SUPREME JUDICIAL COURT FOR THE COMMONWEALTH · SUPREME JUDICIAL COURT FOR THE COMMONWEALTH OF...
Transcript of SUPREME JUDICIAL COURT FOR THE COMMONWEALTH · SUPREME JUDICIAL COURT FOR THE COMMONWEALTH OF...
SUPREME JUDICIAL COURT FOR THE COMMONWEALTH OF MASSACHUSETTS
SJC NO. 10108
CRYSTAL SALVAS, et al.,
PLAINTIFFS-APPELLANTS,
VS . WAL-MART STORES, INC.,
Defendant-Appellee.
Brief Of Amici Curiae New England L e g a l Foundation and Associated Industries of Massachusetts In Support Of
Wal-Mart Stores, Inc.
NEW ENGLAND LEGAL FOUNDATION and ASSOCIATED INDUSTRIES OF MASSACHUSETTS,
B y their attorneys,
Ben Robbins BBO No. 559918 Martin J. Newhouse, President BBO No. 544755 Jo Ann Shotwell Kaplan, General Counsel BBO No. 459800 N e w England Legal Foundation 150 Lincoln Street Boston, MA 02111-2504 (617) 6 9 5 - 3 6 6 0
April .25, 2 0 0 8
Corporate Disclosure Statement
Amicus curiae New England Legal Foundation
('INELF'') states, pursuant to Mass. Sup. Jud. Ct.
R. 1:21, that it is a 26 U . S . C . § 501 ( c ) ( 3 )
nonprofit, public interest law firm, incorporated
in Massachusetts in 1977, with its headquarters
in Boston.
from more than 130 corporations, law firms,
foundations, and individuals, NELF's mission is
to promote balanced economic growth in N e w
NELF is supported by contributions
, England, protect the free enterprise system, and
defend economic rights.
NELF does not issue stock or any other form
of securities and does not have any parent
corporation.
perpetuating Board of Directors, the members of
which serve solely in their personal capacities.
Amicus curiae Associated Industries of
NELF is governed by a self-
Massachusetts ("A.I.M.") states, pursuant to S.J.C.
Rule 1:21, that it is a 26 U.S.C. § 5 0 1 ( c ) (61, 9 0 -
year-old nonprofit association, incorporated in
Massachusetts.
well-being of its members and their employees and the
prosperity of the Commonwealth of Massachusetts by:
A.I.M.'s mission is to promote the
improving the economic climate of Massachusetts;
proactively advocating fair and equitable public
policy; and providing relevant, reliable information
and excellent services. A.I.M. does not issue stock
or any other form of securities and does not have any
parent corporation. A.I.M. is governed by a self-
perpetuating Board of Directors, the members of which
serve solely in their personal capacities.
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TABLE OF CONTENTS
CORPORATE DISCLOSURE STATEMENT ..................... .i
TABLE OF AUTHORITIES .................................
INTEREST OF AMICI CURIAE.....,....,,...*.............l
STATEMENT OF THE CASE AND FACTS . . . . . . . . . . * . . - . . . - * . . . 3
I. STRICT ENFORCEMENT OF THE CLASS ACTION REQUIREMENTS OF RULE 23 IS NECESSARY TO PREVENT POTENTIAL ABUSE OF THE CLASS ACTION MECHANISM. . . 4
11. THE DE M I X I M I S EXCEPTION TO CLASS-WIDE INJURY UNDER ASPINALL v. PHILLIP MORRIS COS. IS INAPPLICABLE IN THIS CASE ......................~8
A. The plaintiffs here, unlike the plaintiffs in Aspinall, have failed to show uniform, virtually class-wide injury ...........,...lo
B. The de minimis exception should not apply to class actions under Rule 23 . . . . . . . . . . . .13
C. It is questionable whether the de minimis exception survives the actual injury requirement under Hershenow.........,...*.l8
CERTIFICATE OF COMPLIANCE............... . . . . . . . . . . . - 2 1
CERTIFICATE OF SERVICE.. - 2 2 . . . . . . . . . . . . . . . . . . . . . . . . . . .
