Summary
granting writ as moulded due to lack of thorough analysis
Summary of this case from State ex rel. W. Virginia-American Water Co. v. WebsterOpinion
No. 21-0561
04-22-2022
STATE of West Virginia EX REL. DODRILL HEATING AND COOLING, LLC, Defendant Below, Petitioner, v. The Honorable Maryclaire AKERS, Judge of the Circuit Court of Kanawha County; and Jerry and Pamela Whittington, Husband and Wife, Individually and on Behalf of All Others Similarly Situated, Plaintiffs Below, Respondents.
Camille E. Shora, Esq., Wilson, Elser, Moskowitz, Edelman & Dicker LLP, McLean, Virginia, Counsel for Petitioner Matthew Stonestreet, Esq., Troy N. Giatras, Esq., The Giatras Law Firm, PLLC, Charleston, West Virginia, Counsel for Respondents
Camille E. Shora, Esq., Wilson, Elser, Moskowitz, Edelman & Dicker LLP, McLean, Virginia, Counsel for Petitioner
Matthew Stonestreet, Esq., Troy N. Giatras, Esq., The Giatras Law Firm, PLLC, Charleston, West Virginia, Counsel for Respondents
WALKER, Justice: Respondents Jerry and Pamela Whittington purchased an HVAC unit from Petitioner Dodrill Heating and Cooling LLC (Dodrill), and later sued Dodrill when they had issues with the unit. Eventually, the circuit court certified a class action based on the Whittingtons’ claim that language in the documents used by Dodrill violated the West Virginia Consumer Credit Protection Act (WVCCPA), West Virginia Code § 46A-2-127(g). Dodrill seeks a writ of prohibition challenging the class certification on two grounds. First, Dodrill contends that the Whittingtons lack standing because the challenged language is no more than a threat and was never acted upon, so it is not actionable as an injury-in-fact. But because the West Virginia Legislature has determined that representations made in violation of the WVCCPA are an injury-in-fact with or without resulting damages, we deny Dodrill's writ of prohibition as to standing.
Pursuant to an administrative order entered by this Court on February 7, 2022, the Honorable Alan D. Moats, Judge of the Nineteenth Judicial Circuit, was assigned to sit as a member of the Supreme Court of Appeals of West Virginia commencing February 7, 2022, following the resignation of former Justice Evan Jenkins. In this case, Justice Moats was temporarily assigned to hear the case due to Justice Armstead's disqualification.
Second, Dodrill seeks to prohibit certification of a class of individuals who also received documents from Dodrill containing the language that purportedly violates the WVCCPA. Dodrill contends that the circuit court's order does not sufficiently analyze the predominance and superiority factors of Rule 23(b)(3) of the West Virginia Rules of Civil Procedure as thoroughly as we deemed necessary in our recent opinion in State ex rel. Surnaik Holdings of West Virginia, LLC v. Bedell . We agree with Dodrill that the circuit court's order was conclusory as to its analysis of the predominance and superiority factors addressed in Surnaik , but disagree that the appropriate remedy is to vacate with instructions that class certification be denied. Rather, we grant the requested writ of prohibition, but direct, as we did in Surnaik , that the circuit court undertake a more rigorous analysis under the parameters outlined in that case.
244 W. Va. 248, 852 S.E.2d 748 (2020).
I. FACTUAL AND PROCEDURAL BACKGROUND
Respondents Jerry and Pamela Whittington, like the class they propose to represent, purchased an HVAC unit from Dodrill. The written proposal for installation the Whittingtons received from Dodrill quoted a total price of $11,995.00 and noted that "[b]uyer agrees to any reasonable attorney or collection fees incurred by seller in securing payment for this contract." Dodrill facilitated the Whittingtons’ finance of the purchase through Greensky, LLC.
The Whittingtons allege that they had repeated issues with the HVAC unit, requiring Dodrill to return to their home to service the unit several times. Each time Dodrill returned to work on the unit, the written work orders provided to the Whittingtons contained the language "[i]n the event that collection efforts are initiated against me, I shall pay for all associated fees at the posted rates as well as all collection fees and reasonable attorney fees." The Whittingtons ultimately requested that Dodrill remove the unit and issue a full refund.
When the Whittingtons filed suit against Dodrill, they alleged negligence and violations of West Virginia Code § 46A-6-102(7) and West Virginia Code § 46A-6-104 for the omission of material terms required by the Home Improvement Rule and misrepresentation and breach of warranty under the WVCCPA. The Whittingtons then sought and were granted leave to file an amended complaint converting the case to a putative class action.
The Home Improvement Rule is a legislative rule, West Virginia C.S.R. 142-5-1, et seq. Below, Dodrill challenged whether a private cause of action exists under those provisions, but that issue is not before the Court.
The amended complaint added the claim that Dodrill had violated West Virginia Code § 46A-2-127(g) by including language in the proposal/agreement and subsequent work orders that they would be subject to pay Dodrill's attorney fees and sought class-wide relief for all individuals who had received the same proposal/agreement and work orders containing that language. After a hearing on class certification on December 15, 2020, the circuit court entered an order certifying the class on June 17, 2021. Dodrill filed the instant petition for writ of prohibition seeking to preclude certification of the class.
II. STANDARD OF REVIEW
Dodrill seeks relief in prohibition under this Court's original jurisdiction as to the Whittingtons’ purported lack of standing and the circuit court's alleged failure to fully comply with Rule 23 of the West Virginia Rules of Civil Procedure in certifying the class. "A writ of prohibition will not issue to prevent a simple abuse of discretion by a trial court. It will only issue where the trial court has no jurisdiction or having such jurisdiction exceeds its legitimate powers. W. Va. Code 53-1-1." The requisite considerations for issuance of a writ of prohibition that do not involve the absence of jurisdiction are well-settled:
Syl. Pt. 2, State ex rel. Peacher v. Sencindiver , 160 W.Va. 314, 233 S.E.2d 425 (1977).
In determining whether to entertain and issue the writ of prohibition for cases not involving an absence of jurisdiction but only where it is claimed that the lower tribunal exceeded its legitimate powers, this Court will examine five factors: (1) whether the party seeking the writ has no other adequate means, such as direct appeal, to obtain the desired relief; (2) whether the petitioner will be damaged or prejudiced in a way that is not correctable on appeal; (3) whether the lower tribunal's order is clearly erroneous as a matter of law; (4) whether the lower tribunal's order is an oft repeated error or manifests persistent disregard for either procedural or substantive law; and (5) whether the lower tribunal's order raises new and important problems or issues of law of first impression. These factors are general guidelines that serve as a useful starting point for determining whether a discretionary writ of prohibition should issue. Although all five factors need not be satisfied, it is clear that the third factor, the existence of clear error as a matter of law, should be given substantial weight.[ ]
Syl. Pt. 5, State ex rel. Hoover v. Berger , 199 W. Va. 12, 483 S.E.2d 12 (1996).
With this standard in mind, we turn to the parties’ arguments. III. ANALYSIS
As noted above, Dodrill seeks a writ of prohibition on two separate issues. First, Dodrill contends that the Whittingtons lack standing because they have only produced evidence of a "threat" to add attorney fees but have not incurred actual harm from Dodrill since the Whittingtons financed their HVAC through a third-party and Dodrill never attempted to collect a debt from the Whittingtons. Second, Dodrill challenges the circuit court's order certifying the class as non-compliant with the analysis required under Rule 23 of the West Virginia Rules of Civil Procedure. We examine these arguments in turn.
