Opinion
Case No. 20-CV-00953-FJG
2023-03-21
Chong KEISTER and Russell Keister on behalf of themselves and all others similarly situated, Plaintiffs, v. ALLSTATE FIRE AND CASUALTY INSURANCE COMPANY, Defendant.
Joseph A. Kronawitter, Taylor Foye, Horn, Aylward & Bandy, LLC, Kansas City, MO, Brian Timothy Meyers, Law Offices of Brian Timothy Meyers, Kansas City, MO, for Plaintiffs. Dawn B. Williams, Pro Hac Vice, Faegre Drinker Biddle & Reath LLP, Washington, DC, Michael John Carroll, Gordon Rees Scully Mansukhani, LLP, Des Moines, IA, for Defendant.
Joseph A. Kronawitter, Taylor Foye, Horn, Aylward & Bandy, LLC, Kansas City, MO, Brian Timothy Meyers, Law Offices of Brian Timothy Meyers, Kansas City, MO, for Plaintiffs. Dawn B. Williams, Pro Hac Vice, Faegre Drinker Biddle & Reath LLP, Washington, DC, Michael John Carroll, Gordon Rees Scully Mansukhani, LLP, Des Moines, IA, for Defendant. ORDER Fernando J. Gaitan, Jr., United States District Judge
Currently pending before the Court is plaintiffs' Motion to Certify Class (Doc. # 52), Allstate's Motion for Summary Judgment and for Oral Argument (Docs. # 69, 73), plaintiff's Motion to Strike Allstate's Motion for Summary Judgment or Alternatively to Stay Briefing Deadline (Docs. # 77, 79).
I. BACKGROUND
Plaintiffs Chong and Russell Keister are Missouri residents who purchased an automobile insurance policy from Allstate that included $5,000 of Automobile Medical Payments ("Med-Pay") coverage. On October 31, 2019, Chong Keister, was involved in an accident in Kansas. The other driver was determined to be at fault for the accident. As a result of the accident, Ms. Keister received medical care which resulted in bills exceeding $5,000. Allstate paid $4,500 toward the medical bills pursuant to Kansas law. Allstate alleges that this payment was made pursuant to the Kansas statute which requires nonresidents to meet certain minimum protections, including $4,500 in personal injury protection, also referred to as ("PIP") coverage. Allstate states that it paid the remaining $500 per the policy's Med-Pay provision. Allstate then sought subrogation of the $4,500 in PIP coverage payments from the other driver's insurance company, CNA. Allstate never received subrogation from the at-fault driver and it engaged outside counsel to pursue the claim in October 2020. In February 2021, outside counsel determined that the subrogation case was not worth pursuing and closed the file. Since that time, Allstate is not and has not sought subrogation from anyone regarding the Keister's claim and informed the at-fault driver's insurance company CNA that it is not doing so.
On October 20, 2020, plaintiffs filed a class action petition against Allstate seeking a declaratory judgment that Allstate violated Missouri law and breached its contract with its insured when it asserted a subrogation claim or sought reimbursement from its insured for the Med-Pay benefits. Plaintiffs are seeking damages for themselves and on behalf of the putative class for breach of contract, breach of duty of good faith, declaratory and injunctive relief, restitution of premium payments, damages, penalties and attorney fees for vexatious refusal to pay. Plaintiff proposed two classes defined as follows:
All persons residing in Missouri with a contract of automobile insurance with Allstate Insurance that included Medical Payments Coverage, at any point in time from October 20, 2010 to the present. ("Injunctive Class").Plaintiffs also proposed a damages class defined as:
All persons residing in Missouri with a contract of automobile insurance with Allstate Insurance that included Medical Payments Coverage, at any point in time from October 20, 2010 to the present, that had a claim for medical payments coverage subjected to subrogation or reimbursement by Allstate ("Damages Class").
On December 3, 2020, Allstate removed the case to this court on the basis of the Class Action Fairness Act, 28 U.S.C. § 1332(d) ("CAFA").
