Court Opinion

ID: 9754331
Source: CourtListenerOpinion
Date Created: 2023-08-28 19:55:28.804391+00
Date Added: 2024-06-11T07:27:52.217920
License: Public Domain

Justice SAYLOR,
dissenting.
I agree with the majority’s rationale as it concerns the attorney-fee matters but dissent relative to the class treatment as it was administered by the trial court.
I. Preface
Initially, the majority’s overarching approach to this appeal appears to suggest liberality in favor of class certification. I have no objection, to the degree that this does — as the majority indicates and our rules prescribe — nothing more than indicate who the parties to the action will be. See Majority Opinion, at 396-97, 34 A.3d at 15-16 (quoting Pa.R.C.P. No. 1707, cmt.).
The difficulty we are seeing in the cases, however, is that many proponents of class treatment believe the judiciary concomitantly should bring about substantive changes in the law favorable to consumer classes. It seems, more often than not, that such innovations are not being presented to our courts as the matters of substantive law they truly represent. Rather, they are being passed off as if they were merely part and parcel of the procedural aspects of class treatment.
My intention is not to advance or criticize any particular position advanced in the legitimate, ongoing policy debate concerning what the substantive law should be in the class setting. It may be that changes are desirable. My point is that substantive modifications require choices among competing social policies, can have deep and wide-reaching social impact, and may implicate defendants’ constitutional rights and entitlements.1 Furthermore, substantive changes in the *467law generally are most appropriate to legislative consideration. See Program Admin. Servs., Inc. v. Dauphin County Gen. Auth., 593 Pa. 184, 192, 928 A.2d 1013, 1017-18 (2007) (explaining that “it is the Legislature’s chief function to set public policy and the courts’ role to enforce that policy, subject to constitutional limitations”).
Accordingly, and in the first instance, it is essential to recognize substantive accretions for what they are. Moreover, even assuming judicial lawmaking is appropriate to facilitate collectivized litigation, there can be no legitimate dispute that substantive changes are well beyond the contemplation of the class action provisions presently reposited in our Civil Procedural Rules. See Pa.R.C.P. Class Actions, Explanatory Comment 1977 (“Many desirable approaches to class action problems involve substantive rather than procedural solutions.... These are beyond the power of the Procedural Rules.”). Therefore, if such alterations of law are to occur, they must be overtly presented, considered, and sanctioned as matters of substance.
In the present case, the phenomenon of substantive inroads riding the coattails of class action procedure is most vividly illustrated with regard to the damages question. To develop this, in light of the breadth and complexity of the underlying litigation, it is necessary first to lay some supporting groundwork. Upon review of this background, I will discuss how class members were relieved of the obligation to present necessary, fair, and sufficient proofs concerning an unarguably individualized form of damages they sought — and the only form of damages they were awarded — namely, “out of pocket paid repair costs.” N.T., May 26, 2005, Vol. 4, at 51 (jury charge).
II. Background
In assessing the damages question, it is important to understand that there simply was no evidence of class-wide corn*468monality relative to numerous factors affecting out-of-pocket costs, including the mileage of affected Sephias or the length of actual ownership by class members. Moreover, Appellees’ own proofs established that many remedial measures were undertaken by KMA as warranty brake repairs at no cost to individual class members. See, e.g., N.T., May 19, 2005, Vol. 1, at 92, 96-97 (testimony of Appellees’ automotive expert). Given such substantial variables,2 it seems plain that individual class members had markedly different experiences of personal expenditure to address Sephia brake problems. Certainly, Appellees never attempted to prove differently by accounting for the variables. Indeed, at various junctures throughout the pretrial and trial proceedings, class counsel conceded their presence and impact.3
Rather than addressing individualized damages on conventional terms, as required under ordinary substantive law, class *469counsel repeatedly argued to the judge and the jury that — on account of the small amounts involved and the nature of a class action — there simply was no need for any sort of individualized assessments. See, e.g., N.T., May 26, 2005, Vol. 4, at 113-14. For its part, the trial court, at the certification stage, did not concretely address how individualized damages matters would be managed. Instead, the court rested its approval of class treatment entirely on conclusory pronouncements indicating that damages issues simply were not a problem. See Samuel-Bassett v. Kia Motors Am., Inc., No. 2199, Jan. Term 2001, slip op. at 18, 2004 WL 2173324 (C.P. Phila., Civ. Trial Div. Sep. 21, 2004) (“Neither do potential differences in individual damage claims based upon individual experiences and costs associated with attempts to repair the vehicle pose any serious management difficulty.”); id. at 21 (“The damages herein are ascertainable, not de minimus and quite capable of determination. No problems exist herein for certification.”).4
