Court Opinion

ID: 3187366
Source: CourtListenerOpinion
Date Created: 2016-03-21 20:03:39.760476+00
Date Added: 2024-06-11T14:35:50.540327
License: Public Domain

Case: 15-11455       Date Filed: 03/21/2016       Page: 1 of 27

                                                                                  [PUBLISH]

                  IN THE UNITED STATES COURT OF APPEALS

                            FOR THE ELEVENTH CIRCUIT
                              ________________________

                                     No. 15-11455
                               ________________________

                      D.C. Docket No. 1:08-cv-00030-LGW-BKE

ROBERT BROWN,
on behalf of himself and all others similarly situated,
MICHAEL VOGLER,
on behalf of himself and all others similarly situated,

                                                                        Plaintiffs-Appellees,
                                            versus

ELECTROLUX HOME PRODUCTS, INC.,
d.b.a. Frigidaire,

                                                                       Defendant-Appellant.

                               ________________________

                      Appeal from the United States District Court
                         for the Southern District of Georgia
                             _______________________

                                      (March 21, 2016)

Before WILSON and WILLIAM PRYOR, Circuit Judges, and BUCKLEW, *
District Judge.

*
  Honorable Susan C. Bucklew, United States District Judge for the Middle District of Florida,
sitting by designation.
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WILLIAM PRYOR, Circuit Judge:

      This interlocutory appeal involves a class action over smelly washing

machines. Across the country, consumers have filed class actions against the

manufacturers of front-loading washing machines. See, e.g., In re Whirlpool Corp.

Front-Loading Washer Prods. Liab. Litig., 722 F.3d 838 (6th Cir. 2013); Butler v.

Sears, Roebuck & Co., 727 F.3d 796 (7th Cir. 2013); Tait v. BSH Home Appliances

Corp., 289 F.R.D. 466 (C.D. Cal. 2012). Front-loaders are considered an

improvement over traditional top-loading machines because they use less water

and energy. But the initial models have a problem: the rubber seal on the front door

of the machine retains water, which allows mildew to grow. The mildew then

stains clothes and creates a foul odor. In this case, consumers from California and

Texas filed a class action against Electrolux Home Products, the manufacturer of

Frigidaire front-loading washing machines. After the district court certified two

statewide classes, see Terrill v. Electrolux Home Prods., Inc., 295 F.R.D. 671 (S.D.

Ga. 2013), Electrolux filed this interlocutory appeal. We now vacate the class

certification. Although several of Electrolux’s arguments fail, we agree with

Electrolux that the district court abused its discretion in determining the

predominance requirement of Federal Rule of Civil Procedure 23(b)(3). For that

reason, we vacate its order and remand for further proceedings.

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                                I. BACKGROUND

      Electrolux Home Products, a Delaware corporation headquartered in

Georgia, manufacturers front-loading washing machines under the Frigidaire

brand. Front-loaders are the next stage in the evolution of the washing machine.

While traditional top-loading machines completely fill up with water and spin the

clothes around with an agitator, front-loading machines only partially fill up and

tumble the clothes in and out of the water. This process saves both water and

energy.

      To prevent water from leaking, front-loaders come with a rubber seal known

as a “bellow.” Frigidaire machines initially came with a convoluted bellow, which

is not as smooth as the S-shaped bellow that is now available. The plaintiffs allege

that convoluted bellows are defective because they trap water, which allows

mildew to grow in the washing machine. But Electrolux contends that owners can

easily avoid the mildew problem by wiping down the machine and leaving the door

open after use.

      Robert Brown, a Californian, and Michael Vogler, a Texan, purchased

Frigidaire front-loading washing machines with convoluted bellows. Vogler saw a

poster from Frigidaire in the department store where he bought his machine. But

Brown never saw any advertisements from Frigidaire. Both consumers discovered

mildew in their machines. All Frigidaire front-loading washing machines come

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with a full one-year warranty. The warranty includes several exceptions, including

damage caused by “misuse.”

