law claim is meritless because

California securities law specifically excludes annuity contracts from the definition of a “security.”

(ECF No. 43 at 13 (citing Cal. Corp. Code § 25109 (“‘Security’ does not include . . . any . . . annuity

contract.”))). 

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focus is on the difference between what was paid and what a reasonable consumer

would have paid at the time of purchase without the fraudulent or omitted information.

See also Kwikset Corp. v. Super. Ct., 51 Cal. 4th 310, 329 (2011).

Using the economic harm at the time of purchase, Plaintiff’s recovery turns on

the same calculation as the remainder of the class and Plaintiff is an adequate

representative for the proposed classes. 

2. Mootness of Breach of Contract Claim

ING also asserts that Mr. Abbit is an inadequate representative on the breach of

contract cause of action because the claim relates to ING’s alleged failure to provide

for daily compounding of interest in his minimum guaranteed contract value

(“MGCV”) calculation, and Plaintiff has reached a point where his Cash Surrender

Value is certain to be higher than the MGCV even if interest on the MGCV had been

compounded daily.

2

(ECF No. 43 at 15.) Plaintiff did not respond to this argument.

The Court finds below that this portion of the claim is not suitable for certification

based on predominance. However, Plaintiff’s claim of failure to maintain the

contracts’ minimum guaranteed values is also based on ING setting the prices of the

undisclosed derivatives structure so low that the true values of the contracts were

below the minimum values guaranteed. ING does not challenge Mr. Abbit’s adequacy

as a representative as to the undisclosed derivatives structure claim. Accordingly, the

Court finds that Plaintiff is an adequate representative on the breach of contract cause

of action as to this portion of the claim.

II. Rule 23(b)(3)

Plaintiff argues that the Court should grant class certification under Rule

23(b)(3). Under Rule 23(b)(3), Plaintiff must show that “questions of law or fact

common to class members predominate over any questions affecting only individual

2 Defendant’s assertion that Plaintiff’s Cash Surrender value is certain to be higher than his

MGCV is based on paragraph 4 of the Declaration of William Bainbridge (ECF No. 43-1.) Plaintiff

objectsto paragraph 4 as irrelevant, lacking in foundation, impermissible layopinion, and speculation.

(ECF No. 46-1 at 1.) 

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members, and that a class action is superior to other available methods for fairly and

efficiently adjudicating the controversy.” Fed. R. Civ. P. 23(b)(3). Rule 23(b)(3) lists

the following factors as pertinent to a court’s assessment of the predominance and

superiority criteria:

(A) the class members’ interests in individually controlling the

prosecution or defense of separate actions;

(B) the extent and nature of any litigation concerning the controversy

already begun by or against class members;

(C) the desirability or undesirability of concentrating the litigation of the

claims in the particular forum; and

(D) the likely difficulties in managing a class action.

Id. 

A. Predominance

To satisfy the predominance requirement, “the common questions must be ‘a

significant aspect of the case ... [that] can be resolved for all members of the class in

a single adjudication.’” Berger v. Home Depot USA, Inc., 741 F.3d 1061, 1068 (9thCir.

2014) (quoting Hanlon, 150 F.3d at 1022). The predominance inquiry requires a court

to consider “how a trial on the merits would be conducted if a class were certified. Bell

Atl. Corp. v. AT&T Corp., 339 F.3d 294, 302 (5th Cir. 2003) (quotation marks and

citation omitted). This, in turn, “entails identifying the substantive issues that will

control the outcome, assessing which issues will predominate, and then determining

whether the issues are common to the class, a process that ultimately preventsthe class

from degenerating into a series of individual trials.” Id. (quotation marks and citation

omitted).

Here, the predominance inquiry begins with identifying the evidence that

supports each of the causes of action identified in the motion; determining the extent

of the common factual and legal issues, and determining whether common issues

predominate. 

