February 28, 2018 Articles

Roundup of Recent Class Action Trials, 2016 to 2018

A review of eight class action cases that have been tried effectively.

By Elizabeth J. Cabraser and Fabrice N. Vincent

Increasingly, class action certification depends on plaintiffs’ ability to establish the manageability by presenting a trial plan showing the feasibility of a class-wide trial. At the same time, a strategic and thoughtful trial plan is equally important to defense counsel facing trial of certified classes.

Review of and citation to previously conducted class-wide trials can aid practitioners in establishing a road map for class certification and trial of their own class actions.

This review of seven class action cases that have been effectively tried within the past two years reveals trials, trial plan strategies, and jury interrogatories and verdict forms that can help both plaintiffs and defense strategically and thoughtfully plan for and successfully conduct class action trials.

Six of these cases were tried in federal court, where PACER’s electronic docket allows easy retrieval of the parties’ class-certification briefing, trial plans, jury instructions, and verdict sheets.

Margie Daniel, Individually and on Behalf of a Class of Similarly Situated Individuals v. Ford Motor Co., Civ. No. 2:11-02890 (N.D. Cal. Jan. 26, 2018) (Judge William B. Shubb)

In Daniel v. Ford Motor Co., a California federal jury in the Eastern District of California cleared Ford Motor Co. of all four claims in an 11-day class action trial alleging that hazardous and noisy rear suspension defects caused premature and uneven tire wear in Ford Focus vehicles manufactured between 2005 and 2011.

The trial court’s 2013 grant of summary judgment in favor of Ford and denial of class certification for lack of commonality was reversed by the Ninth Circuit in 2015, and a class was certified in 2016. The class consisted of all individuals who purchased 2005–2011 Ford Focus vehicles new in California and who still owned the vehicles.

Notably, Ford vigorously contested class certification throughout the entirety of the case, even during trial, even though issuance of a defense verdict would have class-wide preclusive effect. Despite those efforts, the class remained certified and the ensuing defense verdict on all four claims is one that, once final, Ford will be able to rely on preclusively class-wide.

Strategically speaking, a complex case and the proffer of a verdict form that asked the jury to make legal conclusions without listed factual findings may have favored Ford Motor Co. as did seemingly tough defect facts. Regarding the alleged defect, plaintiffs reportedly had difficulty establishing “premature tire wear” in class vehicles, which one plaintiff expert reportedly was not adversely affected unless the vehicle is heavily loaded, with more than just a driver. Ford Motor Company’s Notice of Motion for Judgment as a Matter of Law (Jan. 23, 2018). Notably, on the eve of trial, the plaintiffs reportedly contended that normal tire life should extend to 75,000 miles, almost double the 40,000-mile normal life supported by pretrial expert testimony. Id.

The first four questions on the jury verdict simply asked how the jury came out on each legal claim, instead of asking the jury to determine predicate factual issues, like whether or not the vehicle had any defects. The returned verdict read:

We, the jury, answer the questions submitted to us as follows:

1.         For plaintiff Margie Daniel’s claim for breach of implied
            warranty, we find in favor of:

                  Plaintiff

               X  Defendant

2.         For plaintiff Margie Daniel’s claim for breach of express
            warranty, we find in favor of:

                  Plaintiff

               X  Defendant

3.         For plaintiff Margie Daniel’s claim for violation of
            California’s Consumer Legal Remedies Act and the Unfair
            Competition Law, we find in favor of:

                  Plaintiff

               X  Defendant

4.         For plaintiff Margie Daniel’s claim for violation of
            California’s Unfair Competition Law, we find in favor of:

                  Plaintiff

               X  Defendant

Petrone v. Werner Enterprises, Nos. 8:11-cv-00401, 8:12-cv-00307 (D. Nev. May 23, 2017) (Chief Judge Laurie Smith Camp)

A Nebraska federal jury decided that Werner Enterprises Inc. and a subsidiary owed a class of around 52,000 student truck drivers almost $780,000, amounting to about $15 per class member, over allegations the company failed to pay the students for short rest breaks of 20 minutes or less in violation of minimum wage laws. See Michael Phillis, “Student Truckers Awarded $780K from Werner for Break Pay,” Law360, May 24, 2017.