      After Michael Terrill, a consumer from Wisconsin, filed a putative class

action against Electrolux in the district court and amended the complaint to add

Brown, Vogler, Palecia Boyd, and Denise Pack as named plaintiffs, the district

court dismissed all of the named plaintiffs except Brown and Vogler. The amended

complaint alleges two types of claims: warranty claims and consumer claims. The

warranty claims include breach of express warranty under California law, breach

of the implied warranty of merchantability under California and Texas law, and

violations of the Magnuson-Moss Warranty Act, 15 U.S.C. § 2310. The claims

under the Magnuson-Moss Act are identical to the other warranty claims because

they are also based on state law. See Walsh v. Ford Motor Co., 807 F.2d 1000,

1012 (D.C. Cir. 1986). The consumer claims include violations of the California

Unfair Competition Law and violations of the Texas Deceptive Trade Practices–

Consumer Protection Act. The consumer claims stem from Electrolux’s failure to

disclose the defective nature of the convoluted bellow in its advertisements and

marketing materials. For example, the Frigidaire website boasted that its front-

loading washing machines would “keep your clothes looking their best” without

mentioning the defective bellow or the mildew problem. The amended complaint

seeks damages in the form of a refund of the purchase price or the difference in the

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resale value of the washing machines, as well as any injuries caused by the

mildew, including soiled laundry.

      Brown and Vogler moved for class certification, which the district court

granted. The district court certified the following two statewide classes:

      California Class: All persons and entities who purchased, other than
      for resale, after March 5, 2004, and while in the State of California, a
      Frigidaire front-loading washing machine with a convoluted bellow.

      Texas Class: All persons and entities who purchased, other than for
      resale, after March 5, 2004, and while in the State of Texas, a
      Frigidaire front-loading washing machine with a convoluted bellow.

Brown represents the California class for the claims under California law, and

Vogler represents the Texas class for the claims under Texas law.

      The district court recognized that it must conduct a “rigorous analysis” to

determine whether a class action satisfies Rule 23. Terrill, 295 F.R.D. at 682

(quoting Vega v. T-Mobile USA, Inc., 564 F.3d 1256, 1266 (11th Cir. 2009)). And

it explained that “[a] party seeking class certification must affirmatively

demonstrate his compliance with the Rule.” Id. (quoting Wal-Mart Stores, Inc. v.

Dukes, 131 S. Ct. 2541, 2551 (2011)). But the district court also stated that it

“resolves doubts related to class certification in favor of certifying the class,” id. at

683, and that it “accepts the allegations in the complaint as true,” id. at 682

(quoting Mazur v. eBay Inc., 257 F.R.D. 563, 566 (N.D. Cal. 2009)), and “draws

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all inferences and presents all evidence in the light most favorable to” the party

seeking class certification, id. at 680.

      The district court concluded that “the questions of law or fact common to

class members predominate over any questions affecting only individual

members,” Fed. R. Civ. P. 23(b)(3). With respect to the consumer claims, the

district court concluded that every element was susceptible to classwide proof.

Electrolux argued that causation would require individual proof because the class

members must prove that they did not already know about the mildew problem,

which was well-publicized at the time, when they purchased their front-loading

washing machines. But the district court concluded that “each class member

presumably relied on the fact that Defendant provided Washing Machines suited

for cleaning and freshening clothing.” Terrill, 295 F.R.D. at 696. The district court

explained that the class members “can show their reliance on Defendant’s failure

to disclose the Washing Machines’ alleged design defect and the inevitable

consequences of that defect through classwide proof that they purchased Machines

to clean and freshen their clothes rather than to soil and odorize them.” Id. As for

the warranty claims, the district court concluded that most of the elements were

susceptible to classwide proof. It rejected Electrolux’s argument that the questions

whether the class members gave Electrolux pre-suit notice of the defect, whether

the class members gave Electrolux an opportunity to cure the defect, and whether

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the defect manifested during the warranty period would require individual proof.

The district court speculated that Brown and Vogler might not need to prove pre-

suit notice, an opportunity to cure, or manifestation of the defect under California

or Texas law: pre-suit notice and an opportunity to cure might not be required

when the defendant had “prior knowledge of the design defect,” id. at 689, 692,

and manifestation of the defect might not be required “when a latent defect existed

during the warranty period but was discovered after the warranty period,” id. at

691. But the district court never answered these preliminary questions of state law.

Instead, it concluded that the questions whether pre-suit notice, an opportunity to

cure, and manifestation of the defect are required under California and Texas law

are “common questions” that weigh in favor of class certification. Id. at 689–92.

      The district court also rejected several other challenges to predominance. For

example, Electrolux argued that the individual nature of the plaintiffs’ damages

defeats predominance for every claim. The district court disagreed because the

“many . . . common issues” of liability outweigh the individual issues of damages.

Id. at 697. It cited the general rule that “the presence of individualized damages

issues does not prevent a finding that the common issues in the case predominate.”

Id. (quoting Allapattah Servs., Inc. v. Exxon Corp., 333 F.3d 1248, 1261 (11th Cir.

