Class Actions: Fundamentals of Certification Analysis
In recent years a growing explosion of consumer class actions has swept the nation, exposing an increasing number of courts, legal practitioners, and business executives to class action issues. Legislative restrictions on federal security class actions have shifted the focus of many plaintiff class action specialists to alternative industries, including the insurance, banking, retail, and consumer finance industries. Today, virtually any consumer product or service can become the subject of scrutiny for class action claims. The class mechanism often is heralded by plaintiffs’ counsel as the only means to vindicate clients with small monetary damages. Critics of the class action device describe it as a means of corporate blackmail, plagued by improper class certifications, inequitable settlements, and unjustifiable fee awards.
From any perspective, class action litigation presents a unique and procedurally complex legal arena fraught with special risks and challenges. Plaintiffs’ counsel must demonstrate the prerequisites for class treatment, as well as adequacy of the putative class representatives and their own competence as class counsel. For defense counsel, class actions require the immediate development of short term and long term litigation strategies, as well as a comprehensive analysis of certification issues, discovery issues, liability risk, and settlement options. With the dramatic increase in potential exposure that often accompanies the certification of a class, it is imperative for counsel to be well versed in the law governing class actions. This article will review the fundamental principles of class action litigation with special emphasis on recent developments in 11th Circuit and Florida law.
A class action is, in simple terms, a procedural device designed to promote the efficient and orderly adjudication of substantive rights affecting an entire class of persons, without the necessity of joining all such persons as formal parties. The contemporary form of class action was created with the revision in 1966 of Fed. R. Civ. P. 23.1 The most dramatic philosophical change during that revision was to make the final judgment in a certified class action binding on all members of the class, excepting only those who affirmatively opt out of the action.2 Virtually every state class action rule, including Fla. R. Civ. P. 1.220 (which was enacted in its present form by the Florida Supreme Court in 1980), has been modeled after federal Rule 23.3 For that reason, even in state court litigation, federal case law precedent under Rule 23 assumes a uniquely persuasive role.
Standards for Class Certification
Procedurally, a civil action does not become a “class” action simply because the complaint bears the legend “class action complaint” or, as required by Fla. R. Civ. P. 1.220, “class representation.”4 The plaintiff seeking to represent a class bears the burden of pleading and proving each and every element required by Rule 23 or 1.220.5 In fact, Fla. R. Civ. P. 1.220 contains specific pleading requirements which, if not complied with, can result in the dismissal of class allegations.6 Where the rule requires specific “facts and circumstances,” the mere recitation of legal conclusions is not sufficient.7 Unlike federal practice, motions to dismiss class allegations are, therefore, common in Florida state courts.
The standards for maintaining a class action must be applied carefully in light of the serious due process concerns raised by certification. aggregating and magnifying claims, certification “makes it more likely that a defendant will be found liable and results in significantly higher damage awards.”8 Courts have also recognized that “[c]ertification of a large class may so increase the defendant’s potential damages liability and litigation costs that he may find it economically prudent to settle and to abandon a meritorious defense.”9 For this reason, “class actions create the opportunity for a kind of legalized blackmail.”10
Thus, the stakes in class certification are extremely high, particularly for defendants. Accordingly, the U. S. Supreme Court has made it clear that no class should be certified until the trial court has satisfied itself “after a rigorous analysis” that all of the requirements of Rule 23 have been met.11 In order to meet these requirements, a case must satisfy all of the requirements of subsection (a) and at least one of the requirements of subsection (b).
The four elements of Rule 23(a) are commonly referred to as numerosity, commonality, typicality, and adequacy.