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Table of Authorities
Cases
Amchem Prods. , Inc. v. Windsor, 521 U.S. 591 (1997) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Andrews v. A m . T e l . & Xel. Co., 95 F . 3 d 1014 (11th Cir. 1996) . . . . . . . . . . . . . . . . . . 12
Aspinall v . Philip Morris Cos'., 442 Mass. 381 (2004) . . . . . . . . . . . . . . . . . . . . . . . p a s s i m
Benedict v. Altria Group, Inc . , 241 F.R.D. 6 6 8 (D.Kan. 2007) . . . . . . . . . . . . . . . . . . . 17
B l a i r v. E q u i f a x Check Servs . , Inc. , 1 8 1 F.3d 8 3 2 (7th Cir. 1 9 9 9 ) . ................... 5
Boughton v. Cotter Corp . , 6 5 F.3d 823 (loth Cir, 1995) . . . . . . . . . . . . . . . . . . . 1 5
Boyd v. Becker, 6 2 7 So.2d 4 8 1 (Fla. 1993) . . . . . . . . . . . 2 0
Broussard v . Meineke Discount M u f f l e r Shops, Inc. , 155 F.3d 331 (4th Cir. 1998) . . . . . . . . . . . . . . . . . . . 15
Califano v. Yamasaki , 442 U.S. 682 (1979). . . . . . . . . . . 1 6
Castano v. Am. Tobacco Co., 84 F.3d 734 (5th Cir. 1996) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
D a v i e s v. Philip Morris U.S.A., Inc. , 2006 WL 1600067 (Wash.Super. May 26, 2006) . . . . . 17
F e i t e l b e r g v . C r e d i t Suisse First Boston, LLC, 36 Cal.Rptr.3d 592 (Cal. Ct. A p p . 2 0 0 5 ) . . . . . . . . 20
Fletcher v. Cape Cod Gas C o . , 394 Mass. 595 (1985) . . 13
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. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . _
Hershenow v. Enterprise Rent-A-Car Co. , 445 Mass. 802 (2006) ....................... passim
In re Baycol Prods. Litigation, 218 F.R.D. 1 9 7 (D. Minn. 2003) . . . . . . . . . . . . . . . . . 15
Jackson v. Motel 6 Multipurpose, Inc. , 130 F . 3 d 999 (11th C i r . 1 9 9 7 ) . . . . . . . . . . . . . . . . . . 15
McLaughlin v. Am. Tobacco Co., 2008 WL 878627 (2d Cir. A p r . 3, 2 0 0 8 ) . . . . . . . 6 , 1 7
M u l f o r d v. Altria Group, Inc., 2 4 2 F . R . D . 615 (D.N.M. 2 0 0 7 ) . . . . . . . . . . . . . . . . . . . 17
Pearson v. Philip Morris, Inc., 2006 WL 663004, ( O r , C i r . , Feb. 23, 2006) ....................... 17
Philip Morris U S A Inc. v, Hines, 883 So.2d 292, (F1a.Dist.Ct.A~~. 2 0 0 4 ) . . . . . . . . . . . . . . . . . . . . . . . . 17
Polion v. W a l - M a r t , 2006 WL 4472492, ( M a s s - S u p e r . Nov. 7, 2006)) . . . . . . . . . . . . . . . . passim
Sw, Refining Co., Inc. v. Bernal, 22 S.W.3d 425 (Tex. 2000) . . . . . . . . . . . . . . . . . . . 7, 1 6
Sprague v. Gen. Motors Corp., 133 F.3d 388 (6th C i r . 1998) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
S t a t u t e s
G . 1;. c. 93A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . passim
G . L. c. 93A, § 9 ( 2 ) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Rules Fed. R. C i v . P. 23 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Mass. R. C i v . P. 23 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . p a s s i m
Mass. R . C i v . P. 23(b) . . . . . . . . . . . . . . . . . . . . . . . . . . p a s s i m
V
Miscellaneous
1998 Advisory Committee Notes to Fed. R. Civ. P. 23(f) ........................... 6
Richard A. Nagareda, Aggregation And i t s Discontents: C l a s s Settlement Pressure, C l a s s - Wide Arbitration, and CAFA, 106 Colum. L.Rev. 1872 (2006) . . . . . . . . . . . . . . . . . . . 5
Gary M. Kramer, No C l a s s : Post-1991 Barriers to Rule 23 Certification of Across-The-Board Employment Discrimination Cases, 15 L a b . Law. 415 (2000). . . 4
Thomas E. Willging et a l . , An Empirical Analysis of R u l e 23 to A d d r e s s the Rulemaking Challenges, N . Y . U . L. Rev. 74 (1996) ........................ 4
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ISSUE PRESENTED
Amici will address the following issue set forth in
this Court‘s January 11, 2008 announcement soliciting
amicus briefs:
In this reported case, at issue is the correctness of the Superior Court judge’s . . . decertification, as overbroad, [of] a plaintiff class of approximately 67,000 hourly employees, on whose behalf was alleged the employer’s improper credit for meal and rest breaks and improper compensation for time worked.
INTEREST OF AMICI CURIAE
Amicus curiae New England Legal Foundation (”NELF”)
is a nonprofit, public interest law firm, incorporated in
Massachusetts in 1977 and headquartered in Boston. Its
membership consists of corporations, law firms,
individuals, and others who believe in NELF‘s mission of
promoting balanced economic growth in New England,
protecting the free enterprise system, and defending
economic rights. NELF’s more than 139 members and
supporters include a cross-section of large and small
businesses and other organizations from a11 parts of the
Commonwealth, New England, and the United States.
