Todd J. Zywicki and William H. Jordan*
The explosion of mass tort class actions has presented courts with
increasingly complicated and massive cases. Many of these cases
are based entirely upon "junk" science, such as the breast
implant cases, or upon claims presenting uniquely individual factual
issues, such as the asbestos cases. See, e.g., Georgine v. Amchem
Prods., 83 F.3d 610 (3d Cir. 1996) (rejecting a settlement class
of asbestos claimants); Dante v. Dow Corning Corp., 143 F.R.D. 136
(S.D. Ohio 1992) (certifying silcone breast implant class). Signaling
an encouraging trend toward greater judicial scrutiny of large class
actions, the Fifth Circuit, in Castano v. American Tobacco Co.,
84 F.3d 734 (5th Cir. 1996) ("Castano II"), recently reversed
the decision of the United States District Court for the Eastern
District of Louisiana, which had certified a huge, potentially unmanageable
class of virtually all nicotine-dependent persons, and their heirs
or survivors, who have smoked cigarettes in the United States since
1943. Id. at 738 (reversing Castano v. American Tobacco Co., 160
F.R.D. 544, 560-61 (E.D. La. 1995) ("Castano I")). In
so doing, the Fifth Circuit established an effective methodology
by which courts may grapple with the difficult and important issue
of class certification in mass tort suits.
I. Background of the Castano Case.
Seeking certification of a nationwide class of individuals injured
through nicotine addiction, the plaintiffs in Castano I alleged
nine causes of action under various state tort and consumer protection
statutes against eight cigarette manufacturers. Castano II, 84 F.3d
at 737. The Castano plaintiffs' "novel and wholly untested
theory" was that "the defendants fraudulently failed to
inform consumers that nicotine is addictive and manipulated the
level of nicotine in cigarettes to sustain their addictive nature."
Id. The district court certified a Rule 23(b)(3) damages class on
certain "core liability issues," such as the "common
factual issues" of "whether defendants knew cigarette
smoking was addictive, failed to inform cigarette smokers of such,
and took actions to addict cigarette smokers," and "common
legal issues" of "fraud, negligence, breach of warranty
(express or implied), strict liability, and violation of consumer
protection statutes." Castano I, 160 F.R.D. at 553. The district
court also certified a class on the issue of punitive damages, establishing
a procedure whereby the class jury would develop a ratio of punitive
damages to actual damages, and the court would apply that ratio
in individual cases. Castano II, 84 F.3d at 740.
Under Rule 23(b)(3), a class action may be maintained if "the
court finds  that the questions of law or fact common to the
members of the class predominate over any questions affecting only
individual members, and  that a class action is superior to other
available methods for the fair and efficient adjudication of the
controversy." The Fifth Circuit held that the class of plaintiffs
in Castano failed both the predominance and superiority tests of
Rule 23(b)(3), and therefore reversed, decertified the class, and
remanded the case.
II. The Problems of an Immature Tort.
Judge Jerry E. Smith's opinion in Castano II analyzed the predominance
and superiority prongs of the certification process by examining
the inherent difficulties of certifying a class whose claims are
based upon an "immature" tort. A "mature" tort
is one where there has been a sufficient number of individual trials
to provide a track record to guide the court in making the predominance
and superiority analysis required by Rule 23, such as asbestos or
Dalkon Shield. Castano II, 84 F.3d at 748.
The Fifth Circuit directs a certifying court to consider first
whether the mass tort has matured to the point where an accurate
determination can be made as to whether superiority and predominance
exist. If the tort is not yet mature, the certifying court is to
take a subsequent step and determine whether there are any barriers
to an expeditious and cost-effective means of bringing the mass
tort to maturation. Only if it is impossible to bring the mass tort
to maturation should the court consider certifying an immature mass
By forcing the tort to mature, the Fifth Circuit established an
effective methodology for determining class certification questions
that balances the goals of Rule 23 with other policy concerns. Through
the initial litigation of actions in individualized adjudications,
courts in cases involving mature mass torts can establish reliable
findings as to issues such as general causation, typical injuries,
and levels of damages. Id. For an "immature" class action,
especially one of the size and complexity as Castano, the absence
of any track record on any of the important issues in the case makes
any determinations as to superiority or predominance mere speculation.