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1. Multi-State Breach of Contract Cause of Action

With respect to the breach of contract cause of action, Plaintiffseeks certification

of a multi-state class asto ING’sfailure to maintain the contracts’ minimumguaranteed

values. (ECF No. 41 at 14-15.) This breach allegedly occurred as a result of (1) ING

failing to calculate and compound interest daily; and (2) ING setting the prices of the

undisclosed derivatives structure so low that the true values of the contracts were

below the minimum values guaranteed. (Id.)

ING contends that extrinsic evidence of each class member’s understanding of

what the contract intended will be necessary to support Plaintiff’s claim that the

contract term providing for “interest credited daily” actually means “interest credited

and compounded daily.” (ECF No. 43 at 23.) Because this individual inquiry will be

necessary, ING argues Plaintiff has failed to demonstrate predominance. (Id.)

Defendants argue that thisis particularly true given that Plaintiff proposes a multi-state

class and Plaintiff has failed to establish that “each state’s rules on construction,

extrinsic evidence, ambiguity, and contra proferentum are uniform, or that those

differences can be respected at trial.” (Id. at 24.) 

Plaintiffresponds that, even ifit were true that evidence of contractual intent and

extrinsic evidence were necessary, this would not make the adjudication unmanageable.

(ECF No. 46 at 10.) First, Plaintiff believes contractual intent can be determined

through common evidence, such as premium payments and contract delivery. (Id.)

Second, Plaintiff points out that the FIAs are fully integrated and the plain meanings

of “interest credited daily” and “minimum guaranteed contract value” are uniform.

(Id.) Third, Plaintiff states that “any extrinsic evidence to resolve the meaning of the

contractual guarantees asrelated to the hidden ‘embedded derivatives’ is also common

to the Class.” (Id. (citing ING’s SEC filing)). Finally, Plaintiff submits that there are

no meaningful variances between the five states in terms of their rules of construction,

so any differences can be managed during the litigation and trial. (Id. at 10 and n.22.)

Plaintiff provides a chart comparing the differentstates’ laws on contract interpretation.

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(ECF No. 46, Ex. G.)

ING assertsthat “[a] class action should not be certified where extrinsic evidence

as to the scope and meaning of contractual duties may be necessary.” (ECF No. 43 at

23.) ING relies on Monaco v. Bear Stearns Co., No. CV 09-05438-SJO-JCX, 2012 WL

10006987, at *6 (C.D. Cal. Dec. 10, 2012), where the court considered a proposed class

of individuals who had undertaken option adjustable rate mortgages. The court

determined that certain contract terms were ambiguous and that extrinsic evidence was

required to construe them. Monaco, 2012 WL 10006987, at *6. Because the three

named plaintiffs varied significantly in their understanding of the ambiguous contract

terms,3the court found that common issues did not predominate. Id. Fletcher v. Sec.

Pac. Nat'l Bank, 23 Cal. 3d 442, 448-49 (1979), involved a claim that the bank’s

practice of calculating “per annum” interest rates on a 360 day year constituted unfair

trade practice. The court found that individual issues of each borrower’s knowledge

predominated over the common questions of law, because many borrowers were aware

of the bank’s policy.

In the instant case the parties dispute the meaning of “interest credited daily.”

The Court finds that the question cannot be answered with common evidence and

requires extrinsic evidence and individualized determinations as to the annuitants’

knowledge and understanding of this contract language. 

Plaintiff also raises a second contract based claim regarding ING setting the

prices of the undisclosed derivatives structure so low that the true values of the

contracts were below the minimum values guaranteed. (FAC ¶¶ 38, 88-89.) Plaintiff

claimsthatING did not properlymaintain the minimumcontractual values, asING was

obliged to do contractually and pursuant to Cal. Ins. Code § 10168.25. ING has not

3

“Mr. Monaco believed, based on conversations with his broker, that he was taking on a loan

with a 1 % interest rate for “at least one year” and that he was only required to pay interest, and not

the principal. Mrs. Monaco believed that the interest rate would vary between 1% and 3% for five

years, based on conversations with her husband. Finally, Brandt has testified that he believed he was

entering into a thirty-year 1% fixed rate loan based on conversations with his broker and a notary.

