Spokeo v. Robins Supreme Court Opinion: What Is Concrete Harm?

Today the Supreme Court issued its long-awaited decision in Spokeo, Inc. v. Robins, addressing whether the plaintiff had standing to sue in a putative class action brought under the Fair Credit Reporting Act (“FCRA”). Like some other opinions we have seen from the eight-member Court following Justice Scalia’s death, this decision is relatively narrow in scope. The Court held that the requirements of standing apply to statutory violations, and sent the case back to the Ninth Circuit to reconsider whether the plaintiff adequately alleged a “concrete harm.” Plaintiffs and defendants will continue to debate in individual cases whether the alleged harm was sufficiently concrete or particularized, with limited guidance from the Court. The requirement of a “personal and individual” injury that the Court reiterated may be useful in defending against motions for class certification in some cases.

As brief background, Spokeo operates an Internet-based “people search engine” that can be used to search for information about a particular person. Robins alleged that Spokeo violated the FCRA by providing incorrect information about his age, marital / family status, education, employment status, etc., which could have impacted his general prospects in finding a job. The district court dismissed the case for lack of standing, but the Ninth Circuit reversed.

The Court issued a 6-2 decision authored by Justice Alito. The Court explained that the requirement that an injury is “concrete and particularized” involves two separate requirements. “For an injury to be ‘particularized,’ it ‘must affect the plaintiff in a personal and individual way,” whereas “[a] ‘concrete’ injury must be ‘de facto’; that is, it must actually exist” – it must be “’real,’ and not ‘abstract.’” (Slip op. at 7-8.) It seems to me that when an injury affects someone in a “personal and individual way” it is usually “real,” but I suppose some people might be personally impacted by the abstract (academics perhaps more than others).

The heart of the Court’s opinion was that “Article III standing requires a concrete injury even in the context of a statutory violation. For that reason, Robins could not, for example, allege a bare procedural violation, divorced from any concrete harm, and satisfy the injury-in-fact requirement of Article III.” (Id. at 9-10.) The Court noted, however, that some harms that are difficult to prove (such as libel and slander per se) are deemed sufficiently concrete by the law, and in some circumstances the violation of a procedural right can be sufficient (such as with voting rights or rights to government information). With respect to the FCRA, however, the Court concluded that “not all inaccuracies cause harm or present material risk of harm.” (Id. at 11.) The Court gave the example of an incorrect zip code as something that likely would not cause concrete harm.  The case was remanded to the Ninth Circuit to address the concrete harm requirement, which the Court found not adequately addressed in the Ninth Circuit’s prior opinion. (The Court could have tackled this issue themselves, it simply involves an analysis of the complaint, but they may have been deadlocked on that point, and therefore reached this outcome.)

Justice Thomas wrote a concurring opinion, in which he proposed to create a distinction between private rights (where, in his view, a mere statutory violation apparently would be sufficient) and public rights (where concrete, individual harm distinct from harm to the general public would be required). He would find the FCRA to largely create public rights, however, except for one provision.

Justice Ginsburg wrote a dissent, joined by Justice Sotomayor. They would have found that Robins’ complaint adequately alleged concrete harm to his employment prospects, and therefore would have affirmed the Ninth Circuit’s decision. It is notable though that only two of the Justices took this view.

I expect this opinion will have limited impact on class action litigation generally. Where the plaintiff’s claims are nebulous, defendants will continue to argue that there is no concrete or particularized injury. Lower courts will have to sort that out without much more guidance from the Supreme Court than they had before this decision.

Where I see this opinion as being potentially more useful to defendants is that where defendants can  argue that the individual circumstances of each putative class member’s claim must be litigated to determine whether there is a “personal and individual” injury, that can, in appropriate cases, be a strong argument against class certification.

Tyson Foods Supreme Court Opinion Addresses Statistical Evidence in Class Actions

Today, the Supreme Court issued its opinion in Tyson Foods v. Bouaphakeo, addressing the use of statistical evidence in class actions. The plaintiffs’ bar will undoubtedly claim the decision as a victory because class certification was upheld. But I don’t think that’s right. The decision (a  6-2 opinion by Justice Kennedy, with Justices Thomas and Alito dissenting) stands for principles that defendants can use to defend many class actions successfully.

The heart of the Court’s decision is that we should think of class actions conceptually as if they were hundreds or thousands (or millions, as the case may be) of separate individual suits. If the statistical evidence being offered could be properly used to prove entitlement to relief in individual cases, then it can all be used in a class action. But if the evidence would not be sufficient in an individual case, then it will not pass muster in a class action either. This is because the procedural device of a class action cannot alter substantive rights, under the Rules Enabling Act.

