Class Actions & Common Questions of Facts

Courts construing R. 4:32-1(b)(3) have repeatedly stressed that the Rule only requires a predominance of common questions, not an identity of all issues. See, e.g., Fiore v. Hudson County Employees Pension Comm.,151 N.J. Super. 524, 528 (App. Div. 1977); Lusky v. Capasso Bros., 118 N.J. Super. 369, 372 (App. Div.), certif. denied, 60 N.J. 466 (1972). In Delgozzo, supra, the Appellate Division stated that a court may certify a class “even though individual questions, such as degree of damages due a particular class member, or reliance by individual class members on defendants’ alleged misrepresentations, may remain following resolution of the common questions.” 266 N.J. Super. at 181; Strawn v. Canuso, 140 N.J. 43, 67 (1995) (certifying class of landowners). Despite these instructions, defendants’ opposition offers nothing more than a hodgepodge of the typical and over-used arguments that class certification is inappropriate because generalized individual questions and affirmative defenses exist, a position routinely rejected by the New Jersey Supreme Court.
For example, in Iladis v. Wal-Mart Stores, Inc., 191 N.J. 88 (2007), the plaintiff moved to certify a class of current and former New Jersey employees of Wal-Mart for unpaid work. Before the Supreme Court, Wal-Mart argued that the trial court’s and Appellate Division’s decisions denying class certification should be affirmed because of numerous individual issues, including, but not limited to, “whether particular employees voluntarily missed rest and meal breaks; why employees who worked off-the clock did not avail themselves of the curative time-clock procedure; how much time was worked off-the-clock; whether employees worked off-the clock with the expectation of compensation; and how much in damages employees suffered, if any.” Id. at 112.
In reversing the lower courts, the Court focused on Wal-Mart’s common course of conduct towards its employees. See id. at 111-12 (describing common factual, legal and evidentiary issues). It determined that, even though there were numerous and material individual issues of fact, they did not prevent or foreclose a finding of predominance or that class certification was inappropriate. Id. at 112. In particular, the Court relied upon its earlier decision in In re Cadillac, supra. As explained by the Iliadis Court:
The arguments advanced by Wal-Mart implicate our ruling in In re Cadillac, supra. That case concerned a state-wide class of 7,500 purchasers of Cadillac automobiles with a specific engine. The customers alleged that General Motors Corporation, knowing of common design defects, defrauded them into purchasing the vehicles. General Motors urged decertification, arguing, as Wal-Mart does here, that individualized questions predominated over common legal and factual contentions. Summarizing General Motors assertions, Justice Pollock wrote:

GM vigorously contends that the engine is not defective and that diverse causes unrelated to the design of the V8-6-4 engine are the source of the common complaints. For example, it attributes the various problems of the individual owners to defective parts, improper maintenance, alteration of the car, or intervening accidents. GM asserts that the need to prove these numerous causes of engine failure would necessitate thousands of mini-trials involving, among others, the issues of causation and damages as to each car owner. Thus, GM contends that certification would prevent it from pursuing defenses based on each car’s individual characteristics and use by each owner.

We rejected General Motors’ arguments and affirmed the class certification entered by the trial court. We explained that General Motors “misconstrue[d] the nature of class action proceedings. Certification as a class action does not limit a defendant’s rights to pursue any defense on any of a plaintiff’s claims … [C]ertification merely permits litigation of common issues on a class basis before litigation of individual issues.”