2003)). Electrolux also argued that misuse—one of its affirmative defenses to the

warranty claims—defeats predominance. It argued that this defense would require

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the plaintiffs to prove, for each class member, that the mildew in their washing

machine was not caused by their own misuse—for example, leaving damp clothes

in the washer for too long, failing to perform routine maintenance, or installing the

machine in a damp area. The district court rejected this argument because misuse

has “classwide application” and “goes to the common issue of causation.” Id. The

district court also cited the general rule that “unique affirmative defenses rarely

predominate where a common claim is established.” Id. at 696.

      After the district court certified the California and Texas classes, Electrolux

filed a petition for permission to take an interlocutory appeal, Fed. R. Civ. P. 23(f).

We granted its petition. Brown and Vogler have asked us to dismiss the petition as

improvidently granted, but we decline.

                          II. STANDARD OF REVIEW

      We review a class certification for abuse of discretion. Local 703, I.B. of T.

Grocery & Food Emps. Welfare Fund v. Regions Fin. Corp., 762 F.3d 1248, 1253

(11th Cir. 2014). But abuse of discretion is a “continuum,” Henry J. Friendly,

Indiscretion About Discretion, 31 Emory L.J. 747, 756 (1982), and in the context

of class actions, review for abuse of discretion often “does not differ greatly from

review for error,” Abrams v. Interco Inc., 719 F.2d 23, 28 (2d Cir. 1983) (Friendly,

J.). “[W]ith great power comes great responsibility; the awesome power of a

district court [to certify a class action] must be ‘exercised within the framework of

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rule 23.’” Klay v. Humana, Inc., 382 F.3d 1241, 1251 (11th Cir. 2004) (quoting

Castano v. Am. Tobacco Co., 84 F.3d 734, 740 (5th Cir. 1996)), abrogated in part

on other grounds by Bridge v. Phoenix Bond & Indem. Co., 553 U.S. 639 (2008).

                                  III. DISCUSSION

      Electrolux challenges the class certification on two primary grounds: it

contends that the district court articulated the wrong standard for class certification

and that Brown and Vogler cannot satisfy the predominance requirement of Rule

23(b)(3). We address each argument in turn.

       A. The District Court Misstated the Standard for Class Certification.

      Electrolux contends that the district court made two misstatements of law

when it articulated the standard for class certification. First, the district court erred

by stating that it “resolves doubts related to class certification in favor of certifying

the class.” Terrill, 295 F.R.D. at 683. Second, the district court erred by stating that

it “accepts the allegations in the complaint as true,” id. at 682 (quoting Mazur, 257

F.R.D. at 566), and “draws all inferences and presents all evidence in the light

most favorable to” the party seeking class certification, id. at 680. Brown and

Vogler concede that these statements were erroneous.

      The parties are correct that the district court misstated the law when it said

that it “resolves doubts related to class certification in favor of certifying the

class.” Id. at 683. The party seeking class certification has the burden of proof.

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Valley Drug Co. v. Geneva Pharm., Inc., 350 F.3d 1181, 1187 (11th Cir. 2003).

And the entire point of a burden of proof is that, if doubts remain about whether

the standard is satisfied, “the party with the burden of proof loses.” Simmons v.

Blodgett, 110 F.3d 39, 42 (9th Cir. 1997). All else being equal, the presumption is

against class certification because class actions are an exception to our

constitutional tradition of individual litigation. See Comcast Corp. v. Behrend, 133

S. Ct. 1426, 1432 (2013); Hansberry v. Lee, 311 U.S. 32, 40–41 (1940). A district

court that has doubts about whether “the requirements of Rule 23 have been met

should refuse certification until they have been met.” Fed. R. Civ. P. 23 advisory

committee’s note to 2003 amendment; accord In re Hydrogen Peroxide Antitrust

Litig., 552 F.3d 305, 321 (3d Cir. 2008); Wallace B. Roderick Revocable Living

Trust v. XTO Energy, Inc., 725 F.3d 1213, 1218 (10th Cir. 2013).

      The district court also misstated the law when it said that it “accepts the

allegations in the complaint as true,” Terrill, 295 F.R.D. at 682 (quoting Mazur,

257 F.R.D. at 566), and “draws all inferences and presents all evidence in the light

most favorable to Plaintiffs,” id. at 680. The party seeking class certification has a

burden of proof, not a burden of pleading. See Halliburton Co. v. Erica P. John

Fund, Inc., 134 S. Ct. 2398, 2412 (2014). He “‘must affirmatively demonstrate his

compliance’ with Rule 23” by proving that the requirements are “in fact” satisfied.

