There have been an unusually large number of significant decisions in insurance class actions over the last couple of weeks.  I will not be able to discuss all of them in detail but thought you would like to have shorter summaries of them.  Here is the first installment regarding recent P&C class action decisions: 

  • Folks v. State Farm Mut. Auto. Ins. Co., 2012 U.S. Dist. LEXIS 43294 (D. Colo. Mar. 29, 2012):  This case involves personal injury protection (PIP) coverage and a requirement in Colorado’s No Fault Act that insurers must offer enhanced PIP coverage that includes coverage for pedestrians.  State Farm failed to offer the enhanced benefits and, after losing some prior court decisions, modified its policy language.  State Farm also provided voluntary relief, re-adjusting a number of claims.  The court denied class certification, finding that numerosity was not satisfied because, excluding the people who were given voluntary relief, the plaintiff could only speculate that there were about 50 class members that might obtain relief in the suit.  The court also concluded that a reformation claim was not suitable for certification under Rule 23(b)(2) because reformation is an equitable remedy that requires an individualized analysis of whether the class member relied on State Farm’s past practices and the degree of injustice or hardship.  To the extent certification was sought under Rule 23(b)(3), predominance also was not satisfied because the prior litigation, together with State Farm’s voluntary relief program, had resolved the common legal and liability issues, and what remained were only individualized determinations regarding reformation of policies and the amounts claimed by individual class members.  This case is a good example of how a voluntary relief program can potentially defeat a putative class action (for more on that, see my Sept. 16, 2011 blog post). 
  • Cox v Allstate Insurance Company.pdf, No. CIV-07-1449-F, slip op. (W.D. Okla. Mar. 28, 2012):  This is a class certification decision in a first-party property insurance case involving claims for wildfire damage.  The two proposed Oklahoma statewide classes were: (1) insureds who had recoverable depreciation held back from their claim and did not receive a letter from Allstate explaining the amount of depreciation and how to recover it; and (2) insureds whose policy limits were increased automatically by Allstate’s “Property Insurance Adjustment” feature.  The claim on behalf of the first class was that the failure to send a letter regarding the holdback was by itself bad faith and resulted in unjust enrichment to Allstate.  The claim on behalf of the second class was that Allstate’s method of increasing policy limits resulted in overinsurance and unduly high premiums, also resulting in unjust enrichment.  The court held that commonality was not satisfied under Wal-Mart v. Dukes as to proposed class (1) because Allstate’s general policy was to send the letter, and, as the plaintiffs’ expert admitted, some people who did not receive the letter recovered all depreciation they were owed.  Determining whether people failed to receive the letter and sustained an injury would require a file-by-file individualized analysis.  The court reached a similar conclusion with respect to the class of insureds claimed to be overinsured – a file-by-file analysis would be required to determine if there was overinsurance.  The court also found that predominance was not satisfied because, with respect to class (1), a bad faith claim could not be pursued without a breach of contract, and, under Wal-Mart, Allstate would be entitled to present its individualized defenses to breach of contract claims.  The court rejected an argument that Allstate was somehow estopped from asserting defenses in litigation that it had not asserted during the claim process.  With respect to class (2), a determination of whether Allstate inappropriately raised the policy limit would require comparing every individual policy limit with the property’s fair market value, an individualized analysis that defeated certification.  This case is a good example of how courts are applying Wal-Mart v. Dukes in insurance class actions.
Tags: Allstate, Rule 23(b)(2), State Farm, Wal-Mart v. Dukes
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Photo of Wystan Ackerman Wystan Ackerman

I am a partner at the law firm of Robinson+Cole in Hartford, Connecticut, USA.  My contact information is on the contact page of my blog.  I really enjoy receiving questions, comments, suggestions and even criticism from readers.  So please e-mail me if you…

I am a partner at the law firm of Robinson+Cole in Hartford, Connecticut, USA.  My contact information is on the contact page of my blog.  I really enjoy receiving questions, comments, suggestions and even criticism from readers.  So please e-mail me if you have something to say.  For those looking for my detailed law firm bio, click here.  If you want a more light-hearted and hopefully more interesting summary, read on:

People often ask about my unusual first name, Wystan.  It’s pronounced WISS-ten.  It’s not Winston.  There is no “n” in the middle.  It comes from my father’s favorite poet, W.H. (Wystan Hugh) Auden.  I’ve grown to like the fact that because my name is unusual people tend to remember it better, even if they don’t pronounce it right (and there is no need for anyone to use my last name because I’m always the only Wystan).

I grew up in Deep River, Connecticut, a small town on the west side of the Connecticut River in the south central part of the state.  I’ve always had strong interests in history, politics and baseball.  My heroes growing up were Abraham Lincoln and Wade Boggs (at that time the third baseman for the Boston Red Sox).  I think it was my early fascination with Lincoln that drove me to practice law.  I went to high school at The Williams School in New London, Connecticut, where I edited the school newspaper, played baseball, and was primarily responsible for the installation of a flag pole near the school entrance (it seemed like every other school had one but until my class raised the money and bought one at my urging, Williams had no flag pole).  As a high school senior, my interest in history and politics led me to score high enough on a test of those subjects to be chosen as one of Connecticut’s two delegates to the U.S. Senate Youth Program, which further solidified my interest in law and government.  One of my mentors at Williams was of the view that there were far too many lawyers and I should find something more useful to do, but if I really had to be a lawyer there was always room for one more.  I eventually decided to be that “one more.”  I went on to Bowdoin College, where I wrote for the Bowdoin Orient and majored in government, but took a lot of math classes because I found college math interesting and challenging.  I then went to Columbia Law School, where I was lucky enough to be selected as one of the minions who spent their time fastidiously cite-checking and Blue booking hundred-plus-page articles in the Columbia Law Review.  I also interned in the chambers of then-Judge Sonia Sotomayor when she was a relatively new judge on the Second Circuit, my only connection to someone who now has one-ninth of the last word on what constitutes the law of our land.  I graduated from Columbia in 2001, then worked at Skadden Arps in Boston before returning to Connecticut and joining Robinson+Cole, one of the largest Connecticut-based law firms.  At the end of 2008, I was elected a partner at Robinson+Cole.

I’ve worked on class actions since the start of my career.  Being in the insurance capital of Hartford, we have a national insurance litigation practice and most of the class actions I’ve defended have been brought against insurance companies. I’ve also handled some involving products liability, managed care, health care, utilities, financial services, higher education and environmental issues.

My insurance class action practice usually takes me outside of Connecticut.  I’ve had the pleasure of working on cases in various federal and state courts and collaborating with great lawyers across the country.  While class actions are an increasingly large part of my practice, I don’t do exclusively class action work.  The rest of my practice involves litigating insurance coverage cases, often at the appellate level.  That also frequently takes me outside of Connecticut.  A highlight of my career thus far was working on Standard Fire Ins. Co. v. Knowles, the U.S. Supreme Court’s first Class Action Fairness Act case.  I was Counsel of Record for Standard Fire on the cert petition, and had the pleasure of working with Ted Boutrous on the merits briefing and oral argument.

I started this blog because writing is one of my favorite things to do and I enjoy following developments in class action law, writing about them and engaging in discussion with others who have an in interest in this area.  It’s a welcome break from day-to-day practice, keeps me current, broadens my network and results in some new business.

When I’m not at work, you might find me running lines or watching a musical with my teenage daughter who hopes to be a Broadway star (or taking her to voice or dance lessons) or reading a good book.

Read more about Wystan Ackerman
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