JERRY E. SMITH, Circuit Judge:
In what may be the largest class action ever attempted in federal court, the district court in this case embarked "on a road certainly less traveled, if ever taken at all," Castano v. American Tobacco Co., 160 F.R.D. 544, 560 (E.D.La.1995) (citing EDWARD C. LATHAM, THE POETRY OF ROBERT FROST, "THE ROAD NOT TAKEN" 105 (1969)), and entered a class certification order. The court defined the class as:
Id. at 560-61. The plaintiffs limit the claims to years since 1943.
This matter comes before us on interlocutory appeal, under 28 U.S.C. § 1292(b), of the class certification order. Concluding that the district court abused its discretion in certifying the class, we reverse.
A. The Class Complaint
The plaintiffs seek compensatory
The plaintiffs initially defined the class as "all nicotine dependent persons in the United States," including current, former and deceased smokers since 1943. Plaintiffs conceded that addiction would have to be proven by each class member; the defendants argued that proving class membership will require individual mini-trials to determine whether addiction actually exists.
In response to the district court's inquiry, the plaintiffs proposed a four-phase trial plan.
Phase 1 would be followed by notice of the trial verdict and claim forms to class members. In phase 2, the jury would determine compensatory damages in sample plaintiff cases. The jury then would establish a ratio of punitive damages to compensatory damages, which ratio thereafter would apply to each class member.
Phase 3 would entail a complicated procedure to determine compensatory damages for individual class members. The trial plan envisions determination of absent class members' compensatory economic and emotional distress damages on the basis of claim forms, "subject to verification techniques and assertion of defendants' affirmative defenses under grouping, sampling, or representative procedures to be determined by the Court."
The trial plan left open how jury trials on class members' personal injury/wrongful death claims would be handled, but the trial plan discussed the possibility of bifurcation. In phase 4, the court would apply the punitive damage ratio based on individual damage awards and would conduct a review of the reasonableness of the award.
B. The Class Certification Order
Following extensive briefing, the district court granted, in part, plaintiffs' motion for class certification, concluding that the prerequisites of FED.R.CIV.P. 23(a) had been met.
The court did grant the plaintiffs' motion to certify the class under FED.R.CIV.P. 23(b)(3),
1. Core Liability Issues
The court defined core liability issues as "common factual issues [of] whether defendants knew cigarette smoking was addictive, failed to inform cigarette smokers of such, and took actions to addict cigarette smokers. Common legal issues include fraud, negligence, breach of warranty (express or implied), strict liability, and violation of consumer protection statutes." 160 F.R.D. at 553.
The court found that the predominance requirement of rule 23(b)(3) was satisfied for the core liability issues. Without any specific analysis regarding the multitude of issues that make up "core liability," the court found that under Jenkins v. Raymark Indus., 782 F.2d 468 (5th Cir.1986), common issues predominate because resolution of core liability issues would significantly advance the individual cases. The court did not discuss why "core liability" issues would be a significant, rather than just common, part of each individual trial, nor why the individual issues in the remaining categories did not predominate over the common "core liability" issues.
The only specific analysis on predominance analysis was on the plaintiffs' fraud claim. The court determined that it would be premature to hold that individual reliance issues predominate over common issues. Relying on Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 94 S.Ct. 2140, 40 L.Ed.2d 732 (1974), the court stated that it could not inquire into the merits of the plaintiffs' claim to determine whether reliance would be an issue in individual trials. 160 F.R.D. at 554. Moreover, the court recognized the possibility that under state law, reliance can be inferred when a fraud claim is based on an omission. Accordingly, the court was convinced that it could certify the class and defer the consideration of how reliance would affect predominance.
The court also deferred substantial consideration of how variations in state law would affect predominance. Relying on two district court opinions,
The court also concluded that a class action is superior to other methods for adjudication of the core liability issues. Relying heavily on Jenkins, the court noted that having this common issue litigated in a class action was superior to repeated trials of the same evidence. Recognizing serious problems with manageability, it determined that such problems were outweighed by "the specter of thousands, if not millions, of similar trials of liability proceeding in thousands of courtrooms around the nation." Id. at 555-56.