Comcast, 133 S. Ct. at 1432 (quoting Wal-Mart, 131 S. Ct. at 2551). And the

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district court must conduct a “rigorous analysis” to determine whether the movant

carried his burden, which “will frequently entail ‘overlap with the merits of the

plaintiff’s underlying claim.’” Id. (quoting Wal-Mart, 131 S. Ct. at 2551). Of

course, the district court can consider the merits “only” to the extent “they are

relevant to determining whether the Rule 23 prerequisites for class certification are

satisfied.” Amgen Inc. v. Conn. Ret. Plans & Trust Funds, 133 S. Ct. 1184, 1195

(2013). But if a question of fact or law is relevant to that determination, then the

district court has a duty to actually decide it and not accept it as true or construe it

in anyone’s favor. See Comcast, 133 S. Ct. at 1432–33; Szabo v. Bridgeport

Machs., Inc., 249 F.3d 672, 675–76 (7th Cir. 2001); Gariety v. Grant Thornton,

LLP, 368 F.3d 356, 365–66 (4th Cir. 2004). The district court erred when it stated

the opposite.

      Brown and Vogler argue that these misstatements by the district court are

harmless because they played no role in its actual analysis, but the harmfulness of

an error does not matter when we are going to remand anyway. See United States

v. Molina-Guevara, 96 F.3d 698, 705 (3d Cir. 1996). And here, we must vacate the

class certification because the district court abused its discretion in assessing

predominance, as we will explain below. On remand, we are confident that the

district court will apply the correct standard for class certification.

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     B. The District Court Abused Its Discretion in Assessing Predominance.

      Electrolux contends that the district court abused its discretion when it

decided that “the questions of law or fact common to class members predominate

over any questions affecting only individual members,” Fed. R. Civ. P. 23(b)(3).

To determine whether the requirement of predominance is satisfied, a district court

must first identify the parties’ claims and defenses and their elements. See Klay,

382 F.3d at 1254 & n.7. The district court should then classify these issues as

common questions or individual questions by predicting how the parties will prove

them at trial. See id. at 1255. Common questions are ones where “the same

evidence will suffice for each member,” and individual questions are ones where

the evidence will “var[y] from member to member.” Blades v. Monsanto Co., 400

F.3d 562, 566 (8th Cir. 2005).

      After identifying the common and individual questions, the district court

should determine whether the common questions predominate over the individual

ones. We have adopted the following rule of thumb:

      [I]f common issues truly predominate over individualized issues in a
      lawsuit, then the addition or subtraction of any of the plaintiffs to or
      from the class [should not] have a substantial effect on the substance
      or quantity of evidence offered. . . . If, on the other hand, the addition
      of more plaintiffs leaves the quantum of evidence introduced by the
      plaintiffs as a whole relatively undisturbed, then common issues are
      likely to predominate.

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Vega, 564 F.3d at 1270 (first and second alterations in original) (quoting Klay, 382

F.3d at 1255). “But predominance requires a qualitative assessment too; it is not

bean counting,” and the “relative importance” of the common versus individual

questions also matters. Butler, 727 F.3d at 801; see also Rutstein v. Avis Rent-A-

Car Sys., Inc., 211 F.3d 1228, 1234 (11th Cir. 2000) (explaining that predominance

“can only be determined after considering what value the resolution of the class-

wide issue will have in each class member’s underlying cause of action”). District

courts should assess predominance with its overarching purpose in mind—namely,

ensuring that “a class action would achieve economies of time, effort, and expense,

and promote . . . uniformity of decision as to persons similarly situated, without

sacrificing procedural fairness or bringing about other undesirable results.”

Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 615 (1997) (alteration in original)

(quoting Fed. R. Civ. P. 23 advisory committee’s note to 1966 amendment).

      Electrolux makes four arguments about predominance. First, it contends that

the plaintiffs cannot prove causation—an element of their consumer claims—on a

classwide basis. Second, Electrolux argues that the district court was wrong to

conclude that predominance is satisfied for the warranty claims without first

answering several preliminary questions of state law. Third, Electrolux contends

that the plaintiffs cannot prove damages on a classwide basis for any of their

claims. Finally, Electrolux contends that misuse—one of its defenses to the

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plaintiffs’ warranty claims—will require individual proof. We agree with

Electrolux’s first two arguments, which require us to vacate the class certification

and remand to the district court, and on remand, the district court should revisit

Electrolux’s last two arguments.

       1. The Consumer Claims Do Not Satisfy Predominance Because the
              Plaintiffs Cannot Prove Causation on a Classwide Basis.

      Electrolux argues that the district court misapplied California and Texas law

when it concluded that the plaintiffs could prove causation on a classwide basis.

Electrolux argues that causation requires individual proof. We agree and will

discuss California law first and Texas law second.