A. Standing
Article VIII, Sections 3 and 6 of the West Virginia Constitution establish a "controversy" requirement. As we have noted previously, "[o]ne of the incidents of [the] controversy requirement is that a litigant have ‘standing’ to the challenge the action sought to be adjudicated[.]" While Section 3 pertains to appellate controversy requirements of this Court, similar parameters are imposed on the circuit courts by Section 6. Specific to the controversy requirement under Article VIII, Section 6, we have discussed that "there must be a justiciable case or controversy—a legal right claimed by one party and denied by another—in order for the circuit court to have subject matter jurisdiction. In part, this means the party asserting a legal right must have standing to assert that right." Standing, as a more specific concept of justiciability, "refers to one's ability to bring a lawsuit based upon a personal stake in the outcome of the controversy[,]" and has been defined by this Court as "[a] party's right to make a legal claim or seek judicial enforcement of a duty or right."
See W. Va. Const. Art. VIII, § 3 :
The court shall have appellate jurisdiction in civil cases at law where the matter in controversy, exclusive of interest and costs, is of greater value or amount than three hundred dollars unless such value or amount is increased by the Legislature; in civil cases in equity; in controversies concerning the title or boundaries of land; in proceedings in quo warranto, habeas corpus, mandamus, prohibition and certiorari; and in cases involving personal freedom or the constitutionality of a law. It shall have appellate jurisdiction in criminal cases, where there has been a conviction for a felony or misdemeanor in a circuit court, and such appellate jurisdiction as may be conferred upon it by law where there has been such a conviction in any other court. In criminal proceedings relating to the public revenue, the right of appeal shall belong to the state as well as to the defendant. It shall have such other appellate jurisdiction, in both civil and criminal cases, as may be prescribed by law.
See also W. Va. Const. Art. VIII, § 6 :
Circuit courts shall have original and general jurisdiction of all civil cases at law where the value or amount in controversy, exclusive of interest and costs, exceeds one hundred dollars unless such value or amount is increased by the Legislature; of all civil cases in equity; of proceedings in habeas corpus, mandamus, quo warranto, prohibition and certiorari; and of all crimes and misdemeanors. On and after January one, one thousand nine hundred seventy-six, the Legislature may provide that all matters of probate, the appointment and qualification of personal representatives, guardians, committees and curators, and the settlements of their accounts, shall be vested exclusively in circuit courts or their officers, but until such time as the Legislature provides otherwise, jurisdiction in such matters shall remain in the county commissions or tribunals existing in lieu thereof or the officers of such county commissions or tribunals.
Coleman v. Sopher , 194 W. Va. 90, 95 n.6, 459 S.E.2d 367, 372 n.6 (1995).
State ex rel. Healthport Tech., LLC v. Stucky , 239 W. Va. 239, 242, 800 S.E.2d 506, 510 (2017).
Id. at 242-43, 800 S.E.2d at 509-10.
Findley v. State Farm Mut. Auto. Ins. Co. , 213 W.Va. 80, 94, 576 S.E.2d 807, 821 (2002) (quoting Black's Law Dictionary 1413 (7th ed. 1999)).
Standing has been further refined as follows:
Standing is comprised of three elements: First, the party attempting to establish standing must have suffered an "injury-in-fact"— an invasion of a legally protected interest which is (a) concrete and particularized and (b) actual or imminent and not conjectural or hypothetical. Second, there must be a causal connection between the injury and the conduct forming the basis of the lawsuit. Third, it must be likely that the injury will be redressed through a favorable decision of the court.[ ]
Id. at Syl. Pt. 5.
Dodrill contends that the Whittingtons cannot establish the first element of standing since they have suffered no injury-in-fact resulting from the language in the proposal/agreement and subsequent work order invoices. Importantly, "standing is gauged by the specific common-law, statutory or constitutional claims that a party presents." And the operative inquiry is "whether the litigant is entitled to have the court decide the merits of the dispute or of particular issues." So, we look to the statutory provision under which the Whittingtons seek relief.
Id. at 95, 576 S.E.2d at 822 (quoting International Primate Protection League v. Administrators of Tulane Educational Fund , 500 U.S. 72, 77, 111 S.Ct. 1700, 114 L.Ed.2d 134 (1991) ).
Id. (quoting Warth v. Seldin , 422 U.S. 490, 498, 95 S.Ct. 2197, 45 L.Ed.2d 343 (1975) ).
The only claim at issue before us is the Whittingtons’ claim under West Virginia Code § 46A-2-127(g). That provision of the WVCCPA states in relevant part:
No debt collector shall use any fraudulent, deceptive or misleading representation or means to collect or attempt to collect claims or to obtain information concerning consumers. Without limiting the general application of the foregoing, the following conduct is deemed to violate this section:
....
(g) Any representation that an existing obligation of the consumer may be increased by the addition of attorney's fees ... when in fact such fees or charges may not legally be added to the existing obligation[.]
As to this provision, Dodrill makes two arguments relating to the Whittingtons’ failure to establish injury-in-fact: (1) "threat" is not an injury-in-fact because it was never enforced against the Whittingtons (i.e., there was no attempt to collect a debt under the statute); and (2) Dodrill is not a "debt collector."
Injury-in-fact means exactly what it sounds like: that the plaintiff has, in fact, been injured in a legally recognizable way. Injury-in-fact may be "economic or otherwise" but "a plaintiff must show that he or she suffered ‘an invasion of a legally protected interest’ that is ‘concrete and particularized.’ " "Concrete" simply means that the injury actually exists or is imminent, and, conversely, is not conjectural or hypothetical. "Particularized" means that it affects the plaintiff in a personal and individual way.
Healthport , 239 W. Va. at 242, 800 S.E.2d at 510 (quoting Snyder v. Callaghan , 168 W. Va. 265, 275, 284 S.E.2d 241, 248 (1981) ).
Id. at 243, 800 S.E.2d at 510 (quoting Spokeo, Inc. v. Robins , 578 U.S. 330, 339, 136 S.Ct. 1540, 194 L.Ed.2d 635 (2016) ).
Id.
Id.
Practically speaking, "[i]njury in fact is easily established when a litigant demonstrates a ‘direct, pocketbook injury.’ " In this sense, Dodrill relies on State ex rel. Healthport Technologies, LLC v. Stucky as supporting its claim that the Whittingtons lack standing for lack of injury, arguing that "like the Whittingtons, the plaintiff in [ Healthport ] obtained a certified class action based on an alleged statutory violation without any out of pocket loss." In Healthport , we dismissed (for lack of standing) a plaintiff's claim against a medical provider for overcharging for copies of medical records in violation of West Virginia Code § 16-29-2a (2014). In doing so, we explained that the cost of those overpayments had been borne not by plaintiff, but by his attorneys, who had not sought reimbursement for those costs from plaintiff. As a result, we concluded that plaintiff had no injury-in-fact unless and until he became contractually obligated to pay the allegedly unlawful expense. Dodrill's reliance on this case is misguided, in part, because out-of-pocket loss is not a prerequisite to recover under the WVCCPA.
Kanawha Cnty. Pub. Library Bd. v. Bd. of Educ. of Cnty. of Kanawha , 231 W. Va. 386, 398, 745 S.E.2d 424, 436 (2013) (quoting Barrows v. Jackson , 346 U.S. 249, 256, 73 S.Ct. 1031, 97 L.Ed. 1586 (1953) ).
Id. at 241, 243-44, 800 S.E.2d at 508, 510-11.