Tyson Foods involved a claim under the Fair Labor Standards Act. The plaintiffs alleged that Tyson Foods failed to pay for time  spent putting on and taking off (“donning and doffing” in the legal lingo) protective equipment at overtime rates where the employee worked more than 40 hours per week including the “donning and doffing” time. The plaintiffs’ expert watched video recordings of employees taking their equipment on and off, and measured and averaged the times for the different departments. The Court found that this evidence, which had not been challenged by the defendant under Daubert, would be admissible in an individual lawsuit. This was because, in Anderson v. Mt. Clemens Pottery Co., the Court established a burden-shifting framework, under which, if the employer fails to satisfy its statutory duty to keep adequate time records, the employee can establish a prima facie case with evidence sufficient to make a “just and reasonable inference” about the amount of time worked. The burden then shifts to the employer to rebut that inference.

The Court distinguished the “Trial By Formula” method that was rejected in Wal-Mart Stores, Inc. v. Dukes because the putative class members in that sex discrimination case could not have properly used deposition evidence regarding practices of individual store managers in stores they did not work in to prevail in individual suits.

The Court declined to create any broad rule, explaining that “[w]hether a representative sample may be used to establish classwide liability will depend on the purpose for which the sample is being introduced and on the underlying cause of action.” (Slip op., at 15.) The Court also declined to decide the second issue in the case – whether uninjured class members could recover from the aggregate jury verdict. The Court found that issue premature, where the district court had not yet allocated the award. Chief Justice Roberts wrote a concurrence (joined by Justice Alito on this point) suggesting that there was no way of knowing how the jury reached its verdict and thus how it could be allocated without providing relief to uninjured plaintiffs. He wrote that “Article III does not give federal courts the power to order relief to any uninjured plaintiff, class action or not,” and “if there is no way to ensure that the jury’s damages award goes only to injured class members, that award cannot stand.” (Slip op. of Roberts, C.J., concurring, at 5-6.)

So how can defendants use this decision in defending against class certification? Here are a few thoughts:

  • In many cases, the law does not permit any type of burden shifting in individual suits. In addition, in many other cases (such as many insurance and financial services class actions), defendants have detailed records of individual interactions with the putative class members. In these situations, statistical evidence often cannot properly be used to prove an individual case. Tyson Foods supports defendants’ position in these cases.
  • Tyson Foods recognizes that the court cannot “deprive [defendant] of its ability to litigate individual defenses.” (Slip op. at 12.) While it appears that the defense was presented using common evidence in Tyson Foods, the defendant should be entitled to introduce individual evidence to support its defenses to individual putative class members’ claims. In some cases, this may result in decertification of the class if the trial becomes unmanageable due to the defendant’s right to put on its individual defenses. As Tyson Foods further explains, it “violate[s] the Rules Enabling Act [to] giv[e] plaintiffs and defendants different rights in a class proceeding than they could have asserted in an individual action.” (Slip op. at 14.) Where the defendant will use individual evidence to defendant against the named plaintiffs’ claims and/or some class members’ claims, it is entitled under Tyson Foods and Wal-Mart to use that same evidence in defending itself at the trial of a certified class action.
  • The presence of uninjured class members, although still an open question, is an important one. The Chief Justice’s concurrence on this point is likely to carry significant weight in the lower courts. Defendants can continue to press this issue.


Property Insurance Diminution in Value Class Action: Georgia Federal Court Certifies Class

One of the issues I’ve been covering on this blog is a series of putative class actions in Georgia arising out of a Georgia Supreme Court decision in 2012, which held that diminution in value of real property is potentially covered under a property insurance policy (see my summary of the Georgia Supreme Court decision if you’d like more background on this). The Georgia Supreme Court essentially extended its prior ruling in an auto insurance case to the property insurance context, although it is somewhat counterintuitive that real property, after it is repaired, would see a reduction in value (as opposed to an increase in value).