2. Injury-in-fact, Proximate Cause, Reliance, Affirmative Defenses, and Compensatory Damages
Using the same methodology as it did for the core liability issues, the district court refused to certify the issues of injury-in-fact, proximate cause, reliance, affirmative defenses, and compensatory damages, concluding that the "issues are so overwhelmingly replete with individual circumstances that they quickly outweigh predominance and superiority." Id. at 556. Specifically, the court found that whether a person suffered emotional injury from addiction, whether his addiction was caused by the defendants' actions, whether he relied on the defendants' misrepresentations, and whether affirmative defenses unique to each class member precluded recovery were all individual issues. As to compensatory damages and the claim for medical monitoring, the court concluded that such claims were so intertwined with proximate cause and affirmative defenses that class certification would not materially advance the individual cases.
3. Punitive Damages
In certifying punitive damages for class treatment, the court adopted the plaintiffs' trial plan for punitive damages: The class jury would develop a ratio of punitive damages to actual damages, and the court would apply that ratio in individual cases. As it did with the core liability issues, the court determined that variations in state law, including differing burdens of proof, did not preclude certification. Rather than conduct an independent review of predominance or superiority, the court relied on Jenkins and on Watson v. Shell Oil Co., 979 F.2d 1014 (5th Cir.1992), vacated for rehearing en banc, 990 F.2d 805 (5th Cir.1993), appeal dismissed, 53 F.3d 663 (5th Cir.1994), for support of its certification order.
A district court must conduct a rigorous analysis of the rule 23 prerequisites before certifying a class. General Tel. Co. v. Falcon, 457 U.S. 147, 161, 102 S.Ct. 2364, 2372, 72 L.Ed.2d 740 (1982); Applewhite v. Reichhold Chems., 67 F.3d 571, 573 (5th Cir. 1995). The decision to certify is within the broad discretion of the court, but that discretion must be exercised within the framework of rule 23. Gulf Oil Co. v. Bernard, 452 U.S. 89, 100, 101 S.Ct. 2193, 2200, 68 L.Ed.2d 693 (1981). The party seeking certification bears the burden of proof. Horton v. Goose Creek Ind. Sch. Dist., 690 F.2d 470, 486 (5th Cir. 1982), cert. denied, 463 U.S. 1207, 103 S.Ct. 3536, 77 L.Ed.2d 1387 (1983); In re American Medical Sys., 75 F.3d 1069, 1086 (6th Cir.1996) (concluding that district court reversed the proper burden of proof by asking defendants to show cause why the court should not certify the class).
The district court erred in its analysis in two distinct ways. First, it failed to consider how variations in state law affect predominance and superiority. Second, its predominance inquiry did not include consideration of how a trial on the merits would be conducted.
Each of these defects mandates reversal. Moreover, at this time, while the tort is immature, the class complaint must be dismissed,
A. Variations in State Law
Although rule 23(c)(1) requires that a class should be certified "as soon as practicable" and allows a court to certify a conditional class, it does not follow that the rule's requirements are lessened when the class is conditional. As a sister circuit explained:
In re Hotel Tel. Charges, 500 F.2d 86, 90 (9th Cir.1974).
In a multi-state class action, variations in state law may swamp any common issues and defeat predominance. See Georgine v. Amchem Prods., 83 F.3d 610, 618 (3d Cir.1996) (decertifying class because legal and factual differences in the plaintiffs' claims "when exponentially magnified by choice of law considerations, eclipse any common issues in this case"); American Medical Sys., 75 F.3d at 1085 (granting mandamus in a multi-state products liability action, in part because "[t]he district court ... failed to consider how the law of negligence differs from jurisdiction to jurisdiction").
Accordingly, a district court must consider how variations in state law affect predominance and superiority. Walsh v. Ford Motor Co., 807 F.2d 1000 (D.C.Cir.1986) (Ruth Bader Ginsburg, J.), cert. denied, 482 U.S. 915, 107 S.Ct. 3188, 96 L.Ed.2d 677 (1987). The Walsh court rejected the notion that a district court may defer considering variations in state law:
Id. at 1016-17 (footnotes omitted).
