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Windshield Repair Case Does Not Meet Requirements for Class Action

Image of a damaged windshield

A lawsuit claiming that an insurance company steered policyholders to repair rather than replace damaged windshields is not a proper class action, the Ohio Supreme Court said today. (Photo courtesy of Derek Jensen)

Image of a damaged windshield

A lawsuit claiming that an insurance company steered policyholders to repair rather than replace damaged windshields is not a proper class action, the Ohio Supreme Court said today. (Photo courtesy of Derek Jensen)

A class-action lawsuit alleging that an insurance company did not disclose the option to replace damaged windshields to its policyholders does not meet the legal requirements for a class action, the Supreme Court of Ohio ruled today.

In its decision, the court clarified the standards that apply when an appellate court reviews certification of a class action pursuant to Ohio’s rules in civil cases.

In a majority opinion authored by Justice Terrence O’Donnell, the court reversed the judgment of the Eighth District Court of Appeals and sent the case back to the trial court for reconsideration.

Ten years ago, Michael Cullen contacted his automobile insurance carrier, State Farm Mutual Automobile Insurance Company, to report damage to his car’s windshield. Cullen spoke with his agent and then a representative from a company that handled State Farm’s windshield claims. He subsequently had his windshield repaired.

Cullen sued State Farm in 2005, requesting class certification and a declaratory judgment that the insurance company’s practices were illegal, and he made claims for breach of contract, bad faith, and breach of fiduciary duty and sought compensatory and punitive damages. The class was defined as all State Farm policyholders on or after February 18, 1990, and the complaint alleged that the company had denied these policyholders full payment to replace windshields (minus their deductibles) because it instead paid to repair some windshields with a chemical compound that it knew or should have known was “only temporary, not entirely translucent, and incapable of restoring the windshield to its preaccident condition.”

The trial court concluded that Cullen and the class satisfied the requirements governing class actions in the Ohio Rules of Civil Procedure (Civ.R. 23(A), 23(B)(2), and 23(B)(3)).

State Farm appealed the decision to the Eighth District Court of Appeals.

The appeals court affirmed the trial court’s order certifying the class pursuant to Civ.R. 23(B)(2) and (3), but it reversed the part of the decision defining the class. The appellate court instructed the trial court to exclude from the class policyholders who had their windshields replaced after they were repaired.

The Ohio Supreme Court accepted State Farm’s appeal regarding the class certification and the standards in the civil rules that apply to a review of an order certifying a class.

In the majority opinion, Justice O’Donnell explained that the appeal does not challenge the determination of the trial court that Cullen and the class met the requirements of Civ.R. 23(A), but rather focuses on whether the class met the requirements of Civ.R. 23(B)(2) and (3).

He wrote: “Review of the certification of a class action requires the appellate court to determine whether the trial court conducted a rigorous analysis that resolved all relevant factual disputes and found by a preponderance of the evidence that the requirements of Civ.R. 23 have been satisfied. In making this determination, some consideration of the underlying merits of the cause of action may be necessary.”

Justice O’Donnell continued: “Here, this action does not satisfy the requirements for class certification pursuant to Civ.R. 23(B)(2), because the declaratory relief sought is at best only incidental to an award of monetary damages, and the trial court abused its discretion in granting class certification pursuant to Civ.R. 23(B)(3), because a rigorous analysis of the evidence presented by the parties demonstrates that individual questions predominate over issues common to the class.”

The court’s majority opinion was joined by Chief Justice Maureen O’Connor and Sharon L. Kennedy and by Judge Matthew W. McFarland of the Fourth District Court of Appeals. McFarland sat in for Justice Judith L. French, who recused herself.

Justice Judith Ann Lanzinger concurred in paragraph three of the opinion’s syllabus and in the judgment.

William M. O’Neill dissented in an opinion joined by Justice Paul E. Pfeifer.

Justice O’Neill wrote in his dissent that “[c]lass actions promote judicial economy and allow resolution of issues that are economically unsolvable via individual actions.”

“[T]he majority faults the appellate court for failing to do something that it had no duty to do under our prior cases, and something that the trial court did in fact do, at State Farm’s request,” he reasoned. “The majority has reached the opposite conclusion on this factual issue from the trial court, but the different perspectives are readily explained. The majority of this court did not have the benefit of the ten-hour certification hearing that the trial court did. That is precisely why we generally defer to the findings of trial courts. Our review in these matters is for an abuse of discretion. Such an abuse does not exist in this case. The class certification … should be upheld.”

2012-0535. Cullen v. State Farm Mut. Auto Ins. Co., Slip Opinion No. 2013-Ohio-4733.

Video clip View oral argument video of this case.

Please note: Opinion summaries are prepared by the Office of Public Information for the general public and news media. Opinion summaries are not prepared for every opinion, but only for noteworthy cases. Opinion summaries are not to be considered as official headnotes or syllabi of court opinions. The full text of this and other court opinions are available online.

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