Since 2010, Allstate has issued two different automobile policies to Missouri residents containing Med-Pay coverage. Allstate sold policy AFA10 in Missouri until June 2018 and thereafter sold policy ACR1 accompanied by a Missouri Amendatory Endorsement on form ACR54 (collectively referred to as ACR1). Policy ACR1 is the type of policy the Keisters had and includes a subrogation provision applicable to Med-Pay. The policy states, "When we pay under this policy, and a person insured under this policy has the right to recover from anyone else, that person's rights of recovery become ours up to the amount we have paid. That person must protect these rights and, at our request, help us to enforce them." (Doc. 60-2, p.5). The subrogation provision found in the policy in use prior to 2018 does not apply to Med-Pay.
II. STANDARDS
Under Fed.R.Civ.P. 23(a), the Court considers the following prerequisites and certifies a class action only if:
(1) the class is so numerous that joinder of all members is impracticable; (2) there are questions of law or fact common to the class; (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and (4) the representative parties will fairly and adequately protect the interests of the class.
The Court will proceed to analyze whether either of plaintiffs' proposed classes meet these criteria and if either class meets at least one provision of the Fed.R.Civ.P. 23(b) criteria.
III. DISCUSSION
A. Motion to Certify
In Morris v. Moon Ridge Foods, LLC, No. 18-CV-03219-SRB, 2019 WL 4197605 (W.D. Mo. Sept. 4, 2019), the Court discussed what must be shown in order to certify a class action:
Class certification is governed by Rule 23, and a proposed class must satisfy all four prerequisites of Rule 23(a) and at least one of the provisions of Rule 23(b). Comcast Corp. v. Behrend, 569 U.S. 27, 32, 133 S.Ct. 1426, 185 L.Ed.2d 515 (2013); Blades v. Monsanto Co., 400 F.3d 562, 568-69 (8th Cir. 2005). Rule 23(a) requires the proponent of a class action to show: 1) "the class is so numerous that joinder of all members is impracticable" (numerosity); 2) "there are questions of law or fact common to the class" (commonality); 3) "the claims or defenses of the representative parties are typical of the claims or defenses of the class" (typicality); and 4) "the representative parties will fairly and adequately protect the interests of the absent class members" (adequacy). District courts must engage in a "rigorous analysis" to determine whether "the prerequisites of Rule 23(a) have been satisfied." Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 161, 102 S.Ct. 2364, 72 L.Ed.2d 740 (1982). If the Rule 23(a) prerequisites have been met, a class action may be maintained only if at least one Rule 23(b) provision is satisfied.Id. at *1.
1. The Injunctive Class
a. Numerosity
Plaintiffs state that Allstate has conceded that it had 98,915 policies in force that included Med-Pay coverage and were issued to residents of Missouri who would potentially benefit from the relief that plaintiffs seek. Additionally, since October 20, 2010, Allstate issued 9,749,826 automobile policies that include Med-Pay coverage to Missouri residents. Plaintiffs allege that Allstate admits to having pursed subrogation more than 250 times since October 20, 2010. In opposition, Allstate asserts that since October 2015, only 68 files have been sent to subrogation and Allstate has received subrogation payments on approximately 50 of those claims. Allstate argues that joinder of these claims is practicable and thus plaintiffs cannot satisfy the numerosity requirement. In reply, plaintiffs argue that it is seeking injunctive and declaratory relief for the Missouri insureds under 98,915 policies in force and those who purchase policies in the future, so numerosity is satisfied. The Court agrees and finds that plaintiffs have satisfied the numerosity requirement.
Allstate argues that plaintiffs' class definition seeks to reach back to 2010, ten years before the Complaint was filed with no analysis of the statutes of limitations. Allstate argues that the statute of limitations for all of plaintiffs' claims is instead five years.
b. Commonality
In Wal-Mart v. Dukes, 564 U.S. 338, 131 S.Ct. 2541, 180 L.Ed.2d 374 (2011), the Court noted that commonality is "the rule requiring a plaintiff to show that 'there are questions of law or fact common to the class.' Rule 23(a)(2)." Id. at 349, 131 S.Ct. 2541. The Court continued that the "common contention, moreover, must be of such a nature that it is capable of classwide resolution - which means that determination of its truth or falsity will resolve an issue that is central to the validity of each one of the claims in one stroke." Id. at 350, 131 S.Ct. 2541. "What matters to class certification . . . is not the raising of common 'questions'—even in droves—but rather, the capacity of a class-wide proceeding to generate common answers apt to drive the resolution of the litigation. Dissimilarities within the proposed class are what have the potential to impede the generation of common answers." Id. (internal citations and quotations omitted).