                                   a. California Law
      The California Unfair Competition Law prohibits “unfair competition,”

which includes “any unlawful, unfair or fraudulent business act or practice.” Cal.

Bus. & Prof. Code § 17200. A plaintiff cannot recover damages for violations of

the statute; he can obtain only an injunction or “restitution.” In re Tobacco II

Cases, 207 P.3d 20, 29 (Cal. 2009). Restitution means “any money or property,

real or personal, which may have been acquired by means of [the defendant’s]

unfair competition.” Cal. Bus. & Prof. Code § 17203. The “by means of”

requirement for restitution is “less stringent” than but-for causation, Tobacco II,

207 P.3d at 3, but “one who was not exposed to the alleged misrepresentations and

therefore could not possibly have lost money or property as a result of the unfair

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competition is not entitled to restitution,” Pfizer Inc. v. Superior Court, 105 Cal.

Rptr. 3d 795, 803 (Cal. Ct. App. 2010); accord Am. Honda Motor Co. v. Superior

Court, 132 Cal. Rptr. 3d 91, 101 (Cal. Ct. App. 2011); Kaldenbach v. Mut. of

Omaha Life Ins. Co., 100 Cal. Rptr. 3d 637, 652 (Cal. Ct. App. 2009).

      Brown argues that the California class is entitled to restitution because

Electrolux engaged in both “unfair” and “fraudulent” business practices when it

failed to mention the defective bellow or mildew problem in its advertisements.

Electrolux responds that Brown cannot prove, on a classwide basis, that Electrolux

acquired the class members’ money “by means of” its omissions, Cal. Bus. & Prof.

Code § 17203. The district court rejected Electrolux’s argument because it

concluded that the class members were exposed to uniform business practices.

      The district court misunderstood the plaintiffs’ complaint. Brown alleges

that Electrolux engaged in unfair competition by omitting essential information in

its advertisements. The only advertisements that Brown has identified are on

Frigidaire’s website, but he has made no effort to prove that any member of the

California Class visited the website before purchasing his washing machine.

Brown instead admitted that he never saw any advertisements from Frigidaire.

Because the class members were not exposed to a uniform misrepresentation, the

claim under the California Unfair Competition Law is unsuitable for class

treatment. See Simon v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 482 F.2d 880,

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883 (5th Cir. 1973); Mazza v. Am. Honda Motor Co., 666 F.3d 581, 595 (9th Cir.

2012).

      We reject Brown’s argument that Electrolux never challenged the

certification of his claim of “unfair” business practices, as opposed to his claim of

“fraudulent” business practices, in the district court. In its opposition to the motion

for class certification, Electrolux challenged the certification of all claims under

the California Unfair Competition Law. And its challenge went to the requirements

for restitution, which apply equally to claims of unfair business practices and

fraudulent business practices alike. Even if Electrolux did not articulate its

arguments with the utmost precision, it did not forfeit anything because “the

burden to prove whether class certification is appropriate rests on the plaintiffs”

and the district court “has the responsibility of conducting its own inquiry as to

whether the requirement of Rule 23 have been satisfied.” Valley Drug, 350 F.3d at

1188–89 & n.16.

                                    b. Texas Law

      The Texas Deceptive Trade Practices–Consumer Protection Act prohibits

“[f]alse, misleading, or deceptive acts or practices in the conduct of any trade or

commerce.” Tex. Bus. & Com. Code Ann. § 17.46(a). To recover under the Act, a

plaintiff must prove that he “relied on” the defendant’s conduct to his detriment.

Id. § 17.50(a)(1)(B). This reliance element requires that the plaintiff “actually did

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rely” on the defendant’s statement or omission, not that the defendant “wanted

purchasers to rely on its advertisements and other representations.” Henry Schein,

Inc. v. Stromboe, 102 S.W.3d 675, 694 (Tex. 2002).

      Electrolux contends that the reliance element defeats predominance because

it requires individual proof. Texas adopted its class-action rule based on federal

Rule 23, Sw. Ref. Co. v. Bernal, 22 S.W.3d 425, 433 (Tex. 2000), and Electrolux

explains that no Texas court has ever certified a class action under the Texas

Deceptive Trade Practices–Consumer Protection Act, see Tex. S. Rentals, Inc. v.

Gomez, 267 S.W.3d 228, 237 (Tex. App. 2008). That a plaintiff could prove

reliance on a classwide basis is “a near-impossibility,” according to the Texas

Court of Appeals. Id. (quoting Fid. & Guar. Life Ins. Co. v. Pina, 165 S.W.3d 416,

423 (Tex. App. 2005)).