In terms of manageability, the case was significantly streamlined by the court’s liability determination. Prior to jury deliberation, the court had already found Werner liable for damages, leaving the damages amount up to the jury. The court’s instruction provided the jury with the necessary context for its task:

[JURY] INSTRUCTION 18

Because this is a class action, any damages will be awarded to the class. This means that you will not provide damages individually for each workweek and for each of the 52,000 or more class members. Instead, any award you make will be to the class as a whole, and it will be for the Court to approve how to distribute any such award to class members.

The Court has already concluded that Warner did not pay Plaintiffs for short rest breaks of 20 minutes or less. You must award Plaintiffs damages in the amount that Plaintiffs should have been paid in minimum wages for such short rest breaks, less what Werner actually paid Plaintiffs.

The jury’s verdict read:

Question No. 1:

            With respect to Plaintiffs’ claims that Werner did not pay Plaintiffs for short rest breaks of 20 minutes or less, what is the amount of damages, if any, that should be awarded to Plaintiffs for the period from August 2008 to August 1, 2014?

            $  779,127     

One lesson of Petrone v. Werner Enterprises may be that by focusing on minimizing damages, a defendant can win the war even when it loses at trial.

Thomas Krakauer v. Dish Networks, No. 1:14-cv-00333-CCE-JEP (D.N.C. Jan. 19, 2017) (Judge Catherine C. Eagles)

A jury awarded a total of $20.5 million in a post-Spokeo Telephone Consumer Protection Act class action against Dish Network over 51,000 unwanted phone calls. Following a five-day trial, the jury awarded $400 for each unwanted call placed by authorized Dish dealer Satellite Systems Network (SSN). See Cara Salvatore, “Jury Awards $20M in Dish Telemarketing Class Action Trial,” Law360, Jan. 19, 2017; Alan Wingfield et al., “2 Dish Network Defeats Suggest TCPA Is Not Dead Yet,” Law360, June 9, 2017.

The jury verdict read:

1.         Was SSN acting as Dish’s agent when it made the
            telephone calls at issue from May 11, 2010, through
            August 1, 2011?

[ ✔ ]    YES

● ● ●

2.         Did SSN make and class members receive at least two
            telephone solicitations to a residential number in any 12-
            month period by or on behalf of Dish, when their telephone
            numbers were listed on the National Do Not Call Registry?

[ ✔ ]    YES as to Dr. Krakauer and all class members

● ● ●

3.         What amount, up to $500, do you award for each call made
            in violation of the TCPA?

            $  400.00  

 /s/ Robert Jackson                   01/19/2017  
   Foreperson                               Date

In a 30-page post-trial order, Judge Eagles tripled the jury award to $61.3 million and held that Dish Network willfully violated the Telephone Consumer Protection Act.

Bad acts can provoke serious consequences for defendants found to have committed willful misconduct, and defendants with serious such exposure should seriously explore settlement options or may face large verdicts.

Sergio Ramirez v. Trans Union, No. 12-cv-00632-JSC (N.D. Cal. July 20, 2017) (Judge Scott Corley)

A California federal jury found that TransUnion violated the Fair Credit Reporting Act (FCRA) when it conflated a class of consumers with similarly named terrorists and criminals from a government watch list. The jury awarded statutory and punitive damages in excess of $60 million ($8.1 million in statutory damages and $52 million in punitive damages) in what the plaintiffs’ attorneys called the largest FCRA verdict to date.

The jury’s verdict included specific findings that TransUnion willfully violated the FCRA by linking law-abiding consumers to similarly named criminals and terrorists in the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC) database. A defense motion for a new trial or reduced damages was denied November 7, 2017. The defendant has filed a notice of appeal to the Ninth Circuit. See also Cara Bayles, “Calif. Jury Hits TransUnion with Record $60M FCRA Verdict,” Law360, June 20, 2017; Rick Archer, “TransUnion Loses Bid to Undo $60M FCRA Verdict,” Law360, Nov. 7, 2017.