Id. at 243, 800 S.E.2d at 510.
Id. at 244 800 S.E.2d at 511.
Healthport is also distinguishable here because part of the issue in that case was who the statute enabled to bring the cause of action. Under the WVCCPA, "consumers" are entitled to bring the cause of action for purported violations, and Dodrill does not appear to dispute that the Whittingtons fit that definition. See Syl. Pt. 1, Young v. EOSCCA , 239 W. Va. 186, 800 S.E.2d 224 (2017).
Rather, the violation of the WVCCPA itself gives rise to civil penalties that are independent of compensatory damages. In our 2013 decision in Vanderbilt Mortgage and Finance v. Cole , we looked at the then-effective West Virginia Code § 46A–5–101(1), which stated, in pertinent part,
See W. Va. Code § 46A-5-101(1) (2017).
If a creditor has violated the provisions of this chapter applying to ... statements of account and evidences of payment [or] ... any prohibited debt collection practice ..., the consumer has a cause of action to recover actual damages and in addition a right in an action to recover from the person violating this chapter a penalty in an amount determined by the court not less than one hundred dollars nor more than one thousand dollars.[ ]
Vanderbilt Mortg. and Fin., Inc. v. Cole , 230 W. Va. 505, 510, 740 S.E.2d 562, 567 (emphasis in original).
We concluded that the legislature intended actual damages and civil penalties to operate independently of one another. That is, that the recovery of civil penalties is not conditioned upon the demonstration of actual damages. In that case, we explained our conclusion based on other language in the statute:
Following the reasoning set forth in Dunlap , Harless , and Baker , this Court believes that the Legislature, in creating W. Va. Code § 46A–5–101(1), has created a mechanism by which those who have suffered no quantifiable harm may yet recover civil penalties for being subject to undesirable treatment described in Article 2 of the Act. We find that by including the option for consumers to pursue civil penalties, the Legislature intended that § 46A–5–101(1) function, in part, as a disincentive for creditors to engage in certain undesirable behaviors that might not result in actual damages. Therefore, based on the language of the WVCCPA and what we perceive to be the Legislature's intent in enacting the WVCCPA, we hold that under W. Va. Code § 46A–5–101(1) (1996), an award of civil penalties is not conditioned on an award of actual damages.[ ]
Id. at 511, 740 S.E.2d at 568.
In 2015, the Legislature clarified the statute to that end, modifying it to read, in pertinent part: "the consumer has a cause of action to recover: (a) Actual damages; and (b) a right in an action to recover from the person violating this chapter a penalty of $1,000 per violation."
W. Va. Code § 46A-5-101 (2015). This statute was again amended in 2017, its current version, but this portion of the statute remained unchanged from the 2015 version.
Stated plainly, violation of the WVCCPA is the injury-in-fact, and as to this statute in particular, "any representation" is the violation. We ask whether the Whittingtons have alleged an invasion of a legally protected interest and were damaged thereby. The Legislature has determined that individuals have a legally protected interest in remaining free from fraudulent, deceptive, and misleading representations similar to the one contained in the proposal/agreement and the work orders and has created a civil penalty provision for its violation without need to show corresponding out-of-pocket damage. In other words, the purported fraudulent, deceptive, misleading representation is a concrete, actual, non-hypothetical, non-conjectural injury-in-fact because the Legislature has made it so. The fact that Dodrill never acted upon the representation does not change that reality. As we recently explained,
The CCPA is intended to deter deceptive practices and to protect West Virginia consumers from fraud, and the goal is to protect the public as a whole. As one state court found in interpreting a similar civil penalty statute, "Because the CCPA's civil penalty requirement is intended to punish
and deter the wrongdoer and not to compensate the injured party, the CCPA is intended to proscribe deceptive acts and not the consequences of those acts." May Dep't Stores Co. v. State ex rel. Woodard , 863 P.2d 967, 972 (Colo. 1993).[ ]
State ex rel. 3M Co. v. Hoke , 244 W. Va. 299, ––––, 852 S.E.2d 799, 813 (2020).
Dodrill's "no-harm, no foul" argument is thus unavailing. The injury-in-fact (the representation in purported violation of the WVCCPA) is likewise particularized to the Whittingtons; there can be no valid argument that the representations were not made to the Whittingtons when there is no dispute that the documents containing those representations were given directly to them.
In arguing that it is not a debt collector and that it was not attempting to collect a debt, Dodrill does not ask us to resolve the standing question – the Legislature has done that already but rather, it asks for summary judgment. Those are not "injury-in-fact" inquiries, nor are they "are-the-Whittingtons-the-proper-party-to-bring-suit" inquiries – they are merits inquiries. Whether Dodrill was attempting to collect a debt and qualifies as a "debt collector" goes to the merits of the Whittingtons’ claims, not their standing to bring suit in seeking relief: "[t]he focus of a standing analysis is not on the validity of the claim but instead is ‘on the appropriateness of a party bringing the questioned controversy to the court.’ " Discovery will tell whether the Whittingtons and, if certified, the class at large, have successfully made out their claim under the WVCCPA that Dodrill was (1) a debt collector and (2) attempting to collect a debt, but Dodrill's arguments are suited for a motion for summary judgment, not a standing challenge. We therefore conclude that the Whittingtons have established standing to bring this suit and refuse Dodrill's petition for a writ of prohibition on that ground.
Healthport , 239 W. Va. at 243, 800 S.E.2d 506 (quoting Findley , 213 W. Va. at 95, 576 S.E.2d at 822 ) (emphasis added).
B. Class certification
Dodrill petitions for a writ of prohibition on the independent ground that the circuit court failed to undertake the necessary analysis of Rule 23(b) of the West Virginia Rules of Civil Procedure in granting class certification. Specifically, Dodrill contends that the circuit court's analysis of the predominance and superiority factors falls short of the requirements discussed in Surnaik .
244 W. Va. 248, 852 S.E.2d 748 (2020).
In relation to class certification, the circuit court is entitled to our deference. As we have previously held, " ‘[w]hether the requisites for a class action exist rests within the sound discretion of the trial court.’ Syllabus Point 5, Mitchem v. Melton , 167 W. Va. 21, 277 S.E.2d 895 (1981)." But, the Rules of Civil Procedure demand a certain amount of analysis before certification is appropriate, and such analysis is not a perfunctory exercise:
Id. at Syl. Pt. 7 (additional quotations and citation omitted).
A class action may only be certified if the trial court is satisfied, after a thorough analysis, that the prerequisites of Rule 23(a) of the West Virginia Rules of Civil Procedure have been satisfied. Further, the class certification order should be detailed and specific in showing the rule basis for the certification and the relevant facts supporting the legal conclusions.[ ]
And,
Before certifying a class under Rule 23 of the West Virginia Rules of Civil Procedure [1998], a circuit court must determine that the party seeking class certification has satisfied all four prerequisites contained in Rule 23(a) —numerosity, commonality, typicality, and adequacy of representation—and has satisfied one of the three subdivisions of Rule 23(b). As long as these prerequisites to class certification are met, a case should be allowed to proceed
Syl. Pt. 8, State ex rel. Chemtall Inc. v. Madden , 216 W. Va. 443, 607 S.E.2d 772 (2004). See also State ex rel. W. Va. Univ. Hosps. v. Gaujot , 242 W. Va. 54, 62, 829 S.E.2d 54 (2019).
on behalf of the class proposed by the party.[ ]
Syl. Pt. 8, In re West Virginia Rezulin Litigation , 214 W. Va. 52, 585 S.E.2d 52 (2003).