Amicus curiae Associated Industries of Massachusetts
(\\A.I,M.”) is a 90-year-old non-profit association with
over 7,000 employer members doing business in the
Commonwealth. A.I.M.‘s mission is to promote the well-
being of its members and their employees, and the
prosperity of the Commonwealth of Massachusetts, by:
improving the economic climate of Massachusetts;
proactively advocating fair and equitable public policy;
and providing relevant and reliable information and
excellent services.
class actions can increase greatly the costs and
burdens of litigation on business defendants. NELF,
A.I.M., and their respective members accordingly seek
strict enforcement of Rule 2 3 ’ s requirements and oppose
the certification of class actions where, as here, the
plaintiffs have failed to show class-wide injury.
Certification of such a class would expose a business to
the risk of protracted and costly litigation and a large
settlement when it is doubtful that the plaintiffs could
prove liability for a11 or even most of the putative
class members.
NELF and A.I.M. have regularly appeared as amici
curiae in cases, such as this one, that raise issues of
general concern for the business community in
Massachusetts.’ Amici believe that this brief will
1 See, e . g . , Scott v. NG U . S . 1, Inc., 450 Mass. 7 6 0 (2008); St. Fleur v . WPI Cable Sys./Mutron, 450 Mass. 345 (2008); Eigerrnan v. Putnam Inv . , Inc. , 4 5 0 Mass. 281 ( 2 0 0 7 ) ; Allen v. Boston Redevelopment Auth . , 450 Mass.
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provide an additional perspective that may assist the
Court . Accordingly, amici have sought leave to file this
brief. 2
STATEMENT OF THE CASE AND FACTS
NELF and A.I.M. hereby incorporate by reference the
Statement of the Prior Proceedings and Statement of Facts
contained in the Brief of the Defendant-Appellee Wal-Mart
Stores, Inc. (Wal-Mart) .
2 4 2 ( 2 0 0 7 ) ; Jepson v. Z o n i n g B d . of Appeals of I p s w i c h , 450 Mass. 81 (2007); Hanover Ins. Co. v. R a p 0 & Jepsen Ins . Servs . , Inc . , 449 Mass. 609 ( 2 0 0 7 ) ; Devine v. Town of Nantucket, 4 4 9 Mass. 4 9 9 ( 2 0 0 7 ) ; C i o v a n e l l a v. C o n s e r v a t i o n Cornmln of A s h l a n d , 4 4 7 Mass. 7 2 0 ( 2 0 0 6 ) ; C e n t r a l Steel Supp ly C o . v . Planning B d . of Somervil le, 4 4 7 Mass. 3 3 3 ( 2 0 0 6 ) ; Humphrey v , B y r o n , 4 4 7 Mass. 3 2 2 ( 2 0 0 6 ) ; Mscisz v. K a s h n e r Dav idson Sec. C o r p . 4 4 6 Mass. 1 0 0 8 ( 2 0 0 6 ) ; Superadio L t d . P'ship. v. W i n s t a r R a d i o P r o d . , 4 4 6 Mass. 330 ( 2 0 0 6 ) ; Hershenow v. E n t e r p r i s e R e n t - A - C a r C o . of B o s t o n , 4 4 5 Mass. 7 9 0 ( 2 0 0 6 ) ; Roberts v. Enterpr ise R e n t - A - C a r C o . of B o s t o n l 4 4 5 Mass. 8 1 1 ( 2 0 0 6 ) ; S u l l i v a n v. Liberty M u t . Ins. C o , , 444 Mass. 34 ( 2 0 0 5 ) ; Phillips v. Pembroke R e a l E s t a t e , Inc., 443 Mass. 110 ( 2 0 0 4 ) ; Phelan v. May Dep't Stores Co., 4 4 3 Mass. 52 ( 2 0 0 4 ) ; White v. B l u e Cross & B l u e S h i e l d , Inc . , 4 4 2 Mass. 64 ( 2 0 0 4 ) ; Stonehill College v. Massachuset ts Comm'n Against Discrimination, 441 Mass. 5 4 9 ( 2 0 0 4 ) ; Morrison v . Toys "R" U s , Inc., 441 Mass. 451 ( 2 0 0 4 ) .
Neither Defendant-Appellee nor its counsel in this matter, nor any individual or entity aside from amici, has authored this brief in whole or in part or made any monetary contribution to its preparation or submission.
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ARGUMENT
I. STRICT ENFORCEMENT OF THE CLASS ACTION REQUIREMENTS OF RULE 23 IS NECESSARY TO PREVENT POTENTIAL ABUSE OF THE CLASS ACTION MECHANISM.