A district court's duty to determine whether the plaintiff has borne its burden on class certification requires that a court consider variations in state law when a class action involves multiple jurisdictions. "In order to make the findings required to certify a class action under Rule 23(b)(3) ... one must initially identify the substantive law issues which will control the outcome of the litigation." Alabama v. Blue Bird Body Co., 573 F.2d 309, 316 (5th Cir.1978).
A requirement that a court know which law will apply before making a predominance determination is especially important when there may be differences in state law. See In re Rhone-Poulenc Rorer, Inc. ("Rhone-Poulenc"), 51 F.3d 1293, 1299-1302 (7th Cir.) (mandamus) (comparing differing state pattern instructions on negligence and differing formulations of the meaning of negligence), cert. denied, ___ U.S. ___, 116 S.Ct. 184, 133 L.Ed.2d 122 (1995); In re
The able opinion in School Asbestos demonstrates what is required from a district court when variations in state law exist. There, the court affirmed class certification, despite variations in state law, because:
789 F.2d at 1010; see also Georgine, 83 F.3d at 627 & n. 13 (distinguishing School Asbestos because it involved few individualized questions, and class counsel had made a credible argument that the applicable law of the different states could be categorized into four patterns); Walsh, 807 F.2d at 1017 (holding that "nationwide class action movants must creditably demonstrate, through an `extensive analysis' of state law variances, `that class certification does not present insuperable obstacles'").
A thorough review of the record demonstrates that, in this case, the district court did not properly consider how variations in state law affect predominance. The court acknowledged as much in its order granting class certification, for, in declining to make a choice of law determination, it noted that "[t]he parties have only briefly addressed the conflict of laws issue in this matter." 160 F.R.D. at 554. Similarly, the court stated that "there has been no showing that the consumer protection statutes differ so much as to make individual issues predominate." Id.
The district court's review of state law variances can hardly be considered extensive; it conducted a cursory review of state law variations and gave short shrift to the defendants' arguments concerning variations. In response to the defendants' extensive analysis of how state law varied on fraud, products liability, affirmative defenses, negligent infliction of emotional distress, consumer protection statutes, and punitive damages,
The district court's consideration of state law variations was inadequate. The surveys provided by the plaintiffs failed to discuss, in any meaningful way, how the court could deal with variations in state law. The consumer fraud survey simply quoted a few state courts that had certified state class actions. The survey of punitive damages was limited to the defendants' home states. Moreover, the two district court opinions on which the court relied did not support the proposition that variations in state law could be ignored.
The court also failed to perform its duty to determine whether the class action would be manageable in light of state law variations. The court's only discussion of manageability
The problem with this approach is that it substitutes case-specific analysis with a generalized reference to Jenkins. The Jenkins court, however, was not faced with managing a novel claim involving eight causes of action, multiple jurisdictions, millions of plaintiffs, eight defendants, and over fifty years of alleged wrongful conduct. Instead, Jenkins involved only 893 personal injury asbestos cases, the law of only one state, and the prospect of trial occurring in only one district. Accordingly, for purposes of the instant case, Jenkins is largely inapposite.
In summary, whether the specter of millions of cases outweighs any manageability problems in this class is uncertain when the scope of any manageability problems is unknown. Absent considered judgment on the manageability of the class, a comparison to millions of individual trials is meaningless.
The district court's second error was that it failed to consider how the plaintiffs' addiction claims would be tried, individually or on a class basis. See 160 F.R.D. at 554. The district court, based on Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 177-78, 94 S.Ct. 2140, 2152-53, 40 L.Ed.2d 732 (1974), and Miller v. Mackey Int'l, 452 F.2d 424 (5th Cir.1971), believed that it could not go past the pleadings for the certification decision. The result was an incomplete and inadequate predominance inquiry.