Monaco, 2012 WL 10006987, at *6 (internal citations omitted).

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challenged Plaintiff’s allegation that the undisclosed derivatives were common to all

FIAs and that common evidence exists to determine whether the FIAs value was less

than the minimum values guaranteed under the contracts and the law. The factual and

legal issues asto this claim appear to be common and amenable to class determination.

The Court finds that Plaintiff has sufficiently alleged a breach of contract that is

capable of being adjudicated with common evidence and that class certification is

appropriate.

4

2. California Class (Statutory Claims)

Plaintiff assertsstatutory claimsfor(1)Unlawful,Deceptive and Unfair Business

Practices (“UCL”) (Cal. Bus. & Prof.Code § 17200, et seq.); (2) Unlawful, Deceptive

and Misleading Advertising (“FAL”) (Cal. Bus. & Prof.Code § 17500, et seq.); (3)

violations of the Elder Abuse statute (Cal. Welf. & Inst.Code § 15610, et seq.), and (4)

violations of the California Securities Act (Cal. Corp. Code §25401). (FAC ¶¶ 144-

150, 157-172, 190-192.)

Plaintiff allegesthe common contention thatING’s product design and execution

utilized a hidden derivatives structure to transfer risks to Plaintiff and the Class,

causing them to overpay for their Secure Index FIA contracts. (FAC No. 49 at 12.)

According to Plaintiff, this common contention is capable of class-wide resolution

through common evidence, including, inter alia, (1) uniform sales materials, (2)

uniform training of sales agents, (3) pricing memoranda, (4) ING’s interest-crediting

decisions driven by meeting corporate objectives, (5) uniform Secure Index FIA

contracts, and (6) expert analyses of FIA contract data. Id. 

///

4 Plaintiff alleges ING offered Secure Index Opportunities Plus annuityinvestors a five percent

(5%) bonus which purportedlyadded to investors' total premium at contract inception as an immediate

head start on earnings. (FAC ¶ 34; FAC Ex. A at 5.) However, the 5% bonus was not available to

investors in “ING Secure Index Five” and “ING Secure Index Seven” annuities. As such, questions

relating to the bonus are not common to the entire class and are not suitable for class certification. Cf.,

Berger v. Home Depot USA, Inc., 741 F.3d 1061, 1067-68 (9th Cir. 2010) (“Class certification is

available only to those members who were actually exposed to the business practices at issue.”).

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a. Unfair Competition Law

California Business and Professions Code § 17200, et seq. is also known as the

Unfair Business Practices Act or Unfair Competition Law. “California’s unfair

competition statute prohibits any unfair competition, which means ‘any unlawful,

unfair or fraudulent business act or practice.’” In re Pomona Valley Med. Group, Inc.,

476 F.3d 665, 674 (9th Cir. 2007) (citing Cal. Bus. & Prof. Code §§ 17200, et seq.).

“The ‘unlawful’ practices prohibited by . . . section 17200 are any practices forbidden

by law, be it civil or criminal, federal, state, or municipal, statutory, regulatory, or

court-made.” South Bay Chevrolet v. General Motors Acceptance Corp., 72 Cal. App.

4th 861, 881 (1999) (citations omitted). Under the unlawful prong, therefore, the UCL

“borrows” violations of other laws and makesthemindependently actionable under the

UCL. In addition, a practice that is not “unlawful” under the UCL may still be

considered “unfair.” See Cel-Tech Commc’ns, Inc. v. L.A. Cellular Tel. Co., 20 Cal.

4th 163, 180-81 (1999). To be unfair, the plaintiff must be able to show that his claim

is “tethered” to an underlying law. Cel-Tech, 20 Cal. 4th at 186-87. Finally, the

fraudulent prong of § 17200 requires a showing “that ‘members of the public are likely

to be deceived.’ Allegations of actual deception [and] reasonable reliance . . . are

unnecessary.” Comm. on Children's Television, Inc. v. Gen. Foods Corp., 35 Cal. 3d

197 (1983). 