Initially, we note that Dodrill does not raise any concerns with the circuit court's analysis of the factors under Rule 23(a) in concluding that the plaintiffs have established numerosity, commonality, typicality, and adequacy of representation. Rule 23(b) is broken up into three subsections, only one of which need be satisfied for class certification. Here we focus on subsection (3) of Rule 23(b), which provides that class certification may be appropriate 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, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy. The matters pertinent to the findings include: (A) the interest of members of the class in individually controlling the prosecution or defense of separate actions; (B) the extent and nature of any litigation concerning the controversy already commenced by or against members of the class; (C) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; (D) the difficulties likely to be encountered in the management of a class action.
In Surnaik , we examined Rule 23(b)(3), directing that it, like subsection (a), is subject to a rigorous analysis. We therefore held that
See Surnaik , 244 W. Va. at ––––, 852 S.E.2d at 757.
When a class action certification is being sought pursuant to West Virginia Rule of Civil Procedure 23(b)(3), a class action may be certified only if the circuit court is satisfied, after a thorough analysis, that the predominance and superiority prerequisites of Rule 23(b)(3) have been satisfied. The thorough analysis of the predominance requirement of West Virginia Rule of Civil Procedure 23(b)(3) includes (1) identifying the parties’ claims and defenses and their respective elements; (2) determining whether these issues are common questions or individual questions by analyzing how each party will prove them at trial; and (3) determining whether the common questions predominate. In addition, circuit 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. This analysis must be placed in the written record of the case by including it in the circuit court's order regarding class certification.[ ]
Syl. Pt. 7, Surnaik .
Specific to the predominance requirement, in Surnaik , this Court explicitly rejected any suggestion in Rezulin that "there is not much difference between commonality and predominance." The circuit court's order here, though citing Surnaik at the outset, does not apply the analysis set forth in that decision, but instead reverts to the less-nuanced, commonality-resembling analysis of the predominance factor as was set forth in Rezulin . The order simply concludes that the central legal question predominating the nine thousand cases was that they all involved allegations of violations of West Virginia Code § 46A-2-127(g). As a result of the circuit court's application of Rezulin , its conclusions as to predominance are apparently conclusory and contain none of the requisite analysis outlined in Surnaik as separate and apart from, and more exacting than, a commonality analysis.
Id. at ––––, 852 S.E.2d at 761.
Similarly, as to superiority, the order summarily concludes that class action is an efficient and superior method for resolution of the claims stemming from alleged violations of § 46A-2-127(g). Superiority is more than a mere conclusion that class action would suit as a general proposition:
[u]nder the superiority test, a trial court must "compare [ ] the class action with other potential methods of litigation." Cleckley, Davis, & Palmer, Jr., Litigation
Handbook on West Virginia Rules of Civil Procedure § 23(b)(3)[2][b], at 554 (footnote omitted). See also Nolan v. Reliant Equity Investors, LLC , No. 3:08-CV-62, 2009 WL 2461008, at *4 (N.D. W. Va. Aug. 10, 2009) ("Superiority requires that a class action be superior to other methods for the fair and efficient adjudication of the controversy." (quotations and citations omitted)); In re West Virginia Rezulin Litig. , 214 W. Va. at 75, 585 S.E.2d at 75 (stating that superiority "requirement focuses upon a comparison of available alternatives").
"Factors that have proven relevant in the superiority determination include the size of the class, anticipated recovery, fairness, efficiency, complexity of the issues and social concerns involved in the case." Cleckley, Davis, & Palmer, Jr., Litigation Handbook on West Virginia Rules of Civil Procedure § 23(b)(3)[2][b], at 554 (footnote omitted). In addition, this Court has observed that consideration must be given to the purposes of Rule 23, " ‘including: conserving time, effort and expense; providing a forum for small claimants; and deterring illegal activities.’ " In re West Virginia Rezulin Litig. , 214 W. Va. at 76, 585 S.E.2d at 76 (quoting 2 Conte & Newberg, Newberg on Class Actions § 4:32, at 277-78 ).[ ]
Perrine v. E.I. du Pont de Nemours & Co. , 225 W. Va. 482, 527, 694 S.E.2d 815, 860 (2010).
The conclusions made in the circuit court's order with respect to predominance and superiority cannot pass muster under the standards articulated in Surnaik , and, in fact, are more conclusory than the analysis conducted in that case. Because "[a] circuit court's failure to conduct a thorough analysis of the requirements for class certification pursuant to West Virginia Rules of Civil Procedure 23(a) and/or 23(b) amounts to clear error[,]" we must grant the writ of prohibition with respect to class certification. But we do not – as Dodrill requests – vacate the order and require denial of class certification upon remand by concluding that the class cannot meet the predominance and superiority requirements. We simply grant the writ of prohibition and direct the circuit court to undertake a more thorough analysis of those two factors under Rule 23(b)(3) to ensure class resolution is the appropriate method to adjudicate these claims.
Syl. Pt. 8, Surnaik .
IV. CONCLUSION
For the reasons set forth above, we deny Dodrill's requested writ of prohibition seeking to dismiss the Whittingtons’ claims for lack of standing. However, we agree that the June 21, 2021 order of the Circuit Court of Kanawha County granting class certification requires more analysis under Rule 23(b)(3) of the West Virginia Rules of Civil Procedure and grant the writ of prohibition as moulded.
Writ granted as moulded.
CHIEF JUSTICE HUTCHISON concurs and reserves the right to file a separate opinion.
JUSTICE WOOTON concurs, in part, and dissents, in part, and reserves the right to file a separate opinion.
JUSTICE ARMSTEAD, deeming himself disqualified, did not participate in the decision of this case.
JUSTICE ALAN D. MOATS, sitting by temporary assignment.
Chief Justice Hutchison, concurring:
It is a basic rule, of fairness and of process, that judges speak through their orders. The majority did not issue a writ of prohibition in this case because the circuit judge reached a wrong result. We did so only because the judge did not plainly and fully explain in her order – to the parties and to the public – why a class action is the best way forward. Still, I feel a need to concur to explain two points in the majority's opinion.
The facts in this case are quite simple: in the middle of the summer, plaintiffs Jerry and Pamela Whittington bought a new whole-house heating and cooling unit from Dodrill Heating and Cooling. The unit was either defective or the installation was done wrong. Within days it leaked fluid, wiring burned out, valves broke, the cooling unit stopped working. Dodrill's repeated attempts at repair over the following six weeks failed. Dodrill's installation contract had a "money back," "satisfaction" guarantee; when the plaintiffs said they weren't satisfied and demanded Dodrill return their money, Dodrill refused because the plaintiffs wouldn't let Dodrill try and repair the unit just one more time. On these simple facts, a lawsuit was born.
The Dodrill repair technician who discovered the burned wiring told the plaintiffs that the Dodrill installation technicians had used the wrong type of wiring when they installed the new unit.
West Virginia Code § 46A-2-127 reads, in pertinent part,
No debt collector shall use any fraudulent, deceptive or misleading representation or means to collect or attempt to collect claims or to obtain information concerning consumers. Without limiting the general application of the foregoing, the following conduct is deemed to violate this section:
[...]
(g) Any representation that an existing obligation of the consumer may be increased by the addition of attorney's fees, investigation fees, service fees or any other fees or charges when in fact such fees or charges may not legally be added to the existing obligation[.]