The crux of the court's error was that it misinterpreted Eisen and Miller. Neither case suggests that a court is limited to the pleadings when deciding on certification. Both, instead, stand for the unremarkable proposition that the strength of a plaintiff's claim should not affect the certification decision. In Eisen, the Court held that it was improper to make a preliminary inquiry into the merits of a case, determine that the plaintiff was likely to succeed, and consequently shift the cost of providing notice to the defendant. 417 U.S. at 177, 94 S.Ct. at 2152. In Miller, this court held that a district court could not deny certification based on its belief that the plaintiff could not prevail on the merits. 452 F.2d at 427.
A district court certainly may look past the pleadings to determine whether the requirements of rule 23 have been met.
The district court's predominance inquiry demonstrates why such an understanding is necessary. The premise of the court's opinion is a citation to Jenkins and a conclusion that class treatment of common issues would significantly advance the individual trials.
The court's treatment of the fraud claim also demonstrates the error inherent in its approach.
The problem with the district court's approach is that after the class trial, it might have decided that reliance must be proven in individual trials. The court then would have been faced with the difficult choice of decertifying the class after phase 1 and wasting judicial resources, or continuing with a class action that would have failed the predominance requirement of rule 23(b)(3).
In addition to the reasons given above, regarding the district court's procedural errors, this class must be decertified because it independently fails the superiority requirement of rule 23(b)(3). In the context of mass tort class actions, certification dramatically affects the stakes for defendants. Class certification magnifies and strengthens the number of unmeritorious claims. Agent Orange, 818 F.2d at 165-66. Aggregation of claims also makes it more likely that a defendant will be found liable and results in significantly higher damage awards. MANUAL FOR COMPLEX LITIGATION § 33.26 n. 1056; Kenneth S. Bordens and Irwin A. Horowitz, Mass Tort Civil Litigation: The Impact of Procedural Changes on Jury Decisions, 73 JUDICATURE 22 (1989).
In addition to skewing trial outcomes, class certification creates insurmountable pressure on defendants to settle, whereas individual trials would not. See Peter H. Schuck, Mass Torts: An Institutional Evolutionist Perspective, 80 CORNELL L.REV. 941, 958 (1995). The risk of facing an all-or-nothing verdict presents too high a risk, even when the probability of an adverse judgment is low. Rhone-Poulenc, 51 F.3d at 1298. These settlements have been referred to as judicial blackmail.
It is no surprise then, that historically, certification of mass tort litigation classes has been disfavored.
We first address the district court's superiority analysis. The court acknowledged the extensive manageability problems with this class. Such problems include difficult choice of law determinations, subclassing of eight claims with variations in state law, Erie guesses, notice to millions of class members, further subclassing to take account of transient plaintiffs, and the difficult procedure for determining who is nicotine-dependent. Cases with far fewer manageability problems have given courts pause. See, e.g., Georgine, 83 F.3d at 632; In re Hotel Tel., 500 F.2d at 90.
The district court's rationale for certification in spite of such problems — i.e., that a class trial would preserve judicial resources in the millions of inevitable individual trials — is based on pure speculation. Not every mass tort is asbestos, and not every mass tort will result in the same judicial crises.
What the district court failed to consider, and what no court can determine at this time, is the very real possibility that the judicial crisis may fail to materialize.
Severe manageability problems and the lack of a judicial crisis are not the only reasons why superiority is lacking. The most compelling rationale for finding superiority in a class action — the existence of a negative value suit — is missing in this case. Accord Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 809, 105 S.Ct. 2965, 2973, 86 L.Ed.2d 628 (1985); Rhone-Poulenc, 51 F.3d at 1299.
As he stated in the record, plaintiffs' counsel in this case has promised to inundate the courts with individual claims if class certification is denied. Independently of the reliability of this self-serving promise, there is reason to believe that individual suits are feasible. First, individual damage claims are high, and punitive damages are available in most states. The expense of litigation does not necessarily turn this case into a negative value suit, in part because the prevailing party may recover attorneys' fees under many consumer protection statutes. See Boggs v. Alto Trailer Sales, 511 F.2d 114, 118 (5th Cir.1975) (acknowledging that the availability of attorneys' fees is a common basis for finding non-superiority).