Plaintiffs argue that Allstate treats all of its Missouri policies the same and has a policy of paying either Med-Pay or PIP benefits to a Missouri insured when they are injured outside the state of Missouri and seeking subrogation against the insured.
In opposition, Allstate states that the common questions asserted by plaintiffs will all require individualized proof and an analysis of the individualized subrogation process for each plaintiff. In Pete v. State Farm Mut. Auto. Insur. Co., No. 4:21-cv-00056KGB, 2022 WL 18457941 (E.D. Ark. Sept. 29, 2022), plaintiff sought to bring a class action against State Farm for Arkansas residents who had claims for underinsured and/or uninsured coverage which was discounted as a result of State Farm's failure to properly value their medical expenses. The Court stated
[e]ven if the Court were to agree with [plaintiff] that there is a common issue that State Farm violated Arkansas law in the manner in which it evaluated [plaintiff's] and other class members' medical expenses, the Court cannot agree based on the record before it that this common question is sufficient to establish commonality among the class because as explained in this Order significant individualized liability and damages issues remain.Id. at *7. The Court agrees and finds that the individualized subrogation analysis necessary for each class member defeats the commonality requirement.
c. Typicality
Typicality is met when the "claims or damages raised by the representative parties are typical of the claims and defenses of the class." Fed.R.Civ.P. 23(a)(3). In Dukes, the court noted:
[w]e have previously stated in this context that "[t]he commonality and typicality requirements of Rule 23(a) tend to merge. Both serve as guideposts for determining whether under the particular circumstances maintenance of a class action is economical and whether the named plaintiff's claim and the class claims are so interrelated that the interests of the class members will be fairly and adequately protected in their absence. Those requirements therefore also tend to merge with the adequacy-of-representation requirement, although the latter requirement also raises concerns about the competency of class counsel and conflicts of interest." General Telephone Co. of Southwest v. Falcon, 457 U.S. 147, 157-158, n. 13, 102 S.Ct. 2364, 72 L.Ed.2d 740 (1982).Id. at 349, n.5.
Plaintiffs allege that they share identical claims with all putative injunctive class members as the injunctive class is seeking declaratory and injunctive relief that Allstate's practice is prohibited under the terms of Allstate's policy and Missouri law. Plaintiffs state that Allstate testified that it treats the Med-Pay language in each Missouri policy the same and Allstate is continuing to assert subrogation rights against them. Thus, plaintiffs argue that their claims are typical of the injunctive class member claims. In opposition, Allstate argues that the Keisters' claims are not typical of the class because Allstate ceased pursuing subrogation against them over two years ago and thus their claim for damages is moot. Additionally, because they no longer have a harm to redress, Allstate argues that they lack standing. Without standing, Allstate argues that they are not adequate or typical class representatives and the class cannot be certified. In reply, plaintiffs state that Allstate's proof that it "long ago" abandoned its subrogation claim against plaintiffs is a June 16, 2022 letter from Allstate's counsel Dawn Williams directed to CNA and Plaintiffs' counsel. (Doc. 60-5). Plaintiffs argue that Allstate could have sent the letter long ago, but only now in an effort to defend against the class action did Allstate withdraw its subrogation lien. Plaintiffs argue that this "conduct alone warrant class certification as a sanction, if nothing more." (Plaintiffs' Reply Suggestions, p. 10). The Court disagrees. Allstate's representative, Chad Clark, stated in his Declaration that because Allstate never received subrogation from the at-fault party, in October 2020, Allstate engaged outside counsel to serve as a debt collector. In February 2021, the outside firm determined that it was not worth pursuing subrogation on the Keister's claim and closed the file. Allstate states that it deferred to that firm's assessment and has not thereafter sought subrogation. (Doc. 60, ¶¶ 36-37). To have standing to seek injunctive relief, plaintiffs must show that they are likely to suffer a "certainly impending" threat of future injury. Clapper v. Amnesty Intern'l, 568 U.S. 398, 409, 133 S.Ct. 1138, 1147, 185 L.Ed.2d 264 (2013). Because Allstate is no longer seeking subrogation from the Keisters, there is no current threat of ongoing harm. Allstate also argues that it is unlikely that its subrogation practices would cause the Keisters future harm, because this would require the Keisters to be driving in a different state, be involved in an accident caused by another party, be injured, incur medical expenses, submit and have the medical expenses paid by Allstate. Allstate would have to seek subrogation on the claim and deem it worthy of pursuit. Thus, the Court finds because the Keisters face no current threat of harm and it is unlikely that they will suffer any farm from Allstate's practices in the future, the Court finds that the Keisters' claims are not typical of the injunctive class they seek to represent.