Dodrill's "Proposal/Agreement" to the plaintiffs provides: "GUARANTEES : vComfort vNo Lemons ... vMoney Back ... Satisfaction: We will guarantee that your system meets or exceeds your expectations for quality and reliability."
When the plaintiffs hired their lawyer, the lawyer looked at the documents Dodrill had handed to the plaintiffs. Every proposal, contract, or invoice that Dodrill prepared had language saying, in effect, that the plaintiffs would have to pay any attorney or collection fees Dodrill might incur to secure payment for the broken unit. After a little discovery, the plaintiffs’ lawyer found Dodrill had included the same language in proposals, contracts, and invoices it gave to 9,000 or more other customers.
The "Proposal/Contract" said "Buyer agrees to any reasonable attorney or collection fees incurred by seller in securing payment for this contract." Dodrill's repair invoices said that, by accepting Dodrill's work, the plaintiffs agreed that "in the event collection efforts are initiated ... [you] shall pay for all associated fees at the posted rates as well as all collection fees and reasonable attorney fees."
West Virginia's Consumer Credit and Protection Act appears to specifically prohibit companies from making such threats against consumers. The Act lays out various "protective measures for consumers in transactions[.]" W. Va. Code § 46A-1-103(3) (1996). One of those protective measures prohibits a "debt collector" from using "any fraudulent, deceptive or misleading representation or means" to collect a debt or to obtain information from a consumer. W. Va. Code § 46A-2-127 (1997) ("Section 127"). The Act lays out various examples of outlawed debt collection practices, including (in Section 127(g)) prohibiting a debt collector from making "[a]ny representation that an existing obligation of the consumer may be increased by the addition of attorney's fees, investigation fees, service fees or any other fees or charges[.]" W. Va. Code Ann. § 46A-2-127(g).
If a defendant is found to have violated the Act, a consumer is permitted to recover their actual damages plus a penalty of $1,000 per violation of the Act (up to $175,000 or the amount of indebtedness, if higher). The same remedy applies to each consumer in a class action. West Virginia Code § 46A-5-101(1) (2017) creates this civil remedy for consumers:
If a ... debt collector has violated the provisions of this chapter [Chapter 46A] applying to ... any prohibited debt collection practice ... the consumer has a cause of action to recover: (a) Actual damages; and (b) a right in an action to recover from the person violating this chapter a penalty of $1,000 per violation: Provided, That the aggregate amount of the penalty awarded shall not exceed the greater of $175,000 or the total alleged outstanding indebtedness: Provided, however, That in a class action the aggregate limits on the amount of the penalty set forth above shall be applied severally to each named plaintiff and each class member such that no named plaintiff nor any class member may recover in excess of the greater of $175,000 or the total alleged outstanding indebtedness....
Obviously, the plaintiffs sued over the faulty HVAC unit. But the plaintiffs also alleged Dodrill violated the Consumer Credit and Protection Act. They did not seek damages for just themselves, they sought damages for over 9,000 other Dodrill customers who supposedly received the same threats. In the order on appeal, the circuit court said the allegation looked ripe to be resolved in a class action. Dodrill, however, ran to this Court with two claims: that the plaintiffs did not have standing to sue under the Consumer Credit and Protection Act, and that the circuit court did not make clear that the plaintiffs’ allegations "predominate" over other, individual questions for all the class members. Let me expound upon the Court's resolution of these two claims.
A. Standing
Dodrill's primary claim to this Court was that the plaintiffs do not have standing to pursue a claim under Section 127(g) because they cannot prove Dodrill was a "debt collector." Dodrill first says it isn't a debt collector because it never tried to collect any payment for installing the HVAC unit, mostly because Dodrill got the plaintiffs to pay Dodrill's bill in full using third party financing (financing that Dodrill arranged for the plaintiffs). Dodrill argues that a company should be allowed to include menacing language in its bills or contracts threatening to charge consumers attorney fees and collection costs, just so long as the consumer pays the bill and the company is never provoked to act upon those threats.
Standing is not a high hurdle for a plaintiff. The plaintiff must only show some "injury-in-fact" that forms the basis of their lawsuit, and that the "injury" can be redressed through a decision by the trial court. Syllabus Point 5, Findley v. State Farm Mut. Auto. Ins. Co. , 213 W. Va. 80, 576 S.E.2d 807 (2002). Dodrill, however, misreads the "injury-in-fact" requirement to suggest it requires a plaintiff to sustain a physical injury, or a monetary, out-of-pocket loss. What Dodrill's argument misses is that a plaintiff does sustain an injury in fact when the defendant directs a threat at a consumer or engages in other fraudulent or deceptive conduct prohibited by the Act.
The plain language of Section 127(g) prohibits "any representation" that a company will attempt to collect fees or collection costs; ergo, the Act prohibits threats, not merely the actual taking of those charges from a consumer. As we noted in State ex rel. 3M Co. v. Hoke , 244 W. Va. 299, 852 S.E.2d 799, 813 (2020), the Act was designed to do more than just compensate a consumer physically or monetarily harmed by conduct proscribed by the Act. The Act imposes civil penalties to punish those who violate the Act. Further, the penalties dissuade other actors from using fraudulent, deceptive, and misleading conduct that the Legislature has deemed harmful to West Virginians in general:
The [Consumer Credit and Protection Act] is intended to deter deceptive practices and to protect West Virginia consumers from fraud, and the goal is to protect the public as a whole. As one state court found in interpreting a similar civil penalty statute, "Because the CCPA's civil penalty requirement is intended to punish and deter the wrongdoer and not to compensate the injured party, the CCPA is intended to proscribe deceptive acts and not the consequences of those acts." May Dep't Stores Co. v. State ex rel. Woodard , 863 P.2d 967, 972 (Colo. 1993).
Id. at 312, 852 S.E.2d at 813. The civil penalties also compensate the plaintiff for enforcing the Act. Stated succinctly, a plaintiff need not allege out-of-pocket damages or other injuries to maintain an action under the Act. The plaintiff must only assert a violation of the Act's terms by the defendant and that the defendant's conduct was directed toward the plaintiff. The Act is analogous to criminal law, in that a threat or representation of an intent to harm someone is as actionable as actual harm itself.
Dodrill does not seriously dispute the clear, unambiguous threat contained in its proposal and invoices that it intended to collect attorney fees and costs from the plaintiffs, if it tried to collect on its bill. Instead, the second part of Dodrill's standing argument suggests that Dodrill is not a professional debt collector who chases customers over unpaid bills and, hence, is exempt from the meaning of "debt collector" as defined in the Act. However, this Court firmly rejected Dodrill's attempts at legal sophistry. The Act defines a "debt collector" as a person or organization that engages in "debt collection," meaning they take any "action, conduct or practice" to collect a consumer's obligation to pay money that arose from some transaction in money, property, insurance or services. See W. Va. Code §§ 46A-2-122 (b), (c), and (d). The plaintiffs’ complaint clearly asserts that the documents presented by Dodrill were intended to compel the plaintiffs to pay money in exchange for Dodrill installing the HVAC unit that is the focus of the parties’ transaction. Moreover, this Court has made clear that a person or organization does not have to be a "professional" or full-time debt collector to be bound by the Act. In Syllabus Point 3 of Thomas v. Firestone Tire and Rubber Co. , 164 W. Va. 763, 266 S.E.2d 905 (1980), this Court found that
In reverse order, the Act provides:
(d) "Debt collector" means any person or organization engaging directly or indirectly in debt collection....