• Numerosity. Subsection (a) requires first that the members of the class be “so numerous that joinder of all members is impracticable.”12 A complaint in Florida state court must plead the approximate number of class members.13 This requirement of numerosity is rarely difficult to satisfy, and classes have been certified with as little as 25 members.14
• Commonality. Class certification also requires that there be questions of law or fact common to the class.15 Common questions of law or fact are not difficult to frame, and courts have noted that the “threshold of commonality is not high.”16 The test for commonality has been characterized as “qualitative rather than quantitative” and “there need be only a single issue common to all members of the class.”17 Nevertheless, commonality must be genuine and not superficial. Common questions such as, “Did the defendant defraud each member of the class?” can be manufactured in almost any case and are of little analytical value. Such broad, general allegations of commonality will not satisfy the requirements of Rule 23 when the actual facts of the case reflect that legal and evidentiary issues are not constant, but vary among class members.18
• Typicality. In order to be certifiable, the claims or defenses of the representative parties must be “typical of the claims or defenses of the class.”19 This requirement, which addresses the relationship between the claims of the proposed class representative and those of the class, is often misunderstood and poorly applied. A proper analysis of typicality examines 1) the elements of the named plaintiff’s claims and those of the proposed class; 2) the nature of the injury suffered by the representative and that of class members; 3) the relief that would satisfy the named plaintiff’s claims compared to those of the class; and 4) the defenses applicable to the proposed representative and those applicable to class members. The wrong suffered by the putative class representative must be the same wrong suffered by the class,20 and “the interest of the plaintiff must be coextensive with the interest of the other members of the class.”21
Typicality also is closely tied to the adequacy of the class representative.22 At a minimum, typicality requires that the proposed class representative possess a valid claim; if the representative is “unable to state a claim for relief, any question as to class certification will be moot.”23 If the merits of the proposed representative’s claims are speculative or seriously questionable, or if “individualized defenses” apply to the proposed class representative (e.g., statute of limitations, counterclaims, or equitable defenses), the representative’s claims likely will not be typical of the proposed class.24 If serious legal questions exist as to the viability of the named plaintiff’s claims, it may not be “practicable”25 to address certification until after the plaintiff’s claim has been tested by summary judgment proceedings.26 Conversely, even if the representative plaintiff possesses a valid claim, typicality will not exist if the claims of a large portion of the proposed class are subject to dismissal.
• Adequacy. The requirement that there be an “adequate representative” of the class has been touted as “crucial to consider with great care.”27 The importance of adequacy flows from the fact that a judgment in a class action, whether favorable or unfavorable, will bind absent class members who do not affirmatively opt out of the case. The representative, therefore, serves as a fiduciary to absent class members.28 Thus, the proposed representative must have common interests with the class members and be able to properly prosecute the class action.29 It is fundamental that adequacy is lacking if the interests of the putative class representative are antagonistic to or in conflict with the interests of other class members.30 If the class representative has been convicted of crimes demonstrating “lack of honesty and trustworthiness,” he or she may not be adequate.31 Adequacy also does not exist when the representative is immune to an affirmative defense which will apply to other class members.32
The adequacy requirement also mandates that class counsel be experienced, competent, and able to conduct the litigation, but “a court should conduct an inquiry into the knowledge of the representative. . . to ensure that the party is not simply lending [her] name to a suit controlled entirely by the class attorney.”33 If a plaintiff “fails to demonstrate that she is familiar with the facts,” or “does not show knowledge of the essential issues,” the plaintiff is not qualified to act as a class representative.34 While courts are generally reluctant to hold counsel inadequate, specific acts of incompetence or unprofessional conduct, such as the submission of a false affidavit or the failure to communicate settlement offers, can result in a finding of inadequacy.35
The requirements of subsection (a) “are necessary but not sufficient conditions for a class action.”36 In order to be certifiable as a class action, one of the three subsections of subsection (b) must be satisfied. Fla. R. Civ. P. 1.220 requires that a pleading specify the particular provision of subsection (b) under which the class claim or defense is to be maintained.37 This practice is generally advisable in federal court as well, where the failure to designate the particular subsection of Rule 23(b) may be taken as a lack of meaningful analysis.
• Subsection (b)(1). A class action may be maintained under this subsection if the prosecution of individual actions by members of the class would create a risk of inconsistent adjudications that would establish incompatible standards of conduct for the party opposing the class; or adjudications with respect to individual class members that would, as a practical matter, be dispositive of the interests of other nonparty class members or substantially impair or impede their ability to protect their interests.38 Actions under this subsection may be brought by or against a class to avoid a series of individual litigations that might produce conflicting results, or to join all persons having a financial interest in the subject matter of the litigation.
