Opinion ID: 75658
Heading Depth: 2
Heading Rank: 1

Heading: PwC

Text: 18 PwC argues that the Rule 23(a) prerequisites were not met here because (1) commonality was defeated by the fact that plan participants live in thirty-seven states and therefore the laws of thirty-seven different states would have to be applied; (2) there is no typicality because Piazza cannot establish the reliance element necessary to prove each individual class member's claim; and (3) Piazza cannot serve as a class representative since he does not have standing because his claim is barred by the statute of limitations. 19 Because the question is dispositive in this case, we begin our analysis with Piazza's standing to raise the claim against PwC. Without individual standing to raise a legal claim, a named representative does not have the requisite typicality to raise the same claim on behalf of a class. See Prado-Steiman, 221 F.3d at 1279. It is by now clear that a class representative whose claim is time-barred cannot assert the claim on behalf of the class. See Carter v. West Publ'g Co., 225 F.3d 1258, 1267 (11th Cir. 2000) (reversing class certification because the named plaintiff, whose claim was time-barred, lacked standing to assert the claim); Great Rivers Coop of S.E. Iowa v. Farmland Indus., Inc., 120 F.3d 893, 899 (8th Cir. 1997) (Here, [the class representative] is not and cannot be a class member because his claim is time barred; consequently, he cannot represent the class.). If Piazza's claim is time-barred, he cannot assert the claim against PwC on behalf of the class, and it would not be necessary toreach PwC's other arguments. We turn, then, to the statute of limitations. 20 The claim against PwC is a professional negligence-accounting malpractice claim. Under Alabama law, claims for negligence are subject to a two-year statute of limitations. See Henson v. Celtic Life Ins. Co., 621 So. 2d 1268, 1274 (Ala. 1993). The statutory period of limitations for negligence actions, found at Ala. Code §a6-2-38, is two years from the date the injury occurred. Id. It is well settled under Alabama law that a negligence cause of action accrues when the plaintiff can first maintain the action, regardless of whether the full amount of damage is apparent at the time of the first injury. See Booker v. United American Ins. Co., 700 So. 2d 1333, 1339 (Ala. 1997). 21 The district court never made a finding as to when the claim against PwC accrued, but instead simply observed that the claim accrued sometime after the delivery of the valuation to the trustees. The valuation on which the negligence claim is based was delivered to the Trustee on January 31, 1994, the EBSCO stock was sold on March 10, 1994, and the sale of the stock was completed in June 1994. We need not resolve whether Piazza's cause of action accrued when the valuation was delivered, when the stock was sold, or when the sale of the stock was complete because, even if Piazza did not realize any injury until the sale was actually completed, his cause of action accrued by June 1994 at the latest. Piazza, however, did not initiate this professional negligence suit against PwC until July 18, 1997. Piazza does not dispute that he did not file suit until more than two years after his cause of action accrued, but he argues that the Alabama discovery rule tolls the statute of limitations. We are not persuaded. 22 The Alabama discovery rule tolls the statute of limitations for fraud claims, but not for negligence claims. See Henson, 621 So. 2d at 1274. Piazza argues that the discovery rule tolled the statute of limitations in this case because Alabama's tort of professional negligence is based on the tort of negligent representation as described in the Restatement (Second) of Torts § 552, which is a combination of fraud and negligence. The Alabama Supreme Court adopted Section 552 as the test for professional negligence in Boykin v. Arthur Andersen & Co., 639 So. 2d 504, 509-10 (Ala. 1994). Section 552 provides: 23 (1) One who, in the course of his business, profession or employment, or in any other transaction in which he has a pecuniary interest, supplies false information for the guidance of others in their business transactions, is subject to liability for pecuniary loss caused to them by their justifiable reliance upon the information, if he fails to exercise reasonable care or competence in obtaining or communicating the information. 24 (2) Except as stated in Subsection (3), the liability stated in Subsection (1) is limited to loss suffered 25 (a) by the person or one of a limited group of persons for whose benefit and guidance he intends to supply the information or knows that the recipient intends to supply it; and 26 (b) through reliance upon it in a transaction that he intends the information to influence or knows that the recipient so intends or in a substantially similar transaction. 27 (3) The liability of one who is under a public duty to give the information extends to loss suffered by any of the class of persons for whose benefit the duty is created, in any of the transactions in which it is intended to protect them. 28 Restatement (Second) of Torts §552 (1977). 29 On its face, Section 552 is cast in terms of negligence. It imposes liability for the breach of a duty, arising from a professional relationship, to exercise reasonable care. Indeed, the Alabama Supreme Court has treated professional negligence claims based on Section 552 as negligence claims. See Fisher v. Comer Plantation, Inc., 772 So. 2d 455 (Ala. 2000); Boykin, 639 So. 2d 504. Piazza cites no case, and we are not aware of any, to support the proposition that the tort of professional negligence sounds also in fraud. 30 Moreover, the Alabama Supreme Court has expressly rejected expansive readings of the discovery rule. In Travis v. Ziter, 681 So. 2d 1348 (Ala. 1996), the plaintiff sought to toll a statute of limitations on the ground that she had repressed memories of sexual abuse until they were triggered during therapy fifteen years later. As compelling as the facts were, the Alabama Supreme Court stated that this Court will not apply the discovery rule unless it is specifically prescribed by the Legislature. 681 So. 2d at 1354; see also Garrett v. Raytheon Co., 368 So. 2d 516, 521 (Ala. 1979) (explaining that as this Court is committed to the proposition that the legislature has the Inherent power to establish statutes of limitation, we have no other alternative than to leave it to the legislature to abrogate this rule and adopt a more equitable one should it see fit.). Here, Piazza has not offered any basis for expansively reading the discovery rule. In the absence of any compelling argument from Piazza, and considering the language of Section 552 and the Alabama Supreme Court's commitment to narrowly reading the discovery rule, we conclude that the discovery rule does not apply here and that Piazza's professional negligence claim is barred by the statute of limitations. Since Piazza's claim against PwC is time-barred, we hold that the district court abused its discretion in finding Piazza to be an adequate class representative. SeeCarter, 225 F.3d at 1263. Accordingly, we reverse the certification of the class against PwC.