The California Supreme Court has held that “[r]elief under the UCL is available

without individualized proof of deception, reliance and injury.” In re Tobacco II

Cases, 46 Cal.4th 298, 320 (2009). The California Court of Appeal noted in

Massachusetts Mutual Life Insurance Co. v. Superior Court, 97 Cal. App. 4th 1282

(2002),

 The fact that a defendant may be able to defeat the showing of causation as to

a few individual class members does not transform the common question into a

multitude ofindividual ones; plaintiffs satisfy their burden ofshowing causation

as to each by showing materiality as to all. Thus, it is sufficient for our present

purposes to hold that if the trial court finds material misrepresentations were

made to the class members, at least an inference of reliance would arise as to the

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entire class.

Id. at 1292–93 (internal quotation marks and citations omitted).

I. Fraudulent Prong

ING contests predominance under the “fraudulent” prong of the UCL based on

the lack of uniformmisrepresentationsin the marketing orsale of the FIAs. ING points

out that oral and written presentations were made to putative class members by

independent agents and financial advisors, using their own sales materials. (ECF No.

43 at 19-20.) ING assert that “[t]here is no ING USA sales ‘script,’ and the agents and

advisors were not required to provide any ING USA materials to prospective purchases

other than an application and related disclosure form.” (ECF No. 43 at 19.) Absent a

showing that putative class members received “uniform written or oral

misrepresentations or omissions,” ING contendsthat Plaintiff cannot demonstrate that

common issues predominate. (Id. at 19-20.) ING further assertsthat the individualized

nature of sales also defeats any claims that ING USA was a fiduciary. (Id. at 20.)

Plaintiff alleges that ING created uniform sales materials that promised a

“guarantee” to “Protect Your Assets” (FAC ¶ 6) and interest potential beyond “other

sources of fixed income.” (Id.) Mr. Abbit then points out that all agents are required

to complete training before they sell FIAs and all agent-generated sales messaging

must be pre-approved by ING. (ECF No. 46 at 2 n.4 (citing Dep. of Chad Tope, ECF

No. 39-10 at 53:7-11) and n.6 (citing Dep. of Chad Tope, ECF No. 39-10 at 47:1-9;

49:1-11).) Additionally, Mr. Abbit highlights that the agent must attest to ING that

they had not made statements that differ from the sales materials, illustrations or

proposals that were provided. (ECF No. 46 at 2.) 

However, there is no evidence that any “uniform materials” other than the

contracts were provided to class members. Though the independent agents had to

certify that they had not made representations contrary to ING’s written materials, they

were not affirmatively required to make any representations about “protection” of

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retirement assets. This deficiency is not cured by the fact that sales agents were

required to attend training, that agent-generated materials were pre-approved by

Defendants or that agents attest that they did not make statements that differ from the

sales materials. These assertions do not show that the promises that Plaintiff received

were made classwide to FIA purchasers. Instead, they only support the conclusion that

agents did not make any promises beyond those that were contained in ING materials

at any particular time.

Other courts have addressed the argument that unique oral representations by

sales agents defeat certification in cases based on misrepresentations. The

determination in these cases turns on whether the agent relied on uniform sales

materials or a uniform sales script. Compare Avritt v. Reliastar Life Ins. Co., 615 F.3d

1023, 1035 (8th Cir. 2010) (denying class certification where annuity company “did

not adopt a uniform approach with respect to its representation of its interest-crediting

policies” and where “annuities were sold by thousands of independent agents who did

not follow a particular sales script when working with customers”), and In re LifeUSA

Holding Inc., 242 F.3d 136, 146-47 (3d Cir. 2001) (denying class certification where

there was absence of commonality where independent sales agents did not use sales

script in selling annuities, did not rely on uniform sales materials, and were not

required to attend training seminar before selling LifeUSA annuities), with Yokoyama

v. Midland Nat. Life Ins. Co., 594 F.3d 1087 (9th Cir. 2010) (reversing denial of class

certification where there was failure to disclose material information in uniformly

provided brochures concerning the detriments from annuities which were sold to

seniors by independent brokers), Negrete v. Allianz Life Ins. Co. of N. Am., 287 F.R.D.