• Subsection (b)(2). Certification also is allowed when the relief sought by the class is injunctive or declaratory in nature. This provision is “intended to reach situations where a party has taken action or refused to take action with respect to a class.”39 Certification under subsection (b)(2) is not appropriate when the “appropriate final relief” is predominantly money damages.40
• Subsection (b)(3). Most class actions seeking substantial money damages will only be appropriate for class certification, if at all, under subsection (b)(3). Certification under this subsection requires that common issues of law or fact predominate over issues affecting only individual class members, and that a class action would be superior to other methods of adjudication. The absence of such “predominance” or “superiority” is a frequent reason for denying class certification.41 Claims which involve “case-specific factual issues” for each class member will fail the predominance test,42 and classes that are too numerous may affect the superiority of a class action by rendering it unmanageable.43 Likewise, if each potential class member seeks thousands of dollars in damages, a class action may not be a superior method of adjudication because individual lawsuits could be brought, especially when the particular claims provide for treble damage or attorneys’ fees to the prevailing party.44 While the predominance issue is difficult, and poorly reasoned decisions abound, most of these decisions result from a failure to analyze the details of the proposed class claims and the proofs necessary to try the case.
Certification Analysis and Due Process Concerns
In determining whether a class action should be certified, it is imperative for the trial court to envision the form that a trial would take and to ask several critical questions. The “typicality,” “predominance,” and “superiority” inquiries mandate an objective evaluation of how and whether a class action trial could be conducted.45 If a class action trial cannot genuinely be conducted, either for legal or practical reasons, e.g., if the jury cannot realistically be instructed, or if the case would necessarily degenerate into a series of mini-trials in order to prove liability for each class member, the case should not be certified.46 The trial of an improperly certified class action will almost certainly result in a violation of the defendant’s due process rights.
It should be emphasized that the certification of a class does not relieve the named plaintiff of proving each and every element of a claim with respect to each and every member of the class. Consequently, first and foremost, the court should inquire: Can the proposed class representatives put on their case and establish the elements, not only of their own claims, but all of the elements necessary to establish liability as to all class members?47 If individual elements of the claims cannot be proven on a class-wide basis without bringing all class members before the court, a class should not be certified. Thus, for example, Florida law recognizes that a common law fraud claim, which would require each class member to prove reliance, is clearly not appropriate for class certification.48
Just as the class representative must be able to establish the elements of the class claim on behalf of all class members, due process requires that the defendant be allowed to assert all defenses applicable to all class members. “Substantive defenses” are a “species of property protected by the due process clause.” Thus, if class certification or the management of a class action trial will effectively preclude a defendant from presenting viable defenses which the defendant might possess with respect to individual class members, the procedure would violate the requirements of due process.49
Class Certification Hearing
An evidentiary hearing should be held by the court prior to certification in virtually every case.50 Recent decisions have held that the “rigorous analysis” mandated by the U.S. Supreme Court requires the trial court to apply the specific elements of the class action rule to the facts and legal issues of the case.51 It is prudent practice for trial judges to base a class certification on well thought out findings of fact and conclusions of law. A certification order which merely parrots the language of Rule 23 will be subject to attack on appeal.52
Although it has been said that a court should not consider the merits of the claims when determining whether a class should be certified,53 “evidence relevant to the commonality requirement is often intertwined with the merits,” and thus “it sometimes is necessary to probe behind the pleadings before coming to rest on the certification question.”54 If the record is insufficient, or the defendant has not had an adequate opportunity to conduct discovery, the court should postpone the certification issue pending discovery, which may be limited to certification issues.55
After a class is certified, the representative plaintiff generally is required to send notice of the class action to members of the class. The notice provisions of Florida’s Rule 1.220 were intended to be more “explicit and stringent than those in the Federal rule.”56 A class notice cannot be biased toward any party but “must be neutrally drafted.”57 Courts often allow defendants to comment on, or object to, a proposed notice that was drafted by a plaintiff.58 Rule 1.220(d)(2) provides that “the party asserting the existence of the class shall initially pay for the cost of giving notice” unless otherwise ordered by the court. Although one court required a class action defendant to pay for notice costs apparently because it was the “most economically viable means of assuring efficient and cost-efficient notification,” the basis for such a ruling is highly questionable.59 The U.S. Supreme Court has held that a plaintiff seeking class certification is required to pay the costs of notice “as part of the ordinary burden of financing his own suit,”60 and, if the proposed representative cannot afford the costs of notice, class certification should be denied.61
Despite the enormous impact of class certification, a federal court order certifying a class is still interlocutory and not subject to direct appeal. At the federal level, a class certification order can be reviewed prior to trial only by writ of mandamus62 or pursuant to 28 U.S.C. §1292.63 An amendment to Rule 23 is currently being considered by the U.S. Supreme Court, however, that would provide federal appellate courts with the discretion to hear an appeal filed within 10 days of a class certification order.64 Under the proposed amendment, the district court would not be required to certify the issue for appeal as is currently necessary under 28 U.S.C. §1292. In contrast to the federal rule, in Florida state court, an order determining class status is directly appealable under Fla. R. App. P. 9.130(a)(3)(C)(vii) (orders certifying a class) or 9.130(a)(6) (orders denying certification).