The looseness of the certification decision yielded ongoing controversy about how the certification was to operate and its impact on required substantive proofs.5 At the pretrial stage, the uncertainties culminated in a surprising turn taken shortly before trial, during a discussion of KMA’s motion to bifurcate. At this juncture, after consistently rejecting the notion that individualized treatment of any issues was necessary, both class counsel and the trial court cryptically agreed that some sort of undefined claims process would be necessary. This dialogue proceeded as follows:
THE COURT: And [the] verdict will then set the upper limit of what [KMA] has to pay and then people will have to prove that they fit within whatever requirements qualify *470them to receive that upper limit, and if they had to pay twice or three times as much, it’s because of the defect, they’re out of luck, right?
[CLASS COUNSEL]: That’s correct.
THE COURT: Okay.
N.T., May 16, 2005, Vol. 1, at 60. Such consensus was then memorialized in the pretrial order, referenced by the majority, specifying that “[e]ach class member’s entitlement to recover if plaintiff class prevails, shall be determined at claims proceedings.” Majority Opinion, at 42 (quoting Samuel-Bassett v. KMA Motors of Am., Inc., No. 2199 Jan. Term 2001 (Order of May 16, 2005)).6
Despite this prescription for claims proceedings (which, conceptually, should have worked a major alteration in the path of the litigation), Appellees attempted at trial to quantify the out-of-pocket expenses incurred by absent class members via grossly generalized, hypothetical proof. In this regard, Appellees presented an “automotive expert” who indicated— based on assumptions that each class member paid for all relevant brake repairs and drove his vehicle 100,000 miles — all plaintiffs incurred $1,005 in damages. See N.T., May 19, 2005, Vol. 3, at 23-26. Two obvious deficiencies in the testimony were that: the first of the underlying assumptions was directly contrary to the record (not the least because it was well established that KMA already had paid for many of the repairs as warranty items, see supra note 3); and the second was in strong tension with common experience (since it seems highly unlikely that all of a class of 9,400 automobile owners would retain their vehicles for 100,000 miles).7
*471In response to defense criticisms of this evidence, class counsel, for his part, maintained before the jury that the class action procedural device alleviated his problems of substantive proof:
[Defense counsel] is a good guy, a good lawyer but this is a Class action and I think you have heard comments that distort Pennsylvania law with respect to how Class actions are handled. This is not a case of 10,000 individual claimants in which case we would have the burden of bringing in everybody including everybody’s individual damages.
The whole notion of a Class action, why they exit [sic], is because if you can satisfy the court before it gets to the jury trial stage that the issues are common and the complaints of Ms. Samuel-Bassett are shared by all other members of the Class, then the court will certify by a judicial Order the action as a Class action and it may proceed to this trial. Ladies and Gentlemen, this case was certified by the Philadelphia Court of Common Pleas as a Class action. This court was satisfied after a hearing that the complaints that [sic] Ms. Samuel-Bassett were the complaints of the 10,000 members of the Class. But I don’t ask any of you to accept what I tell you; I ask that you listen to the instruction of the court on this issue. Listen to Judge Bernstein’s instruction. I believe he will tell you that proof and evidence that we present as to Ms. Samueh-Bassett should be considered by you as evidence for the entire Class. That’s important. That’s how Class actions work.
N.T., May 26, 2005, Vol. 4, at 113-14 (emphasis added).8
Finally, contradicting its pretrial order providing for claims proceedings, the trial court instructed the jurors that there would be no subsequent proceedings to decide anything.9
*472III. Discussion
In my view, the irregularities discussed above are manifestations of a core analytical problem, ie., the failure to distinguish between the procedural class action device and substantive legal innovations being employed to facilitate them, including adjustments to the plaintiffs’ burden of proof. It could not be argued seriously that hypothetical testimony from an automotive expert — based upon underlying assumptions that are unsupported by the record, false, counterintuitive, and/or substantially under-representative of the range of actual variables affecting plaintiff costs — could support an out-of-pocket damages verdict in any individual case. Plainly, therefore, the trial court’s decision to permit Appellees to use just this sort of testimony to justify such a verdict for 9,400 people was incongruous with Pennsylvania substantive law governing damages.10