Earlier this week, a Georgia federal court granted class certification, in part, in Thompson v. State Farm Fire & Casualty Company, 2016 U.S. Dist. LEXIS 30308 (M.D. Ga. Mar. 9, 2016). The class was defined as homeowners who, within the six-year period prior to the filing of the lawsuit, made claims arising from water damage to their homes. The class was limited to a claim for breach of contract based on State Farm’s failure to make assessments for potential diminished value. Key points from the ruling included:

  • State Farm apparently took the position that it does not assess or pay for diminished value, and its policy never covers diminished value, notwithstanding the Georgia Supreme Court’s decision. The court found that State Farm Mutual Auto. Ins. Co. v. Mabry (the auto insurance case) required these assessments. Insurers that do not dispute that their policies potentially cover diminished value in Georgia, and that make assessments for diminished value where appropriate, are likely to be in a different position.
  • With respect to the claim for failure to assess for diminished value, the court found that common issues predominated because State Farm did not make any such assessments, and because damages potentially could be based on the cost of the assessment. at *32. The court did not explain how, under the policy, the insured could recover the cost of the assessment. That puzzles me. Mabry involved declaratory and injunctive relief.
  • The court denied the motion for certification with respect to the claim for State Farm’s failure to pay for diminished value. Common issues did not predominate on that claim because “State Farm can avoid liability, not just an award of damages, by showing that an individual property did not suffer diminished value,” and the “necessary determination of whether each class member suffered diminished value renders breach anything but a common question.” at *23-24. Because State Farm would be entitled to make this showing for every class member, common issues did not predominate. Id. at *26-27. This is consistent with other insurance class action decisions.

This decision seems likely to heat up the diminution in value class action litigation in Georgia, although insurers that are handling the issue differently will have different arguments to make in defending against class certification. As I noted in my February 2 post, Liberty Mutual recently obtained dismissal of a declaratory judgment claim in one of these cases.

Insights From FDCC Program On December 2015 Amendments To Federal Rules of Civil Procedure

Last week, I attended an excellent program of the Federation of Defense and Corporate Counsel regarding how the December 2015 amendments to the Federal Rules of Civil Procedure are impacting the defense of class actions and other complex litigation. (For a summary of the amendments pertinent to class action practice, see my November 20 blog post). Here are my takeaways from the FDCC program:

  • It appears that Defendants are not yet asking for shifting/allocation of costs in discovery because this area of the rule amendments has not yet resulted in court decisions. This is a fertile area for defendants to test the waters, but they should pick the right test cases.
  • With respect to the requirement that discovery be proportional to the needs of the case, recent decisions have demonstrated that defendants need to give courts the tools they need to cut down on “fishing expeditions” by plaintiffs. This often involves filing some type of affidavit with respect to the nature and extent of the burden and perhaps cost imposed by the discovery being sought. Defendants that have been able to demonstrate the burden with greater specificity, where that is possible, have been achieving good results. Some courts have not applied the proportionality requirement where the defendant has failed to file a burden affidavit.
  • Defendants should remind courts that the “reasonably calculated to lead to the discovery of admissible evidence” language that was part of Rule 26 for many years is no longer there. It has been deleted, but some courts are still referencing it, erroneously, in discovery rulings.
  • Defendants’ briefs on discovery issues should emphasize that the proportionality balancing that the new Rule 26 requires is mandatory, not optional.

Compliance With Medicare Secondary Payer Act At Issue In Auto Insurance Case

A recent decision in the District of New Jersey addressed an auto insurer’s obligations to comply with the Medicare Secondary Payer Act. Auto insurers may wish to review their practices and procedures in light of this decision.

In Negron v. Progressive Casualty Insurance Company, 2016 U.S. Dist. LEXIS 24994 (D.N.J. Mar. 1, 2016), the plaintiff brought a qui tam suit under the False Claims Act against Progressive. The allegations focused on an online application, in which policyholders were asked to select either a “health first” policy, under which the policyholder’s health insurance coverage would be the primary medical coverage for injuries arising from an auto accident, or Personal Injury Protection (PIP) primary coverage, under which Progressive would provide the primary coverage. The application noted that the policyholder should select the PIP primary coverage if one or more drivers was insured by Medicare or Medicaid. Id. at *7-8. The plaintiff selected the health first policy, even though she was a Medicare recipient. After she was injured in an auto accident, an adjuster denied her claim because the “health first” policy was a secondary payer. One of her medical bills was conditionally paid by Medicare. Id. at *6-8. The Medicare Secondary Payer Act provides that Medicare is a secondary payer where auto insurance coverage exists. The plaintiff sued, alleging that the insurer caused the submission of a false or fraudulent claim to Medicare, in violation of the Medicare Secondary Payer Act. The United States and New Jersey both declined to intervene, and the plaintiff proceeded with the qui tam suit.