On appeal, a class certification order is technically reviewed for an abuse of discretion on both the state and federal levels.65 The wide latitude generally afforded trial courts under the abuse of discretion standard, however, is substantially restricted in the certification context by the requirements of Rule 23. “The decision to certify is within the broad discretion of the court, but that discretion must be exercised within the framework of rule 23.”66 The trial court must give “due consideration to all the relevant factors within the context of a rigorous analysis,” without relying on “impermissible factors.”67 The practical effect of Rule 23’s requirements is a type of review that borders on de novo, and certainly, if an appellate court believes that certification has been improvidently granted, it generally will have no difficulty finding that a trial court has abused its discretion or departed from the essential requirements of law.
Class action litigation has continued to grow, and despite three decades of evolution, many of the fundamental issues remain unsettled or misapplied. With enormous economic interests often at stake, the need for critical analysis from both courts and practitioners is an absolute necessity. An essential part of this analysis, prior to certification, must include a genuine assessment of whether a trial of the proposed class action realistically could be held, and whether class-wide liability could conceivably be imposed in light of due process guarantees. Until such meaningful analysis becomes common practice, or more definitive law develops as to when claims are clearly not appropriate for class treatment, the flood of class action litigation is likely to continue. q
1 Fed. R. Civ. P. 23 Advisory Committee’s Note to 1966 amendment.
2 H. Newberg and A. Conte, Newberg on Class Actions §1.10, at 1-26 to 1-27 (1992).
3 Johnson v. Plantation Gen. Hosp. Ltd. Partnership, 641 So. 2d 58, 59 (Fla. 1994); Fla. R. Civ. P. 1.220, Advisory Committee’s Note.
4 Port Royal, Inc. v. Conboy, 154 So. 2d 734, 736 (Fla. 2d D.C.A. 1963); 3B J. Moore, Moore’s Federal Practice ¶ 23.02-2, at 23–78 (2d ed. 1995); Fla. R. Civ. P. 1.220(c).
5 Hudson v. Delta Air Lines, Inc., 90 F.3d 451, 456 (11th Cir. 1996), cert. denied, 117 S. Ct. 1082 (1997); Castano v. American Tobacco Co., 84 F.3d 734, 740 (5th Cir. 1996); Baptist Hosp. of Miami, Inc. v. Demario, 661 So. 2d 319, 321–22 (Fla. 3d D.C.A. 1995) (“class action cannot be certified on the basis of a default”); Arrowsmith v. Broward County, 633 So. 2d 21 (Fla. 4th D.C.A. 1993) (citing Southern Bell Tel. & Tel. Co. v. Wilson, 305 So. 2d 302 (Fla. 3d D.C.A. 1974), cert. dismissed, 327 So. 2d 220 (Fla. 1976)).
6 Fla. R. Civ. P. 1.220(c). For a list of pleading requirements, see Frankel v. City of Miami Beach, 340 So. 2d 463, 465 (Fla. 1977).
7 Dade County Police Benevolent Assoc. v. Metropolitan Dade County, 452 So. 2d 6, 8–9 (Fla. 3d D.C.A. 1984).
8 Castano v. American Tobacco Co., 84 F.3d 734, 746 (5th Cir. 1996).
9 Coopers & Lybrand v. Livesay, 437 U.S. 463, 476 (1978).
10 In re General Motors Corp. Pick-Up Truck Fuel Tank Prod. Liab. Litig., 55 F.3d 768, 784 (3d Cir.), cert. denied, 116 S. Ct. 88 (1995); In re Rhone-Poulenc Rorer, Inc., 51 F.3d 1293, 1298 (7th Cir. 1995), cert. denied, 516 U.S. 867 (1995) (“Judge Friendly, who was not given to hyperbole, called settlements induced by a small probability of an immense judgment in a class action ‘blackmail settlements.’”) (citing H. Friendly, Federal Jurisdiction: A General View 120 (1973)); see also Castano, 84 F.3d at 746 (“judicial blackmail”).