(c) "Debt collection" means any action, conduct or practice of soliciting claims for collection or in the collection of claims owed or due or alleged to be owed or due by a consumer.
(b) "Claim" means any obligation or alleged obligation of a consumer to pay money arising out of a transaction in which the money, property, insurance or service which is the subject of the transaction is primarily for personal, family or household purposes, whether or not such obligation has been reduced to judgment.
W. Va. Code § 46A-2-122(b), (c), and (d).
The plain meaning of W.Va. Code § 46A-2-122 requires that the provisions of article 2 of Chapter 46A regulating improper debt collection practices in consumer credit sales must be applied alike to all who engage in debt collection, be they professional debt collectors or creditors collecting their own debts.
(Emphasis added). The plaintiffs allege that Dodrill was a creditor seeking to collect upon its own debt – the debt the plaintiffs incurred when they agreed to pay for a heating and cooling unit provided and installed by Dodrill.
In a nutshell, the record wholly supports the Court's finding that the plaintiffs have standing. The plaintiffs sufficiently alleged that Dodrill was attempting to collect a debt owed by the plaintiffs when it threatened the plaintiffs with attorney's fees and collection costs, if the plaintiffs failed to pay their debt. When Dodrill made a representation that threatened the plaintiffs, in violation of the Act, it created an "injury in fact." The plaintiffs therefore have standing to go forward with their own claim, and they have standing to pursue in a class action the claims of other Dodrill customers subjected to similar conduct.
B. Predominance in a Class Action
Under the West Virginia Rules of Civil Procedure, a party may seek to form a class action by showing evidence supporting all four elements in Rule 23(a) and at least one of the three subdivisions in Rule 23(b). The plaintiffs in this case sought a class action under Rule 23(b)(3).
As we said in Syllabus Point 8 of In re W. Va. Rezulin Litig. , 214 W. Va. 52, 585 S.E.2d 52 (2003) :
Before certifying a class under Rule 23 of the West Virginia Rules of Civil Procedure [1998], a circuit court must determine that the party seeking class certification has satisfied all four prerequisites contained in Rule 23(a) —numerosity, commonality, typicality, and adequacy of representation—and has satisfied one of the three subdivisions of Rule 23(b). As long as these prerequisites to class certification are met, a case should be allowed to proceed on behalf of the class proposed by the party.
Rule 23(b)(3) of the West Virginia Rules of Civil Procedure required the circuit court in this case to make two findings: "that the questions of law or fact common to the members of the class predominate over any questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy." These are the "predominance" and "superiority" requirements.
This Court has couched the predominance and superiority analysis as requiring a "thorough" and "rigorous" analysis by the circuit judge. In reality, Rule 23(b)(3) deliberately encompasses malleable standards. The drafters of Rule 23 thought the words " ‘predominance’ and ‘superiority’ were like silly putty that could be molded in any way by a judge in a particular context." State ex rel. Surnaik Holdings of WV, LLC v. Bedell , 244 W. Va. 248, 271, 852 S.E.2d 748, 771 (2020) (Hutchison, J., concurring).
Exactly what is meant by "predominate" is not made clear in Rule 23(b)(3). Surnaik Holdings offers some qualitative or quantitative guides. Predominance is a common battleground for certification decisions but is basically an inquiry into the material legal or factual questions presented by the class members. The goal is for a court to find if the proposed class is "sufficiently cohesive to warrant adjudication by representation." Amchem Prod., Inc. v. Windsor , 521 U.S. 591, 594, 117 S.Ct. 2231, 138 L.Ed.2d 689, (1997). Predominance does not mean that individual questions concerning class members do not exist; it merely means that some common question predominates among members. If a question can be "can be resolved for all members of [a] class in a single adjudication," then the predominance requirement is satisfied. Messner v. Northshore Univ. HealthSystem , 669 F.3d 802, 815 (7th Cir. 2012) (quoting 7AA Wright & Miller, Federal Practice & Procedure § 1778 (3d ed. 2011)).
Syllabus Point 7 of Surnaik Holdings , 244 W. Va. at 250, 852 S.E.2d at 750, offers these guidelines for assessing predominance and superiority:
When a class action certification is being sought pursuant to West Virginia Rule of Civil Procedure 23(b)(3), a class action may be certified only if the circuit court is satisfied, after a thorough analysis, that the predominance and superiority prerequisites of Rule 23(b)(3) have been satisfied. The thorough analysis of the predominance requirement of West Virginia Rule of Civil Procedure 23(b)(3) includes (1) identifying the parties’ claims and defenses and their respective elements; (2) determining whether these issues are common questions or individual questions by analyzing how each party will prove them at trial; and (3) determining whether the common questions predominate. In addition, circuit 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. This analysis must be placed in the written record of the case by including it in the circuit court's order regarding class certification.
Or, to put it another way, common questions can predominate if a "common nucleus of operative facts and issues" underlies the claims brought by the proposed class. In re Nassau County Strip Search Cases , 461 F.3d 219, 228 (2d Cir. 2006), quoting Waste Mgmt. Holdings, Inc. v. Mowbray , 208 F.3d 288, 299 (1st Cir. 2000). "If, to make a prima facie showing on a given question, the members of a proposed class will need to present evidence that varies from member to member, then it is an individual question. If the same evidence will suffice for each member to make a prima facie showing, then it becomes a common question." Blades v. Monsanto Co. , 400 F.3d 562, 566 (8th Cir. 2005). Individual questions need not be absent. The text of Rule 23(b)(3) itself contemplates that such individual questions will be present. The rule requires only that those questions not predominate over the common questions affecting the class as a whole.
Id.
"Superiority is the oft-overlooked sibling of predominance." Christine P. Bartholomew, The Failed Superiority Experiment , 69 Vand. L. Rev. 1295, 1300 (2016). See also , Jay Tidmarsh, Diagnosis and Treatment of the "Superiority Problem," 69 Vand. L. Rev. En Banc 267, 268 (Among the terms used in Rule 23, "none is slipperier to understand than ‘superiority.’ "). Rule 23(b)(3) ’s superiority requirement is comparative: the circuit court must assess the efficiency of a class action with an eye toward "other available methods," as well as the interests of the class members, whether other litigation has been commenced, what forum should be the locus of litigation, and the management difficulties of a class action. See Rule 23(b)(3)(A)-(D). "The court must compare the possible alternatives to determine whether Rule 23 is sufficiently effective to justify the expenditure of the judicial time and energy that is necessary to adjudicate a class action[.]" 7AA Wright & Miller, Fed. Prac. & Proc. Civ. § 1779 (3d ed. 2011). Refusing to certify on manageability grounds alone should be the last resort. "[A] class action has to be unwieldy indeed before it can be pronounced an inferior alternative—no matter how massive the fraud or other wrongdoing that will go unpunished if class treatment is denied—to no litigation at all." Carnegie v. Household Int'l, Inc. , 376 F.3d 656, 661 (7th Cir. 2004). Overall, Rule 23 is a robust procedural tool that permits courts to efficiently resolve complicated questions. What makes sense for one class action creates problems in another. The only requirement in Rule 23(b)(3) is that at least one question predominate among the class members such that a class action is the superior vehicle to resolve that question. There is no mechanical requirement in the rule that a class action only encompass one question, or that there be no individual questions. Rule 23(c)(4) provides that "an action may be brought or maintained as a class action with respect to particular issues" and, hence, infers that the same action may be dissolved into smaller proceedings to address other issues. In other words, a court may certify a class as to some common issues, and later decertify the action as to other issues not common to all members. "[S]eparate juries may decide different issues. One jury will render a verdict as to the common, certifiable issues. In many instances it would be impracticable to expect that same jury to be empaneled long enough to resolve all of the noncertified issues of each class member as well." Simon v. Philip Morris Inc. , 200 F.R.D. 21, 29 (E.D.N.Y. 2001) (Weinstein, J.). See also Susan E. Abitanta, Bifurcation of Liability and Damages in Rule 23 (b)(3) Class Actions: History, Policy, Problems, and A Solution , 36 Sw. L.J. 743 (1982).