*473The complexity of class action litigation, and the concomitant need for probing consideration of foundational questions concerning the appropriateness of full or partial class treatment, is apparent both from the many closely reasoned judicial opinions and the broad range of commentary on the subject. See, e.g., Cimino v. Raymark Indus., Inc., 151 F.3d 297, 319-21 (5th Cir.1998). A judicious class certification decision requires the trial court to distinguish between common questions and individual ones, and to approve a litigation plan for fair and efficient administration which will provide appropriate treatment for both issue categories.11 Where the *474proponent of class certification fails to lay the necessary groundwork, the correct judicial response is to deny the certification. See generally 2 McLaughlin on Class Actions § 8:16 (“[Certification is not permissible where it relies on a damages model under which gross or aggregate damages would be calculated and awarded without considering whether each class member had a valid claim, thereby risking that the defendant would be liable for damages that it was not proved to have caused, or that some class members would recover damages that do not correspond to the true value of their claims.”). As fundamentally, where class treatment is appropriate, the trial court must tailor class procedure to accommodate the governing substantive law, not the opposite.12
In the present case, certification of a 9,400-person class action occurred without the predicate, closely-reasoned justification or any rational plan for the handling of individualized issues.13 Rather than redressing this fundamental misstep at any of several benchmark opportunities, Appellees continued to invite the trial court and the jurors to treat the substantive *475law as if were shaped by the certification of a class. Unfortunately, to a large degree, the trial court accommodated Appellees’ vision of aggregate litigation. Thus, for example, Appellees’ expert was permitted to testify to fictionalized class-wide out-of-pocket expenses, which became the sole basis for the only damages awarded by the jury (other than to the named plaintiff).14
At one point, during the transient agreement of class counsel and the trial court to subsequent claims proceedings, they appear to have come to some realization of the scale of the distortion created by conflating the common and individualized issues. In the end, however, the latter were unceremoniously blended back into the collectivized treatment, apparently under the force of the driving class-action rubric. The result *476was a trial at which class members’ plainly individualized experience with out-of-pocket expenditures was simply glossed over. As developed above, however, such blurring of the substantive requirements of the law of damages is plainly outside the contemplation of our civil procedural rules. See supra Part I. Furthermore, I agree with KMA that the perversion of expressly limited procedural rules to accomplish unauthorized substantive objectives impacts upon a defendant’s due process rights. See Brief for KMA at 28-32. See generally Erbsen, From “Predominance” to “Resolvability”, 58 Vand. L.Rev. at 1024 (“Class certification is ... proper only if the court has a plan for eventually reaching an adjudicated or negotiated judgment that reflects the parties’ rights under controlling law.”).
I recognize that the record of this case creates the impression that purchasers of Sephias in the relevant time period sustained injury on account of a poor brake design and that the amount of the damages awarded to each individual class member appears to be modest. Thus, there may be a sense that the jury verdict in this case serves a “rough justice” and, as such, should not be disturbed. Result orientation in the law, however, yields its own set of perverse consequences, not the least of which is the silent dilution of the consistency, predictability, and fundamental fairness which are aspirations of the American judicial system. Cf. Erbsen, From “Predominance” to “Resolvability”, 58 Vand. L.Rev. at 1037-39 (discussing the deleterious impact of ad hoc lawmaking in class action proceedings on democratic legitimacy and concluding that “[allowing courts to bend substantive rules to the procedural needs of particular cases is ... inconsistent with the normal process of rulemaking and prone to prioritize the welfare of litigants over broader social welfare with undesirable distributive consequences”).
Finally, Appellees forcefully contend that KMA’s attorneys did not do enough to bring their criticisms to the attention of the trial court, and the majority credits such argument. See Majority Opinion, at 438-40, 34 A.3d at 41^2. My response is twofold. First, I do not believe the majority opinion in this *477case will be read as an error-review, issue-preservation decision.15 Rather, it will likely be advanced as supporting the proposition that Pennsylvania takes an unconventionally liberal approach to class certification and collectivized treatment of individualized issues in aggregate litigation. Second, the record is replete with objections on KMA’s part to: the class certification decision; the expert testimony upon which the hypothesized class-wide out-of-pocket expenses was based; and the trial court’s failure to require individualized proof for individualized claims. To me, this case should not turn on waiver.
In summary, left to my own devices, I would vacate the verdict and overturn the class certification order on its terms. I would also highlight the evaluative process which I believe should be required from the outset to shape the course of broad-scale, aggregate litigation likely to span the better part of a decade. I do not believe justice is served by insulating this verdict in reliance on the discretionary aspect of certification decisions, thus extending a liberality which yields trials where substantive requirements are subject to dilution and non-enforcement without substantive justification.