AS the Superior Court properly held, the plaintiffs
here have failed to satisfy Mass. R . Civ. P. 23(b)'s
predominance requirement, because individual inquiries
are necessary to determine whether any m e m b e r of the
putative employee class was injured. See Polion v. Wal-
M a r t , 2006 WL 4472492 at *15 (Mass,Super. Nov. 7, 2 0 0 6 ) .
Strict enforcement of Rule 23's class certification
requirements, in this o r any other putative class action,
is essential to prevent the improper use of the c l a s s
action mechanism to force a favorable settlement of
uncertain or dubious claims, and to expose businesses to
costly and unwarranted litigation costs. 3 \\[CIlass
It is a well-established fact that most class actions settle after certification, even when the merits of the underlying claims are doubtful, due to the high cost of defending a class action and the risk of exposure to a large and potentially crippling aggregated damages award. 'The percentage of certified class actions terminated by a class settlement ranged from 6 2 % to l o o % , while settlement rates (including stipulated dismissals) f o r cases not certified ranged from 20% to 30%." Thomas E. Willging et a l . , An Empirical Analysis of R u l e 23 to Address the Rulemaking Challenges, 71 N . Y . U . L. Rev. 74, 143 ( 1 9 9 6 ) . When faced with potentially dire financial consequences after class certification, \\companies often perceive that they have little choice but to cut their losses through settlement." Gary M. Kramer, No C l a s s :
4
certification creates insurmountable pressure on
defendants to settle, whereas individual trials would
not. The risk of facing an all-or-nothing verdict
presents too high a risk, even when the probability of an
adverse judgment is low. These settlements have been
referred to as judicial blackmail.'' C a s t a n o v. Am.
Tobacco Co., 84 F.3d 734, 740 (5th Cir. 1996)
(decertifying multi-state class based in part on
plaintiffs' failure to show that common factual issues
concerning elements of reliance and addiction-as-injury
would predominate over individual issues). 4
In fact, Fed. R . Civ. P. 2 3 was amended expressly to
counter the potentially extortionate effect of class
certification by creating a discretionary right to
Post-1991 Barriers to Rule 23 Certification of Across- The-Board Employment Discrimination Cases, 15 Lab. Law. 415, 416 (2000).
See also B l a i r v. E q u i f a x Check Servs., Inc., 181 F.3d 832, 834 (7th Cir. 1999) ('[A] grant of class status can put considerable pressure on the defendant to settle, even when the plaintiff's probability of success on the merits is slight. Many corporate executives are unwilling to bet their company that they are in the right in big- stakes litigation, and a grant of class status can propel the stakes of a case into the stratosphere."); Richard A. Nagareda, Aggregation And its Discontents: C l a s s Set t 1 ement Pressure, C1 ass - Wide Arbi trat ion, and CAFA, 106 Colum. L.Rev. 1872, 1873 (2006) ( " [ C l l a s s certification operates most disturbingly when the underlying merits of class members' claims are most dubious. " ) .
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interlocutory appellate review. "An order granting
certification . . . may force a defendant to settle
rather than incur the costs of defending a class action
and run the risk of potentially ruinous liability," 1998
Advisory Committee Notes to Fed. R. Civ. P. 2 3 ( f ) .
In addition to forcing inappropriate settlements, a
decision .allowing class certification in the
circumstances of this case could invite the potential for
damages verdicts far in excess of a defendant company's
actual liability. This is so because here there is no
proof of uniform class-wide injury. Were t h e class
certified and the plaintiff class representatives to
prevail at t r i a l , a substantial portion of the damages
verdict could be based on inclusion of class members who
were not actually injured. '\[S]uch an aggregate
determination [of damages] is likely to result in an
astronomical damages figure that does not accurately
reflect the number of plaintiffs actually injured by
defendants and that bears little or no relationship to
the amount of economic harm actually caused by
defendants.'' McLaughlin v. American Tobacco Co. , 2 0 0 8 WL
8 7 8 6 2 7 , at *11 (2d Cir. A p r . 3, 2 0 0 8 ) (decertifying
"light cigarette" class for lack of proof of class-wide
injury and rejecting, on constitutional and other
6
grounds, calculation of class-wide damages based on rough
initial estimate of number of class members actually
injured) .
Such an outcome would not only impose an unwarranted
financial burden on the class action defendant but would
also violate the fundamental principle that the class
action mechanism does not affect in any way the
substantive proof requirements for establishing liability
and damages with respect to each class member.
R e f i n i n g Co., Inc. v. Bernal, 22 S.W.3d 425, 437 (Tex.
See Sw.
2000) *
As a policy matter, a decision allowing class
certification in this case, where there is insufficient
proof of class-wide injury, might discourage employers
from locating in Massachusetts, for fear of exposure to
onerous class-action litigation without the guarantee of
fairness that only a strict application of Rule 23’s
class action certification requirements can provide.