Progressive moved to dismiss the federal and New Jersey False Claims Act claims. The court denied  the motion, finding that the complaint sufficiently alleged both that the defendants caused the submission of a false or fraudulent claim, and that the violation was “knowingly” made. A central part of the opinion focused on what the court concluded that the defendants could have done better:

First, Defendants could have constructed their online application to prevent Medicare and Medicaid enrollees from purchasing health first policies. This could have been accomplished through pop-up warnings, by requiring applicants to disclose the name of their health insurance carrier or provide a certification that they are not Medicare/Medicaid recipients, or by any number of other modifications to the online application process.

Second, it seems reasonable to assume that the online application process resulted in further post-application underwriting review and further communications between the Defendants and purchasers of health first policies such as the issuance of a formal policy and declarations, the issuance of permanent insurance cards, premium notices, and renewal processes. Each of these communications or interactions presented a separate opportunity to ensure that health first policies were not held by Medicare/Medicaid enrollees.

Lastly, both sides describe a claims adjustment process which involved a real human being. Yet, nowhere is it explained why the adjustor did not ask the health providers submitting the claims the simple question of what other insurance Realtor presented to the health care provider when the services were rendered. Further, no reason is given why that same simple question was not asked of Realtor at the beginning of the claims adjustment process. Patients of health care providers are routinely asked for proof of insurance and insurance companies routinely ask insureds to provide information about other available and potentially primary or overlapping coverage. Health care providers rarely miss an opportunity to get paid for their services, and as we have noted, insurance companies rarely miss the opportunity to come in second when it comes time to pay.

Id. at *18-20.

The court rejected the defendants’ argument that there was no loss to the government because Medicare’s payment was merely conditional, explaining that “[i]f that practice regularly occurred, defendants would essentially be receiving an interest free loan from the government on claims they are obligated to pay and were always obligated to pay.” Id. at *24. The court further found that the plaintiff had sufficiently alleged a knowing violation of the False Claims Act “by alleging that Defendants failed to make reasonable and prudent inquiries to ensure compliance with the [Medicare Secondary Payer] Act.” Id. at *27.

Insurers writing auto policies similar to Progressive’s “health first” policy may want to take note of this decision.

How Will Justice Scalia’s Death Impact Pending Class Action Cases?

As our nation and especially the legal community mourn the death of one of the most charismatic and influential Supreme Court justices in our history, one question that might be asked is how Justice Scalia’s death might impact pending class action cases. There are two pending class action cases of broad significance: Spokeo, Inc. v. Robins, which presents a question involving standing to sue in so-called “no injury” class actions; and Tyson Foods, Inc. v. Bouaphakeo, which involves whether a class can be certified based on a statistical sampling technique, and whether a class can properly be certified where it includes many members who were not injured.

Both cases were argued in November, and thus the Court could be close to finalizing decisions in them, although it may need to revisit that if Justice Scalia’s vote was decisisve. As Tom Goldstein explains at SCOTUSblog, the Court has traditionally not issued opinions based on the vote of a justice who has died or left the Court before the opinion is issued. There are two ways the Court has traditionally handled a justice’s death in the middle of a term, where the justice’s vote was decisive and the remaining members are divided 4-4. The Court could hold the case for reargument after a new justice is confirmed, or issue an order affirming the lower court based on the 4-4 deadlock. If the Senate refuses to confirm a nominee of President Obama, as Senate Republican leadership has suggested they might do, that could mean holding a case for reargument for quite a long time. Even if the next president were to make a nomination shortly after taking office next January 20, it would be at least a few months—towards the end of the next Court Term—before the seat would be filled, leaving the Court with only eight members for more than a year.

In Spokeo, based on my review of the oral argument transcript (see my November 3 blog post), the Court seemed to be largely in agreement that there has to be some concrete harm beyond a mere statutory violation to satisfy Article III standing requirements. There was a lot of disagreement over how to resolve the Spokeo case on its own allegations, however, suggesting that there might have been a 5-4 vote on that prior to Justice Scalia’s death. My guess is that, if Justice Scalia’s vote was decisive, the remaining justices might now find their way to a majority in favor of a narrower decision that corrects what they seemed to pretty much all think was wrong about the Ninth Circuit’s opinion, while resolving this case on narrow grounds, leaving some issues for another day. If that happens, it could be a small victory for class action defendants.

