Free Motion to Certify Class - District Court of Colorado - Colorado

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO

Civil Action No. 00-cv-02098-REB-MJW KELLY FINCHER, by her guardian, JAMES FINCHER, on behalf of herself and all others similarly situated, Plaintiff, v. PRUDENTIAL PROPERTY AND CASUALTY INSURANCE COMPANY, a New Jersey Corporation, Defendant.

PLAINTIFF'S MOTION FOR CLASS CERTIFICATION

MOTION FOR CLASS CERTIFICATION

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TABLE OF CONTENTS Page I. II. III. IV. V. VI. PRELIMINARY STATEMENT ...............................................................................................2 STATEMENT OF THE CASE................................................................................................2 PROPOSED CLASS...............................................................................................................6 LEGAL OVERVIEW ................................................................................................................6 FACTUAL SUMMARY..........................................................................................................10 STANDARDS FOR RESOLVING THIS MOTION ...........................................................15 A. B. VII. Purpose of Class Actions.........................................................................................15 The Task of the Court at the Class Certification Stage.......................................16

THE REQUIREMENTS OF RULE 23 ARE SATISFIED .................................................16 A. The Requirements of Rule 23(a) Are Satisfied.....................................................18 1. 2. 3. 4. B. Rule 23(a)(1): The class is so numerous that joinder of all members is impracticable ............................................................................18 Rule 23(a)(2): There are questions of law or fact common to the class ................................................................................................................21 Rule 23(a)(3): The claims or defenses of the representative parties are typical of the claims or defenses of the class ....................................22 Rule 23(a)(4): The representative parties will fairly and adequately protect the interests of the class .................................................................23

The Requirements of Rule 23(b) Are Satisfied.....................................................24 1. Rule 23(b)(2): The party opposing the class has acted or refused to act on grounds generally applicable to the class, thereby making appropriate final injunctive relief or corresponding declaratory relief with respect to the class as a whole...........................................................25 Rule 23(b)(3): Questions of law or fact, to the members of the class, dominate over any questions affected only individual members, and a class action is superior to other available methods for the fair and efficient adjudication of the controversy .........................28 a. b. Common Questions Predominate ..................................................28 A Class Action Is Superior to Other Methods ...............................32

2.

VIII.

CONCLUSION.......................................................................................................................34

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MOTION FOR CLASS CERTIFICATION

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I.

PRELIMINARY STATEMENT

Plaintiff Kelly Fincher, by her guardian, James Fincher, individually, (hereinafter "Plaintiff") and by and through her attorneys, THE CAREY LAW FIRM, moves this Court for an order certifying Plaintiff's First Cause of Action as a class action claim under Fed. R. Civ. P. 23 and appointing Plaintiff's counsel as counsel for the class and Plaintiff as class representative. Plaintiff seeks claim certification, as provided for by Fed. R. Civ. P. 23(c)(4), under Rule 23(b)(2), and/or 23(b)(3), for her reformation claim. Plaintiff does not seek to certify damages claims or bad faith claims (statutory or common law).1 She only seeks to certify her reformation claim, so that all class members' receive the mandated reformation described in Clark v. State Farm Mut. Auto. Ins. Co., 319 F.3d 1234 (2003) (Clark I). II. STATEMENT OF THE CASE

This is an insurance case in which Plaintiff is seeking to secure the reformation mandated by law. The statutory violation by Defendant ("Prudential") was uniform and standardized, and can be entirely proven by the policy forms certified by Prudential for use in Colorado. Plaintiff seeks to certify only some of the issues affecting the class and litigate the other issues in her complaint individually, as provided for by Fed. R. Civ. P. 23(c)(4). Plaintiff has sued in her individual capacity and a representative capacity. The Court's ruling on certification will not affect her individual claim, including her right to declaratory relief and reformation. Certification will ensure, however, that all those similarly situated will be advised of and receive the same rights.
Plaintiff filed her Complaint on August 24, 2000, bringing several claims, including (i) noncompliance with statute and seeking reformation of all Prudential automobile insurance policies issued in Colorado; (ii) breach of contract; (iii) bad faith; and statutory willful and wanton conduct entitling the plaintiff and class members to enhanced penalties under the Colorado Auto Accident Reparations Act, Colo. Rev. Stat. § 10-4-704.
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The limited relief sought in this motion is archetypal for class treatment. First, although the relief sought is simple, the proposed class who would directly benefit is large, numbering in the several hundreds. Prudential's own records will clearly identify the individuals in the class. Second, the questions relating to the rights and remedies to which Plaintiff and the class are entitled under Colorado's No-Fault Act are questions common to all class members, based on universally applicable statutory language. Third, the relevant automobile insurance policies applicable to all class members, including PIP endorsements, are identical or substantially similar insofar as the violation of the statute is concerned. Fourth, if class members were to bring their claims

individually, each would have to argue the same legal theories and establish the same essentially undisputed facts, leading to gross inefficiencies for these claimants, Prudential and the Court. Fifth, most class members' claims are likely insufficient in size to warrant individual litigation, especially where reformation must be achieved before rights exist and where some benefits have been paid already. Finally, and

perhaps most importantly, Prudential has kept the class members in the dark about the true scope of their rights and the obligations imposed upon Prudential by law. Where class members are ignorant of their rights, declaratory relief is invaluable. See U.S. ex rel. Moran v. Sielaff, 546 F.2d 218, 222 (7th Cir. 1976) (only a representative proceeding guarantees a hearing for individuals who by reason of ignorance may not have been in a position to seek one on their own behalf); see also Darling v. Bowen, 685 F. Supp. 1125, 1127 (W.D. Mo. 1988), aff'd, 878 F.2d 1069 (8th Cir. 1989). The reality is that absent a class action, these insureds would have no recourse against Prudential for its violation of Colorado's No-Fault Act, and Prudential would profit

