I’ve tried to make this a blog with national coverage.  This post is my first venture to Alaska, which is about as far from my home in Connecticut as one can get and still be in the U.S. (except, I suppose, for Hawaii).  What sparked my venture to write about a decision from Alaska is that it’s the first insurance class action decision I’ve seen that applies the Supreme Court’s recent decision in Comcast Corp. v. Behrend (blog post).

In Wheeler v. United Services Automobile Association, Case No. 3:11-cv-00018-SLG, 2013 U.S. Dist. LEXIS 122447 (D. Alaska Aug. 27, 2013), the plaintiff was a driver who made a claim against a driver insured by USAA, and later settled her claim.  She alleged that under Alaska law, she was entitled to attorneys’ fees calculated as a percentage of her total damages, rather than as a percentage of the settlement amount.  The dispute involves whether the insurance policy at issue complied with a regulatory requirement that enables an insurer to limit its liability for attorneys’ fees under Alaska law.  Id. at *3.

In denying class certification, the court focused on the issue of individualized damages, which it concluded precluded class certification.  The court explained that:

Comcast thus holds that where a proposed Rule 23(b)(3) class involves individualized damages, the plaintiff must provide the district court with a method that is capable of measuring damages on a classwide basis. Without such a method, Comcast instructs that the predominance requirement of Rule 23(b)(3) cannot be met, as “[q]uestions of individual damage calculations will inevitably overwhelm questions common to the class.”

. . .

[E]ven under the authority cited by the dissent in Comcast, certain categories of cases, such as those involving “significant personal injury damages,” are inappropriate for class actions because of the extent of the individualized damage evaluations necessary, which prevents them from meeting the predominance requirement of Rule 23(b)(3).

Here, the necessary damage calculations would involve separate and “significant personal injury damages” evaluations for each of the proposed 136-plus class members. Each proposed class member allegedly received attorney’s fees that were calculated as a percentage of the policy limit. Ms. Wheeler asserts that each member should have received attorney’s fees calculated as a percentage of the amount of his or her actual damages. The amount of damages allegedly due to each class member would therefore be the difference between the fee award actually received (percentage of policy limit) and the fee award that was supposed to have been received (percentage of actual damages). The fee award actually received is a known number. But each proposed class member was injured in a separate accident and suffered unique injuries; thus, the amount of damages allegedly due to each class member would differ significantly based on the specific nature of each proposed member’s injury.

Ms. Wheeler has not provided the Court with any common method of determining the amount of each proposed class member’s actual damages, and thus has not demonstrated that damages are capable of measurement on a classwide basis. That she has not done so is not surprising, as the Court cannot conceive of a common method that could be applied in these circumstances. Instead, to calculate damages, the Court would be required—for each of the 136-plus proposed class members—to conduct a separate evidentiary proceeding for that class member to determine the cause(s) of each member’s accident and the amount of damages suffered by each of them. The individual questions of fact implicated in the determination of damages for the proposed class would “inevitably overwhelm” the common questions of law and fact asserted in the SAC. Accordingly, the Court finds that Ms. Wheeler has not demonstrated that the proposed class meets the predominance requirement of Rule 23(b)(3).

Id. at *13-16.

The rationale articulated in Wheeler is applicable to many class actions brought against insurers, where resolving the individual class members’ claims requires placing a value on a personal injury claim, or property damage to a home or vehicle.  This is an excellent example of how an insurer can take advantage of the Comcast decision in defending against class certification.

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Photo of Wystan Ackerman Wystan Ackerman

Wystan Ackerman is a partner in Robinson+Cole’s Insurance + Reinsurance Group and handles a diverse range of property insurance litigation, including large business interruption cases, class actions, other complex litigation, and appeals. He also has substantial experience representing insurance companies in putative class…

Wystan Ackerman is a partner in Robinson+Cole’s Insurance + Reinsurance Group and handles a diverse range of property insurance litigation, including large business interruption cases, class actions, other complex litigation, and appeals. He also has substantial experience representing insurance companies in putative class actions involving homeowners’ insurance coverage and market conduct/claim-handling practices. He has been prominently involved in high-profile property insurance litigation concerning the September 11th catastrophe and Hurricane Katrina, and Chinese-made drywall. Based in the insurance capital of Hartford, Connecticut, Wystan writes the blog Insurance Class Actions Insider, which was selected by Lexis Nexis as a top insurance blog for 2011.

Wystan 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. He always had strong interests in history, politics and baseball and his heroes growing up were Abraham Lincoln and Wade Boggs (at that time the third baseman for the Boston Red Sox). Wystan says it was his early fascination with Lincoln that drove him to practice law. As a high school senior, he was one of Connecticut’s two delegates to the U.S. Senate Youth Program, which further solidified his interest in law and government. He went on to Bowdoin College, where he wrote for the Bowdoin Orient and majored in government. After Bowdoin, he went on to Columbia Law School. He also interned in the chambers of then-Judge Sonia Sotomayor on the Second Circuit. Wystan graduated from Columbia in 2001, then worked at Skadden Arps in Boston before returning to Connecticut and joining Robinson+Cole.

When Wystan’s not at his desk, flying around the country trying to save insurance companies from the plaintiffs’ bar, or attending a conference on class actions or insurance litigation he often can be found watching “Dora the Explorer” or reading or playing whiffleball with his young daughter, helping his wife with her business, Option Realty, reading a book about history or politics, or watching the Boston Red Sox.

Read Wystan’s rc.com bio.