In Tyson Foods, my reading of the oral argument transcript (see my November 11 blog post) suggests that this case might not turn on Justice Scalia’s vote. The media’s interpretation was that Justice Kennedy would side with the plaintiffs, perhaps along with the four liberal justices. My effort to read the tea leaves suggested that Justice Kennedy, if he sided with the plaintiffs, would want to do so quite narrowly. He will still frequently be a lynchpin in the eight-member Court. I also thought that there seemed to be a broader majority in Tyson Foods in favor of a result that might explain how the way this case was presented to the jury was the wrong way to try a class action, and send the case back for a retrial without deciding much more than that. My guess is that we will see a majority opinion in this case, rather than a rehearing or affirmance because of a 4-4 vote. It could be a narrow opinion that provides district courts and class action practitioners some guidance on how a class action should be tried, and does not completely eliminate the possibility of statistical evidence being used, but leaves some of those details unanswered. The issue of many class members lacking injury, however, may be more difficult to resolve, and perhaps the Court might find a way to decide the case without deciding that issue if there were a tie vote on that question.

Wilcox v. State Farm: Minnesota Supreme Court Decision In Labor Depreciation Class Action

Today the Minnesota Supreme Court issued its opinion in Wilcox v. State Farm Fire & Casualty Company, a putative class action alleging that State Farm, in estimating the “actual cash value” of property damage under homeowners’ insurance policies, improperly applied depreciation to the labor component of the replacement cost of damaged structures. A question pertaining to whether depreciation can properly be applied to labor costs was certified by Minnesota’s federal district court to the state supreme court. In a prior post, I covered the oral argument in the Minnesota Supreme Court. I represented the American Insurance Association as an amicus curiae in this case.

Today, the court held that “absent specific language in the insurance policy that identifies a method of calculating actual cash value, the trier of fact must determine whether depreciation of embedded labor components ‘logically tend[s] to the formation of a correct estimate of the loss.” (Slip op. at 3.) In other words, the court concluded that determining the correct amount of the “actual cash value,” based on all applicable factors, is an issue that should generally be decided by an appraisal panel or the finder of fact at trial, typically based on expert testimony. The court further concluded that this determination “depends on the facts and circumstances of the particular case (id. at 10), which means that class certification on this issue is unlikely. This decision is more favorable to insurers’ positions than some of the other recent decisions on this issue (see my January 18 blog post for more on those).

Key points from this decision include:

  • The court ruled that “actual cash value” is not ambiguous because it is “a legal term of art that refers to the ‘actual loss’ sustained by the insured.” (Slip op. at 7.) The term “actual cash value” is well-defined by case law in most jurisdictions.
  • The court relied on its prior adoption of the “broad evidence rule” for determining actual cash value. It explained that the “broad evidence rule” is “a flexible approach that allows the trier of fact to consider ‘every fact and circumstance which would logically tend to the formation of a correct estimate of the loss.’” (Slip op. at 7.) The court explained that “the broad evidence rule does not dictate whether labor is depreciable or is not depreciable.” Rather, it is a factor to consider, and “certain embedded labor costs may be depreciable, depending on the facts and circumstances of the particular case.” (Id. at 8.)
  • The court rejected the position that depreciation of embedded labor costs is illogical, explaining that “arguments about whether labor-cost depreciation is ‘logical’ according to accepted methods of appraisal in a given case are best presented to an appraisal panel or via expert testimony before a jury.” (Id. at 9.) The court noted that “[t]he appraisal of real estate includes elements of both art and science,” and “[i]t is not the role of the judiciary to define best practices for appraisers without regard for the facts and circumstances of the case presented.” (Id. at 9.)
  • The court also noted that insurers can revise their policy language to specifically address this issue.

Overall, this is a significant victory for insurers who are defending putative class actions on this issue across the country. The court’s ruling that the question of whether embedded labor costs are appropriately depreciated is a case-by-case determination means that class certification is likely to be denied. This is because any common issues of law and fact (if any exist) likely will not predominate over individual issues concerning the nature and extent of the damage to each individual property, and the appropriate calculation of the actual cash value of the damage at issue.

SPECIAL DISCLAIMER: Because this case is one in which Robinson & Cole LLP represented an amicus curiae, we reiterate that the intent of this blog is to serve as an informational resource for readers, not advertising for our legal services. Every case is different and the result achieved in the case described above may differ from the result in some other case, which may involve different facts, different applicable law or a different jurisdiction. Case results depend upon a variety of factors unique to each case. Case results do not guarantee or predict a similar result in any future case undertaken by the same lawyer(s). This blog does not constitute legal advice and you should always consult your own lawyer about your own case.