In a case such as this one, where each plaintiff may receive a large award, and fee shifting often is available, we find Chief Judge Posner's analysis of superiority to be persuasive:
Rhone-Poulenc, 51 F.3d at 1300. So too here, we cannot say that it would be a waste to allow individual trials to proceed, before a district court engages in the complicated predominance and superiority analysis necessary to certify a class.
MANUAL FOR COMPLEX LITIGATION § 33.26.
The remaining rationale for superiority — judicial efficiency
Even assuming arguendo that the tort system will see many more addiction-as-injury claims, a conclusion that certification will save judicial resources is premature at this stage of the litigation. Take for example the district court's plan to divide core liability from other issues such as comparative negligence and reliance. The assumption is that after a class verdict, the common issues will not be a part of follow-up trials. The court has no basis for that assumption.
It may be that comparative negligence will be raised in the individual trials, and the evidence presented at the class trial will have to be repeated. The same may be true for reliance.
Even assuming that certification at this time would result in judicial efficiencies in individual trials, certification of an immature tort brings with it unique problems that may consume more judicial resources than certification will save. These problems are not speculative; the district court faced, and ignored, many of the problems that immature torts can cause.
The primary procedural difficulty created by immature torts is the inherent difficulty a district court will have in determining whether the requirements of rule 23 have been met. We have already identified a number of defects with the district court's predominance and manageability inquires, defects that will continue to exist on remand because of the unique nature of the plaintiffs' claim.
The district court's predominance inquiry, or lack of it, squarely presents the problems associated with certification of immature torts. Determining whether the common issues are a "significant" part of each individual case has an abstract quality to it when no court in this country has ever tried an injury-as-addiction claim. As the plaintiffs admitted to the district court, "we don't have the learning curb [sic] that is necessary to say to Your Honor `this is precisely how this case can be tried and that will not run afoul of the teachings of the 5th Circuit.'"
Yet, an accurate finding on predominance is necessary before the court can certify a class. It may turn out that the defendant's conduct, while common, is a minor part of each trial. Premature certification deprives the defendant of the opportunity to present that argument to any court and risks decertification after considerable resources have been expended.
The court's analysis of reliance also demonstrates the potential judicial inefficiencies in immature tort class actions. Individual trials will determine whether individual reliance will be an issue. Rather than guess that reliance may be inferred, a district court should base its determination that individual reliance does not predominate on the wisdom of such individual trials. The risk that a district court will make the wrong guess, that the parties will engage in years of litigation, and that the class ultimately will be decertified (because reliance predominates over common issues) prevents this class action from being a superior method of adjudication.
The complexity of the choice of law inquiry also makes individual adjudication superior
Through individual adjudication, the plaintiffs can winnow their claims to the strongest causes of action.
The full development of trials in every state will make subclassing an easier process. The result of allowing individual trials to proceed is a more accurate determination of predominance. We have already seen the result of certifying this class without individual adjudications, and we are not alone in expressing discomfort with a district court's certification of a novel theory. See Rhone-Poulenc, 51 F.3d at 1300.
Another factor weighing heavily in favor of individual trials is the risk that in order to make this class action manageable, the court will be forced to bifurcate issues in violation of the Seventh Amendment. This class action is permeated with individual issues, such as proximate causation, comparative negligence, reliance, and compensatory damages. In order to manage so many individual issues, the district court proposed to empanel a class jury to adjudicate common issues. A second jury, or a number of "second" juries, will pass on the individual issues, either on a case-by-case basis or through group trials of individual plaintiffs.
The Seventh Amendment entitles parties to have fact issues decided by one jury, and prohibits a second jury from reexamining those facts and issues.
Alabama v. Blue Bird Body Co., 573 F.2d 309, 318 (5th Cir.1978) (citations and footnotes omitted).
The Seventh Circuit recently addressed Seventh Amendment limitations to bifurcation. In Rhone-Poulenc, 51 F.3d at 1302-03, Chief Judge Posner described the constitutional limitation as one requiring a court to "carve at the joint" in such a way so that the same issue is not reexamined by different juries. "The right to a jury trial ... is a right to have juriable issues determined by the first jury impaneled to hear them (provided there are no errors warranting a new trial), and not reexamined by another finder of fact." Id. at 1303.