      The district court certified a class because it concluded based on

Southwestern Bell Telephone Co. v. Marketing on Hold Inc., 308 S.W.3d 909 (Tex.

2010), that the plaintiffs could prove reliance on a classwide basis. The district

court erred.

      Southwestern Bell is inapposite. There, a class of consumers sued a phone

company for overcharging them on their bills. Id. at 914. The Texas Supreme

Court held that the consumers could prove reliance on a classwide basis because

the inflated price on their bills was a uniform misrepresentation by the phone

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company, and the class members all relied on that misrepresentation when they

paid their bills without objection. Id. at 922–23. Here, by contrast, we cannot

presume that the class members relied on any uniform misrepresentation. As

explained above, we have no inkling whether the class members saw any

advertisements from Frigidaire, much less uniform advertisements, before they

purchased their washing machines. Unlike in Southwestern Bell, the Texas class

will need to prove reliance on an individual basis. This necessity means that their

claim under the Texas Deceptive Trade Practices–Consumer Protection Act cannot

proceed as a class action. See Wal-Mart, 131 S. Ct. at 2552 n.6; Sandwich Chef of

Tex,, Inc. v. Reliance Nat. Indem. Ins. Co., 319 F.3d 205, 219 (5th Cir. 2003); In re

Clorox Consumer Litig., 301 F.R.D. 436, 446 (N.D. Cal. 2014).

      The district court abused its discretion when it certified the consumer claims.

These claims do not satisfy predominance because their elements of causation

require individual proof. In concluding otherwise, the district court misapplied

California and Texas law.

      2. The District Court Abused Its Discretion by Certifying the Warranty
       Claims Without First Resolving Preliminary Questions of State Law that
                              Bear on Predominance.

      Electrolux next argues that the district court prematurely certified the

warranty claims because it did not first resolve several questions of state law that

were relevant to predominance. That is, the district court could not determine

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predominance without first deciding whether California and Texas law require pre-

suit notice, an opportunity to cure, and manifestation of the defect. We agree.

      A district court must decide all questions of fact and law that “b[ear] on the

propriety of class certification.” Comcast, 133 S. Ct. at 1432. For example, a

question of state law bears on predominance if, answered one way, an element or

defense will require individual proof but, answered another way, the element or

defense can be proved on a classwide basis. It does not matter whether the question

also pertains to the merits; if a question of law bears on a requirement of Rule 23,

then the district court must answer it. See Vega, 564 F.3d at 1266. “[B]ecause each

requirement of Rule 23 must be met, a district court errs as a matter of law when it

fails to resolve a genuine legal or factual dispute relevant to determining the

requirements.” Hydrogen Peroxide, 552 F.3d at 320.

      The questions of state law that Electrolux asked the district court to

resolve—whether the plaintiffs must prove pre-suit notice, an opportunity to cure,

and manifestation of the defect—bear on predominance. If California and Texas

law do not excuse pre-suit notice and an opportunity to cure when the defendant

had “prior knowledge of the design defect,” as the district court speculated, Terrill,

295 F.R.D. at 689, 692, then each class member will need to prove that he gave

Electrolux pre-suit notice and an opportunity to cure. This showing could require

individual proof. See Cohen v. Implant Innovations, Inc., 259 F.R.D. 617, 642

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(S.D. Fla. 2008). And if California and Texas law require the defect to manifest,

then each class member will need to prove that his washing machine actually grew

mildew during the warranty period. This showing could also require individual

proof. See Gen. Motors Corp. v. Garza, 179 S.W.3d 76, 82–84 (Tex. App. 2005).

Because the answers to these preliminary questions of California and Texas law

could affect whether Rule 23(b)(3) is satisfied, the district court had a duty to

resolve them. See Cole v. Gen. Motors Corp., 484 F.3d 717, 727–30 (5th Cir.

2007).

      The district court erred when it classified these preliminary questions as

“common questions” that weigh in favor of class certification. Terrill, 295 F.R.D.

at 689–92. “[A]ny competently crafted class complaint literally raises common

‘questions.’ . . . What matters to class certification . . . is not the raising of common

‘questions’—even in droves—but, rather the capacity of a classwide proceeding to

generate common answers apt to drive the resolution of the litigation.” Wal-Mart,

131 S. Ct. at 2551 (third alteration in original) (quoting Richard A. Nagareda,

Class Certification in the Age of Aggregate Proof, 84 N.Y.U. L. Rev. 97, 131–32

(2009)). A question is common when “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.” Id. Answering the questions whether California and Texas law require pre-

suit notice, an opportunity to cure, and manifestation of the defect would not

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resolve issues that are “central to the validity” of the plaintiffs’ warranty claims. Id.