Rigorous enforcement of Rule 2 3 ’ s class certification
requirements is necessary to avoid these deleterious
effects and to prevent t h e extortionate settlement effect
of allowing plaintiffs to aggregate many, dubious
individual claims into a single class action.
The Superior Court's decision in this case should be
affirmed because the lower court appropriately applied
the requirements of Rule 23 and thereby prevented abuse
of the class action mechanism in this case.
11. THE DE Mmrms EXCEPTION TO CLASS-WIDE INJURY UNDER ASPINALL v . PHILLIP MORRIS COS. IS INAPPLICABLE.
This employment case clearly does not arise under
G . L. c. 93A. Nevertheless, the Superior Court invoked
the Court's c. 93A jurisprudence by assuming, without
deciding, the applicability of the so-called de m i n i m i s
exception to class-wide injury recognized in Aspinall. v .
Philip Morris Cos., 442 Mass. 381 ( 2 0 0 4 ) * 5 As amici
argue below, the Superior Cour t correctly decided that
the plaintiffs could not satisfy Aspinall's de m i n i m i s
exception, even assuming i t s applicability to this case.
In addition to elaborating upon t h e sound basis of the
' The majority in Aspinall did not use the term 'de m i n i m i s " when discussing the permissible inclusion of a limited number of uninjured class members in a certified class. Instead, the Court stated that there were "members of the class who have not suffered the 'injury' of higher t a r and nicotine [who] are both very few in number and impossible to identify." Aspinall I 442 Mass. a t 398 n.21 (emphasis added). In his dissent, Justice Cordy restated this language as allowing class certification when there is a 'de minimis number of uninjured class members who are difficult to identify with specificity." Id. at 405. Both the lower court and the p a r t i e s here have adopted Justice Cordy's " d e m i n i m i s " terminology.
Superior Court's decision, amici advance two.other
compelling reasons why the d e m i n i m i s exception should
not apply in this case.
In A s p i n a l l , the Court certified a class of
consumers alleging violation of c . 93A even though the
plaintiffs conceded that certain class members,
very few in number and impossible to identify," suffered
no injury whatsoever because they received the promised
benefits of lower tar and nicotine whenever they smoked
Marlboro Lights. Aspinall, 442 Mass. at 398 n.21. The
Superior Court here considered the applicability of
A s p i n a l l ' s d e m i n i m i s exception, stating that "[tlhe
application of this [ d e m i n i m i s ] principle to
certification under Mass, R. Civ. P. 2 3 is uncertain, but
in making this decision,
d e m i n i m i s inclusion is allowable. ' I P o l i o n v. Wal -Mart ,
2 0 0 6 WL 4472492 , at *15.
"both
t h e court has assumed that the
The Superior Court carefully reviewed the record
before it and concluded t h a t the plaintiffs had failed t o
establish that t he number of uninjured Wal-Mart employees
in the proposed class was only de m i n i m i s .
case, t o determine whether any associate was i n j u r e d - -
e . g . , whether an associate was coerced to miss a rest
break or not--mandates individualized inquiry of the
"In this
associates. In this court's view, such a determination
cannot be made on a class-wide basis." Polion, id.
(emphasis added). Accordingly, the Superior Court
decertified the class.
Consistent with the Superior Court's decision, amici
assert that the de m i n i m i s exception adopted in A s p i n a l l
is inapplicable to this case, for three compelling
reasons. First, the plaintiffs have failed to produce
information sufficient to prove generally class-wide
injury, which is the necessary foundation to application
of the d e m i n i m i s exception. Secondly, the d e m i n i m i s
exception is limited to c. 9 3 A cases due to c. 93A's
unique c l a s s certification requirements, which are less
stringent than those contained in Mass. R. Civ. P. 2 3 .
Finally, the d e m i n i m i s exception is of dubious continued
validity in light of this Court's decision in Hershenow
v. E n t e r p r i s e Rent-A-Car C o . , 445 Mass. 790 ( 2 0 0 6 ) ' which
requires a c. 93A plaintiff to prove actual i n ju ry to
establish liability.
A. The plaintiffs here, unlike the plaintiffs in Aspinall, have failed to show uniform, virtually class-wide injury.
The d e m i n i m i s exception can apply only where, as in
A s p i n a l l , plaintiffs have produced information capable of
10
establishing uniform, virtually class-wide injury.6
Aspinall, the plaintiffs had also conceded that a few
unidentified class members were not injured.
Aspinall, 442 Mass. at 393. The Court permitted the
inclusion of a small number of uninjured,
members in the certified c l a s s only because the
plaintiffs produced evidence capable of establishing that
the vast majority of class members had been injured. The
Cour t explained:
In
See
unidentified
What we have in [ A s p i n a l l are] statements made by the defendants which are alleged to be untrue for the overwhelming majority of smokers, with only a very few smokers who fortuitously happened to smoke all their cigarettes in a manner that has resulted in the intake of lower t a r and nicotine.