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unjustly from failing to offer the enhanced PIP benefits and from withholding PIP benefits and statutory remedies that are owed by law to every eligible injured insured. Recognizing that challenges to widespread insurance practices are appropriate for class action treatment, courts have certified class actions challenging various such practices. For example, in Baughman v. State Farm Mut. Auto. Ins. Co., 727 N.E.2d 1265, 1274-75 (Ohio 2000) (citations omitted), the Ohio Supreme Court explained: `[C]lass action treatment is appropriate where the claims arise from standardized forms or routinized procedures, notwithstanding the need to prove reliance,' and recognized that `proof of reliance * * * may be sufficiently established by inference or presumption.' . . . [I]t is not necessary to establish inducement and reliance upon material omissions by direct evidence. When there is nondisclosure of a material fact, courts permit inferences or presumptions of inducement and reliance. Thus, cases involving common omissions across the entire class are generally certified as class actions, notwithstanding the need for each class member to prove these elements. See also Lebrilla v. Farmers Group, Inc., 119 Cal.App.4th 1070, 16 Cal.Rptr.3d 25 (Cal.App. 4 Dist. 2004)(declaratory and injunctive relief are not damages claims, but merely vehicles designed to make the insurer act on its obligations); Sitton v. State Farm Auto. Ins., 63 P.3d 198, 204-05 (Wash. Ct. App. 2003); Spirek v. State Farm Mut. Ins. Co., 382 N.E.2d 111, 119 (Ill. Ct. App. 1978) (certifying class under common automobile insurance policy and stating "[b]ecause the question of contract interpretation upon which this action is based is a question of law common to all members of the designated class, and because the differences as to facts among insureds are not likely to be great, a common question of law clearly predominates as to Illinois residents."); Allstate Indemnity Co. v. de la Rosa, 800 So. 2d 245 (Fla. App. 2001) (certifying PIP consumer class); Kromnick v. State Farm Mut. Ins. Co., 112 F.R.D.

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124, 125-26 (E.D. Pa. 1986) (certifying class of estates of insureds killed in auto accidents seeking additional benefits). Indeed, an extremely similar case was certified under the state counterpart to 23(b)(2) in Texas, which applies the most stringent standards to certification. In Bailey v. Kemper Cas. Ins. Co., 83 S.W.3d 840 (Tx. Ct. App. 2002), the court of appeals affirmed the trial court's finding that the request for declaratory relief of rights under a PIP contract was certifiable as a (b)(2) class and also, after finding that the declaratory relief predominated over monetary relief sought, concluded that the claim was appropriate certified as a (b)(3) claim, even with a class definition proposed after the certification hearing.2 Because the remedies sought are based on the No-Fault Act's universally applicable language and Prudential used the same three defective PIP policy forms for all of its insureds, this case presents a classic case for treatment as a class action. This lawsuit is filed on behalf of Plaintiff, by and through her father and legal guardian James Fincher, against Prudential, and also on behalf of a proposed class of Prudential insureds who, at the time of their injuries, were covered by a Prudential car insurance policy suffering from the same or substantially similar legal defect as the policy covering Plaintiff. The right to reformation in this case arises from the inability, and consequent failure, of Prudential at all times in the class period to offer enhanced No-Fault ("APIP") benefits, as defined by Colo. Rev. Stat. § 10-4-710, for inclusion in a complying policy. This inability and lack of the statutory coverages results in a statutory violation and mandated reformation of the policies under Colorado law.
2 Texas class action rule counterparts were not called 23(b)(2) or (3) at the time, but for convenience, they are referred to by the federal nomenclature. The substance of the p is the same, however.

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Thus, absent a class action, these insureds would have no recourse against Prudential for its violation of Colorado's No-Fault law, and Prudential would profit unjustly from failing to offer the enhanced PIP benefits and from denying PIP benefits that are, by law, owed to every eligible injured person. III. PROPOSED CLASS

Plaintiff respectfully requests that the Court define the class as follows: All persons who received medical or wage-loss personal injury protection benefits under a Prudential Colorado car insurance policy, and received those benefits no earlier than August 25, 1992. Excluded from the class are all Prudential executives, their legal counsel, and their immediate family members, the Court and its staff, and all employees of The Carey Law Firm.3

IV.

LEGAL OVERVIEW

Since 1990, under Colorado's No-Fault Law, Colo. Rev. Stat. § 10-4-701, et seq., Colorado has required insurance companies that sell automobile insurance policies, like defendant Prudential, to offer certain statutory coverages to Colorado residents, including enhanced personal injury protection (also called "APIP") benefits, before issuing a policy containing those coverages. This case is predicated on the precept that insurance companies whose policies do not contain such enhanced PIP benefits in a manner prescribed by statute are in
3

Plaintiff initially brought her claim as a class action on behalf of the following class: All injured persons covered under a Prudential automobile insurance policy who were not offered extended coverage as required by C.R.S. § 10-4-710 of the Colorado Auto Accident Reparations Act, and who were not provided the additional benefits provided for therein. Excluded from the class are all Prudential executives, their counsel, and their immediate family members.

However, because of additional information developed since the filing of the complaint six years ago, Plaintiff has modified the class definition to better comport with the status of the case and the law.

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violation of the No-Fault Law. See Brennan v. Farmers Alliance Mut. Ins. Co., 961 P.2d 550 (Colo. App. 1998), Clark v. State Farm Mut. Auto. Ins. Co., 433 F.3d 703 (10th Cir. 2005), December 30, 2005 ("Clark III"). If the policies do not contain the coverage required, the statute is violated. Id. Non-policy information cannot change or alter this. Brennan, at 555. Regardless of whether Plaintiff is right or wrong, that is her presented legal question, and the answer thereto would apply to the class as a whole. As part of the changes to the APIP statute in 1989, auto insurance companies were obligated to offer no less than $200,000 in aggregate APIP benefits with a policy (Colo. Rev. Stat. § 10-4-710). Since 1992, in an amendment to the APIP statute, the law required that the companies offer "in a complying policy" at least two APIP options: one package of medical expenses unlimited in time and amount; and one package of medical expenses and wage loss benefits unlimited in time and amount. During all times pertinent hereto, Prudential sold automobile insurance policies to all of its Colorado customers when those policies did not contain enhanced PIP benefits, as defined by Colo. Rev. Stat. § 10-4-710(2)(a), and it did not have any other policies that it could offer that did have such coverage. Because all of Prudential's automobile insurance policies are identical, or substantively similar to one another, all of Prudential's issued automobile insurance policies suffer from the same legal defect. And although Prudential modified its forms during the class period, at no time did Prudential ever have the coverages required by Colo. Rev. Stat. § 10-4-710 available for inclusion in the prospective purchaser's policy without the purchase of other optional coverage or with limitations not permitted by statute.