d. Adequacy
In Baker v. City of Florissant, No. 4:16-CV-1693-NAB, 2023 WL 1434261 (E.D. Mo. Feb. 1, 2023), the Court stated, "[c]lass representatives and their attorneys must be able and willing to prosecute the action competently and vigorously, and each representative's interests must be sufficiently similar to those of the class that it is unlikely that their goals and viewpoints will diverge." Id. at *12. Plaintiffs state that they are adequate class representatives because they have maintained their policy and they could be future victims of Allstate's abuse absent the declaratory and injunctive relief they are pursuing on behalf of the Injunctive Class. Class counsel have also submitted declarations stating that they have significant experience in handling complex litigation as well as class actions. In opposition, Allstate states that the Keisters do not know the facts of the case, did not review critical legal documents such as the Complaint and the interrogatory responses and their understanding of how they were harmed came only from their attorney. In his deposition Mr. Keister testified:
Q. Sure. Do you believe that Allstate is able to recover from the at-fault party or the at-fault party's insurer funds that it paid out for medical benefits as a result of the accident?
. . .
A. Do I believe that they're able to pay it?
Is that?
Q. (By Ms. Williams) To recover the funds.(Russell Keister Depo. pp. 87-89).
A. Able to recover. From what I understand - and that's not very good - they—they shouldn't be recovering those funds.
Q. Why not?
A. I guess I would have to refer to my lawyer about that.
Q. And did your understanding come from your lawyer?
A. Pardon?
Q. You said from what I understand, they shouldn't be recovering those funds. Is that - is that understanding from your lawyer?
A. I guess so. I don't know.
Q. Do you have an independent understanding of whether or not Allstate can recover the funds?
A. My understanding, which isn't real good, is that Allstate is trying to recover funds that are—should be ours.
Q. Which funds are those?
A. I'm drawing a blank.
Q. Is it specific to funds expended for medical treatment?
A. I'm getting very confused, and I just -- I have to refer to my lawyer. I don't know.
Q. You said that Allstate was trying to recover funds that should be ours. Do you have an understanding of why those funds should be yours?
A. Because my understanding is that Allstate is trying to take back money that should have gone to our - I don't know. I'm confused.
Q. But Allstate paid out $5,000 in medical payments as a result of the accident, right?
A. Uh-huh.
Q. And it paid those directly to the providers?
A. I don't know.
Q. Okay. The funds eventually made their way to the providers.
A. I think the providers have been paid, but I don't know what else to say. I'm just not . . .
Q. So I think my question for you is, if the $5,000 was paid to providers, why is this your money?
A. Why is it mine?
Q. Correct.
. . .
A. It's - I'm very confused. I just can't answer this.
When Mr. Keister was asked about the Complaint he testified:
Q. In order to commence the lawsuit, you filed a complaint. Did you read the complaint before it was filed?(Russell Keister Depo. 115-116).
A. I read whatever was presented to me that - that's about all I can answer there.
. . .
Q. (By Ms. Williams) Who are the parties to this lawsuit?
A. I guess myself and my wife and people who - who are not—who are the parties? Anybody who paid for insurance through Costco - Costco. Wow. Through Allstate and - they paid for a certain amount of insurance, and then the - they paid for certain coverage of insurance - the insurance - the insurance was paid out to something. I - I'm not there. I don't know.