. One commentator summarized one facet of the tremendous controversy which has arisen over the employment of the class action device as follows:
The academic literature examining this form of litigation has portrayed the class action at times as a savior, bringing about justice in an otherwise flawed system of individual adjudication, and other *467times as a villain, serving to artificially expand defendant liability and create a specialty practice for entrepreneurial plaintiffs’ lawyers.
Martin H. Redish & Clifford W. Berlow, The Class Action As Political Theory, 85 Wash. U.L.Rev. 753, 754 (2007) (footnotes omitted).

. For the sake of readability, in the text above, I have identified only a few of the many, readily-discernible variables differentiating out-of-pocket expenditures by class members. Here, I note only that there are many others. See, e.g., N.T., May 19, 2005, Vol. 3, at 18 (reflecting the testimony of Appellees' automotive expert that a "field fix” utilized by KMA had redressed the brake issue relative to some Sephia vehicles); compare N.T., May 19, 2005, Vol. 1, at 88 (containing the explanation of Appellees’ expert that the named plaintiff's brake pads wore out at between 3,000 and 5,000 miles), with N.T., May 19, 2005, Vol. 3, at 22 (reflecting the same expert's testimony that other class members experienced brake pad life in the range of 10,000 miles).

. For example, at the certification hearings, counsel for the named plaintiff (later class counsel) explained that, at times, “[t]he individuals had to pay for the repair. In other instances maybe [KMA] did cover it or did under goodwill.” N.T., July 15, 2004, at 22-23; accord N.T., May 26, 2005, Vol. 4, at 57 (reflecting class counsel’s comment in his closing remarks that "KMA did replace many, many defective pads and rotors for some people who owned Kia Sephias”).
There is nothing unusual about the phenomenon that class actions encompass both common and individual questions. See generally Allan Erbsen, From “Predominance" to "Resolvability": A New Approach to Regulating Class Actions, 58 Vand. L.Rev. 995, 998-99 (2005) ("Factual distinctions at various levels of subtlety and materiality usually permeate the legal claims of putative class members, such that their collective claims raise both ‘common’ and ‘individual’ questions relevant to proving liability and damages.” (footnote omitted)). As further developed below, the irregularities in this case pertain to the absence of a management approach which would fairly account for such material differences.

. Notably, from the outset, KMA argued to the court that individualized assessments were required. See, e.g., N.T., July 15, 2004, at 50-51 ("What happened with Ms. Bassett doesn’t provide any information or proof for the remainder of the class. It must be done individually.”).