Severing a defendant's conduct from comparative negligence results in the type of risk that our court forbade in Blue Bird. Comparative negligence, by definition, requires a comparison between the defendant's and the plaintiff's conduct. Rhone-Poulenc, 51 F.3d at 1303 ("Comparative negligence entails, as the name implies, a comparison of the degree of negligence of plaintiff and defendant."). At a bare minimum, a second jury will rehear evidence of the defendant's conduct. There is a risk that in apportioning fault, the second jury could reevaluate the defendant's fault, determine that the defendant was not at fault, and apportion 100% of the fault to the plaintiff. In such a situation, the second jury would be impermissibly reconsidering the findings of a first jury. The risk of such reevaluation is so great that class treatment can hardly be said to be superior to individual adjudication.
The plaintiffs' final retort is that individual trials are inadequate because time is running out for many of the plaintiffs.
Second, the plaintiffs' claim that time is running out ignores the reality of the class action device. In a complicated case involving multiple jurisdictions, the conflict of law question itself could take decades to work its way through the courts.
The district court abused its discretion by ignoring variations in state law and how a trial on the alleged causes of action would be tried. Those errors cannot be corrected on remand because of the novelty of the plaintiffs' claims. Accordingly, class treatment is not superior to individual adjudication.
We have once before stated that "traditional ways of proceeding reflect far more than habit. They reflect the very culture of the jury trial...." In re Fibreboard Corp., 893 F.2d 706, 711 (5th Cir.1990). The collective wisdom of individual juries is necessary before this court commits the fate of an entire industry or, indeed, the fate of a class of millions, to a single jury. For the forgoing reasons, we REVERSE and REMAND with instructions that the district court dismiss the class complaint.
Id. at 561. The definition is based upon the criteria for "dependence" set forth in AMERICAN PSYCHIATRIC ASSOCIATION, DIAGNOSTIC AND STATISTICAL MANUAL OF MENTAL DISORDERS (4th ed.).
83 F.3d at 626 (citations omitted).
The Castano class suffers from many of the difficulties that the Georgine court found dispositive. The class members were exposed to nicotine through different products, for different amounts of time, and over different time periods. Each class member's knowledge about the effects of smoking differs, and each plaintiff began smoking for different reasons. Each of these factual differences impacts the application of legal rules such as causation, reliance, comparative fault, and other affirmative defenses.
Variations in state law magnify the differences. In a fraud claim, some states require justifiable reliance on a misrepresentation, see Allgood v. R.J. Reynolds Tobacco Co., 80 F.3d 168, 171 (5th Cir.1996); Burroughs v. Jackson Nat'l Life Ins. Co., 618 So.2d 1329, 1332 (Ala.1993), while others require reasonable reliance, see Parks v. Morris Homes Corp., 245 S.C. 461, 141 S.E.2d 129, 132 (1965). States impose varying standards to determine when there is a duty to disclose facts. See Sugarhouse Fin. Co. v. Anderson, 610 P.2d 1369, 1373 (Utah 1980) (finding no duty when transaction was made at arm's length); Dodd v. Nelda Stephenson Chevrolet, Inc., 626 So.2d 1288, 1293 (Ala.1993) (using a flexible standard based on the transaction and relationship of the parties).
Products liability law also differs among states. Some states do not recognize strict liability. E.g., Cline v. Prowler Indus., 418 A.2d 968, 979-80 (Del.1980). Some have adopted RESTATEMENT (SECOND) OF TORTS § 402A. E.g., O.S. Stapley Co. v. Miller, 103 Ariz. 556, 447 P.2d 248, 251-52 (1968). Among the states that have adopted the Restatement, there are variations. See 5 STUART M. SPEISER ET AL., THE AMERICAN LAW OF TORTS §§ 18.31, 18:34-18:35 (Law Co-op 1996).