590, 595 (C.D. Cal. 2012) (denying motion to decertify class where there were

misrepresentations as to no sales charges and immediate bonus contained in brochures

provided to the consumer), In re Nat'l W. Life Ins. Deferred Annuities Litig., 268

F.R.D. at 665 (granting partial class certification where each class member received

specific written materials from Defendant which made specific claims regarding a

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premium bonus and no up-front fees), and Iorio v. Allianz Life Ins. Co. of N. Am., No.

05CV633 JLS CAB, 2008 WL 8929013, at *23, *27 (S.D. Cal. July 8, 2008) (denying

motion to decertify class and upholding finding that distribution of uniform written

communications to each class member “allayed concerns about any differences in the

oral communications that the independent selling agents made to class members”).

The Court finds a lack of uniformity as to the misrepresentations made to Class

members and finds that individualized questions predominate on this theory of

recovery. As a result, the Court turns to the other prongs under section 17200 to

determine whether class certification is appropriate under the UCL. 

ii. Unlawful and Unfair Prong

Plaintiff also relies on the “unlawful” prong of the UCL by alleging violations

of the Cal. Ins. Code §§ 332, 780, 781, 827 and 10168.25. (FAC 38, 88-89, 159; ECF

No. 39 at 19.).5See Pastoria v. Nationwide Ins., 112 Cal. App. 4th 1490, 1496 (2003)

(plaintiffs allege that the defendants acted “unlawfully” by violating Insurance Code

§§ 330, et seq.); see also Burdick v. Union Sec. Ins. Co., No. CV 07-4028 ABC (JCX),

2009 WL 4798873, at *16 (C.D. Cal. Dec. 9, 2009) (violations of Ins. Code § 330, et

seq. constitute “unlawful” conduct giving rise to UCL claim). Plaintiff’s theory under

the Insurance Code is based on the allegation that ING failed to maintain guaranteed

values of the Secure Index FIAs as required by Cal. Ins. Code § 10168.25. Plaintiff

intendsto prove this claim through the uniform language in the FIAs and the testimony

of his expert witness. (ECF No. 39 at 7) ING has not addressed this “unlawful

conduct” theory. The Court finds that there are common issues of fact and law as to

5 Cal. Ins. Code § 332 provides “[e]ach party to a contract of insurance shall communicate to

the other, in good faith, all facts within his knowledge which are or which he believes to be material

to the contract and as to which he makes no warranty, and which the other has not the means of

ascertaining.” Cal. Ins. Code §§ 780 and 781 prohibit misrepresentations in the sale of insurance

policies and Cal. Ins. Code § 827 involves the unpermitted sales of securities by an insurer. Cal. Ins.

Code § 10168.25 sets out the approved method for determining minimum nonforfeiture amounts. 

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this claim and that it is suitable for class certification. 

In addition, “a breach of contract may form the predicate for Section 17200

claims, provided it also constitutes conduct that is‘unlawful, or unfair, or fraudulent.’”

Puentes v. Wells Fargo Home Mortgage, Inc., 160 Cal. App. 4th 638, 645 (2008),

quoting Watson Laboratories, Inc. v. Rhone-Poulenc Rorer,Inc. 178 F. Supp. 2d 1099,

1117, n.12 (2001); see also Allied Grape Growers v. Bronco Wine Company, 203 Cal.

App. 3d 432 (1988) (buyers’ breach of contract to purchase grapes constituted unfair

business practice under Section 17200). To the extent that Plaintiff alleges a breach

of contract based upon the same “unlawful” failure to maintain guaranteed values of

the FIAs, the alleged breach of contract may also constitute an “unfair” business

practice. 

