On the heels of the Ninth Circuit’s recent decision in Bowerman—which held that questions concerning the “existence of damages” for each class member can prevent certification—the Eleventh Circuit became the latest in a growing number of courts to conclude that class certification should be denied when plaintiffs cannot prove that each individual class member actually suffered damages.
In Baker v. State Farm Mutual Automobile Insurance Company, 2022 WL 3452469, at *1 (11th Cir. Aug. 18, 2022), plaintiffs alleged that State Farm’s formula for assessing diminution in vehicle value systematically understated the true diminished value, thereby leading to underpayment of claims. In support of class certification, plaintiffs submitted an expert sample of seventy-five individual claims where State Farm’s formula purportedly under-assessed the true diminished value. Id. at *3. On that basis, plaintiffs argued that State Farm’s liability could be established by common proof.
The Eleventh Circuit disagreed, affirming the district court’s conclusion that plaintiffs’ expert sample failed to demonstrate that State Farm’s formula always under-assessed diminished value across the broad spectrum of vehicles and types of damage included in the class. Id. at *4. Because “the central liability question” for each class member—i.e., whether State Farm’s formula resulted in under-assessment of a particular claim—required individualized proof, the Eleventh Circuit concluded that plaintiffs had failed to satisfy Rule 23(b)(3)’s predominance requirement. Id.
Baker emphasizes the continued importance of framing individualized damages issues as questions of fact of injury required to establish liability rather than damages per se. Although courts have been reluctant to conclude that certification should be denied when the quantum of each class member’s damages requires individual proof, they have broadly concluded that certification should be denied when plaintiffs’ “common proof” is insufficient to demonstrate that the defendant is liable to each individual class member.