Answering them would instead help the district court determine what the law is in

California and Texas, which in turn would help it identify the overall mix of

individual versus common questions for purposes of predominance. Because the

district court punted these questions instead of answering them, it abused its

discretion.

      We remand to the district court so it can answer these questions of state law

in the first instance. We express no view on what the answers are, and we express

no view on whether the answers, if unfavorable to the plaintiffs, will defeat

predominance and prevent class certification. The latter determination “is

committed in the first instance to the discretion of the district court.” Califano v.

Yamasaki, 442 U.S. 682, 703 (1979).

      3. The Plaintiffs’ Damages Do Not Necessarily Defeat Predominance.
      Electrolux argues that none of the plaintiffs’ claims satisfies predominance

because their damages will require individual proof. The district court rejected this

argument because it concluded that the common questions of liability outweighed

the individual questions of damages. Electrolux contends that this analysis

conflicts with the recent decision of the Supreme Court in Comcast Corp. v.

Behrend, 133 S. Ct. 1426.

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      We disagree with Electrolux’s argument. Comcast did not change the law

about the effect of individual damages on predominance. Nevertheless, under

existing law, the individual nature of the plaintiffs’ damages is still relevant to

whether predominance is satisfied.

      As the district court correctly explained, “the presence of individualized

damages issues does not prevent a finding that the common issues in the case

predominate.” Allapattah Servs., 333 F.3d at 1261. The “black letter rule”

recognized in every circuit is that “individual damage calculations generally do not

defeat a finding that common issues predominate.” William B. Rubenstein,

Newberg on Class Actions § 4:54 (5th ed.). Although damages often raise

numerous “individual” questions, predominance is “a qualitative rather than a

quantitative concept. It is not determined simply by counting noses: that is,

determining whether there are more common issues or more individual issues,

regardless of relative importance.” Parko v. Shell Oil Co., 739 F.3d 1083, 1085

(7th Cir. 2014). And, relatively speaking, individual issues of damages are

sometimes easy to resolve because the calculations are formulaic. See Klay, 382

F.3d at 1259–60. District courts have many tools to decide individual damages:

“(1) bifurcating liability and damage trials with the same or different juries;

(2) appointing a magistrate judge or special master to preside over individual

damages proceedings; (3) decertifying the class after the liability trial and

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providing notice to class members concerning how they may proceed to prove

damages; (4) creating subclasses; or (5) altering or amending the class.” In re Visa

Check/MasterMoney Antitrust Litig., 280 F.3d 124, 141 (2d Cir. 2001) (footnote

omitted), abrogated in part on other grounds by In re Initial Pub. Offerings Sec.

Litig., 471 F.3d 24 (2d Cir. 2006).

      Contrary to Electrolux’s argument, Comcast did not alter the black-letter

rule that individual damages do not always defeat predominance. The issue in

Comcast was whether the plaintiffs could use an expert model to prove their

damages on a classwide basis, even though the model did not match their theory of

liability. See Comcast, 133 S. Ct. at 1431. The Supreme Court held that they could

not and, for that reason, the class action did not satisfy predominance. See id. at

1432–35. But the Supreme Court did not hold that individual damages necessarily

defeat predominance or that a plaintiff seeking class certification must present an

expert damages model. The Court assumed those points because the parties had

conceded them. See id. at 1430 (“The District Court held, and it is uncontested

here, that to meet the predominance requirement respondents had to show . . . that

the damages . . . were measurable ‘on a class-wide basis’ through use of a

‘common methodology.’” (emphasis added) (quoting Behrend v. Comcast Corp.,

264 F.R.D. 150, 154 (E.D. Pa. 2010)). Such assumptions are not holdings, see

Brecht v. Abrahamson, 507 U.S. 619, 631 (1993), and they do not overrule our

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precedents. Indeed, the Comcast Court confirmed that its decision did not break

new ground but instead “turn[ed] on the straightforward application of class-

certification principles.” Comcast, 133 S. Ct. at 1433. And other courts agree that

Comcast did not change the law that a class action can sometimes be maintained

notwithstanding the need to prove individual damages. See, e.g., Roach v. T.L.

Cannon Corp., 778 F.3d 401, 408 (2d Cir. 2015); Neale v. Volvo Cars of N. Am.,

LLC, 794 F.3d 353, 374–75 & n.10 (3d Cir. 2015); In re Deepwater Horizon, 739

F.3d 790, 815 (5th Cir. 2014); Butler, 727 F.3d at 800–01. But cf. In re Rail

Freight Fuel Surcharge Antitrust Litig.–MDL No. 1869, 725 F.3d 244, 255 (D.C.