11 General Tel. Co. v. Falcon, 457 U.S. 147, 161 (1982).
12 Fed. R. Civ. P. 23(a)(1).
13 Fla. R. Civ. P. 1.220(c)(2)(D)(i).
14 Butterworth v. Quick & Reilly, Inc., 171 F.R.D. 319, 321 (M.D. Fla. 1997). See generally C. Wright, Law of Federal Courts §72, at 510 (5th ed. 1994).
15 Fed. R. Civ. P. 23(a)(2); Fla. R. Civ. P. 1.220(a)(2).
16 Broin v. Philip Morris Cos., 641 So. 2d 888, 890 (Fla. 3d D.C.A. 1994), review denied, 654 So. 2d 919 (Fla. 1995).
17 In re American Med. Sys., Inc., 75 F.3d 1069, 1080 (6th Cir. 1996) (quoting Newberg on Class Actions §3.10, at 3-50 (3d ed. 1992)); see also In re Disposable Contact Lens Antitrust Litig., 170 F.R.D. 524, 529 (M.D. Fla. 1996); Buford v. H & R Block Tax Servs., Inc., 168 F.R.D. 340, 349 (S.D. Ga. 1996), aff’d sub nom. Jones v. H & R Block Tax Servs., Inc., 117 F.3d 1433 (11th Cir. 1997).
18 Hudson, 90 F.3d at 457 (evidence that putative class members would have acted in a particular manner is a “highly individualized” issue that defeats commonality); In re American Med. Sys., 75 F.3d at 1080–81 & n.11–12 (absent more specific proof of commonality, plaintiffs failed to satisfy Rule 23(a)(2)); Arrowsmith, 633 So. 2d at 22 (no commonality because lack of proof that each potential class member provided statutory notice); Maner Properties, Inc. v. Siksay, 489 So. 2d 842, 845 (Fla. 4th D.C.A. 1986) (“where separate fact situations are involved concerning alleged negligence or violations with respect to separate pieces of property, a class action is generally not an appropriate means of resolving the claims”); Cohen v. Camino Sheridan, Inc., 466 So. 2d 1212, 1214 (Fla. 4th D.C.A. 1985) (because complaint did not allege that many individual contracts were virtually identical, there was “simply insufficient allegations to demonstrate the commonality required to allow all of the claims to be tried together”).
19 Fed. R. Civ. P. 23(a)(3); Fla. R. Civ. P. 1.220(a)(3).
20 Butterworth, 171 F.R.D. at 322 (named plaintiff “must have the ‘same essential characteristics as the claims of the class at large’”) (citations omitted); Auto Ventures, Inc. v. Moran, No. 92-436, 1997 U.S. Dist. LEXIS 7037, at *12–13 (S.D. Fla. Apr. 3, 1997).
21 Hendler v. Rogers House Condominium, 234 So. 2d 128, 130 (Fla. 4th D.C.A. 1970); Port Royal, 154 So. 2d at 736.
22 Buford, 168 F.R.D. at 350.
23 Hudson, 90 F.3d at 459 n.14.
24 See, e.g., Auto Ventures, 1997 U.S. Dist. LEXIS 7037, at *15–17 (and cases cited therein).
25 Rules 23 and 1.220 both provide that the determination of whether a case is appropriate for class treatment should be made “[a]s soon as practicable” after the litigation is commenced. Fed. R. Civ. P. 23(c)(1); Fla. R. Civ. P. 1.220(d)(1).
26 See, e.g., Taran v. Blue Cross Blue Shield of Fla., Inc., 685 So. 2d 1004, 1006–07 (Fla. 3d D.C.A. 1997) (affirming trial court’s decision to resolve question of plaintiff’s standing through summary judgment before addressing class certification issue).
27 Hall v. National Recovery Sys., Inc., No. 96-132-CIV-T-17(c), 1996 U.S. Dist. LEXIS 11992, at *11 (M.D. Fla. Aug. 9, 1996) (citation omitted).