The jury verdict read:

Question No. 1 (First Claim): Did Defendant Trans Union, LLC willfully fail to follow reasonable procedures to assure the maximum possible accuracy of the OFAC information it associated with members of the class?

Yes  ✔             No    

Proceed to Question No. 2.

Question No. 2 (Second Claim): Did Defendant Trans Union, LLC willfully fail to clearly and accurately disclose OFAC information in the written disclosures it sent to members of the class?

Yes  ✔             No    

Proceed to Question No. 3.

Question No. 3 (Third Claim): Did Defendant Trans Union, LLC willfully fail to provide class members a summary of their FCRA rights with each written disclosure made to them?

Yes  ✔             No    

If your answer is “Yes” to Question Nos. 1, 2, or 3 (or any combination of these), proceed to Question No. 4. However, if you do not answer “Yes” to any of Questions Nos. 1, 2, or 3, then your deliberations are concluded. Your Presiding Juror should sign this verdict and inform Court staff.

Question No .4: What amount of statutory damages (of not less than $100 and not more than $1,000) do you award to each class member?

$  984.22  

In rejecting TransUnion’s post-trial motions, the court observed:

D. Trans Union’s Renewed Objections Regarding Class Certification
    Finally, Trans Union yet again challenges class treatment of Plaintiff’s claims. The Court has repeatedly rejected these objections and does so again. If anything, the trial evidence demonstrated that class treatment of these claims is even more appropriate than appeared at the class certification stage. Trans Union falsely identified every class member as a potential match and every class member received an incomplete disclosure which failed to properly advise them of their rights to challenge the OFAC information in their file.

    Trans Union’s argument that the class size should be “corrected” to reflect only those class members who actually received notice is unavailing. Rule 23 requires “the best notice that is practicable under the circumstances” and it does not limit the class to only those who received notice. See In re Integra Realty Res., Inc., 354 F.3d 1246, 1260 (10th Cir. 2004). To the extent that notice to some of the class members was returned, Plaintiff represents that he is committed to undertaking additional efforts to provide notice of the damages award to affected class members. Further, as Plaintiff notes, Trans Union, which maintains a consumer credit file on each of these class members, is likely in the best position to provide up-to-date address information for class members. Trans Union’s argument that the judgment should be amended to only cover those who received notice is likewise misplaced. Rule 23 requires judgment be entered as to those class members to whom notice was sent. See Fed. R. Civ. Pro. 23(c)(3)(B) (“the judgment in a class action must . . . include and specify or describe those to whom the Rule 23(c)(2) notice was directed, who have not requested exclusion, and whom the court finds to be class members.”); see also Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 812 (1985) (holding that “a fully descriptive notice [] sent first-class mail to each class member, with an explanation of the right to ‘opt out,’ satisfies due process”). All such class members are deemed bound by the judgment. See Phillips, 472 U.S. at 811-12 (holding that absent class members are bound to the judgment as long as they are afforded the minimal procedural due process protections of “notice plus an opportunity to be heard and participate in the litigation, whether in person or through counsel.”) However, the Court will grant Trans Union’s unopposed request to amend the form of the judgment to conform to the language of Rule 23(c)(3)(B).

Once again, a defendant facing serious allegations of wrongdoing was held accountable for large damages in a class action trial.

In re Syngenta AG MIR 162 Corn Litigation, No. 2:14-md-02591 JWL-JPO (D. Kan. July 23, 2017) (Judge John W. Lungstrom)

A Kansas federal jury, in a 13-day trial, awarded corn producers $218 million in compensatory damages (and no punitive damages) in the first trial in multidistrict litigation over agricultural giant Syngenta’s alleged role in China’s rejection of U.S. corn shipments. See Rachel Graf, “Farmers Awarded $218M in 1st Syngenta GMO Corn Trial,” Law360, June 23, 2017; Daniel Siegal, “Syngenta Looks to Speed Appeal of $218M GMO Corn Verdict,” Law360, Sept. 22, 2017.

In this first-of-its-kind bellwether class trial, the jury found the plaintiffs’ claims of depressed prices so convincing that they awarded all damages requested. Following the verdict, Syngenta has sought to expedite its appeal to the Tenth Circuit by asking the trial court to certify a final judgment.