Cir. 2013).

      The black-letter rule has always been subject to exceptions. For example,

individual damages defeat predominance if computing them “will be so complex,

fact-specific, and difficult that the burden on the court system would be simply

intolerable.” Klay, 382 F.3d at 1260. Furthermore, individual damages defeat

predominance when they are accompanied by “significant individualized questions

going to liability.” Id. (citing Sikes v. Teleline, Inc., 281 F.3d 1350, 1366 (11th Cir.

2002), abrogated in part on other grounds by Bridge, 553 U.S. 639; Rutstein, 211

F.3d at 1234, 1240).

      We leave it to the district court on remand to decide whether the latter

exception is satisfied here. The district court concluded that the individual

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questions of damages in this case were outweighed by numerous questions of

liability that are common to the class. But, as explained above, the district court

could not be sure that many of those questions of liability—namely, pre-suit

notice, an opportunity to cure, and manifestation of the defect—are common to the

class because it did not first resolve several preliminary questions of state law. On

remand, the district court must resolve those preliminary questions and reconsider

the issue of predominance. We express no view on this issue and leave it to the

discretion of the district court, where it belongs.

          4. Electrolux’s Defense of Misuse Does Not Necessarily Defeat
                                   Predominance.

      Electrolux contends that the warranty claims do not satisfy predominance

because causation will require individual proof. Electrolux does not raise any

specific concerns about causation, except for its affirmative defense of misuse.

Electrolux argues that the plaintiffs will need to prove that the convoluted bellows,

as opposed to misuse by the owners, caused the mildew to grow in their washing

machines. The district court rejected this argument because it concluded that

Electrolux’s defense has “classwide application.” Terrill, 295 F.R.D. at 697. The

district court also concluded that even if misuse would require individual proof,

“unique affirmative defenses rarely predominate where a common claim is

established.” Id. at 696.

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      We disagree that misuse can be proved classwide, but we agree that

individual affirmative defenses generally do not defeat predominance.

Nevertheless, like damages, the individual nature of the affirmative defenses is still

relevant to whether predominance is satisfied.

      The district court erred when it stated that Electrolux’s defense of misuse

was a common question. Although Electrolux raised this defense against every

class member, the applicability of a defense does not make it a “common”

question. See Wal-Mart, 131 S. Ct. at 2551. What matters is the type of evidence

that the parties will submit to prove and disprove the defense. Here, the class

members will need to prove that the mildew in their washing machines did not

arise from their own misuse. That showing will require individual proof. See

Marcus v. BMW of N. Am., LLC, 687 F.3d 583, 604 (3d Cir. 2012); Parkinson v.

Hyundai Motor Am., 258 F.R.D. 580, 595 (C.D. Cal. 2008).

      The district court was nevertheless correct when it stated that individual

affirmative defenses ordinarily do not defeat predominance. “The general rule,

regularly repeated by courts in many circuits, is that ‘[c]ourts traditionally have

been reluctant to deny class action status under Rule 23(b)(3) simply because

affirmative defenses may be available against individual members.’” Newberg on

Class Actions § 4:55 (alteration in original) (quoting Smilow v. Sw. Bell Mobile

Sys., Inc., 323 F.3d 32, 39 (1st Cir. 2003)). Like damages, affirmative defenses are

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often easy to resolve, see, e.g., Waste Mgmt. Holdings, Inc. v. Mowbray, 208 F.3d

288, 297 (1st Cir. 2000), and district courts have several tools available to manage

them, see Smilow, 323 F.3d at 39–40.

       But like damages, affirmative defenses are still relevant to the question of

predominance. See Waste Mgmt. Holdings, 208 F.3d at 295. Individual affirmative

defenses can defeat predominance in some circumstances. For example, the

affirmative defenses could apply to the vast majority of class members and raise

complex, individual questions. See, e.g., Sacred Heart Health Sys., Inc. v. Humana

Military Healthcare Servs., Inc., 601 F.3d 1159, 1177–83 (11th Cir. 2010). Or the

affirmative defenses could be coupled with several other individual questions. See

Barnes v. Am. Tobacco Co., 161 F.3d 127, 147 n.25 (3d Cir. 1998).

       We again leave these questions to the district court on remand. As explained,

the district court too hastily concluded that several questions in this litigation were

common to the class. On remand, the district court must reconsider these questions.

We express no view about them and leave them, like all questions of class

certification, to the discretion of the district court.

                                  IV. CONCLUSION

       We VACATE the class certification and REMAND for further proceedings

consistent with this opinion.

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