Court Opinion

ID: 621467
Source: CourtListenerOpinion
Date Created: 2012-01-25 14:40:59+00
Date Added: 2024-06-11T17:50:56.750694
License: Public Domain

[DO NOT PUBLISH]

                      IN THE UNITED STATES COURT OF APPEALS

                                   FOR THE ELEVENTH CIRCUIT           FILED
                                    ________________________ U.S. COURT OF APPEALS
                                                                       ELEVENTH CIRCUIT
                                            No. 10-15837                JANUARY 25, 2012
                                      ________________________             JOHN LEY
                                                                            CLERK
                                 D.C. Docket No. 0:10-cv-60354-UU

COASTAL NEUROLOGY, INC.,
individually and on behalf of all others similarly situated,

llllllllllllllllllllllllllllllllllllllll                          Plaintiff - Appellant,

                                                versus

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY,

llllllllllllllllllllllllllllllllllllllll                          Defendant - Appellee.

                                     ________________________

                           Appeal from the United States District Court
                               for the Southern District of Florida
                                 ________________________

                                           (January 25, 2012)

Before CARNES and HULL, Circuit Judges, and ROTHSTEIN,* District Judge.

PER CURIAM:

         Coastal Neurology, Inc., appeals the district court’s order denying its

         *
         Honorable Barbara Jacobs Rothstein, United States District Judge for the Western
District of Washington, sitting by designation.
motion for class certification. The district court reasoned that individual issues of

fact would predominate over the general issues of law and fact during the

adjudication of this case, and on that basis determined that Coastal failed to satisfy

the predominance, superiority, and typicality requirements of Federal Rule of Civil

Procedure 23. After carefully reviewing the record, reading the briefs, and hearing

oral argument from Coastal and defendant State Farm Mutual Automobile

Insurance Company, we conclude that the district court did not abuse its discretion

in entering the November 30, 2010 order denying class certification and the

resulting December 12, 2010 order dismissing Coastal’s complaint for lack of

subject matter jurisdiction.

      The district court applied the correct legal standard from Rule 23. Coastal

contends that the court misapplied Klay v. Humana, Inc., 382 F.3d 1241 (11th Cir.

2004), and our other class certification precedent. We disagree, and in any event,

“as long as the district court’s reasoning stays within the parameters of Rule 23’s

requirements . . ., the district court decision will not be disturbed.” Babineau v.

Fed. Express Corp., 576 F.3d 1183, 1189 (11th Cir. 2009) (quotation marks

omitted). It did.

      In performing its Rule 23(b)(3) predominance analysis, the district court did

not err in considering the individualized defenses that State Farm would have to

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the proposed class members’ claims. As this Court noted in the Klay decision,

“[i]n determining whether class or individual issues predominate in a putative

class action suit, we must take into account the claims, defenses, relevant facts,

and applicable substantive law . . . .” Klay, 382 F.3d at 1254 (quotation marks

omitted). Although a district court may not resolve the merits of a case when

ruling on a Rule 23 motion, see Heffner v. Blue Cross and Blue Shield of Ala.,

Inc., 443 F.3d 1330, 1337 (11th Cir. 2006), the court may, and sometimes must,

inquire into the merits in order to determine whether the requirements of Rule 23

have been satisfied, see Valley Drug Co. v. Geneva Pharms., Inc., 350 F.3d 1181,

1188 n.15 (11th Cir. 2003). That kind of limited inquiry is all that the district

court undertook in this case. See also Walmart Stores, Inc. v. Dukes, — U.S. —,

131 S.Ct. 2541, 2551–52 (2011) (“[S]ometimes it may be necessary for the court

to probe behind the pleadings before coming to rest on the certification question . .

. [, which] generally involves considerations that are enmeshed in the factual and

legal issues comprising the plaintiff’s cause of action.” (quotation marks and

citations omitted)); Babineau, 576 F.3d at 1191 (“The predominance inquiry

requires an examination of the claims, defenses, relevant facts, and applicable

substantive law . . . .” (quotation marks omitted)); Heaven v. Trust Bank Co., 118

F.3d 735, 738 (11th Cir. 1997) (stating that the existence of “individual defenses”

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for each case in the proposed class “is a proper factor for consideration” in the

Rule 23(b) analysis); Huff v. N.D. Cass Co. of Ala., 485 F.2d 710, 714 (5th Cir.

1973) (en banc) (“It is inescapable that in some cases there will be overlap

between the demands of [Rule] 23(a) and (b) and the question of whether [a]

plaintiff can succeed on the merits.”).1

       We are not persuaded by Coastal’s claim that State Farm waived its right to

assert individualized defenses by not listing them in an “itemized specification”

during the claims review process. Fla. Stat. § 627.734(4)(b). Florida’s Motor

Vehicle No-Fault Law explicitly states that insurers may, “at any time,” assert that

a claim for benefits “was unrelated, was not medically necessary, or was

unreasonable.” Id. Because State Farm can raise those defenses “at any time,”

they were properly considered in the district court’s Rule 23 analysis.

       Finally, we reject Coastal’s contention that the district court resolved the

merits of the legal dispute at the heart of this case by using language about

“permissible” and “impermissible” edits. While the district court’s language was

not as precise as it could have been, we are not convinced that the court meant to,

or did, use that language to announce a resolution of the merits. Instead, we think

       1
        In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981) (en banc), we
adopted as binding precedent all decisions of the former Fifth Circuit handed down before
October 1, 1981.

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the district court used that language to differentiate between those cases in which

State Farm might have some individualized, non-edits defense to a claim for

benefits from those cases in which State Farm might not have such a defense. By

doing so, the court recognized that the question of whether individualized, non-

edits defenses could be raised by State Farm was an unresolved issue.

      AFFIRMED.

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