Based upon the above analysis, the Court findsthat common issues predominate

as to the “unlawful” and “unfair” business practices claim and Plaintiff’s motion to

certify a class based upon a violation of the UCL is GRANTED. 

b. False Advertising Law

Plaintiffs’ false advertising claim is based on Cal. Bus. & Prof. Code § 17500,

which “renders it unlawful for a defendant to ‘induce the public to enter into any

obligation’ based on a statement that is ‘untrue or misleading, and which is known, or

which by the exercise of reasonable care should be known, to be untrue or

misleading.’” Hauk v. JP Morgan Chase Bank USA, 552 F.3d 1114, 1122 (9th Cir.

2009) (citing Cal. Bus. & Prof. Code § 17500). This statement must also be “ma[de]

or disseminate[d] . . . in any newspaper or other publication, or any advertising device,

or by public outcry or proclamation, or in any other manner or means whatever,

including over the Internet.” Cal. Bus. & Prof. Code § 17500. 

The Court finds insufficient evidence of uniform public dissemination of any

untrue or misleading statement. As noted above, Plaintiff has failed to demonstrate that

ING brochures were provided to all class members or that class members were

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subjected to a uniform advertising campaign. As such, Plaintiff has failed to

demonstrate that uniform misrepresentations were uniformly disseminated. Plaintiff’s

motion to certify the California class as to the FAL claim is DENIED. 

c. Elder Abuse Law

Plaintiffs allege financial abuse under California's Elder Abuse law, Cal. Welf.

& Inst. Code § 15657.5. This law “reflect[s] the Legislature’s intent to provide

enhanced remedies to encourage private, civil enforcement of laws against elder abuse

and neglect.” Intrieri v. Superior Court., 117 Cal. App. 4th 72 (2004) (citation

omitted). “‘Financial abuse’ of an elder . . . occurs when a person or entity . . . [t]akes,

secretes, appropriates, or retains real or personal property of an elder or dependent

adult to a wrongful use or with intent to defraud, or both.” Cal. Welf. & Inst. Code

§ 15610.30(a)(1). Under the statute, it is not necessary that the taker maintain an intent

to defraud if it can be shown that the person took the property for a wrongful use and

“knew or should have known that [his or her] conduct is likely to be harmful to the

elder . . . .” Bonfigli v. Strachan, 192 Cal. App. 4th 1302, 1315 (2011), as modified on

denial of reh'g (Mar. 24, 2011). See also Welf. & Inst. Code § 15610.30(b). 

The Court has found that class certification is suitable as to claims for unlawful

business practices which include allegations that would satisfy the first element of the

claim, i.e. ING took money from a subclass of elders. The remaining element for elder

abuse requires Plaintiff to establish that money was taken “to a wrongful use.” This

element focuses on whether ING took the money wrongfully or with the intent to

defraud. Plaintiff’s theory regarding the failure to maintain guaranteed values of the

Secure Index FIAs is based upon common evidence and is common as to all putative

class members, thus making class certification appropriate on this claim as well.

Therefore, the Court GRANTS the motion to certify the elder abuse class. 

d. Securities Laws

Plaintiff also seeks certification of a class based upon violations ofthe California

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securities laws. Under California law, annuities are exempted from securities laws. 

Cal. Corp. Code § 25109 (“‘Security’ does not include . . . any . . . annuity contract.”).

NotwithstandingCalifornia law, Plaintiff argues that FIAs are securities because ING’s

internal execution of the “derivatives” and “options” transfers market risks from ING

to Plaintiff and the California Subclass. (ECF No. 39 at 21.) 

As observed by Dr. McCann, FIAs have been regulated by state insurance

commissions, rather than by the Securities and Exchange Commission and the NASD.

(ECF No. 49-6 at 67.) Plaintiff acknowledges the state of the law but offers a novel

theory which would extend the reach of securities law to FIAs. ING has not opposed

certification on the security causes of action. Given that common questions oflaw exist

that can be disposed of by motion for summary judgment, the Court GRANTS

certification on the security causes of action.