Delay In Seeking Class Certification May Be Grounds For Denial Of Certification

A recent decision by a Florida appellate court highlights an important point that defendants can effectively raise in other jurisdictions as well – a named plaintiff’s failure to timely seek certification can, by itself, be grounds for denial of certification.

In Osborne v. Emmer, No. 4D15-1761, 2016 Fla. App. LEXIS 1445 (Fla. 4th DCA Feb. 3, 2016), an amended complaint including class action allegations was filed in October of 2009. As of March 2016, more than five years later, the plaintiffs had not sought class certification. The defendant moved to deny certification, and the trial court granted the motion based on the delay alone, without holding a hearing on any other class certification issues. The appellate court affirmed. It explained that: (1) “extensive delay alone can warrant denial of class certification”; and (2) “[p]art of the adequacy determination includes the zeal and competence of the representative’s counsel, and courts may consider the delay in the progress of a case and in seeking class certification in deciding whether a representative is adequate.” Id. at *4-5.

This is an argument that may sometimes be overlooked by defendants as litigation drags on. It is an argument that, as this case demonstrates, can be effectively made in appropriate cases.

Blog Name Change: Welcome To Class Actions Insider

After nearly four years of blogging, I’ve decided to make one small change. The name of the blog is now “Class Actions Insider” and the site is www.classactionsinsider.com.  You can still find it at www.insuranceclassactions.com, which will redirect you to the new site.

For my insurance industry readers, please be assured that I will still cover all major developments in class actions against the insurance industry. But I’ve realized that many of my posts have a broader reach, and are just as useful for readers involved in class actions outside of the insurance industry. And insurers themselves are often involved in defending class actions on behalf of other companies under liability policies. My class action defense practice has also grown to include cases involving various industries. The new name and site better convey that my blog has, and will continue to have, a broader reach than just insurance, although it will still closely follow insurance class actions. Thank you for your loyalty if you are a regular reader of my blog, and please feel free to reach out to me if you have any questions.

Property Insurance Diminution in Value Class Action: Georgia Federal Court Dismisses Declaratory Judgment Claim

A while back, I wrote about a Georgia Supreme Court decision, Royal Capital Development LLC v. Maryland Casualty Co., that held that diminution in value of real property is potentially covered  under a property insurance policy, in addition to the costs of repairs (see my June 6, 2012 blog post). This was an extension of a decision by the Georgia Supreme Court in the auto insurance context, which had held that diminution in value of a vehicle, after completing repairs, was covered under an auto policy. Vehicles are different than autos though. Unlike some used vehicles, real properties often gain in value when old materials are replaced with new. Nevertheless, as I predicted, the Royal Capital decision has resulted in some class action filings against homeowners’ and commercial property insurers, although not a large number of cases. As far as I know, the issue has not yet spread beyond Georgia.

In Brewton v. Liberty Mutual Holding Company, Inc.,  2016 WL 224124 (M.D. Ga. Jan. 19, 2016), a putative class action involving this issue, a Georgia federal district court recently granted the insurer’s motion to dismiss a declaratory judgment claim. The plaintiff sought a declaratory judgment that the insurer “is obligated under the homeowners insurance policies to assess insured properties for and pay diminished value when policyholders present first-party physical damage claims arising from direct physical losses to their insured properties, which are covered events.” Id. at *1. The court dismissed this claim because it was based on the possibility of a hypothetical or contingent future injury. The court reasoned that “[a]lthough it is possible that [plaintiff] may experience damage to her home and thus a dispute with First Liberty over diminished value in the future, her allegations are insufficient to establish a reasonable expectation that her alleged injury will be repeated. ‘[A] plaintiff seeking declaratory . . . relief must allege . . . a real and immediate – as opposed to a merely hypothetical or conjectural – threat of future injury.’” Id. at *3. “The mere possibility that [plaintiff’s] home may suffer damage in the future is ‘simply too remote to satisfy the case-or-controversy requirement and permit adjudication by a federal court.’” Id. (quoting O’Shea v. Littleton, 414 U.S. 488, 498 (1974)).

The argument made here is one that insurers and other defendants can often make in defending against declaratory judgment claims in putative class actions. With this type of claim dismissed, class certification will depend entirely on a breach of contract claim, on which class certification is governed by the more stringent Rule 23(b)(3) standard, which requires that common issues of law or fact predominate. With respect to diminution in value, for example, the defendant, in opposing class certification or moving to strike the class allegations, has a strong argument that the specific factual circumstances of each individual claim will predominate in determining whether there was any uncompensated diminution in value that falls within the scope of coverage as construed by the Georgia Supreme Court’s decision.