Id. at 747.
The guesswork required in certifying an immature tort was obvious
in the district court's predominance analysis. A court must undertake
an independent inquiry in state law variations, especially in light
of differing consumer protection, fraud, comparative or contributory
negligence, and punitive damages standards. Id. at 741. The Fifth
Circuit found that crucial differences in state law and the lack
of any proven "track record" in tobacco cases militated
against a finding of predominance. A potential nationwide tort class
raises thorny conflict of laws and Erie problems that must be examined
in detail. By allowing individual trials to proceed, "[s]tate
courts can address the more novel of the plaintiffs' claims, making
the federal court's Erie guesses less complicated . . . [and] allow
state courts to apply and develop their own law." Id. at 750.
The predominance inquiry also requires a court to "look past
the pleadings . . . [to] understand the claims, defenses, relevant
facts, and applicable substantive law...." Id. at 741. Without
having any trials to guide its analysis, the district court simply
assumed that because individual trials would each have a common
element - addiction - that common issues would be "significant."
Id. at 744-45. Such an interpretation, however, would render the
predominance requirement a mere nullity because "any common
issue would predominate if common to all individual trials."
Id. Moreover, if subsequent litigation demonstrates that individualized
issues predominate over common issues, then the class ultimately
will be decertified and years of litigation will have been wasted.
Id. at 749.
The certification of an immature tort also creates significant
problems in determining whether a class action is superior to individual
cases. Unlike the court-swamping caused by individual asbestos cases,
there was no indication that the failure to certify the class in
this case would create a "judicial crisis" that would
overwhelm the legal system with individual suits. The novel nature
of the plaintiffs' claim and the speculative nature of the supporting
evidence makes it possible that only a limited number of suits will
actually be filed. Id. at 747. Moreover, because individual damage
claims are high, punitive damages are available in most states,
and attorneys' fees may be recovered under many statutes, nicotine
addiction cases do not represent "negative value suits."
Id. at 748. Thus, if no class were certified at this stage of the
litigation, a manageable number of individual claims would probably
be filed and litigated, which suits could then serve as the basis
for a later determination of whether the case had matured to a point
where class certification was appropriate. This "positive value"
of these cases is made all the more apparent by the recent $750,000
jury verdict in Florida state court against Brown & Williamson
won by a single plaintiff. See "Jury's Tobacco Verdict Suggests
Tough Times Ahead for the Industry," Wall St. J., Aug. 12,
1996, at A1.
The Fifth Circuit also found that there is no basis to conclude
that there would be any savings in judicial efficiency that could
support a finding of superiority. The issues to be established by
the class proceeding are intertwined with issues such as comparative
negligence and reliance, which will have to be litigated on a case-by-case
basis. Because these individualized and common "core"
liability issues are intertwined, any savings for judicial efficiency
will be at best speculative and at worst non-existent. Id. at 749.
An additional substantive concern raised by class certification
is the prejudice to the individual plaintiffs themselves. When a
case is converted to a class action, the loyalties of the plaintiffs'
counsel become uncertain, as the class action lawyers will face
tension in attempting to balance the needs of their individual plaintiffs
with their desires to certify a larger class of plaintiffs. Thus,
although plaintiffs' counsel claimed that "time was running
out" on the lives of the putative members of the class, the
class certification issues alone would add multiple layers of complexity
and delay into the time that would otherwise be required to prosecute
these cases. Id. at 751.
The Fifth Circuit's opinion in Castano II is a significant addition
to the law of class certification. The stakes are high in such cases;
to certify a class is to "commit the fate of an entire industry
or, indeed, the fate of a class of millions, to a single jury."
Id. at 752. By channeling the analysis into issues of the maturity
of the underlying tort, Judge Smith's opinion will hopefully force
district courts to increase their scrutiny at the certification
stage of all potential class actions. The result should be more
accurate determination of when class certification is appropriate,
an important contribution when the cost of inaccuracy is so high.
* Todd Zywicki is Assistant Professor of Law at Mississippi College
School of Law.
William Jordan is an Associate at Alston & Bird in Atlanta.