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The remedy for a violation of § 10-4-710 is for the Court to reform any policy issued at a time when the enhanced benefits described in Colo. Rev. Stat. § 10-4710(2)(a) were not offered, and to provide this enhanced PIP coverage to all eligible injured persons, as defined by Colo. Rev. Stat. § 10-4-707. This is a mandated

reformation that arises under Colorado law: "[W]hen, as here, an insurer fails to offer the insured optional coverage that satisfies the No-Fault Act, additional coverage in conformity with the offer mandated by statute will be incorporated into the policy. See Thompson v. Budget Rent-A-Car Sys., Inc., 940 P.2d 987 (Colo. App. 1996); see also 2 COUCH
ON INSURANCE

26:1 (L. Russ & T. Segalla 3d ed. 1995)." Brennan, 961 P.2d at

554. Every person who was injured in a covered automobile accident is entitled to additional coverage and benefits because of Prudential's violation of Colorado's 1990 and 1992 No-Fault statutes, regardless of the category of eligible injured person. Fincher v. Prudential Prop. & Cas. Ins. Co., 76 Fed. Appx. 917 (10th Cir. 2003). From the time of its enactment in 1973, the No-Fault Act has included a specified minimum medical, rehabilitative, and wage loss package known as PIP. See Colo. Rev. Stat. § 10-4-706(1)(b). As of 1990, the date of the enactment of the $200,000 APIP minimum requirement, the No-Fault Act required that a complying policy include these mandatory minimum PIP benefits. Specifically, Colo. Rev. Stat. § 10-4-706(1) requires a carrier to provide, among other things: (b)(I) Compensation without regard to fault, up to a limit of fifty thousand dollars per person for any one accident, for payment of all reasonable and necessary expenses for medical . . . and nonmedical remedial care and treatment . . . performed within five years after the accident for bodily injury arising out of the use or operation of a motor vehicle. . . . ***

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(d)(I) Payment of benefits equivalent to one hundred percent of the first one hundred twenty-five dollars of loss of gross income per week, seventy percent of the next one hundred twenty-five dollars of loss of gross income per week, and sixty percent of any loss of gross income per week in excess thereof, with the total benefit under this subparagraph (I) not exceeding four hundred dollars per week, from work the injured person would have performed had he not been injured during a period commencing the day after the date of the accident, and not exceeding fifty-two additional weeks. The aggregate amount of those benefits is approximately $130,000. Colo. Rev. Stat. § 10-4-706 does not indicate to whom these coverages apply; however, that information is provided in Colo. Rev. Stat. § 10-4-707(1), in which the coverages described in section 10-4-706 are applied to four different groups of people: "1) the named insured, 2) resident relatives of the named insured, 3) passengers occupying the insured's vehicle with the consent of the insured, and 4) pedestrians who are injured by the covered vehicle." Brennan, 961 P.2d at 553 (citing Hall v. Trinity Universal Ins. Co., 660 P.2d 1298 (Colo. App. 1982), aff'd, 690 P.2d 227 (Colo. 1984)). Colorado law, by way of § 10-4-710, affords those who may need increased PIP coverage the opportunity to purchase it, thereby ensuring adequate compensation when the minimum medical and loss of income benefits may be insufficient. Hence, Colorado law requires insurers to offer for inclusion in all automobile policies the benefits described in Colo. Rev. Stat. § 10-4-710.4 Purchase of this coverage is at the option of the named insured. Specifically, Every insurer shall offer for inclusion in a complying policy, in addition to the coverages described in section 10-4-706, at the option of the named insured: (I) Compensation of all expenses of the type described in section 10-4-706(1)(b) without dollar or time limitation; or (II) Compensation of all expenses of the type described in section 10-4-706 (1)(b) without dollar or time limitations and payment of benefits equivalent to eighty-five percent of loss of gross income per week from work the
4 See Krieg v. Prudential Prop. & Cas. Ins. Co., 686 P.2d 1331, 1334 (Colo. 1984) ("With respect to lost income benefits, section 10-4-710(2)(a)(II) expressly requires an insurer to offer customers the option of accepting more extensive coverage than the statutory minimum provided in section 10-4-706(1)(d)(I)).") (emphasis added).

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injured person would have performed had such injured person not been injured during the period commencing on the date after the date of the accident without dollar or time limitations. Brennan, 961 P.2d at 553 (emphasis added). In 1998, the Brennan court confirmed that these enhanced benefits must be offered to the same groups of people identified in Colo. Rev. Stat. § 10-4-707(1). Id. at 553-54; see also Hall, 690 P.2d at 229, 231 (under Colorado law injured persons are treated the same as any other insureds under the No-Fault Act for PIP purposes). V. FACTUAL SUMMARY

In this lawsuit Kelly Fincher claims she is entitled to additional benefits known as additional Personal Injury Protection ("APIP") benefits. Kelly Fincher was severely injured when she was struck by a car while riding her bicycle on May 8, 1994, when Kelly was 11 years old. Fincher suffered a permanent brain injury and will have to live in an assisted living milieu for the remainder of her life. The car that struck Kelly Fincher was driven by Anthony Bekeshka, who was insured under an auto insurance policy issued by defendant, Prudential Property and Casualty Insurance Company. Findings of Fact, Conclusions of Law, and Order, February 28, 2006 (Ex. 3); Fincher v. Prudential Prop. & Cas. Ins. Co. supra. Fincher exhausted the basic PIP benefits available to her under the Bekeshka policy within a few months of her accident in 1994, and thereafter Prudential ceased paying any further PIP benefits on her behalf. However, the policy issued to Bekeshka, and therefore covering Fincher as an eligible injured person under Colo. Rev. Stat. § 10-4-707, contained a limitation of $150,000 upon the aggregate benefits available for purchase under the extended PIP options contained within the policy. See generally Plaintiff's Am. Compl., ¶¶ 16-32. From 1992 until the present, Prudential used only two versions of its specimen policy, PAC 190, for Colorado automobile insureds, augmented by a periodically updated endorsement distributed with the policies (PAC 226). For all Prudential