3. California Class (Common Law Claims) 

Plaintiff also seeks class certification asto claimsfor breach ofimplied covenant

of good faith and fair dealing, breach of fiduciary duty, and fraudulent concealment.

(ECF No. 20 ¶¶ 113-143, 151-156, & 173-179.) Plaintiff summarily addresses the

merits of class certification as to these three causes of action in less than one page of

briefing. (ECF. No. 46 at 18.) The proponent of the class bears the burden of

demonstrating that class certification is appropriate. In re N.D. Cal., Dalkon Shield

IUD Prods. Liab. Litig., 693 F.2d 847, 854 (9th Cir.1982) (citation omitted). “[A]

party seeking to maintain a class action ‘must affirmatively demonstrate his

compliance’ with [Federal Rule of Civil Procedure] 23.” Comcast Corp. v. Behrend,

133 S. Ct. 1426, 1432 (2013) (quoting Dukes, 131 S. Ct. at 2551-52). The Court finds

that Plaintiff has failed to meet his burden of proof of establishing that common issues

predominate asto the claimsrelating to implied covenant of good faith and fair dealing,

fiduciary duty, and fraudulent concealment. Plaintiff’s motion to certify class as to

these common law causes of action is DENIED. 

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4. Damages

Finally, Defendants argue that Plaintiff has failed to show that damages are

measurable on a class-wide basis because each putative class member has experienced

individualized gains and credits.(ECF No. 43 at 24.) Additionally, Plaintiff apparently

purports to measure each contract’s returns against the returns of two specific mutual

funds. (Id. at 25.) Defendants contend this is inappropriate because Plaintiff testified

that he did not want to invest in the stock market and risk a loss. (Id.) Defendants

argue this disconnect between Plaintiff’s damagesmodel and the factual record violates

Comcast. (Id.)

ING argues that Plaintiff’s out-of-pocket damages calculation ignores the

individualized gains and creditsthat each proposed class member has experienced since

purchase. (ECF No. 43 at 24.) Those gains allegedly differ based on a variety of

factors, including the contract issue date and each individual’s interest-crediting

strategy selection. (Id.) Further, ING submits that Plaintiff’s benefit-of-the-bargain

calculation is based on an assumption that is contrary to the record. (Id. at 25.) Plaintiff

responds that Dr. McCann utilizes damages and FIA valuation methodologies that are

well-accepted and that both models provide uniform methods of calculating damages

for the class. (ECF No. 46 at 6.) 

In Yokoyama, the district court, in denying class certification, found that the

damages calculation involved highly individualized and fact-specific determinations

relating to, among other things, the financial circumstances and objectives of each class

member; their ages; the indexed annuity products (“IAP”) selected; the performance

of the selected index; any changes in the index margin for that particular IAP; any cap

on the indexed interest; and the actual rate of return on the IAP. Yokoyama v. Midland

Nat. Life Ins. Co., 243 F.R.D. 400, 410 (D. Haw. 2007), rev’d, 594 F.3d 1087 (9th Cir.

2010). The NinthCircuitreversed the district court observing that damage calculations

alone cannot defeat certification. Yokoyama, 594 F.3d at 1094. The Court concluded

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that there were no individualized issues sufficient to render class certification

inappropriate under Rule 23. 

While the Court entertains concerns as to the methodology of Dr. McCann,6the

Court finds at this time that the damage model is plausible and that individualized

issues do not defeat certification. 

B. Superiority

Rule 23(b)(3) requires that class resolution must be “superior to other available

methods for the fair and efficient adjudication of the controversy.” Fed. R. Civ. P.

23(b)(3). “The superiority inquiry under Rule 23(b)(3) requires determination of

whether the objectives of the particular class action procedure will be achieved in the

particular case.” Hanlon, 150 F.3d at 1023 (noting that in some cases, “litigation costs

would dwarf potential recovery”) (internal citation omitted). Considerations pertinent

to this finding are “(A) the class members’ interests in individually controlling the

prosecution or defense of separate actions; (B) the extent and nature of any litigation

concerning the controversy already begun by or against class members; (C) the

desirability or undesirability of concentrating the litigation of the claims in the

particular forum; and (D) the likely difficulties in managing a class action.” Fed. R.