28 In re American Med. Sys. 75 F.3d at 1083; Hall, 1996 U.S. Dist. LEXIS 11992, at *12.
29 Broin, 641 So. 2d at 892.
30 Cricket Club Condominium, Inc. v. Stevens, 695 So. 2d 826, 827 (Fla. 3d D.C.A. 1997) (counterclaim that class representative had filed against a putative class member in an independent lawsuit prevents the adequacy requirement from being met); Dade County Police Benevolent Assoc. v. Metropolitan Dade County, 452 So. 2d 6, 9–10 (Fla. 3d D.C.A. 1984) (apparent conflict of interest fatal to proposed class action), review denied, 461 So. 2d 114 (Fla. 1985); Cordell v. World Ins. Co., 418 So. 2d 1162, 1164 (Fla. 1st D.C.A. 1982) (where there is no agreement even among the named plaintiffs as to the remedy sought (i.e., specific performance, rescission, or damages), adequacy requirement is not met).
31 Hall, 1996 U.S. Dist. LEXIS 11992, at *12–13.
32 Mathieson v. General Motors Corp., 529 So. 2d 761, 762 (Fla. 3d D.C.A. 1988).
33 Butterworth, 171 F.R.D. at 322 (citation and quotations omitted).
34 Id. at 323.
35 See, e.g., Byes v. Telecheck Recovery Services, Inc., 173 F.R.D. 421, 427–29 (E.D. La. 1997).
36 Fed. R. Civ. P. 23, Advisory Committee’s Note to 1966 amendment.
37 Fla. R. Civ. P. 1.220(c)(2)(A).
38 Fed. R. Civ. P. 23(b)(1); Fla. R. Civ. P. 1.220(b)(1).
39 Fed. R. Civ. P. 23, Advisory Committee’s Note to 1996 amendment.
41 See, e.g., Amchem Products, Inc. v. Windsor, 117 S. Ct. 2231, 2249–50 (1997) (rejecting class certification due to lack of predominance); O’Brien v. J. I. Kislak Mortgage Corp., 934 F. Supp. 1348, 1359 (S.D. Fla. 1996) (same).
42 Jackson v. Motel 6 Multipurpose, Inc., 130 F.3d 999, 1006 (11th Cir. 1997).
43 See, e.g., R.J. Reynolds Tobacco Co. v. Engle, 672 So. 2d 39, 42 (Fla. 3d D.C.A. 1996) (restricting class definition to Florida residents only, and holding that national class was “totally unmanageable and cannot be certified”), review denied, 682 So. 2d 1100 (Fla. 1996).
44 Auto Ventures, 1997 U.S. Dist. LEXIS 7037, at *17–18.
45 See, e.g., Castano, 84 F.3d at 744 (district court erred in failing to consider how trial on the merits would be conducted).
46 Heaven v. Trust Co. Bank, 118 F.3d 735 (11th Cir. 1997) (affirmed trial court’s determination that individual class members’ individual defenses to counterclaim “would require the court to engage in multiple separate factual determinations” and make the class unmanageable); Andrews v. American Tel. & Tel. Co., 95 F.3d 1014, 1023–24 (11th Cir. 1996) (resolution of common issue concerning whether defendants were engaged in an illegal gambling scheme “breaks down into an unmanageable variety of individual legal and factual issues” such as the need to scrutinize the gambling laws of 50 jurisdictions); Castano, 84 F.3d at 743–44 (court recognized that a national class action involving state common law claims was unmanageable because of the numerous variations of the laws of all 50 states); Buford, 168 F.R.D. at 364 (class of several million individuals was unmanageable because of the individual reliance issues).
47 See, e.g., In re Agricultural Chems. Antitrust Litig., 1995-2 Trade Cas. (CCH) ¶ 71, 197 (N.D. Fla. 1995).
48 Lance v. Wade, 457 So. 2d 1008, 1009 (Fla. 1984) (“fraud on individual contracts could not be a basis for a class action”); Southeast Bank, N.A. v. Almeida, 693 So. 2d 1015, 1018 (Fla. 3d D.C.A. 1997); Maner Properties, 489 So. 2d at 845 (“since the fraud claims in the present case are based upon the different circumstances surrounding the class members’ separate contracts, a class action is not an appropriate means for asserting these claims”); Hendler, 234 So. 2d at 130 (“a cause of action based upon fraud and deceit, is inappropriate for a class action”) (citing Osceola Groves v. Wiley, 78 So. 2d 700 (Fla. 1955)); see also Butterworth, 171 F.R.D. at 322 (Florida law does not recognize fraud on the market, thus the individual reliance required precludes class certification). But see Estate of Bobinger v. Deltona Corp., 563 So. 2d 739, 745 (Fla. 2d D.C.A. 1990) (assumed that class may be certified for an extrinsic fraud claim).