Chong Keister testified in her deposition as follows:
Q. Do you have an understanding of whether your Allstate policy offers coverage for medical benefits?(Chong Keister Depo. p. 19)
A. Most of my life I really didn't care about the things because my husband take care of everything.
Q. (By Ms. Williams) Why did you bring a class action instead of an individual case?(Chong Keister Depo. pp. 65-66).
A. I understanding that I'm not the only one to have this case. So I heard from other people through the same situation. That's why.
Q. Which other people?
A. I'm not really sure about individual case and class case, but I just believe that, you know, whoever has some - a similar case they might have a little understanding together or something like that. And I'm - The Interpreter: This is the interpreter saying. I - I think she doesn't really understand about the class actions.
Q. (By Ms. Williams) What are you seeking - what are you seeking to recover in this lawsuit?
A. My understanding was that, you know, some other people have, like, similar case. So I was thinking that everything - same interest. Because I - The Interpreter: As an interpreter, I was not sure what she understanding in the class action, and she say she doesn't understand what is class action. So I was asking her again, Do you understand what the meaning of it? She say no.
Q. (By Ms. Williams) So what - what did Allstate do that was wrong?(Chong Keister, Depo. p. 67).
A. I understanding - I mean. I think Allstate, the insurance company, they get more money than I supposed to receive for my case.
Q. Have they already received that money?
A. I heard that, you know, some other - well, 100 - more than 100 people have a similar situation like my case.
Q. What money did Allstate get that it was not supposed to get from you?
A. I think I supposed to receive more money from Allstate Insurance, but I didn't receive. That's why.
Q. (By Ms. Williams) Do you know who the parties are to the litigation?(Chong Keister Depo. p. 69).
A. I don't -
The WITNESS: I remember, but I forgot. I remember.
Q. (By Ms. Williams) What do you understand your responsibilities to be as the named plaintiff in a class action?
A. I'm not sure - I'm not sure exactly what the - all the responsibility of this - you know, the case, but I just want to - to find what I supposed to.
Q. And how would you know what you're supposed to do?
A. I think that the question you ask me is it kind of lawyer's job to take care of.
. . .
Q. (By Ms. Williams) So your lawyer's job?
A. Yes.
Q. Have you ever talked with other class members - other people that might be in this class?
THE WITNESS Never. I don't even know what kind of people. Okay?
A. I was not really - to understanding what is the class action, but now I getting - know what the meaning of that.(Chong Keister Depo. pp. 87-89).
Q. (By Ms. Williams) Do you have an understanding of how many people are in this - are potentially in the class?
A. I came to know that - I came to know that about - more than 100 people have the same situation like my case.
Q. And you learned that from your lawyers?
THE WITNESS: Yes.
In Hand v. Beach Entertainment KC, LLC, 456 F.Supp.3d 1099 (W.D. Mo. 2020), defendants argued that plaintiff was unaware of information concerning the case such as the exact number of text messages he had received from the defendant, where the case was pending or whether the Court had issued any rulings. The Court disagreed and found that the plaintiff demonstrated his knowledge of the basic facts by testifying that his claim was based on unsolicited text messages sent from a business to whom he had not given permission and were sent in violation of the Telephone Consumer Protection Act. The Court found that "the requirement that a named Plaintiff have an understanding of the litigation only requir[es] one to be aware of the basic facts underlying the lawsuit." Id. at 1143 (quoting In re Dollar Gen. Corp. Motor Oil Mktg. & Sales Practices Litig., No. 16-02709-MD-W-GAF, 2019 WL 1418292 at *14 (W.D. Mo. Mar. 21, 2019)). After reviewing Russell and Chong Keister's depositions, the Court finds that they would not be adequate representatives for the classes they seek to represent.