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insureds in Colorado the subject policies used during that period of time were identified as either "PAC 190/CO 1/89" (Ex.1) or "PAC 190/CO 5/93." (Ex. 2). The sections of the policy that apply to Colorado insureds were contained in a second "half" of the policy referenced as "Car Policy Parts 4, 6, & 7," which contained the company's extended PIP options under Part 7, Additional Personal Protection Coverage PAC 7/CO. From 1992 until 1995, the Prudential auto policy in effect for all Prudential insureds in Colorado was PAC 190/CO Ed. 1/89. The 1/89 policy gave Prudential insureds the choice of purchasing one of eleven APIP options, but of those options, none contained an aggregate amount of benefits in excess of $150,000. Colo. Rev. Stat. § 10-4-710 required Colorado auto insurers to offer APIP benefits that covered medical expenses and wage losses, any cap on APIP benefits could not be lower than 200,000 dollars. Colo. Rev. Stat. § 10-4-710(2)(b) Findings of Fact, Conclusions of Law, and Order, February 28, 2006 (Ex. 3) Prudential began using a revised PAC 190 policy, Ed. 5/93, in 1994. However, this policy contained no APIP option for extended benefits for wage loss without a weekly limitation on the amount payable, also in violation of Colo. Rev. Stat. § 10-4-710. All versions of the PIP endorsement, PAC 226, and PIP selection form, PAC 3821 used in conjunction therewith until 1999 continued to impose a weekly limit upon all wage loss benefits available under the extended PIP options. (Ex. 4, PAC3821 Ed. 3/97) (Ex. 5, PAC3821 Ed. 8/94) (Ex. 6, PAC3821 Ed. 1/98) (Ex. 7, PAC3821 Ed. 1/99) (Ex. 8, PAC226 Ed. 1/98) and (Ex. 9, PAC226 Ed. 8/99). Finally, the only other policy document that addressed substantive enhanced PIP coverage was the endorsement PAC 226/CO (Ed. 1/98, and successor documents) (Ex. 6), which was actually first used by Prudential no earlier than 1999. This was the first policy document since 1992 to modify either edition of the PAC 190/CO so as to contain a wage loss option with no weekly restrictions on amount. However, while removing one defect, the endorsement did not cure the defect in PAC 190/CO Ed. 1/93 (Ex. 2)

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that precluded insureds from being able to purchase the two coverages outlined in Colo. Rev. Stat. § 10-4-710. Prudential's enhanced PIP options available for inclusion in a complying policy are easily chronicled. From August 1992 until a year after Plaintiff's accident with

Anthony Bekeshka in May 1994, the Prudential auto policy in effect for all Prudential insureds in Colorado was PAC 190/CO Ed. 1/89. The portions of PAC 190/CO Ed. 1/89 that pertain to Colorado insureds were contained in a second "half" of the policy referenced as "Parts 4, 5, & 7" (Ex. 1). Under PAC 190/CO Ed. 1/89, Part 7, Additional Personal Injury Protection, gave Prudential insureds the choice of purchasing one of eleven APIP options. Prudential's policy was replete with limitations or deviations from the statutorily required APIP coverage. First, of those options, 1-5 limited the insureds to an aggregate amount of benefits of $100,000 ($29,000 less than the minimum benefits under Colo. Rev. Stat. § 10-4-706); options 6-0 and A contain an aggregate amount of benefits of $150,000, $50,000 less than the minimum aggregate cap allowed under Colo. Rev. Stat. § 10-4-710, and a violation under the law of the case doctrine. Second, the policy's wage-loss benefits are subject to the work-loss option selected by the insured. This selection is made in a PIP selection form, PAC 3821 (Ex's 4-7). However, until 1999, the options available were all capped on their weekly benefit amount. As the Division of Insurance noted, this is a violation of the obligation owing under § 10-4-710. The Company's APIP options do not comply with the statutory requirements. Although the Company offers APIP coverage for all medical expenses without time or dollar restriction but subject to a $200,000 aggregate, as in the first option, the Company places weekly recovery limits on all wage loss options and fails to make a true offer of the second option listed under the statutes cited above. In order to comply with the statutory requirements the Company must offer an APIP option which includes compensation, without time or dollar restriction, for work loss the injured person would have performed had such injured person not been injured during the

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period commencing on the day after the date of the accident without dollar or time limitations. (Ex. 10, Market Conduct Exam (emphasis added).) Third, the selection of every APIP option requires that the insured also pay for higher death benefit coverage (500% increase in coverage). This coverage, found in § 10-4-706(1)(e), is not part of the offer required under § 10-4-710. Fourth, for an insured to purchase the § 10-4-710(2)(a)(I) coverage ­ unlimited medical expense coverage ­ the insured would, by virtue of the replacement of wage loss limits of liability paragraph, be forced to increase from the basic PIP wage-loss percentage (100/70/60) to enhanced PIP wage-loss percentage (85). Fifth, if an insured desired the wage-loss of § 10-4-710(2)(a)(II), he would have to purchase 100% coverage for the first $125 dollars of weekly wage loss, rather than the prescribed 85%. Each of these restrictions or conditions violates the obligation to offer that described in § 10-4-710(2)(a), and thus, no APIP option compliant with these simple statutory requirements could be purchased by any Prudential customer under any circumstances. Prudential's corrective actions did not change this. Prudential implemented the use of the revised PAC 190/C0 Ed. 5/93 after the Plaintiff's accident, despite the edition date that might suggest otherwise. While this endorsement corrected the aggregate cap limit, raising it to $200,000, it did not correct any of these other problems. Similarly, after adopting the 5/93 version of PAC 190/CO, Prudential also removed the benefit limit on the weekly wage loss amount effective in 1999, but did not change the other requirements or conditions. PAC 3821 (Ex's 4-6); PAC 226/CO (Ed. 8/99) (Ex. 9). While some improvements were made, the changes did not cure the defect in the policies nor permit insureds to purchase the two coverages outlined in Colo. Rev. Stat. § 10-4-710. Prudential simply never had the statutory coverages in a policy document that did not require the purchase of coverages not required by statute or limit the amount or duration of such coverages. At no time under any of the forms certified for

