• July 7, 2011

Update (July 7, 2011): A big win for plaintiffs’ class actions before the Eighth Circuit this week.  Judge Diana E. Murphy wrote the opinion, in which Judge Roger L. Wollman concurred, affirming U.S. District Court Judge Ann Montgomery’s class certification in its entirety.

Judge Raymond W. Gruender dissented, arguing that the “dry plaintiffs’ class,”  that is, the class of plaintiffs whose pipes had not yet failed, was not a proper class because they have not shown sufficient injury, according to Judge Gruender, to have standing.

Original Post (March 21, 2011):  A substantial body of law has developed over the years to address the difficult problem of an allegedly defective product whose defect manifests (or, maybe, does not?) over time.  On the one hand, plaintiffs seem prejudiced when they confront a product whose defect lurks ominously in their future.  Must they sit and wait until the harm materializes and then sue?  (These concerns are particularly compelling when they concern medical devices implanted in one’s body but having such a risk built into the walls of one’s home is not a whole lot better, the Zurn Pex plaintiffs’ class would argue.)

(What about the statutes of limitation?) (What if failure is not a “potential risk” but, say, the result of a natural chemical process (i.e., metallurgical degradation) that is more or less certain to occur over time?)

On the other hand, is it in the interests of justice that defendants should face multi-million dollar liability when the plaintiffs (or perhaps most of them but not all of them?), as of the date of the lawsuit, have suffered no injury?

U.S. District Court Judge Ann D. Montgomery (D. Minn.) confronted these difficult questions this in a class action arising in the context of allegedly defective plumbing components in In re: Zurn Pex.  Appeal of Judge Montgomery’s decision was argued last week before the U.S. Court of Appeals for the Eighth Circuit (Judges Roger L. Wollman, Judge Diana E. Murphy, Raymond W. Gruender).  James A. O’Neal of  Faegre & Benson argued on behalf of the defendants.  Former Minnesota Supreme Court Chief Judge Eric Magnuson argued for the plaintiff’s class.

This is not the Simplicity case or the Briehl case (discussed here), Magnuson argued.   The Zurn Pex case, in contrast to these earlier Eighth Circuit decisions, involves true present-day “ticking time-bombs” not some speculative risk of future injury.

At the class certification stage, what kind of scrutiny is the trial court supposed to subject the expert evidence?  This appears to be a critical issue in this case and, specifically, whether the Eighth Circuit Blades case bars the Eighth Circuit from following the analysis of its sister circuit, the Seventh Circuit, in the American Honda case.

In American Honda, the Seventh Circuit held:

We hold that when an expert’s report or testimony is critical to class certification, as it is here,…, a district court must conclusively rule on any challenge to the expert’s qualifications or submissions prior to ruling on a class certification motion.

In Blades, the Eighth Circuit held:

Appellants argue on appeal that the district court improperly resolved disputes between the parties’ experts that go to the merits of the case.  We have stated that in ruling on class certification, a court may be required to resolve disputes concerning the factual setting of the case.  This extends to the resolution of expert disputes concerning the import of evidence concerning the factual setting…. While the district court’s language may have been overbroad in places, we believe the district court’s findings as to the experts’ disputes were properly limited to whether, if appellants’ basic allegations were true, common evidence could suffice, given the factual setting of the case, to show class-wide injury…

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