In the instant case, the plaintiffs seek a class action to resolve their allegation that Dodrill violated the Act, in a similar manner, toward over 9,000 consumers. These consumer class members are easily identified, but Dodrill vigorously contends that the plaintiffs cannot represent these similarly situated consumers in a class action. Hence, one alternative would be for the plaintiffs to file a complaint joining those 9,000 separate consumers into their action. Another would be for the plaintiffs’ attorney to sign representation agreements with all 9,000 consumers, file 9,000 separate lawsuits (while filing a separate filing fee for each), and then have the circuit court transfer and consolidate those 9,000 lawsuits under Rule 42 for joint resolution. Either instance would impose significant administrative and fiscal burdens on the plaintiffs’ attorney, on the circuit clerk that would handle the increased paperwork, and on the defendant, which would be required to respond to each joinder motion or separate lawsuit. The circuit court would also be required to expend considerable time and energy consolidating and managing 9,000 separate litigants and lawsuits.
Stated differently, in this case, the plaintiff's suggestion that the circuit court certify a class action to resolve the same predominating legal and factual question about the Act for over 9,000 consumers appears to be the superior method compared to the other available methods. Since a class action requires only one plaintiff, one complaint, one judge, and eliminates dozens of pleadings, motions and filing fees along with a mountain of attorneys’ fees (all of which, if the plaintiffs were successful, would be paid for by the defendant under W. Va. Code § 46A-5-104 ), a class action would seem to be the superior vehicle. However, it is up to the circuit court to consider the evidence and arguments of the parties before adopting its ruling.
Rule 23 parallels Rule 16 and Rule 42 of the Rules of Civil Procedure, which grant a trial court broad authority to join or sever parties and issues for trial or "adopt[ ] special procedures for managing potentially difficult or protracted actions that may [involve] complex issues, multiple parties, difficult legal questions, or unusual proof problems[.]" Rule 16(c)(12). Lastly, judges should understand that the certification of a class action is not an irreversible act: a class may be decertified after a liability ruling, or decertified when facts later reveal that a class action is not the best tool for resolving the dispute.
Another procedural use for Rule 23 permits a court to certify a class for settlement purposes only. See , e.g. , In re Gen. Motors Corp. Pick-Up Truck Fuel Tank Prod. Liab. Litig. , 55 F.3d 768, 786 (3d Cir. 1995) ("[A] settlement class is a device whereby the court postpones the formal certification procedure until the parties have successfully negotiated a settlement, thus allowing a defendant to explore settlement without conceding any of its arguments against certification.").
See , e.g. , Syl. pt. 2, State ex rel. Metro. Life Ins. Co. v. Starcher , 196 W. Va. 519, 474 S.E.2d 186 (1996) ("To demonstrate the existence of a class pursuant to Rule 23 of the West Virginia Rules of Civil Procedure, it is not required that each class member be identified, but only that the class can be objectively defined. It is not a proper objection to certification that the class as defined may include some members who do not have claims because certification is conditional and may be altered, expanded, subdivided, or vacated as the case progresses toward resolution on the merits.").
An essential guide for every judge conducting a predominance analysis under Rule 23(b)(3) is this: "do not let the trees blind you to the forest:"
Defendants attempting to avoid class certification will, almost exclusively, overwhelm a circuit judge with the differences between each class member's case. It is akin to a judge being asked to look at a forest of oak trees and being told the difference between each tree: each tree has a different height, a different color, a different number of leaves, a unique number of branches, a wide variation in the number and size of tree rings, and so on.
The test for the judge, though, is to step back and look at the similarities in class members. Step back and see the forest. No matter the number of branches or leaves, a
collection of oak trees has enough similarities to be called a "class" of oak trees. So, on remand, the judge in the instant case should do the same: focus on the class members and find their similarities.
Surnaik Holdings , 244 W. Va. at 272, 852 S.E.2d at 772 (quoting Gulas v. Infocision Mgmt. Corp. , 215 W. Va. 225, 230, 599 S.E.2d 648, 653 (2004) (Starcher, J., concurring)).
Finally, let me address the Court's decision to grant a writ of prohibition in this case. In recent years, this Court has granted several writs of prohibition halting class certification rulings after assessing that the judges had failed to complete a "thorough" or "rigorous" Rule 23 analysis. The Court granted a writ in this case for the same reason.
See , e.g. , State ex rel. W. Va. Univ. Hosps. - E., Inc. v. Hammer , 246 W.Va. 122, 866 S.E.2d 187, 202 (2021) ("[W]e find the circuit court's order fails to provide the ‘thorough analysis’ required[.]"); State ex rel. Surnaik Holdings of WV, LLC v. Bedell , 244 W. Va. 248, 263, 852 S.E.2d 748, 764 (2020) ("[T]he circuit court has exceeded its legitimate powers by certifying the class while failing to undertake a thorough analysis[.]"); State ex rel. Mun. Water Works v. Swope , 242 W. Va. 258, 267, 835 S.E.2d 122, 131 (2019) ("[T]he circuit court's order did not contain a thorough analysis of the Rule 23(a) factors[.]"); State ex rel. W. Va. Univ. Hosps., Inc. v. Gaujot, 242 W. Va. 54, 64, 829 S.E.2d 54, 64 (2019) ("[T]he circuit court has exceeded its legitimate powers by certifying the class while failing to conduct a sufficiently thorough analysis of the case[.]").
"It is a paramount principle of jurisprudence that a court speaks only through its orders." Legg v. Felinton , 219 W.Va. 478, 483, 637 S.E.2d 576, 581 (2006). Judges should, of course, employ precision and clarity in any order. What the Court's ruling, in this case and the others, really means when it uses words like "thorough" or "rigorous" is this: when ruling on a Rule 23 class certification motion, a judge must enter an order with substantial detail that explains the judge's reasoning. Whether the judge is granting or denying class certification, the judge is speaking to a broad audience, one far broader than a typical case. The order in a class action is a historical record. It speaks not only to the litigants, but also speaks to untold numbers of as-yet unidentified, prospective class members. Because of the potential breadth of relief that stands to be imposed by the judge's rulings, and because many defendants in a class action are large, incorporated businesses, the order also speaks to distant corporate officers, employees, stockholders, investors or insurers. Plus, the res judicata effect of the class action on its wide-ranging audience must be clear. Any reader of the judge's certification order should know the step-by-step basis for the certification decision, such that the decision provides clear guidance to the broad audience likely to review the judge's reasoning.
Rule 23 is a magnificent tool for managing complex cases, and while class actions sometimes take a little more elbow grease, they are capable of affording justice for more people than can individual lawsuits. A clear and detailed order on certification questions assures the judge, the litigants, and other observers that consideration has been given to every argument of the parties and every element of the rule.
Hence, I concur with the Court's decision to grant a writ of prohibition to afford the circuit judge an opportunity to craft a more detailed order explaining why a class action is the superior method and why the questions raised by the plaintiffs are predominant.