Aspinall, 442 Mass. at 398 n.21 (emphasis added).
Therefore, a strong showing of virtually uniform class-
wide injury was a necessary precondition to recognition
of the de m i n i m i s exception in Aspinall.
In Aspinall, the plaintiffs produced documents showing that the defendant designed and mass-marketed a so-called “light” cigarette that was allegedly designed not to deliver its promised benefits of lower tar and nicotine when used as directed in ordinary use. Aspinall, 442 Mass. at 386-88. Thus, the plaintiffs in Aspinall produced information capable of proving that virtually all purchasers of these Marlboro Light cigarettes suffered economic 105s from the purchase and ordinary use of the product. Id. at 488.
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By contrast, in this case the Superior Court
correctly determined that the plaintiffs have failed to
show that they represent a unified class suffering a
common injury.
member's circumstances would be necessary to determine
liability. Polion v. W a l - M a r t , 2006 WL 4472492 at *15.7
That is, "as a practical matter, the resQlution of this
overarching common issue breaks down into an unmanageable
variety of individual legal and factual issues." A n d r e w s
v. Am. Tel. & T e l . Co., 95 F.3d 1014, 1023 (11th Cir.
1996) (no class certification in customers' claims
against long-distance telephone companies' "900"
telephone number services where multiple such services in
use). Absent such a record of uniform class-wide injury,
the de minimis exception cannot apply.
irrelevant to consider whether a de m i n i m i s number of
putative class members may not have been injured when the
An individual inquiry into each class
It is simply
7 As Wal-Mart ably argues in i t s appellate brief, the plaintiffs have failed to meet their burden, under Mass. R . Civ. P. 23(b), of establishing the predominance of common questions of fact over individual questions concerning liability for each employee class member. H e r e the c lass is a sprawling and unwieldy assortment of approximately 67,000 individual employees who, alleged time period of more than a decade, were subject to a myriad of particular circumstances unique to their job schedules, positions, branch locations and managers. There is no generalized proof of class-wide liability.
f o r the
i2
plaintiffs have not even shown that a de maximis number
of class members have been injured.
B . The de minimis exception should not apply to class ac t ions under Rule 23.
The de m i n i m i s exception should not apply to this
case as a matter of law, independent of the inadequate
record information, because the case does not arise under
c. 93A. As this Court discussed in Aspinall, c. 9 3 A
contains its own class certification provision, at
3 9 ( 2 ) , which is s u i generis and is less stringent than
the requirements for c lass certification under Mass. R.
Civ. P. 2 3 . See Aspinall, 442 Mass. at 391-92.8 In
particular, the Cour t has " [ n J o t [ e d ] that Ec. 9 3 A l does
not contain t h e predominance or superiority requirements
found in rule 23 [and has] recognized that § 9 ( 2 ) has 'a
more mandatory tone' than the rule [ 2 3 ] . ' I Fletcher v.
Cape Cod Gas C o . , 394 Mass. 5 9 5 , 6 0 5 (1985) (quoting
Chapter 93A's class certification section provides, in relevant part:
(2) Any persons entitled to bring such action may, if the use or employment of the unfair or deceptive act or practice has caused similar iniurv to d 6 - -
numerous other persons similarly situated and if the court finds in a preliminary hearing that he adequately and fairly represents such other persons, bring the action on behalf of himself and such other similarly injured and situated persons . - . .
G . L. c. 9 3 A § 9 ( 2 ) .
13
B a l d a s s a r i v. Public F i n . Trust, 369 Mass. 33, 40
(1975)). Moreover, the Court in Aspinall cautioned that
a t r i a l judge deciding a motion for c . 93A class
certification "must bear in mind a pressing need f o r an
effective private remedy for consumers, and that
traditional technicalities are not to be read into the
statute in such a way as to impede the accomplishment of
substantial j u s t i c e . " Aspinall, 442 Mass. at 391-92
(internal citations omitted).
a de m i n i m i s exception t o class-wide injury therefore
arose in t h e unique and specific context of c . 93A.