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use in Colorado could any policyholder purchase for inclusion in a complying policy during the class period only unlimited in time and amount medical-expense coverage and only unlimited in time and amount medical-expense and wage-loss coverage. The policy documents prove this in every case, and, as Colorado decisional law confirms, an insurer cannot offer what it does not have. The policy documents alone must have the required coverages or the statute cannot be satisfied. The Colorado Court of Appeals and the Tenth Circuit have held that an insurance policy regulated by the CAARA must be reformed when an insurer fails to offer optional APIP coverages, as required by the CAARA. Clark v. State Farm Mut. Auto. Ins. Co., 319 F.3d 1234, 1242 (10th Cir. 2003); Brennan v. Farmers Alliance Mut. Ins. Co, 961 P.2d 550, 553 (Colo. App. 1998); Thompson v. Budget RentACar Sys., Inc., 940 P.2d 987, 990 (Colo. App. 1996). Findings of Fact, Conclusions of Law, and Order, February 28, 2006 (Ex. 3). . Despite its failure to create a statutorily compliant policy in Ed. 1/89 containing the $200,000 limits, to create a statutorily compliant policy in Ed. 5/93, or to acknowledge and fix the other defects, and its ongoing knowledge of these defects, Prudential has never voluntarily reformed an insurance policy to include extended PIP insurance. As described above, the heart of Plaintiff's complaint is that Prudential has engaged in a uniform and long-standing practice of issuing automobile insurance policies without offering enhanced benefits required by statute. Every Prudential policy issued from August 1992 to 2003 violated Colo. Rev. Stat. § 10-4-710. Based on Colorado law, Plaintiff seeks for herself and the class a judicial order reforming each Prudential policy so that the policies contain the coverage that should have been offered. Because of the nature of the claim and the existing law, the facts and issues involved in Plaintiff's Motion for Class Certification are simple:

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1.

The Prudential automobile insurance policy issued to Bekeshka was identical or defective in a substantially similar way to those issued to all Prudential Colorado policyholders. For all such persons' policies, Prudential did not offer enhanced benefits, as defined by Colo. Rev. Stat. § 10-4-710, in that a prospective policyholder could not select unlimited in time and amount coverages as described without getting more or less coverage. According to case law, the above-described Prudential policies should as a matter of law be ordered reformed to provide plaintiff with those PIP benefits described by Colo. Rev. Stat. § 10-4710(2)(a). VI. STANDARDS FOR RESOLVING THIS MOTION

2.

3.

A.

Purpose of Class Actions Class actions, provided for by Colo. R. Civ. P. 23, are intended to achieve

economies of time, effort and expense, and to promote uniformity of decision to persons similarly situated, without sacrificing procedural fairness or producing other undesirable results. Rules Advisory Committee's Notes to 1966 Amendments to Rule 23, 39 F.R.D. 94, 102-03 (1966). Class actions are particularly suited to cases such as this one, where large numbers of potential class members may have relatively small claims, litigation of which may be economically impractical on an individual basis. As the

Colorado Supreme Court stated in Mountain States Tel. & Tel. Co. v. District Court, 778 P.2d 667, 671 (Colo. 1989), cert. denied, 493 U.S. 983 (1989). The basic purpose of a class action is to eliminate the need for repetitious filing of many separate lawsuits involving the interests of large numbers of persons and common issues of law or fact by providing a fair and economical method for disposing of a multiplicity of claims in one lawsuit. This purpose is realized by permitting one or more members of the class to sue or be sued on behalf of all class members. See also Hawaii v. Standard Oil Co., 405 U.S. 251, 266 (1972) ("Rule 23 of the Federal Rules of Civil Procedure provides for class actions that may enhance the efficacy of private actions by permitting citizens to combine their limited resources to achieve a more powerful litigation posture").

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B.

The Task of the Court at the Class Certification Stage The sole issue at the class certification stage is whether the requirements of Rule

23 have been satisfied. Joseph v. General Motors Corp., 109 F.R.D. 635, 637 (D. Colo. 1986). A court may look beyond the complaint to determine whether the requirements of Rule 23 have been met. Cook v. Rockwell Int'l Corp., 151 F.R.D. 378, 381 (D. Colo. 1993). Thus, plaintiff has submitted exhibits to support her contention that the case should be certified as a class action. In addition, certification of a class action should be viewed liberally, because the class can always be modified, subdivided, or decertified, as the issues are refined. Colo. R. Civ. P. 23(c)(1); Cook, 151 F.R.D. at 381; Avagliano v. Sumitomo Shoji America, Inc., 103 F.R.D. 562, 573 (S.D.N.Y. 1984); Shannon v. Hess Oil Virgin Islands Corp., 96 F.R.D. 236, 240 (D.V.I. 1982). Thus the interests of justice require that any doubt be resolved in favor of permitting a class action. Gavron v. Blinder Robinson & Co., 115 F.R.D. 318, 321 (E.D. Pa. 1987); Gruber v. Price Waterhouse, 117 F.R.D. 75, 78 (E.D. Pa. 1987). "[I]f there is to be an error made, let it be in favor and not against the maintenance of the class action." Esplin v. Hirschi, 402 F.2d 94, 99 (10th Cir. 1968). VII. THE REQUIREMENTS OF RULE 23 ARE SATISFIED

The proponent of a class action bears the burden of demonstrating that the claims being asserted may properly be accorded class action treatment. Villa Sierra Condominium Ass'n v. Field Corp., 787 P.2d 661 (Colo. Ct. App. 1990). Plaintiff easily satisfies this burden. Preliminarily it should be noted that Plaintiff's defined class is ascertainable on an objective basis and the class period can be determined on a class-wide basis. While limitations periods and tolling are merits arguments at their core, in the class analysis Plaintiff must show that she has a method to prove class wide that each member of the class's claim would not be time barred.

