In a case that highlights the complexity of structuring class actions, the U.S. Court of Appeals for the Eighth Circuit reversed a trial court’s decision to certify a class claiming damages from trichloroethylene (TCE) contamination. See Ebert v. Gen Mills, Inc., 823 F.3d 472 (8th Cir. 2016). The Eighth Circuit held that the trial court abused its discretion by narrowing the putative class and the issues before the court.

The putative class alleged in Minnesota federal court that TCE vapor from a plume under Defendant’s former facility threatened the health of residents and diminished property values in the surrounding neighborhood. After excluding class members with personal injury claims and bifurcating the action into liability and damages phases, the trial court certified two classes: a declaratory or injunctive relief class for the liability phase and a damages class for the damages phase.

On appeal, the Eighth Circuit found that the trial court abused its discretion by certifying the classes. “[B]y bifurcating the case and narrowing the question for which certification was sought, the district court limited the issues and essentially manufactured a case that would satisfy the Rule 23(b)(3) predominance inquiry.” Id. at 479. Given the varied conditions at each class member’s property, the Court reasoned, “[t]he district court's narrowing and separating of the issues ultimately unravels and undoes any efficiencies gained by the class proceeding because many individual issues will require trial.” Id.

With similar reasoning, the Court held that the class also failed to satisfy the requirements of a declaratory or injunctive relief class: “Rule 23(b)(2) applies only when a single injunction or declaratory judgment would provide relief to each member of the class.” Id. at 480 (quotation omitted). Because different conditions at each neighboring property would require different remediation, a single judgment would be inadequate.

This blog was prepared with the assistance of Lynne Howard.