Civ. P. 23(b)(3)(A-D). 

Defendants argue that the “benefit of the bargain” damages Plaintiff and other

putative class members would be seeking are high enough that they would have a

substantial interest in proceeding independently (even factoring in that Plaintiff’s

damages are substantially higher than most class members’). (ECF No. 43 at 10-11.)

Defendants argue that this is particularly true given that some of the asserted claims

6 While Plaintiff submits that Dr. McCann's damage models are well-accepted, some courts

have expressed reservations about the methodology employed by Dr. McCann in modeling damages

in annuity cases. Yokoyama, 243 F.R.D. at 410 (finding expert testimony of Dr. McCann plausible

in spite of reservations about the methodologyemployed inmodeling damages);Negrete, 238 F.R.D.at

493 (finding that while court had some skepticism that Dr. McCann's model is supportable, plaintiffs

offered a facially plausible method for showing causation and impact across-the-board). 

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permit an award of attorney’s fees, treble damages, and other bases for increasing a

compensatory award. (Id. at 11.)

Plaintiff argues that while the individual damagessuffered by each class member

are not insignificant, the transaction costs offiling individual claims against a company

like ING would far outweigh their recovery. (ECF No. 39-1 at 23; ECF No. 46 at 9

(noting that the cost of hiring an FIA advisor alone could surpass the recoverable

amounts).) 

There are no other actions relating to the present issues pending. The current

action is being led by a litigant who has a large stake in the litigation and is motivated

to adequately represent the interests of putative class members. Lastly, given the high

litigation costs, it is unlikely that other FIA consumers will file separate actions. Cf.,

In re Bank One Securities Litigation/First Chicago Shareholders Claims, 2002 WL

989454, *8 (N.D. Ill. 2002). As such, the Court finds that class litigation is superior

to individual actions. 

CONCLUSION

For the foregoing reasons, the Court GRANTS in part and DENIES in part

Plaintiff's motion for class certification. (ECF No. 39.) The following classes are

hereby certified pursuant to Fed. R. Civ. P. 23(a) and (b)(3) as to the causes of action

approved herein:

The Multi-State Class

All persons or entities, excluding defendants and their directors, officers,

predecessors, successors, affiliates, agents, co-conspirator and employees, as well as

the immediate family members ofsuch persons, that, when a resident of either the state

of California, Florida, Illinois, Pennsylvania or Texas, purchased a Secure Index fixed

index annuity contractfromING USA Annuity and Life Insurance Companywithin the

applicable statute of limitations.

/// 

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The California Class

All persons or entities, excluding defendants and their directors, officers,

predecessors, successors, affiliates, agents, co-conspirator and employees, as well as

the immediate family members of such persons, that, when a resident of California,

purchased a Secure Index fixed index annuity contract from ING USA Annuity and

Life Insurance Company within the applicable statute of limitations. 

The California Seniors Subclass

All members of the California Class that were age 65 or older on the date of

purchase, excluding defendants and their directors, officers, predecessors, successors,

affiliates, agents, co-conspirator and employees, as well as the immediate family

members of such persons.

The Court designates Plaintiff Ernest O. Abbit as class representative and

appoints the Hutton Law Group and Tatro & Zamoyski, LLP as class counsel. The

Court directs the parties to confer and submit a joint proposed notice to the Classes on

or before December 14, 2015.

To the extent that the Court relied upon evidence to which Plaintiff objected, the

objections are overruled. (ECF No. 46.) The Court did not rely on any inadmissible

evidence in reaching its decision. To the extent the Court did not rely on evidence to

which the Plaintiff objected, the objections are overruled as moot.

IT IS SO ORDERED.

DATED: November 16, 2015

HON. GONZALO P. CURIEL

United States District Judge

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