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Here, each and every member of the class would be entitled to class-wide tolling because of Prudential's failure to comply with Colo. Rev. Stat. § 10-4-706(4)(b). As the Colorado Court of Appeals noted in Civale v. State Farm Mut. Ins. Co., 02CA2331 (Colo. App. February 19, 2004) (Ex. 11), the failure to issue the proper description of the benefits due to each PIP claimant tolls the applicable statute. In addition, as Judge Nottingham noted in Kavka v. State Farm Mut. Ins. Co., U.S. District Court, 04-N-483, Order and Memorandum of Decision dated December 10, 2004) (Ex. 12). If Plaintiff is correct on the law, Prudential's statutory failure prevents any class members claim from accruing. This is doubly true for insureds other than policyholders. Prudential's insistence that it had the correct coverages means Prudential's concealment of the nature of the enhanced PIP coverages it had available to offer caused non-policyholders to not be aware of the fact that Prudential could not comply with the offer requirement. Given the fact that the offer was made to the policyholders, not the other eligible injured person, these non-policyholder insureds did not know that the offer was not made as required by statute, had no reason to know, and were kept in the dark by Prudential. Moreover, class members who are policyholders, to appreciate that Prudential could not make the appropriate offer, would have to have knowledge of all of Prudential's available policies and endorsements, not just the versions provided to them. Again, class-wide

adjudication is possible because Prudential did not have any policies that provided the coverages required to be offered. In any event, because Prudential concealed its

failures and defects, and represented to insureds that in did have the coverage required to be offered, Prudential must show that insureds did in fact know in order to exclude them. See In re Monumental Life Ins. Co., 365 F.3d 408, 415 (5th

Cir.2004)(presumption of unawareness warranted where common practice of concealment is alleged). Plaintiff has class-wide theories as to tolling and concealment supported by circumstances warranting a presumption of unawareness; hence, the

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class period is appropriately defined, subject to any judicial modification based on the facts adduced. A. The Requirements of Rule 23(a) Are Satisfied Under Colo. R. Civ. P. 23(a) a class action may be maintained only if: (1) the class is so numerous that joinder of all members is impracticable; (2) there are questions of law or fact common to the class; (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and (4) the representative parties will fairly and adequately protect the interests of the class. As evidenced by the accompanying exhibits and demonstrated by the following discussion, this case meets all four of these requirements. 1. Rule 23(a)(1): The class is so numerous that joinder of all members is impracticable

There is no set formula to determine if a class is so numerous that joinder is impracticable. Rex v. Owens, 585 F.2d 432, 436 (10th Cir. 1978). The Colorado

Supreme Court has held that a class of 92 members satisfies the impracticability-ofjoinder test. Cherry Hills Farms v. Cherry Hills Village, 670 P.2d 779 (Colo. 1983); see also Villa Sierra Condominium, 787 P.2d 661 (Colo. Ct. App. 1990) (200 members suffice); NEWBERG ON CLASS ACTIONS, § 3.05 (3d ed. 1992) (numerosity is presumed at the 40-member level).5 When a class is large, numbers alone are dispositive. Kuhn v. State, Dep't of Revenue, 817 P.2d 101 (Colo. 1991). Furthermore, the numerosity rule is relaxed considerably when plaintiff seeks declaratory or injunctive relief, as she does here. NEWBERG
ON

CLASS ACTIONS, § 3.05

(3d ed. 1992); Grant v. Sullivan, 131 F.R.D. 436, 446 (M.D. Pa. 1990) ("[t]he Court of
See also Brady v. Thurston Motor Lines, 726 F.2d 136, 145 (4th Cir.) (74 members); Arkansas Educ. Ass'n v. Board of Educ., 446 F.2d 763, 765 (8th Cir. 1971) (20 members); Swanson v. American Consumer Indus., Inc., 415 F.2d 1326, 1333 n.9 (7th Cir. 1969) (40 members); Cypress v. Newport News Gen. & Nonsectarian Hosp. Ass'n, 375 F.2d 648, 653 (4th Cir. 1967) (18 members); Bishop v. N.Y.C. Dep't. of Housing Preservation & Dev., 141 F.R.D. 229, 235 (S.D.N.Y. 1992) (32 members); Grant v. Sullivan, 131 F.R.D. 436, 446 (M.D. Pa. 1990) (14 members); Cervantez v. Sullivan, 719 F. Supp. 899, 907 (E.D. Cal. 1989) (50 members); Tietz v. Bowen, 695 F. Supp. 441, 445 (N.D. Cal. 1987) (27 members); Basile v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 105 F.R.D. 506, 508 (S.D. Ohio 1985) (23 members).
5

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Appeals has relaxed the numerosity requirement in cases ... where the class seeks injunctive and declaratory relief"). First, based just on the known data and discovery, which is limited because Prudential refused to provide certain years, the class is sufficiently numerous.6 According to Prudential's own numbers, there can be no doubt that class members number in the many hundreds. In its discovery responses, Prudential admits that during a 21-month period (from July 1, 1992, until the date of this accident in May 1994) its PIP automobile insurance policies generated over 168 wage-loss claims and 33 medical claims over $50,000. (See Def.'s Answer to Pl.'s Interrog.; Ex. 13, at 4); see also (Ex. 14 - spread sheet of insureds). Yet this number is actually only a subset of class members for this period: Prudential only generated figures only for those insureds who were paid $400 or more in weekly PIP wages (the maximum amount under the basis PIP formula), but not those who received less than the weekly maximum, despite the fact that these recipients would be the bulk of the class. Under Colorado law, every

insured would be entitled to the enhanced benefits of unlimited wage loss benefits (subject only to a calculation based upon 85% of an individual's gross income), and unlimited medical benefits. See Colo. Rev. Stat. § 10-4-710. Claimants entitled to under $400 per week in benefits would each be entitled to the difference between eighty-five percent of the wages lost and the amount paid under basic PIP, which could stem from a percentage as low as seventy-one percent. Thus, 201 class members is the number of class members during the limited two-year period if you only include those wage-loss claimants who received the maximum weekly wage-loss benefit. Limiting its numbers reduces its numbers dramatically. Based on our experience in the area, generally more than seventy-five percent of the claimants would be below the
6 Plaintiffs are not required to precisely enumerate the members of the class. Weinberger v. Thornton, 114 F.R.D. 599, 602 (S.D. Cal. 1986); Schwartz v. Harp, 108 F.R.D. 279, 281 (C.D. Cal. 1985); Vernon J. Rockler & Co. v. Graphic Enters., Inc., 52 F.R.D. 335, 339 (D. Minn. 1971). Instead, a reasonable estimate of the number of purported class members satisfies the numerosity requirement. In re Badger Mountain Irrigation Dist. Sec. Litig., 143 F.R.D. 693, 696-97 (W.D. Wash. 1992); see also MANUAL FOR COMPLEX LITIGATION (4th ed.), pp. 270-72, § 21.222.