The Court's recognition of
By contrast, Rule 23's more rigorous class
certification requirements apply in this case. O f
particular relevance here is the predominance requirement
under Mass, R. Civ. P. 23(b), which was the basis of the
Superior Court's decision to decertify the c l a s s . 9
'[Wlhen the court must explore whether any harm actually
resulted, individual questions predominate and class
certification is not appropriate." Polion v. WaL-Mart,
2006 WL 4472492 at *15.
~ .-
Mass. R . C i v . P. 23(b) provides, in relevant part, that " [ a l n action may be maintained as a class action if . . . the court finds that the questions of law or fact common to the members of the class predominate over any questions affecting only individual members . . , . ' I
14
To amici's knowledge, no court in the nation has
adopted a de m i n i m i s exception to class-wide injury under
Rule 2 3 . To the contrary, courts have routinely denied
class certification under Rule 23(b)'s predominance
requirement where, as here, the plaintiffs have failed to
show that each putative class member has suffered a
cognizable loss or injury. 10 As these cases reflect, the
lo See A m c h e m Prods., Inc. v. Windsor , 521 U.S. 591, 6 2 4 - 25 (1997) (no class certification in asbestos litigation where putative class members were exposed to different asbestos-containing products for different amounts of time and in different ways, where each class member had different smoking history complicating causation element, and where range of manifested physical injury varied from none at all to disabling asbestosis); Broussard v . Meineke Discount Muffler Shops, Inc. , 155 F.3d 331,340-344 (4th Cir. 1998) (no class certification of franchisees' claims against franchisor alleging mismanagement of pooled advertising contributions; individual inquiries required to determine which of many franchise agreements were in use, what particular representations franchisor made to each franchisee, and how each franchisee relied on such representations); Sprague v. Gen. Motors Corp. , 133 F . 3 d 3 8 8 , 3 9 7 - 9 9 (6th Cir, 1998) (en banc) (no class certification in retirees' claim of ERISA violation concerning non- payment of health benefits where individual inquiries required to determine which contract each retiree signed and what representations employer made to each retiree); Jackson v. Motel 6 Multipurpose, Inc., 130 F.3d 999, 1006 (11th Cir. 1997) (class certification denied because individualized inquiry required into each putative class member's circumstances concerning claim of racially discriminatory rental practices); v. Cotter Corp., 6 5 F.3d 8 2 3 , 8 2 7 - 2 8 (loth Cir. 1995) (no class certification where individual inquiry required i n t o medical impact on each putative c l a s s member's person and property from uranium mill emissions) ; In
Boughton
Baycol Products L i t i g a t i o n , 2 1 8 F . R . D .
15
class action is merely an efficient procedural mechanism
for the collective litigation of substantially similar
individual claims. The class action is 'an exception to
the usual rule that litigation is conducted by and on
behalf of the individual named parties only." Califano v.
Yamasak i , 442 U.S. 682, 700-1 (1979). Accordingly, a
class action does not affect in any way the plaintiff
class representatives' burden of proving liability and
damages with respect to each class member. "It is not
meant to alter the parties' burdens of proof, right to a
jury trial, or the substantive prerequisites to recovery
under a given [claim] . ' I S w . R e f i n i n g Co., Inc. v,
Bernal, 22 S.W.3d 425, 437 (Tex. 2000). In fact, many
courts faced with "light cigarette" cases nearly
identical to Aspinall have denied class certification
under Rule 23 or the equivalent because t h e plaintiffs
have failed to show t h a t each putative class member was
injured. 11
197, 213 (D. Minn. 2003) (no class certification where individual inquiry required into harmful effects of prescription drug on each putative class member).
l1 Courts in those cigarette cases have consistently concluded that individual inquiries into each smoker's behavior would be required to determine who did not receive the promised benefits of lower tar and nicotine. As one court explained:
The fundamental question in the case is whether Defendants' representation that a pack of Marlboso Lights would deliver lower tar and nicotine than Marlboro Regulars is false. The answer to that question requires each class member to prove that the person who smoked the cigarettes actually received something other than "lowered tar and nicotine." Due to the individualized nature of tar and nicotine delivery, causation and loss cannot be established on a class-wide basis.
Mulford v . Altria Group, Inc. 2 4 2 F . R . D . 615, 6 2 7 - 2 9 (D.N.M. 2 0 0 7 ) class on predominance grounds, and rejecting Aspinall's findings of presumptive class-wide injury and of only a de minimis number of uninjured class members). McLaughlin v. American Tobacco Co., 2008 WL 878627 , at * 4 (2d Cir. A p r . 3 , 2 0 0 8 ) smokers alleging RICO violation on predominance grounds because "reliance on the misrepresentation [I cannot be the subject of general proof is needed to overcome the possibility that a member of the purported class purchased Lights for some reason other than the belief that Lights were a healthier alternative") ; Benedict v. A l t r i a Group, Inc. , 2 4 1 F.P.D. 6 6 8 , 6 8 0 (D.Kan. 2007) (denying class certification because issue of deception required inquiry into each "light" smoker's behavior, including whether each smoker "compensated" by smoking more cigarettes or by inhaling more deeply); Davies v. Philip Morris U . S . A . , Inc . , 2 0 0 6 WL 1600067 , a t *3-4 (Wash.Super. May 26 , 2 0 0 6 ) (denying class certification because inherently individual questions concerning each smoker's reasons f o r buying "light" cigarettes "overwhelmingly predominate [dl over the common questions of deceptive acts or practices"); Pearson v. Philip Morris, Inc., 2006 WL 663004 , at *L (Or.Cir., Feb. 23, 2 0 0 6 ) (denying class certification because "individual issues vastly predominate over the common issues of fact and law" concerning each smoker's habits and actual exposure to tar and nicotine levels); Philip Morris USA Inc, v. Hines, 883-So.2d 292, 294 (F1a.Dist.Ct.A~~. 2 0 0 4 ) smokers because key issue whether each smoker "reaped the benefits of a lower tar and nicotine cigarette depended upon how the cigarettes were smoked").