[Iliadis, supra, 191 N.J. at 113 (internal citations omitted).] Clearly, if the Court believed that certification of a class action was appropriate in Iliadis, supra, and In re Cadillac, supra, which involved thousands of individuals and their unique issues, this matter, affecting a homogenous group of homeowners, is wholly appropriate for class treatment.
Moreover, while defendants stress that the alleged uniqueness of the plaintiffs’ and Class members’ properties prevents class certification, numerous prior courts have rejected similar arguments in property damage litigations. For example, in Strawn, supra, the Supreme Court certified a class consisting of 150 families who purchased homes in the same development. The homes were built in the immediate vicinity of a hazardous waste landfill. The plaintiffs contended that the developers knew of the landfill but did not disclose the information. The defendants used “sales-promotion brochures, newspaper advertisements, and a fact sheet to sell the homes” as vehicles for the fraud. 140 N.J. at 61. Despite the defendant’s position that a trial court would need to examine the unique characteristics of each property and the knowledge of its owners, the Court found:
plaintiffs seek to redress a common legal grievance based on the effect of a nearby landfill, unknown to plaintiffs, on the value or desirability of property purchased by the plaintiffs from developers and brokers who knew of the landfill. Despite potential issues of causation, reliance, and damages particular to the individual actions, the core of this case concerns common issues of fact and law.

[Id. at 67-68.] Accordingly, plaintiffs were entitled to proceed as Class.
Similarly, in Boggs v. Divested Atomic Corp., 141 F.R.D. 58 (S.D. Ohio 1991), the Portsmouth Gaseous Diffusion Plant processed radioactive materials for the United States Department of Energy. Id. at 60. The plaintiffs claimed that they, and their properties, had been exposed to radioactive materials and hazardous wastes emitted from the plant. Id. They asked the court to certify a class consisting of all persons who lived, rented, or owned property within a six-mile radius of the plant for emotional distress, diminution in value of their real property, medical monitoring for early cancer detection and injunctive relief. Id.
In granting certification, the Boggs court rejected defendants’ position that questions peculiar to each individual member of the class prohibited certification. Instead, it appropriately observed that:
Clearly parcels of real property, like snowflakes, necessarily have different and unique characteristics. The important question is to what extent those differences, when compared to the nature and extent of the shared characteristics of the named plaintiffs and the class members’ claims, will defeat the Court’s ability to achieve a considerable efficiency through collective adjudication of those claims. Here, as in Sterling, notwithstanding the differences, class treatment is clearly a better way to proceed. [Id. at 65-66.]
Likewise, in Sterling v. Velsicol Chemical Corp., 855 F. 2d 1189 (6th Cir. 1988), a case cited with approval by the Iliadis Court, the defendant chemical company used its site as a landfill for by-products from the production of pesticides. From 1964 to 1973 the chemical company deposited a total of 300,000 55-gallon steel drums containing ultra-hazardous liquid chemical waste and hundreds of fiber board cartons containing ultra-hazardous dry chemical waste in the landfill. Id. at 1192-93. The ultra-hazardous wastes migrated from the landfill to adjoining properties. Id. at 1193. Subsequently, plaintiffs sued defendant for exposure to the chemicals, as well as loss of property values. In affirming class certification, the Sixth Circuit explained:

The procedural device of a Rule 23(b)(3) class action designed not solely as a means for assuring legal assistance in the vindication of small claims, but rather to achieve the economies of time, effort and expense. [Citations omitted.] However, the problem of individualization of issues often is cited as a justification for denying class action treatment. . . . While some court have adopted this justification in refusing to certify such accidents as class actions, numerous other courts have recognized the increasingly insistent need for a more efficient method of disposing of a large number of lawsuits arising out of a single disaster or a single course of conduct. . . . [T]he factual and legal issues of a defendant’s liability do not differ dramatically from one plaintiff to the next. No matter how individualized the issue of damages may be, these issues may be reserved for individual treatment with the question of liability tried as a class action. Consequently, the mere fact that questions peculiar to each individual member of the class remain after the common questions of the defendant’s liability have been resolved does not dictate the conclusion that a class action is impermissible.

[W]here the defendant’s liability can be determined on a class-wide basis because the cause of the disaster is a single course of conduct which is identical for each of the plaintiffs, a class action may be the best-suited vehicle to resolve such a controversy.
[Id. at 1196-1197.]

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