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weekly benefit limit for wage loss. (Decl. of Dan Rector; Ex. 15.) This means that there would be for this period at least an additional 504 class members, for a total of 672 class members for wage-loss benefits for this twenty-one month period. Second, using the publicly available information on the amounts paid out for PIP claims for the balance of the class period and the known average size of PIP claims, a reasonable estimate of the numbers of PIP claimants can be ascertained, and doing so shows that the admitted numbers of class members are a small fraction of the class. Indeed, based just on the 1999-2002 PIP loss payouts, there would be hundreds of PIP claimants for Prudential for this period. See http://www.dora.state.co.us/insurance/pb/pb.htm#Statistical (PIP payouts per year by carrier; Prudential had PIP payouts ranging from $1.2M to $2.07M from 1999 to 2002); see also Rocky Mountain Insurance Information Association, Survey of PIP Claims in 2001 (Ex. 16 -the average Colorado PIP claim in 1997 was $5,062, in 2002, $7,749). Extrapolating from these numbers for the class period for which no data exist indicates well over a thousand class members. Finally, these class members are strewn throughout Colorado and none of them has been advised of these rights, which further illustrates the impracticability of joinder, rendering this class numerous for purposes of Rule 23. Even on Prudential's limited numbers,7 numerosity is satisfied. Based on the publicly available information regarding PIP payouts and reasonable estimates of the size of those class members not included in Defendant's discovery responses, especially in relation to the number provided by Prudential, the size of the class is plainly in excess of two hundred. If the Court accepts anything close to the reasonable

Prudential refused to provide the numbers sought by Plaintiff on two separate occasions (discovery dated July 9, 2001, and November 13, 2001 (Ex's 13 and 17) despite their representative acknowledging that an improper limitation applied and "promising" to run new searches. (See deposition excerpts of Mary Rowe on August 2, 2001, attached as Ex. 18 at Vol. II, pp. 113-114. and Letter from L. Dan Rector dated August 7, 2001, Ex. 19.)

7

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estimate of the size of the class over the class period, the number exceeds one thousand. Numerosity is satisfied. 2. Rule 23(a)(2): There are questions of law or fact common to the class

Courts interpret the commonality requirement of Rule 23(a)(2) with common sense. When the class is united by a common interest in determining whether the defendant's course of conduct is legal, differences in the impact of this conduct on individual class members (and other individual differences such as damages) do not defeat class certification. Blackie v. Barrack, 524 F.2d 891, 902 (9th Cir. 1975). In this vein, the Tenth Circuit has held that under Rule 23 the claims of the class members need not be identical for there to be commonality. Milonas v. Williams, 691 F.2d 931, 938 (10th Cir. 1982). Moreover, Rule 23 does not require that the injuries complained of be identical among the class members and the class representatives, but only "that the harm complained of be common to the class." Penn v. San Juan Hosp. Inc., 528 F.2d 1181, 1189 (10th Cir. 1975). Many courts have held that the commonality requirement is satisfied if the plaintiff "can show the existence of a `common nucleus of operative facts.'" Esplin v. Hirschi, 402 F.2d 94, 99 (10th Cir. 1968); Gavron v. Blinder Robinson & Co., 115 F.R.D. at 322; Haywood v. Barnes, 109 F.R.D. 568, 577 (E.D.N.C. 1986). This is so regardless of whether the "underlying facts fluctuate over the class period and vary as to individual claimants." In re Asbestos School Litig., 104 F.R.D. 422, 429 (E.D. Pa. 1984), aff'd in part and vacated in part on other grounds, 789 F.2d 996 (3rd Cir. 1986). Some of the common questions in the Complaint are as follows: 1. 2. Whether Prudential had a policy that contained the coverages required to be offered under Colo. Rev. Stat. § 10-4-710. If not, whether Prudential's failure to have a policy containing the enhanced PIP coverages described by statute resulted in a violation of Colo. Rev. Stat. § 10-4-710.

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3.

Whether Plaintiff and the class are entitled to reformation because Prudential failed to offer the enhanced coverage required under Colorado law.

As the Complaint and the facts summarized in this motion show, plaintiff alleges that, over a lengthy period of time, Prudential never had the ability to comply with the offer requirement for enhanced PIP. What coverages Prudential had can be

ascertained by reviewing the common and standardized policy documents and the application of law to the facts ascertained is one common to the class. The legal

question of whether the lack of enhanced PIP in a policy certified for sale in this state precludes compliance with the offer obligation is a question of law common to the class: answering it for one answers it for all. Prudential's conduct in understanding its

obligations and acting or failing to act on them is the same as to each class member, as is its knowledge and intent insofar as the obligations relating to 10-4-710 is concerned. These questions of fact and law, as well as the "common nucleus of operative facts," are sufficient to satisfy the commonality requirement of Rule 23(a)(2). 3. Rule 23(a)(3): The claims or defenses of the representative parties are typical of the claims or defenses of the class

Typicality is shown when all members of the class are victims of the same course of conduct. Daigle v. Shell Oil Co., 133 F.R.D. 600 (D. Colo. 1990). The typicality requirement is satisfied if the representative plaintiff's claim "stems from the same event, practice, or course of conduct that forms the basis of class claims and is based upon the same legal or remedial theory." Adamson v. Bowen, 855 F.2d 668, 676 (10th Cir. 1988); Penn v. San Juan Hosp., Inc., 528 F.2d 1181 (10th Cir. 1975); Alvarado Partners L.P. v. Mehta, 130 F.R.D. 673, 676 (D. Colo. 1990); Rodriguez v. Bar-S Food Co., 567 F. Supp. 1241, 1248 (D. Colo. 1983). Here, plaintiff alleges she and all other members of the proposed class were subjected to the same Prudential practice and course of conduct. The proposed representative claims are not only typical, but virtually the same as the claims of the other class members. Here, there are only three form