WOOTON, J., concurring, in part, dissenting, in part:
This action presented two issues for this Court's resolution: (1) whether the Respondents, plaintiffs-below, lacked standing to assert a claim under West Virginia Code § 46A-2-127(g) 1 ; and (2) whether the circuit court's order certifying this class action properly analyzed the predominance and superiority requirements for class certification under West Virginia Rule of Civil Procedure 23(b)(3). I concur with the majority's resolution of the first question, concluding that Petitioner's assertion that the Respondents lacked standing was without merit. However, I disagree with the majority's resolution of the second question, concluding that the circuit court failed to properly analyze predominance and superiority under the strictures of this Court's holding in State ex rel. Surnaik Holdings of WV, LLC v. Bedell , 244 W. Va. 248, 852 S.E.2d 748 (2020). In my review of the circuit court's order, I believe the circuit court performed a sufficient substantive analysis to survive this Court's scrutiny, and that the majority's insistence on strict adherence to Surnaik "exalts form over substance[.]" Id. at 267, 852 S.E.2d at 767 (Workman, J., dissenting). For this reason, I concur, in part, and dissent, in part.
The majority's decision rests on our holding in Syllabus Point 7 of Surnaik that
[w]hen a class action certification is being sought pursuant to West Virginia Rule of Civil Procedure 23(b)(3), a class action may be certified only if the circuit court is satisfied, after a thorough analysis, that the predominance and superiority prerequisites of Rule 23(b)(3) have been satisfied. The thorough analysis of the predominance requirement of West Virginia Rule of Civil Procedure 23(b)(3) includes (1) identifying the parties’ claims and defenses and their respective elements; (2) determining whether these issues are common questions or individual questions by analyzing how each party will prove them at trial; and (3) determining whether the common questions predominate. In addition, circuit 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. This analysis must be placed in the written record of the case by including it in the circuit court's order regarding class certification.
Id. at 250, 852 S.E.2d at 750, syl. pt. 7 (emphasis added). As noted above, the majority concludes that the circuit court did not adhere to this holding insofar as it allegedly failed to include a "thorough" analysis of predominance and superiority. However, I find that conclusion to be both flatly wrong, and untenable in light of the circuit court's 22-page order.
As the circuit court recognized, the central legal issue in the case below is whether Dodrill Heating & Cooling, LLC, violated the West Virginia Consumer Credit Protection Act, specifically West Virginia Code § 46A-2-127(g), by including language in its contracts and work orders which threatened the addition of collection and attorney's fees to the customer's balance if a collection action were initiated against them. The circuit court identified the offending provisions, finding that Dodrill's contracts state, "Buyer agrees to any reasonable attorney or collection fees incurred by seller in securing payment for this contract[,]" and that the work orders state that "[i]n the event that collection efforts are initiated against [Buyer], [Buyer] shall pay for all associated fees at the posted rate as well as all collection fees and reasonable attorney fees." Ultimately, the circuit court determined that some 1,700 individual customers signed the contract, while 7,500 signed the work order, bringing the putative class to more than 9,000 individual persons.
Respondents, plaintiffs below, specifically challenged the inclusion of this language in the contracts Dodrill required them to sign, alleging West Virginia Code § 46A-2-127(g) plainly prohibits threats to consumers that the balance on their account may be increased by the cost of attorney's fees and/or collection costs. As such, the central question before the circuit court — and the only issue upon which class certification was based — was "whether Dodrill violated W. Va. Code § 46A-2-127 by communicating to consumers that any obligation which they may owe to it can be increased by attorney fees and collection costs." That is a straightforward question of law, and is, in fact, the only question central to every putative class member's cause of action against Dodrill. Beyond this, assuming arguendo the mere threat of fees is a violation of the WVCCPA, it is also the dispositive question. How can there be any doubt that this question predominates over any individual claims of the putative class members? Yet, the majority inexplicitly ignores this natural conclusion and instead holds that the circuit court needed to expend more time explaining the obvious.
Relying on the circuit court's allegedly sparse discussion of predominance, the majority holds that the circuit court failed to undertake a thorough analysis of this factor. I strongly disagree. As stated above, the question before the circuit court was one purely of law, requiring no factual development and no weighing of the evidence — just a straightforward question: does the fee-threatening language included in Dodrill's contracts violate West Virginia Code § 46A-2-127(g) ? This is a purely legal question, yet the majority insists that the circuit court's analysis was not sufficient because it "contain[s] none of the requisite analysis outlined in Surnaik as separate and apart from, and more exacting than a commonality analysis." What the majority means is that the circuit court failed to outline the parties’ claims and defenses and their respective elements, or to analyze the proof necessary to establish those claims and defenses. Surnaik , 244 W. Va. at 258, 852 S.E.2d at 758.
In my reading of § 46A-2-127(g), there are only two elements that must be established to proceed: (1) whether Dodrill is a debt collector for purposes of the WVCCPA — a question readily answered by the Act itself in § 46A-2-122 ; and (2) whether the language in Dodrill's contracts threatens the addition of impermissible collection and attorney's fee — a question readily answered by looking at Dodrill's contracts. The claims and defenses are self-evident, and the proof necessary to establish them is already in the record of this case insofar as Dodrill has supplied its form contracts and a list of customers who have signed them. To require the circuit court to now enumerate these elements is an exercise in futility which achieves only one purpose: further delaying the resolution of these claims.
A similar problem plagues the majority's conclusion that the circuit court failed to properly address Rule 23(b) ’s superiority requirement. In Surnaik we enumerated a number of factors this Court has deemed relevant in establishing whether a class action is superior to other forms of litigation, including "the size of the class, anticipated recovery, fairness, efficiency, complexity of the issues and social concerns involved in the case." Surnaik , 244 W. Va. at 263, 852 S.E.2d at 763 (internal citations omitted). We further cautioned that "consideration must be given to the purposes of Rule 23, ‘ "including: conserving time, effort, and expense; providing a forum for small claimants; and deterring illegal activities." ’ " Id. (internal citations omitted).
The circuit court adequately addressed all but one of the enumerated superiority factors: anticipated recovery. Though the circuit court may have made a poor drafting choice in combining its analyses of predominance and superiority, it cannot be denied that the circuit court's intertwined analysis: (1) identifies a class of 9,000 putative members, which absent a class action would require the filing of 9,000 individual suits; (2) finds that the putative class members all share identical — and from the above analysis, straightforward — legal questions; (3) concludes that "judicial efficiency and public policy" warrant certifying the class; and (4) that management of any remaining individual questions can be achieved via subclasses and bifurcation. Though the circuit court never used the word "superior" in this analysis, what more could have been done to establish that a class action was clearly the superior form of litigation in this matter? Moreover, even had the circuit court not done this analysis, it is obvious that class litigation is far superior to 9,000 individual claims raising identical issues; accordingly, if the circuit court's failure to so state is an error, it is not of such magnitude as to warrant reversal and remand.
I am greatly concerned that this Court's decision in Surnaik portends an imprudent path which will render class certification a far more arduous process, and which will create — as illustrated by the case at bar — senseless delays predicated on strict adherence to form over substance. I do not think this Court intended Surnaik to require the courts of this State to waste judicial time and resources stating the obvious; to the extent that Surnaik does so, I believe it is a serious deviation from our long-standing Rule 23 jurisprudence and, as such, should be limited in its application. For the foregoing reasons, I respectfully concur, in part, and dissent, in part.