The class action trial, conducted on behalf of a Kansas farmer class, was so successful from the court’s point of view that Judge Lungstrom partially granted the plaintiffs’ request to consolidate the seven remaining state class actions into four grouped trials. (Order of November 7, 2017.)

Larry Finch v. LVNV Funding LLC, No. 24-C-11-007101 (Cir. Ct. Baltimore, Md. May 20, 2016)

In this state court case, a Baltimore jury awarded a class of 1,589 Maryland residents the sum of $38,630,344.00 against South Carolina and Nevada debt purchaser and collector LVNV Funding LLC for unlawful debt collection acts throughout the state of Maryland. See, e.g., Consumer Law Ctr. LLC, “Baltimore City Jury Awards Largest Verdict in Maryland History Against a Debt Collector for Actual Damages Related to Defendant’s Unlawful Collection Activities,” May 20, 2016. On appeal, the jury verdict was upheld as to liability and unjust enrichment, and was reversed and vacated as to damages methodologies: A new trial on damages was ordered on September 14, 2017. 2017 WL 4074573 (unreported decision).

Bahamas Surgery Center LLC, et al. v. Kimberly-Clark Corp., No. 2:14-cv-0890-DMG-PLA (C.D. Cal. Apr. 7, 2017) (Judge Dolly M. McGee)

A California federal jury found that Kimberly-Clark Corp. and its spinoff Halyard Health Inc. misled buyers about the impermeability of the companies’ MicroCool surgical gowns, awarding a class of buyers $454 million in compensatory and punitive damages in the fraud trial. See John Kennedy, “Kimberly-Clark Can’t Redo $454M Fraud Trial, Court Told,” Law360, June 19, 2017; Emily Field, “$454M Gown Verdict Says Jury Can Be Swayed Without Harm,” Law360, Apr. 12, 2017.

The jury’s verdict was as follows:

Question No. 1: On the Plaintiff Class Claim for concealment against Defendant Kimberly-Clark, we find in favor of: (check one)

  ✔  The Plaintiff Class and against Defendant Kimberly-Clark

       Defendant Kimberly-Clark and against the Plaintiff Class

● ● ●

Question No. 2: State the amount of compensatory damages, if any, you award to the Plaintiff Class against Defendant Kimberly-Clark on the claim for concealment:

$ 3,889,327.00

In response to Question No. 2, if you awarded the Plaintiff Class $0, skip the remainder of the questions and have your presiding juror sign and date this form. If you awarded the Plaintiff Class any amount greater than $0, proceed to Question No. 3.

Question No. 3: Did the Plaintiff Class prove the dates on which each loss of the Plaintiff Class was incurred? (check one)

Yes  ✔             No    

● ● ●

Question No. 4: Do you find the Plaintiff Class is entitled to prejudgment interest? (check one)

Yes  ✔             No    

Question No. 5: With respect to Defendant Kimberly-Clark’s conduct for which found in favor of the Plaintiff Class on the concealment claim, did the Plaintiff Class prove by clear and convincing evidence that Defendant engaged in the conduct with malice, oppression, or fraud? (check one)

Yes  ✔             No    

● ● ●

Question No. 6: State the amount of punitive damages, if any, you award against Defendant Kimberly-Clark.

$ 350 Million

DATED: 04/07/2017

A post-trial motion to decertify the class was filed on January 25, 2018, by defendants Kimberly-Clark and Halyard Health, arguing that the Ninth Circuit’s decision in In re Hyundai & Kia Fuel Economy Litigation, No. 15-56014, 2018 WL 505343 (9th Cir. Jan. 23, 2018), supports decertification and arguing that the plaintiff’s purported evidence of affirmative representations was not “sufficient to prove classwide exposure to affirmative representations” because the exposure to the supposed misrepresentations varied from class member to class member. No. 2:14-cv-0890-DMG-PLA, ECF No. 551 at 12.

Conclusion
Reference to and study of prior class-wide trials can aid practitioners and the court in successfully certifying and trying new cases.

Elizabeth J. Cabraser and Fabrice N. Vincent – February 28, 2018