No. 5-99-0830 IN THE APPELLATE COURT OF ... - Appellate.net

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transactions presented a multitude of individual factual issues that could not possibly be resolved in a manner consistent with due process without proof of the individual facts and circumstances surrounding each repair. In addition, as a matter of Illinois law and constitutional principle, the claims of non-Illinois class members could not be decided under Illinois law, but rather must be decided under the laws of each individual state. Because it was apparent from the outset that there was no proper way to resolve any common issues of fact or issues of law on a classwide basis, it was reversible error to certify the class. If there was ever any doubt about the propriety of class certification, however, the trial proved that the case could not be fairly adjudicated on a classwide basis. As demonstrated in Part II below, in order to make a classwide trial manageable, the circuit court made a series of erroneous rulings about evidence, burdens of proof, and jury instructions that effectively deprived State Farm of a fair trial. For example, plaintiffs should have been required to prove which class members suffered an economic loss and to provide a reasonable estimate of the amount of that loss. But, recognizing that it was impossible to meet that burden on a classwide basis, the court simply excused plaintiffs from having to prove the fact of damage as to any class member and allowed them to prove “aggregate” damages. Those damages were so clearly improper that plaintiffs’ own expert candidly admitted that the “specification” damages made no “economic sense” and that his estimate of “installation” damages might be as much as $1 billion too high. In order to make the trial manageable, the court also excused plaintiffs from proving that any member of the class — including the five class representatives who testified at trial — had received non-OEM parts that failed to restore his or her particular vehicle to its pre- -28-
loss condition. Instead of requiring proof of any real breaches of contract, the court took yet another shortcut, allowing plaintiffs to obtain a $450 million verdict largely on the strength of anecdotes and glib generalizations about the general quality of non-OEM parts offered by bodyshop owners and plaintiffs’ paid experts. These and other errors detailed in Part II below compel reversal of the breach of contract judgment. Because the errors themselves demonstrate the impossibility of trying this case on a classwide basis, they also compel decertification of the class. As demonstrated in Part III below, the $730 million ICFA judgment must also be reversed. The circuit court tried to resolve the manageability problems inherent in a nationwide consumer fraud class action by applying the Illinois Consumer Fraud Act to the claims of all class members. But, as the Fourth District recently concluded in Oliveira v. Amoco Oil Co., 311 Ill.App.3d 886, 726 N.E.2d 51 (4th Dist. 2000), the General Assembly never intended ICFA to govern transactions in other states. Furthermore, by using ICFA to effectively outlaw the practice of specifying non-OEM parts, the circuit court unconstitutionally interfered with the laws of Illinois’ sister states, the majority of which expressly allow insurance companies to specify non-OEM parts. A separate and independent reason for vacating the ICFA judgment — and, indeed, for entering judgment on that claim in favor of State Farm — is that the circuit court failed to properly apply ICFA to the facts of this case. Among other things, the court applied the wrong standard of proof, using a “preponderance of the evidence” standard despite this Court’s holding in General Motors Acceptance Corp. v. Grissom, 150 Ill.App.3d 62, 65 (5th Dist. 1986), that ICFA requires proof by “clear and convincing” evidence. Furthermore, -29-
Page 1 and 2: No. 5-99-0830 IN THE APPELLATE COUR
Page 3 and 4: Charles Hester Enters. v. Illinois
Page 5 and 6: In re Fibreboard Corp., 893 F.2d 70
Page 7 and 8: State v. Piedmont Funding Corp., 38
Page 9 and 10: Hansberry v. Lee, 311 U.S. 32 (1940
Page 11 and 12: 1. Plaintiffs’ Body Shop Witnesse
Page 13 and 14: People v. Clayton, 302 Ill.App.3d 2
Page 15 and 16: VPHI, Inc. v. National Educ. Traini
Page 17 and 18: Okada v. MGIC Indem. Corp., 823 F.2
Page 19 and 20: Zekman v. Direct Am. Marketers, Inc
Page 21 and 22: Malooley v. Alice, 251 Ill.App.3d 5
Page 23 and 24: NATURE OF THE CASE This is an appea
Page 25 and 26: STATUTES INVOLVED Relevant portions
Page 27 and 28: to its “pre-loss condition.” DX
Page 29 and 30: OEM parts. 5/ At least two states
Page 31 and 32: paid the difference in cost out of
Page 33 and 34: epair estimate specified only OEM p
Page 35 and 36: potential class members whose names
Page 37 and 38: member’s vehicle other than those
Page 39 and 40: William Anderton, who had previousl
Page 41 and 42: categorically inferior and, in fact
Page 43 and 44: specified on their repair estimates
Page 45 and 46: Second, plaintiffs sought “instal
Page 47 and 48: parts] are inferior.” R. 12539 (
Page 49: had an adequate remedy at law if St
Page 53 and 54: ARGUMENT I. Class Certification Vio
Page 55 and 56: members.” Slimack v. Country Life
Page 57 and 58: of evidence State Farm would be ent
Page 59 and 60: that are incongruous with the effic
Page 61 and 62: fenders to its pre-loss condition.