The Court will proceed to consider if the proposed class fits the criteria of Fed.R.Civ.P. 23(b)(2). Plaintiffs state that a class action may be maintained if "the party opposing the class has acted or refused to act on grounds that apply generally to the class, so that final injunctive relief or corresponding declaratory relief is appropriate respecting the class as a whole." Plaintiffs state that where the plaintiff seeks a declaration of the parties' rights under an insurance policy, declaring defendants' conduct unlawful, Fed.R.Civ.P. 23(b)(2) is satisfied. In opposition, Allstate argues that the proposed class lacks cohesiveness because the individual issues regarding each subrogation claim, including the language of the policy at issue, the actions of Allstate, the responses of the policyholders and the outcome of the process will dominate the litigation. Additionally, the class that plaintiffs purport to certify will include insureds who have not faced or may never face a subrogation claim. Additionally, defendants note that certification is appropriate under Fed.R.Civ.P. 23(b)(2) only when the "primary relief sought" is declaratory or injunctive. Allstate argues that the primary relief that the Keisters seek is damages. The Court agrees and finds that certification pursuant to Fed.R.Civ.P. 23(b)(2) is not appropriate. Additionally, as discussed above, because plaintiffs failed to satisfy their burden to demonstrate the commonality, typicality and adequacy requirements of Fed.R.Civ.P. 23(a), the Court hereby DENIES plaintiffs' Motion to Certify an Injunctive class.
2. The Damages Class
a. Numerosity
Plaintiffs state that defendants admitted to pursing subrogation over 250 times and being successful more than 40 times since October 20, 2010. Allstate states that since October 20, 2015 only 68 files have been sent to subrogation and Allstate has received subrogation payments on approximately 50 of those claims. As noted above, for the purposes of this motion, the Court will assume that the numerosity requirement has been met.
b. Commonality
Plaintiffs state that Allstate has admitted that it treats all Missouri insureds the same, its policy language is related to Med-Pay benefits is uniform and it is uniformly seeking subrogation against Missouri insureds for claims arising in certain states. Plaintiffs allege that the common questions include: 1) Did Allstate breach the policy by seeking subrogation of Med-pay benefits against the class?: 2) Did Allstate vexatiously refuse to pay Med-Pay benefits to the class? 3) Did Allstate breach its duty of good faith and fair dealing by seeking subrogation of Med-Pay benefits when subrogation is unlawful under Missouri law? Plaintiffs argue that these merits questions are common to every class member and common evidence will answer each of these questions. For the reasons discussed above, the Court finds that this requirement is not met. For example, with the breach of contract claim, it will depend on which contract the policyholder had and an analysis of the individualized subrogation process. Similarly, the vexatious refusal to pay claim will require an examination of whether Allstate willfully refused to pay benefits without reasonable cause as to each individual policyholder. Again, as to the breach of the duty of good faith and fair dealing, an individualized analysis will be required. Thus, the Court finds that plaintiffs have not shown that there are common questions of law or fact between their claims and the claims of the proposed class.
c. Typicality
The typicality requirement is met when the claims or defenses of the representative party are typical of those of the class. Fed. R. Civ. P. 23(a)(3). "Factual variations in the individual claims will not normally preclude class certification if the claim arises from the same event or course of conduct as the class claims, and gives rise to the same legal or remedial theory." Alpern v. UtiliCorp United, Inc., 84 F.3d 1525, 1540 (8th Cir. 1996) (citing Donaldson v. Pillsbury Co., 554 F.2d 825, 831 (8th Cir. 1977)). Class representatives need not share identical interests with the class, only common objectives and legal and factual positions. Uponor Inc., F1807 Plumbing Fittings Products Liability Litig., 716 F.3d 1057, 1064 (8th Cir. 2013). The requirement "is fairly easily met so long as other class members have claims similar to the named plaintiff." DeBoer v. Mellon Mortg. Co., 64 F.3d 1171, 1174 (8th Cir. 1995).Hand, 456 F. Supp. 3d at 1141. As discussed above, the court finds the Keisters' claims are not typical of the claims of the class, because Allstate stopped pursuing subrogation on their claim over two years ago. Thus, the Court finds that there are questions regarding whether the Keisters' claims are moot and whether they even have standing to bring their claims now that Allstate has ceased pursing the subrogation claim. The Court therefore finds that the Keisters' claims are not typical of the claims of other class members.
d. Adequacy
As discussed above and for the same reasons, the Court finds that the plaintiffs would not be adequate class representatives for the damages class.
