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

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egulations. 29/ Other states permit such suits but prohibit plaintiffs from bringing a suit on behalf of a class. See Ga. Code Ann. § 10-1-399(a); La. Rev. Stat. Ann. § 51:1409(A); Miss. Code Ann. § 75-24-15(4); Mont. Code Ann. § 30-14-133(l); S.C. Code Ann. § 39-5-140(a). And in some states, consumers are required to send demand letters to alleged violators as a condition precedent to bringing a lawsuit. See, e.g., Tex. Bus. & Com. Code Ann. § 17.505(a); Ind. Code § 24-5-0.5-5; Miss. Code Ann. § 75-24-15(2) (requiring exhaustion of alternative dispute resolution remedy). The elements of consumer fraud claims also vary widely from state to state. Some states do not require a plaintiff to prove that he relied on the allegedly deceptive statement. See, e.g., Stephenson v. Capano Dev., Inc., 462 A.2d 1069, 1074 (Del. 1983). Other states, however, do require proof of reliance. 30/ Some states require proof that the defendant made the allegedly deceptive statements with scienter; others do not. Compare Or. Rev. Stat. §§ 646.638(1), 646.605(10) (requiring willful intent to commit fraud) with Del. Code. tit. 6, § 2513(a) (scienter not required). 29/ Ala. Code § 8-19-7(3); O.K. Lumber Co. v. Providence Wash. Ins. Co., 759 P.2d 523, 528 (Alaska 1988); Ferguson v. United Ins. Co. of Am., 293 S.E.2d 736, 737 (Ga. App. 1982); Fla. Stat. Ann. § 501.212(4); Irwin Rogers Ins. Agency v. Murphy, 833 P.2d 128, 134 (Idaho App. 1992); Alarcon v. Aetna Cas. & Sur. Co., 538 So.2d 696, 699-700 (La. App. 1989); Md. Code Ann., Com. Law § 13-104(l); Britton v. Farmers Ins. Group, 721 P.2d 303, 323-24 (Mont. 1986); State v. Piedmont Funding Corp., 382 A.2d 819 (R.I. 1978); Colonial Life & Acc. Ins. Co. v. American Family Life Assur. Co., 846 F. Supp. 454, 463 (D.S.C. 1994); Wilder v. Aetna Life & Cas. Ins. Co., 433 A.2d 309, 310 (Vt. 1981). 30/ E.g., Holeman v. Neils, 803 F. Supp. 237, 242 (D. Ariz. 1992); Lynas v. Williams, 454 S.E.2d 570, 574 (Ga. App. 1995); Ind. Code § 24-5-0.5-4(a); Tex. Bus. & Com. Code Ann. § 17.50(a); Wyo. Stat. Ann. § 40-12-108(a). The states also differ with respect to the degree of reliance plaintiffs must prove. Compare Taylor v. McCollom, 849 P.2d 1123, 1125 (Or. App. 1993), with Lynas, 454 S.E.2d at 574, and Holeman, 803 F. Supp. at 242. -60-
As the circuit court itself recognized (A. 46), the available remedies also differ considerably with respect to whether punitive or treble damages are allowed and, if so, under what circumstances. 31/ In addition, different states require different factors to be considered in assessing the amount of punitive damages to award, and several states limit the amount of punitive damages. See Carpenter v. BMW of N. Am., Inc., 1999 WL 415390, at *4 (E.D. Pa. 1999) (denying certification of nationwide class due to variations among state consumer fraud statutes regarding punitive and treble damages). In addition to these variations in state consumer fraud laws, variations in state laws concerning the specification of non-OEM parts preclude a finding that common issues of law predominated. Plaintiffs’ consumer fraud claims were based on alleged inadequacies in State Farm’s disclosures to policyholders. But those disclosures complied with — and in many cases were required by — the applicable state laws or insurance regulations. See Part III(B)(4), infra. Whether disclosures that comply with state insurance regulations may nevertheless be deemed “deceptive” for purposes of a state’s consumer fraud law is an issue that should have been decided under the laws of each individual state. See Ford Bronco II Litig., 177 F.R.D. at 371 (refusing to certify nationwide consumer fraud class because each state has “policy reasons” for its own particular consumer fraud statute). By applying Illinois law classwide and completely ignoring the laws of 38 states specifically allowing insurance companies to specify non-OEM parts, the circuit court in this case effectively 31/ Compare Ala. Code § 8-19-10(a)(2); Ga. Code Ann. § 10-1-399(c); Idaho Code § 48-608(l); Mass. Gen. Laws ch. 93A, § 9(3); N.J. Stat. Ann. § 56:8-19; N.M. Stat. Ann. § 57-12-10(E); Nev. Rev. Stat. § 41.600(3); N.C. Gen. Stat. § 75-16; N.D. Cent. Code § 51-15-09; S.C. Code Ann. § 39-5-140(a). -61-
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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
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1. Plaintiffs’ Body Shop Witnesse
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People v. Clayton, 302 Ill.App.3d 2
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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
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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 and 50: had an adequate remedy at law if St
Page 51 and 52: loss condition. Instead of requirin
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: (7th Cir. 1995) (decertifying class
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
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This Court should follow the weight
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other states, Illinois cannot apply
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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
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y using parts of like kind and qual
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plaintiffs’ failure to identify a
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percentage of the class (New York a
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committing fraud: if all non-OEM pa
Page 157 and 158:
specification damages they had soug
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A. It Is Unconstitutional To Punish
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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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