. It is perhaps in light of the potential for misunderstandings of this kind ensuing from insufficiently reasoned class certification decisions that the federal appellate courts require of the district courts a "rigorous analysis” of the certification criteria. See Wal-Mart Stores, Inc. v. Dukes, - U.S. -, -, 131 S.Ct. 2541, 2551, 180 L.Ed.2d 374 (2011) (citations omitted).

. This order appeared to embody a variant of the traditional strategy for addressing individual issues in class actions, i.e., bifurcation of the damages question. See 3 Newberg on Class Actions § 9:59 (4th ed.2002) ("After identifying common issues that would support class certification, and recognizing generally or specifically that individual issues would remain after common questions have been litigated, the chief judicial management tool for handling individual issues is to sever them for subsequent trial[.]"). Nevertheless, as further developed below, the order did not alleviate the burgeoning incongruities and misunderstandings.

. Both the hypothetical and the responsive testimony also simply ignore many other readily discernable variables impacting out-of-pocket ex*471penditures by individual class members, which Appellees never attempted to discount. See supra note 2.

. Certainly, counsel’s comments in this regard were apt as to common issues. However, the remarks were not so qualified, and, as developed above, out-of-pocket damages cannot fairly be regarded as a common question.

. The court stated:
*472The amount that you award today must compensate the Class completely for all damage that you find has been proven, let me put it that way.
Because there's no second day in court. Just like I said, we can't handle 10,000 individual cases and just like I said maybe the amount in question is too small to warrant a whole blown trial for every individual claim; well, just like we in court want only one case if we can reasonably and justly do it; likewise, the defendant only wants one case against them [sic]. So you damages, your verdict is the only verdict in this claim for both sides. There’s no second day in court. Nobody can come back and say we forgot to bring this up or we discovered something tomorrow. Can't be done. You the jury are the only judges of the facts. After you decide this case, this case is decided.
N.T., May 26, 2005, Vol. 3, at 49-50 (emphasis added).

. Throughout this litigation, Appellees have repeatedly relied upon the federal district court's decision to certify a class action in their favor against KMA. See, e.g., Brief for Appellees at 3-4. Significantly, however, the district court's supporting opinion actually recognized the necessity of individualized damages assessments relative out-of-pocket expenditures from the outset. See Samuel-Bassett v. Kia Motors Am., Inc., 212 F.R.D. 271, 281 (E.D.Pa.2002) (explaining that elements of damages, other than diminution in value, are "reliant upon ‘the intangible, subjective differences of each class member’s circumstances,' and would likely require additional hearings to determine given that some individuals have undoubtedly expended more monies and incurred higher parts and labor costs to repair their vehicles than others."), vacated and remanded by. 357 F.3d 392 (3d Cir.2004); id. at 282 n. 2 *473(indicating that “the individual questions at issue here largely concern the element of damages").
I note that, in some circumstances, some jurisdictions have accepted the use of statistical, surveying, and sampling techniques to fill this sort of evidentiary void. See generally Laurens Walker, A Model Plan to Resolve Federal Class Action Cases By Jury Trial, 88 Va. L.Rev. 405, 415-20 (2002). Such techniques are not universally and uncritically accepted, however. See generally 2 McLaughlin on Class Actions § 8:7 (6th ed.2010) (collecting cases). Moreover, whatever the merits of these sorts statistical and/or scientific techniques for approximating individualized damages in a class action, nothing of the sort was attempted here. Rather, and again, Appellees' “automotive expert” offered an opinion based on a hypothetical entailing unproven, demonstrably erroneous, and under-inclusive assumptions.