Fed.R.Civ.P. 23(b)(3) requires that "questions of law or fact common to class members predominate over any questions affecting only individual members, and [that] a class action is superior to other available methods for fairly and efficiently adjudicating the controversy."
f. Predominance
Plaintiffs argue that the common questions before the Court are: (1) whether Allstate has a policy of treating the Damages Class members the same and (2) whether that policy is unlawful under the terms of the Missouri policies and Missouri law. Plaintiffs argue that the second question is a merits question which will be reserved for later proceedings. Plaintiffs argue that they and the Damages Class members each had Med-Pay payments subjected to subrogation by Allstate when those payments were protected from subrogation under Missouri law. Plaintiffs argue that the Damages Class members share the same policy language and were treated the same by Allstate.
In opposition, Allstate argues that the predominance requirement is demanding. "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." Blades v. Monsanto, 400 F.3d 562, 566 (8th Cir. 2005). Allstate argues that each of the purported common questions cannot be proved through common proof but will require individualized analysis. Additionally, Allstate argues that plaintiffs seek to represent policyholders who were injured in states other than Kansas but have provided no reasons why Missouri law would apply to those individuals. Allstate argues that an individualized choice-of-law analysis will need to be applied to each plaintiff's claim. Allstate notes that plaintiffs have not provided a choice-of-law analysis, have not suggested which state had the most significant relationship to each claim or presented any information about variations in state law or conflicts with Missouri law. Allstate argues that Missouri's most significant relationship test carries "a presumption that the state with the most significant relationship is the state where the injury occurred, absent an overriding interest of another state." True v. Conagra Foods, Inc., No. 07-00770-CV-W-DW, 2011 WL 176037 at *8 (W.D. Mo. Jan. 4, 2011). Allstate argues that it is likely that the states where the loss was suffered - including at least ten states outside of Missouri who all have their own laws regarding protection of drivers on their state's roads, will have the most significant relationship to the claims of the class. Allstate notes that because plaintiffs have failed to provide any framework for analyzing these claims, individual issues of state law will predominate over common questions.
In reply, plaintiffs state that the merits question is whether Allstate's subrogation is unlawful. Plaintiff state that they have pointed to common proof and whether there are minor differences in the subrogation process and procedures is not the question. The Court however disagrees. In his Declaration, Chad Clark, a lead design consultant for Allstate stated that after Allstate pays a claim for benefits related to medical bills under an auto policy, it will identify if there is a potential for subrogation based on both the policy state and the state where the loss occurred. (Doc. 60, ¶15). Mr. Clark indicated that there are approximately ten states where Allstate would consider subrogation under a Missouri policy. After a policy has been identified as potentially subrogable, it is sent to the Medical Recovery Team to handle. Mr. Clark stated that "[b]ased on the circumstances surrounding the claim and the representatives' communications with the individuals involved, both medical recovery processors and claim representatives maintain discretion to accept a lower amount, request approval to waive subrogation, or otherwise resolve certain claims as appropriate. For example, Allstate may agree to waive subrogation where an insured has passed away or suffered a significant injury resulting in high medical bills or accept a lower recovery if the insured's contract with his or her attorney provides for higher than required attorneys' fees." (Doc. 60, ¶ 21). Mr. Clark stated, "[w]hether and what subrogation Allstate seeks varies based on the law of the state where the accident occurred at the time the accident occurred. The process for seeking subrogation also varies by state, including whether Allstate can pursue subrogation directly from the at-fault party or their insurer or whether Allstate is required to work with the insured's attorney, state law may provide that some portion of the subrogated funds be used to pay the attorneys' fees." (Doc. 60, ¶ 23). In Halvorson v. Auto-Owners Ins. Co., 718 F.3d 773 (8th Cir. 2013), plaintiffs filed a class action complaint against their insurance company for breach of contract and bad faith. Plaintiffs sought to certify a class of persons covered by Auto-Owners Med-Pay or PIP coverage. The class included policy owners who submitted claims for payment of medical expenses and who received less than the submitted amount following a percentile based review of the claim. The district court certified the class for individuals whose policies were issued in North Dakota. On appeal, the Eighth Circuit reversed finding:
the individual questions necessary to determine breach of contract and bad faith include whether a provider's charge was usual and customary and, thus, whether the claim payment was reasonable. These individual inquiries regarding what is "usual and customary" for each class member will predominate over whether Auto-Owner's process was reasonable and "overwhelm questions common to the class."Id. at 779 (quoting Comcast Corp. v. Behrend, 569 U.S. 27, 34, 133 S.Ct. 1426, 1433, 185 L.Ed.2d 515 (2013)). The Court found that although there are common questions of law for the class, "[m]embers of the class incurred different injuries, which were treated by different medical providers charging different prices for their services. Answering the question of whether Auto-Owners's claim processing methodology breached its contract under North Dakota law necessitates individual fact inquiries for each member of the class." Id. at 780. The Court found that the common questions did not predominate and that a class action would not be a superior method of adjudicating this case because the reasonableness of any claim payment would have to be individually analyzed. The Eighth Circuit found that the district court had abused its discretion in certifying the class. Similarly, in the instant case, the Court finds that because of the individualized analysis required for subrogation claims, there are not common questions amongst the class which would predominate. Finding that common questions do not predominate amongst the class, the Court also finds that a class action would not be a superior method of adjudicating this case. Accordingly, because the Court finds that plaintiffs have failed to show that the injunctive class meet the requirements of Fed.R.Civ.P. 23(a) and 23(b)(2) or that the damages class meets the requirements of Fed.R.Civ.P. 23(a) and 23(b)(3), the Court hereby DENIES plaintiffs' Motion for Class Certification (Doc. # 52) and DENIES defendant's Motion for Oral Argument on Motion for Class Certification (Doc. # 73).
B. Allstate's Motion for Summary Judgment
On December 9, 2021, the Court entered a Scheduling Order stating that the discovery would be conducted in two phases. Phase One was focused on discovery related to the named plaintiff's claims and class certification issues. The Court stated that there may be some overlap of issues between the two phases of discovery, and to the extent that there is overlap, the parties shall endeavor to complete such discovery during Phase One. Deadlines were provided for the briefing of the Class Certification motion, but no other deadlines were provided. The deadlines for briefing were extended on January 31, 2022 and once again on May 16, 2022. Plaintiffs filed their Motion for Class Certification on May 20, 2022. On August 5, 2022, Allstate filed its Motion for Summary Judgment. On August 19, 2022, plaintiffs filed their Motion to Strike Allstate's Motion for Summary Judgment or in the Alternative to Stay Briefing Deadlines. Plaintiffs argue that the Court should strike Allstate's Motion as premature because the Court has not yet set a deadline for the parties to complete merits-based discovery. In opposition, Allstate states that the parties have already engaged in merits discovery and they have not demonstrated why they are in need of any additional discovery. In reply, plaintiffs state that it was never their expectation that they would need to complete all discovery before February 14, 2022. This combined with the lack of any dispositive motion deadline in the Scheduling Order, plaintiffs state they were operating under the assumption that there would be additional time to conduct discovery on the merits prior to filing dispositive motions. After reviewing the parties' briefs and arguments, the Court finds that Allstate's Motion was filed prematurely. The phased discovery was focused only on the Class Certification Motions and no deadlines were provided for filing dispositive motions. Accordingly, in order to efficiently manage its docket, the Court hereby PROVISIONALLY DENIES Allstate's Motion for Summary Judgment (Doc. # 69) and DENIES plaintiffs' Motion to Strike Allstate's Motion for Summary Judgment (Docs. # 77, 79). Now that the Court has ruled on the Motion for Class Certification, the parties shall confer and submit a proposed revised Scheduling Order to the Court.
IV. CONCLUSION
For all the reasons stated above, the court hereby DENIES plaintiffs' Motion for Class Certification (Doc. # 52); DENIES defendant's Motion for Oral Argument on plaintiffs' Motion for Class Certification (Doc. # 73); PROVISIONALLY DENIES Allstate's Motion for Summary Judgment (Doc. # 69) and DENIES plaintiffs' Motion to Strike Allstate's Motion for Summary Judgment (Docs. # 77, 79).