Opinion ID: 718631
Heading Depth: 2
Heading Rank: 1

Heading: Variations in State Law

Text: 27 Although rule 23(c)(1) requires that a class should be certified as soon as practicable and allows a court to certify a conditional class, it does not follow that the rule's requirements are lessened when the class is conditional. As a sister circuit explained: 28 Conditional certification is not a means whereby the District Court can avoid deciding whether, at that time, the requirements of the Rule have been substantially met. The purpose of conditional certification is to preserve the Court's power to revoke certification in those cases wherein the magnitude or complexity of the litigation may eventually reveal problems not theretofore apparent. But in this case the District Court seemed to brush aside one of the requirements of Rule 23(b)(3) by stating that at this time analysis of the individual versus common questions would be for the Court to act as a seer. However difficult it may have been for the District Court to decide whether common questions predominate over individual questions, it should not have sidestepped this preliminary requirement of the Rule by merely stating that the problem of individual questions lies far beyond the horizon in the realm of speculation. 29 In re Hotel Tel. Charges, 500 F.2d 86, 90 (9th Cir.1974). 30 In a multi-state class action, variations in state law may swamp any common issues and defeat predominance. See Georgine v. Amchem Prods., 83 F.3d 610, 618 (3d Cir.1996) (decertifying class because legal and factual differences in the plaintiffs' claims when exponentially magnified by choice of law considerations, eclipse any common issues in this case); American Medical Sys., 75 F.3d at 1085 (granting mandamus in a multi-state products liability action, in part because [t]he district court ... failed to consider how the law of negligence differs from jurisdiction to jurisdiction). 31 Accordingly, a district court must consider how variations in state law affect predominance and superiority. Walsh v. Ford Motor Co., 807 F.2d 1000 (D.C.Cir.1986) (Ruth Bader Ginsburg, J.), cert. denied, 482 U.S. 915, 107 S.Ct. 3188, 96 L.Ed.2d 677 (1987). The Walsh court rejected the notion that a district court may defer considering variations in state law: 32 Appellees see the which law matter as academic. They say no variations in state warranty laws relevant to this case exist. A court cannot accept such an assertion on faith. Appellees, as class action proponents, must show that it is accurate. We have made no inquiry of our own on this score and, for the current purpose, simply note the general unstartling statement made in a leading treatise: The Uniform Commercial Code is not uniform. 33 Id. at 1016-17 (footnotes omitted). 34 A district court's duty to determine whether the plaintiff has borne its burden on class certification requires that a court consider variations in state law when a class action involves multiple jurisdictions. In order to make the findings required to certify a class action under Rule 23(b)(3) ... one must initially identify the substantive law issues which will control the outcome of the litigation. Alabama v. Blue Bird Body Co., 573 F.2d 309, 316 (5th Cir.1978). 35 A requirement that a court know which law will apply before making a predominance determination is especially important when there may be differences in state law. See In re Rhone-Poulenc Rorer, Inc. (Rhone-Poulenc ), 51 F.3d 1293, 1299-1302 (7th Cir.) (mandamus) (comparing differing state pattern instructions on negligence and differing formulations of the meaning of negligence), cert. denied, --- U.S. ----, 116 S.Ct. 184, 133 L.Ed.2d 122 (1995); In re Agent Orange Prod. Liability Litig., 818 F.2d 145, 165 (2d Cir.1987) (noting possibility of differences in state products liability law), cert. denied, 484 U.S. 1004, 108 S.Ct. 695, 98 L.Ed.2d 647 (1988). Given the plaintiffs' burden, a court cannot rely on assurances of counsel that any problems with predominance or superiority can be overcome. Windham v. American Brands, Inc., 565 F.2d 59, 70 (4th Cir.1977), cert. denied, 435 U.S. 968, 98 S.Ct. 1605, 56 L.Ed.2d 58 (1978). 36 The able opinion in School Asbestos demonstrates what is required from a district court when variations in state law exist. There, the court affirmed class certification, despite variations in state law, because: 37 To meet the problem of diversity in applicable state law, class plaintiffs have undertaken an extensive analysis of the variances in products liability among the jurisdictions. That review separates the law into four categories. Even assuming additional permutations and combinations, plaintiffs have made a creditable showing, which apparently satisfied the district court, that class certification does not present insuperable obstacles. Although we have some doubt on this score, the effort may nonetheless prove successful. 38 789 F.2d at 1010; see also Georgine, 83 F.3d at 627 & n. 13 (distinguishing School Asbestos because it involved few individualized questions, and class counsel had made a credible argument that the applicable law of the different states could be categorized into four patterns); Walsh, 807 F.2d at 1017 (holding that nationwide class action movants must creditably demonstrate, through an 'extensive analysis' of state law variances, 'that class certification does not present insuperable obstacles' ). 39 A thorough review of the record demonstrates that, in this case, the district court did not properly consider how variations in state law affect predominance. The court acknowledged as much in its order granting class certification, for, in declining to make a choice of law determination, it noted that [t]he parties have only briefly addressed the conflict of laws issue in this matter. 160 F.R.D. at 554. Similarly, the court stated that there has been no showing that the consumer protection statutes differ so much as to make individual issues predominate. Id. 14 40 The district court's review of state law variances can hardly be considered extensive; it conducted a cursory review of state law variations and gave short shrift to the defendants' arguments concerning variations. In response to the defendants' extensive analysis of how state law varied on fraud, products liability, affirmative defenses, negligent infliction of emotional distress, consumer protection statutes, and punitive damages, 15 the court examined a sample phase 1 jury interrogatory and verdict form, a survey of medical monitoring decisions, a survey of consumer fraud class actions, and a survey of punitive damages law in the defendants' home states. The court also relied on two district court opinions granting certification in multi-state class actions. 41 The district court's consideration of state law variations was inadequate. The surveys provided by the plaintiffs failed to discuss, in any meaningful way, how the court could deal with variations in state law. The consumer fraud survey simply quoted a few state courts that had certified state class actions. The survey of punitive damages was limited to the defendants' home states. Moreover, the two district court opinions on which the court relied did not support the proposition that variations in state law could be ignored. 16 Nothing in the record demonstrates that the court critically analyzed how variations in state law would affect predominance. 42 The court also failed to perform its duty to determine whether the class action would be manageable in light of state law variations. The court's only discussion of manageability is a citation to Jenkins and the claim that [w]hile manageability of the liability issues in this case may well prove to be difficult, the Court finds that any such difficulties pale in comparison to the specter of thousands, if not millions, of similar trials of liability proceeding in thousands of courtrooms around the nation. Id. at 555-56. 43 The problem with this approach is that it substitutes case-specific analysis with a generalized reference to Jenkins. The Jenkins court, however, was not faced with managing a novel claim involving eight causes of action, multiple jurisdictions, millions of plaintiffs, eight defendants, and over fifty years of alleged wrongful conduct. Instead, Jenkins involved only 893 personal injury asbestos cases, the law of only one state, and the prospect of trial occurring in only one district. Accordingly, for purposes of the instant case, Jenkins is largely inapposite. 44 In summary, whether the specter of millions of cases outweighs any manageability problems in this class is uncertain when the scope of any manageability problems is unknown. Absent considered judgment on the manageability of the class, a comparison to millions of individual trials is meaningless.