. This point is made by one commentator as follows:
when a plaintiff asks a court to certify her as a representative of absent class members seeking damages, the court may do so only if it has a feasible plan for resolving factual and legal disputes regarding each element and defense applicable to each class member’s claim and for eventually entering judgment for or against each class member. There must either be an opportunity for the parties to litigate individual claims or defenses, or a reason to believe that such an opportunity is not necessary to reach a judgment that accurately values class members' claims. The existence of individualized issues of fact and law unique to the circumstances of particular class members thus does not necessarily preclude certification if the court has a plan for coping with individual factual and legal inquiries. In practice, however, certification will not be possible when there is no manageable way of reaching a final judgment that resolves all factual and legal disputes relevant to each class member’s entitlement to relief under applicable substantive law, and when one or more parties is unwilling to settle voluntarily.
Erbsen, From "Predominance” to "Resolvability”, 58 Vand. L.Rev. at 1049.
Parenthetically, the majority cites Professor Erbsen's substantial work for the proposition that claims proceedings are not required in class *474actions. See Majority Opinion, at 45 n. 30. While this may be true, the majority does not capture the author's overarching point that some fair mechanism for individualized treatment of individualized issues is required.

. Professor Erbsen’s article provides the following explanation for why particular care in class action certification and management is required to protect all parties’ rights and interests:
The practical problems with certifying class actions despite dissimilarity among claims arise from the natural human instinct to simplify the inherently complex and to create order out of what appears chaotic. These instincts manifest in class actions in the form of procedural shortcuts to squeeze heterogeneous claims into a homogenous mold and thereby avoid the procedural difficulties that dissimilarity would create.... Likewise, aggregating distinct individual claims into a class obscures differences among class members in ways that engender substantive consequences.
Erbsen, From “Predominance" to “Resolvability”, 58 Vand. L.Rev. at 1009-10.

. Indeed, this baseline reality of this case was reflected in the following impromptu comment by class counsel during the trial proceedings: "I don’t know how, in the context of this Class Action, or in any Class Action, at a trial you could prove the amount of damages actually incurred by everyone.” N.T., May 26, 2005, Vol. 3, at 19.

. Approximations and extrapolations are frequently the basis for class action settlements. See, e.g., City of Detroit v. Grinnell Corp., 356 F.Supp. 1380, 1385 (S.D.N.Y.1972) (explaining that an "evaluation of the proposed settlement ... requires an amalgam of delicate balancing, gross approximations, and rough justice”), rev’d in part on other grounds, 495 F.2d 448 (2d Cir.1974). However, the settlement context, involving a consensual resolution of affairs, is far different from the adversarial trial setting. Indeed, it is the difficulties of proof facing plaintiffs, and the scale of potential liabilities faced by defendants should they go to trial, which often provide the incentives for consummation of settlements.
Again, it may well be that, as a matter of social policy, some or all of the techniques and philosophies pertaining to class action settlements should be transported into the trial context. My main point here is that, undisputably, the approval of the class action device as acceptable procedure did not accomplish such a substantive change in Pennsylvania. See supra Part I. Moreover, and again, in any such substantive decision making, separation of powers considerations and the constitutional interests of affected defendants obviously merit careful consideration. See id.
Professor's Erbsen’s overview perspective is again illuminating:
"Ad hoc lawmaking” occurs in class actions when courts attempt to devise substantive and evidentiary shortcuts around management problems that dissimilarity imposes on the resolution of otherwise similar claims. For example, courts will ... bend the rules of evidence and alter burdens of proof so that contested facts can be resolved on a common rather than individualized basis[.] ... Nothing inherent in the class action device distorts substantive or evidentiary rules in this manner, but certification has that practical effect when judges try to manage the dissimilar aspects of class members' claims.
Erbsen, From “Predominance" to “Resolvability”, 58 Vand. L.Rev. at 1012-13.

. Responsively, the majority does say that its opinion is so confined, in relevant part. See Majority Opinion, at 440 n. 27, 34 A.3d at 42 n. 27. Nevertheless, the majority decision sanctions the certification of a broad-scale class in circumstances in which there was no ostensible plan for appropriate treatment of individualized issues, while at the same time cataloguing the incongruities, missteps, and (in my view) unfairness which resulted. While the majority places the onus upon defendants to provide some greater critique of class certification efforts, in my view, the need for individualized treatment of some elements of the plaintiffs' claims was obvious from the outset of this case (and KIA's objections were sufficient to identify the problem, in any event). Moreover, to prevent similar disorder in future class action cases, I believe the Court should take this opportunity to place the burden upon *478proponents of class treatment to advance an appropriate management plan.