(denying certification of "light cigarette"
See a l so
(decertifying class of "light"
[and] [ i l ndividualized proof
(decertifying class o f "light"
17
In short, extending Aspinall's de m i n i m i s exception
outside the unique context of c. 93A to class actions
under Rule 2 3 would contravene Rule 2 3 ' s rigorous
requirements for class certification, especially the
predominance requirement of Rule 23 (b) (3) . The de
m i n i m i s exception, t o the extent it can survive the
Court's decision in Hershenow (see below), should
accordingly be restricted to claims arising under c. 93A
and should not be extended to Rule 23 cases such as this
one.
C. It is questionable whether the de m i n i m i s exception survives the actual injury requirement under Hershenow.
Since the de m i n i m i s exception is a creature of
c. 93A case law, it is appropriate to consider whether it
remains valid on its native soil of c. 93A jurisprudence.
If the exception were no longer doctrinally supportable
under the current law of c . 93A, then clearly the
question of i t s application in this or any other putative
class action would not arise.
It is indeed questionable whether the de m i n i m i s
exception remains doctrinally valid a f t e r the Court's
decision in Hershenow. In Hershenow, the Court clarified
that c. 93A requires a plaintiff to prove actual injury
18
in order to establish liability.12 This holding, however,
seems to conflict with the d e m i n i m i s exception, which
eliminates the actual injury requirement f o r those few
class members who concededly have suffered no harm. Such
uninjured class members could not recover individually
under Hershenow, and yet the exception allows them to
remain as members of a certified class and to recover
f r o m a favorable judgment or settlement.
A s amici have already argued, it is fundamental that
the procedural mechanism of a class action is not meant
to, anddoes not, alter in any way the substantive proof
requirements of c. 93A (or any other claim brought as a
c lass action) and therefore should not allow uninjured
plaintiffs to recover in a class action. “ [ C l l a s s action
status does not alter the parties’ underlying substantive
rights. If a specific form of relief is foreclosed to
12 In Hershenow, the Court explained:
If any person invades a consumer’s legally protected interests, and if t h a t invasion causes the consumer a loss-whether that loss be economic or noneconomic-the consumer is entitled to redress under our consumer protection statute. A consumer is not, however, e n t i t l e d t o redress under G . L . c. 93A, where no loss h a s occurred. otherwise is irreconcilable with the express language of G . L . c. 9 3 A , § 9, and our earlier case law.
To permit
I d . , 445 Mass. at 8 0 2 (emphasis added) .
19
claimants as individuals, it remains unavailable to them
even if they congregate into a class."
Credit S u i s s e First Boston, LLC, 134 Cal.App.4th 997,
1018 (2005) (internal citations omi t t ed ) . See also Boyd
v. Becker, 627 So.2d 481, 484 (Fla.1993) ("The class
action device is procedural in na tu re only and cannot be
used to change t h e substantive law.").
Feitelberg v.
In short, this case provides t he Court with the
opportunity to consider the continued validity of the de
m i n i m i s exception a f t e r Hershenow. A ca re fu l examination
of A s p i n a l l through the lens of Hershenow indicates that
the d e m i n i m i s exception conflicts with Hershenow's
actual injury requirement and therefore should be
rejected by the Cour t .
2 0
CONCLUSION
For the foregoing reasons, this Court should affirm
the Superior Court’s decision decertifying the
plaintiffs’ class.
NEW ENGLAND LEGAL FOUNDATION and ASSOCIATED INDUSTRIES OF MASSACHUSETTS
By their attorneys,
BBO No. 559918 Martin J. Newhouse, President BBO No. 544755 Jo Ann’ Shotwell Kaplan, General Counsel BBO No. 459800 New England Legal Foundation 150 Lincoln Street Boston, MA 02111-2504 (617) 6 9 5 - 3 6 6 0
CERTIFICATE OF COMPLIANCE
Pursuant to Mass. R. App. P. 16(k), I hereby certify that this brief complies with the rules of cour t pertaining to the filing of an amicus brief, including, but not limited to, Mass. R . App. P . 1 7 .
Ben Robbins
Dated: April 25, 2008
21