49 Lusardi v. Xerox Corp., 118 F.R.D. 351, 371 (D.N.J. 1987) (“substantive defenses” are a “species of property protected by the due process clause” and any class action procedure which interferes with a party’s right to defend itself against a claim amounts to a deprivation of property and a violation of due process), mandamus granted on other grounds, 855 F.2d 1062 (3d Cir. 1988).
50 See, e.g., Hudson, 90 F.3d at 458, 459 n.15; Barton-Malow Co. v. Bauer, 627 So. 2d 1233, 1235 (Fla. 2d D.C.A. 1993) (“the overriding problem that requires reversal is the failure to conduct an evidentiary hearing before certifying this class”).
51 See, e.g., In re American Med. Sys., 73 F.3d at 1078–79; In re Disposable Contact Lens Antitrust Litig., 170 F.R.D. at 528.
52 E.g., In re American Med. Sys., 75 F.3d at 1086 (the Sixth Circuit criticized the district court for failing to base its order on findings based on the evidence).
53 See, e.g., Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 177 (1974).
54 Hudson, 90 F.3d at 457 (citations and quotations omitted).
55 In re American Med. Sys., 75 F.3d at 1086.
56 Fla. R. Civ. P. 1.220, Advisory Com-
57 Cox v. American Cast Iron Pipe Co., 784 F.2d 1546, 1555 (11th Cir.), cert. denied, 479 U.S. 883 (1986); see also In re Nissan Motor Corp., 552 F.2d at 1105.
58 See, e.g., Walco Invs., Inc. v. Thenen, 168 F.R.D. 315, 339 (S.D. Fla. 1996).
59 Sears, Roebuck and Co. v. Labora, 670 So. 2d 1025, 1026 (Fla. 3d D.C.A. 1996). The Sears court cited to Johnson v. Plantation Gen. Hosp. Ltd., 641 So. 2d 58 (Fla. 1994), and Frankel v. City of Miami Beach, 340 So. 2d 463 (Fla. 1977) in support of its statement regarding the costs of notice. Neither of these decisions supports (or even discusses) the propriety or constitutionality of shifting the costs of notice to a class action defendant.
60 Eisen, 417 U.S. at 179 (district court’s attempt to impose 90 percent of the costs of notice on defendants was improper because plaintiff is required to pay cost of notice “as part of the ordinary burden of financing his own suit”).
61 Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340 (1978) (reversing decision to impose costs of producing lists of class members on defendants); In re Nissan Motor Corp. Antitrust Litig., 552 F.2d 1088, 1102–03 (5th Cir. 1977).
62 See, e.g., In re American Med. Sys., 75 F.3d at 1074; Jackson v. Motel 6 Multipurpose, Inc., 130 F.3d 999 (11th Cir. 1997).
63 See, e.g., Andrews, 95 F.3d at 1021.
64 The proposed amendment was approved by the Judicial Conference of the United States at its September 23, 1997, meeting. Preliminary Report Judicial Conference Actions (Sept. 23, 1997).
65 Heaven, 118 F.3d at 737; Andrews, 95 F.3d at 1022; Samples v. Hernando Taxpayers Ass’n, 682 So. 2d 184, 185 (Fla. 5th D.C.A. 1996).
66 Castano, 84 F.3d at 740.
67 Heaven, 118 F.3d at 739.
Markham R. Leventhal is a partner in the law firm of Jorden Burt Boros Cicchetti Berenson & Johnson LLP, Miami, and a member of the firm’s class action litigation group. Mr. Leventhal is also a member of the Class and Derivative Actions Subcommittee, ABA Section of Business Law, and a member of the Florida, New York, and New Jersey bars. He received his B.S. degree from Duke University, his J.D. from the Seton Hall School of Law, and his LL.M. from New York University.
The author would like to acknowledge and thank Stephan Voudris for his research and assistance with this article.
© 1998 by Markham R. Leventhal