Page 63 and 64: a result of Allstate’s specificat
Page 65 and 66: insurance regulators and consumer a
Page 67 and 68: have been the overwhelming predomin
Page 69 and 70: some class members and the issue of
Page 71 and 72: not sooner, that plaintiffs could n
Page 73 and 74: explained above, class members who
Page 75 and 76: Even if the court had been right in
Page 77 and 78: value” of “parts at the time of
Page 79 and 80: page 7, supra. All of these statute
Page 81 and 82: (7th Cir. 1995) (decertifying class
Page 83 and 84: As the circuit court itself recogni
Page 85 and 86: the same shortcut, arguing — just
Page 87 and 88: epresentatives who appeared at tria
Page 89 and 90: — was injured by the alleged dece
Page 91 and 92: Litig., 182 F.R.D. at 225. Basic fa
Page 93 and 94: Meineke’s continued financial via
Page 95 and 96: this decision, plaintiffs were excu
Page 97 and 98: corresponding OEM part. R. 7169. In
Page 99 and 100: Mathur’s testimony was particular
Page 101 and 102:
end of the day, Mathur conceded tha
Page 103 and 104:
Zimny, 256 Ill.App.3d 386, 390-91 (
Page 105 and 106:
the jury was focused on the wrong i
Page 107 and 108:
to its pre-loss condition.” R. 12
Page 109 and 110:
quality of non-OEM parts. See Baltu
Page 111 and 112:
which is not surprising because the
Page 113 and 114:
In this case, plaintiffs’ experts
Page 115 and 116:
Bender could not swear that the non
Page 117 and 118:
OEM part construction “had some d
Page 119 and 120:
theory, even non-OEM parts that are
Page 121 and 122:
of his training or expertise”). P
Page 123 and 124:
eflected a policy of “discriminat
Page 125 and 126:
“speak up for justice.” R. 1301
Page 127 and 128:
12984-85. The perversion of ostensi
Page 129 and 130:
Polywheels company makes both the O
Page 131 and 132:
parts — was simply a made-for-lit
Page 133 and 134:
In contrast, each of the 47 other s
Page 135 and 136:
occurred outside Illinois. 51/ In t
Page 137 and 138:
laws of the State where the policy
Page 139 and 140:
This Court should follow the weight
Page 141 and 142:
other states, Illinois cannot apply
Page 143 and 144:
state’s law when it is not within
Page 145 and 146:
headquartered in Michigan); Endo, 1
Page 147 and 148:
for this Court to alter that author
Page 149 and 150:
y using parts of like kind and qual
Page 151 and 152:
plaintiffs’ failure to identify a
Page 153 and 154:
percentage of the class (New York a
Page 155 and 156:
committing fraud: if all non-OEM pa
Page 157 and 158:
specification damages they had soug
Page 159 and 160:
A. It Is Unconstitutional To Punish
Page 161 and 162:
that will subject him to punishment
Page 163 and 164:
fact benefitted from access to non-
Page 165 and 166:
deterrence and therefore must be va
Page 167 and 168:
517 U.S. at 576. This case is not i
Page 169 and 170:
either higher premiums or the incre
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