Differences in affirmative defenses also exist. Assumption of risk is a complete defense to a products claim in some states. E.g., S.C.CODE ANN. § 15-73-20 (Law Co-op 1976). In others, it is a part of comparative fault analysis. E.g., COLO.REV.STAT. § 13-21-111.7 (1986). Some states utilize "pure" comparative fault, e.g., ARIZ. REV.STAT.ANN. § 12-2503-09 (1984); others follow a "greater fault bar," e.g., CONN.GEN.STAT.ANN. § 52-572h (West 1988); and still others use an "equal fault bar," e.g., ARK.CODE ANN. § 16-64-122 (Michie 1991).
Negligent infliction of emotional distress also involves wide variations. See Douglas B. Marlow, Negligent Infliction of Mental Distress: A Jurisdictional Survey of Existing Limitation Devices and Proposal Based on an Analysis of Objective Versus Subjective Indices of Distress, 33 VILL. L.REV. 781 (1988). Some states do not recognize the cause of action at all. See Allen v. Walker, 569 So.2d 350, 352 (Ala.1990). Some require a physical impact. See OB-GYN Assocs. v. Littleton, 259 Ga. 663, 386 S.E.2d 146, 148 (1989).
Despite these overwhelming individual issues, common issues might predominate. We are, however, left to speculate. The point of detailing the alleged differences is to demonstrate the inquiry the district court failed to make.
In Cordis, the court specifically recognized that there are differences in the law of strict liability and fraud in different jurisdictions. The court certified the class despite those differences because the differences did not eliminate predominance in that particular case. Such a finding cannot be reflexively applied to the case sub judice.
The same is true of School Asbestos. Like the court in Cordis, the district court there found little variation in state negligence law. The Third Circuit agreed that the variations in strict liability would not make the class unmanageable. 789 F.2d at 1009. See also Georgine, 83 F.3d at 627 & n. 13 (acknowledging that the court in School Asbestos certified the class despite variations in state law, but limiting the reach of the decision to cases where variations can be broken down into a small number of patterns). It is a stretch to characterize these two cases as standing for the proposition that state law does not vary on negligence, strict liability, or fraud.
FED.R.CIV.P. 23(b)(3) advisory committee's note (citation omitted), reprinted in 39 F.R.D. 69, 103 (1966). See also Georgine, 83 F.3d at 627-28 (relying on the Advisory Committee's note); American Medical Sys., 75 F.3d at 1084-85.
The plaintiffs assert that Professor Charles Allen Wright, a member of the Advisory Committee has now repudiated this passage in the notes. See H. NEWBERG, 3 NEWBERG ON CLASS ACTIONS § 17.06 (3d ed. 1992). Professor Wright's recent statements, made as an advocate in School Asbestos, must be viewed with some caution. As Professor Wright has stated:
Letter of Dec. 22, 1994, to N. Reid Neureiter, Williams & Connolly, Washington, D.C.
Where novel theories of recovery are advanced (such as addiction as injury), courts can aggressively weed out untenable theories. See, e.g., Allgood v. R.J. Reynolds Tobacco Co., 80 F.3d 168, 172 (5th Cir.1996) (rejecting failure-to-warn claim against tobacco companies based on inadequate proof of reliance and, alternatively, on "common knowledge" theory). Courts can use case management techniques to avoid discovery abuses. The parties can also turn to mediation and arbitration to settle individual or aggregated cases.
The plaintiffs' claim also overstates the defendants' ability to outspend plaintiffs. Assuming arguendo that the defendants pool resources and outspend plaintiffs in individual trials, there is no reason why plaintiffs still cannot prevail. The class is represented by a consortium of well-financed plaintiffs' lawyers who, over time, can develop the expertise and specialized knowledge sufficient to beat the tobacco companies at their own game. See Francis E. McGovern, An Analysis of Mass Torts for Judges, 73 TEX.L.REV. 1821, 1834-35 (1995) (suggesting that plaintiffs can overcome tobacco defendants' perceived advantage when a sufficient number of plaintiffs have filed claims and shared discovery). Courts can also overcome the defendant's alleged advantages through coordination or consolidation of cases for discovery and other pretrial matters. See MANUAL FOR COMPLEX LITIGATION at § 33.21-25.