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documents that need to be reviewed, one for any given time, and that review will answer the question of whether Prudential had a policy containing the statutory enhanced PIP. No other facts are relevant insofar as liability and causation are

concerned. Liability is shown by looking at the documents and nothing else. Causation is presumed as violation of the statute leads to a mandated reformation. The only variation in proof among the class members relates to the amount of benefits or damages due, which is not sufficient to defeat class certification. Milonas v. Williams, 691 F.2d at 938; Kuhn v. State, Dept. of Revenue, 817 P.2d at 105. Each class

member did what every other class member did: he or she purchased a Prudential policy during the class period. Plaintiff is typical for purposes of Rule 23(a)(3). 4. Rule 23(a)(4): The representative parties will fairly and adequately protect the interests of the class

The standard of Rule 23(a)(4) is met if the plaintiff satisfies a two-prong test. First, the named representative must be able to prosecute the action vigorously through qualified counsel. Second, there can be no disabling conflicts between the interests of the named class representative and the members of the class. Monarch Asphalt Sales Co. v. Wilshire Oil Co., 511 F.2d 1073, 1077-78 (10th Cir. 1975); Steiner v. Ideal Basic Indus., 127 F.R.D. 192, 194-95 (D. Colo. 1987). As alleged in the Complaint, the proposed class representative is committed to the action and is represented by experienced counsel. (Compl. at ¶13) Plaintiff has retained counsel highly experienced in class action litigation to prosecute her claims and those of the class. See Resumes of Plaintiff's Counsel attached as Ex. 20. The Proposed class representative, James Fincher, has shown his willingness to serve as class representative in this case by remaining active on the case throughout its six-year history. His service has included (1) signing a Rights and Responsibilities letter acknowledging his responsibilities to the class, attached as Exhibit 21 (2) preparing for and attending two depositions on November 12, 2001, and March 11, 2005, and

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submitting to all the questions posed to him; (3) traveling from the greater St. Louis, Missouri, area to attend the hearing on the date of reformation on April 4-5, 2005; (4) answering and signing formal discovery questions posed to him as the class representative in July and August of 2001; and (5) attended court-ordered settlement conference on September 27, 2001. Mr. Fincher has at all times been attentive to the case and the class claims. He has always been prepared, thoughtful and diligent in this treatment of his responsibilities. (Ex. 22, Affidavit of James Fincher). With regard to the second prong of the adequacy test, the class representative's interest is the same as the interests of the other members of the proposed class. The representative seeks to demonstrate that Prudential, through the sale of automobile insurance policies in Colorado (which are identical in all material respects), violated Colorado's No-Fault Act and is required to reform each policy in accordance with the Brennan decision and prior case law. Plaintiff does not have any conflicts; indeed

insurance by nature contemplates claims of numerous and various insureds being paid at the same time. His interest is identical to their interests: to ensure that Prudential pays the amount required by law. There is no conflict between the proposed class representative and the other class members. B. The Requirements of Rule 23(b) Are Satisfied In addition to the four requirements discussed above under 23(a), the action must satisfy at least one of the three parts of 23(b) in order to be maintainable as a class action. Here, the action satisfies Rule 23(b)(2) and (b)(3). Rule 23(b)(2) classes are proper when the legality of a practice is at issue, making injunctive relief one element in the class suit. Rule 23(b)(3) is utilized where a class action is superior to other available methods of adjudication and common questions predominate over individual ones. If the action qualifies for certification under (b)(2), and also under (b)(3), certification should be made under (b)(2), rather than (b)(3). In re A.H. Robins Co., 880

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F.2d 709, 728 (4th Cir. 1989); First Federal of Michigan v. Barrow, 878 F.2d 912, 919 (6th Cir. 1989). The reason for doing this is to avoid the risk of inconsistent

adjudication, and to make sure the judgment has binding effect as to all class members. As Professor Moore explains: If an action can be maintained under (b)(1) and/or (b)(2), and also under (b)(3), the court should order that the suit be maintained as a class action under (b)(1) and/or (b)(2), rather than under (b)(3), so that the judgment will have res judicata effect as to all the class (since no member has the right to opt out in a (b)(1) or (b)(2) suit), thereby furthering policy underlying the (b)(1) and (b)(2) class suits. 3B J. Moore & J. Kennedy, MOORE'S FEDERAL PRACTICE ¶ 23.31[3] (2nd ed. 1987). 1. Rule 23(b)(2): The party opposing the class has acted or refused to act on grounds generally applicable to the class, thereby making appropriate final injunctive relief or corresponding declaratory relief with respect to the class as a whole

The requirements of this portion of Rule 23 are satisfied where "settling the legality of the [opposing parties] behavior with respect to the class as a whole, is appropriate." Fed. R. Civ. P. 23, Advisory Committee's Note, Subdivision (b)(2). As one leading commentator explains: Subdivision (b)(2) sets forth two basic requirements for the maintenance of class actions thereunder. First, the party opposing the class must have acted or refused to act or failed to perform a legal duty, on grounds generally applicable to all class members. . . . The second requirement for Rule 23(b)(2) classes is that "final relief of an injunctive nature or a corresponding declaratory nature, settling the legality of the behavior with respect to the class as a whole [must be] appropriate." NEWBERG
ON

CLASS ACTIONS, § 4.11 (3d ed. 1992) (quoting Rules Advisory Committee

Notes to 1966 Amendments to Rule 23, 39 F.R.D. 69, 102 (1966)) (emphasis added). The court in Williams v. Empire Funding Corp., 183 F.R.D. 428, 434 (E.D. Pa. 1998) stated: [T]his requirement is almost automatically satisfied in actions primarily seeking injunctive relief . . . . What is important is that the relief sought by the named plaintiff should benefit the entire class. Id. at 434 (quoting Baby Neal v. Casey, 43 F.3d 48, 58-59 (3rd Cir. 1994)). requirements are easily satisfied here. These

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Because Prudential has acted in a common and uniform manner applicable to the entire class by failing to offer enhanced PIP to all policyholders, and then refusing to acknowledge the obligation to provide such enhanced PIP coverage to Plaintiff and class members because of this failure to offer, Prudential has acted or refused to act on grounds generally applicable to the class. As a result of this conduct, plaintiff will seek an order from Court containing, among other things, the following declaratory and injunctive relief: · Declaring that Prudential neither had available to offer nor offered enhanced PIP benefits, as described in Colo. Rev. Stat. § 10-4710(2)(a); Declaring that Prudential's failure to offer the statutory coverages is a violation of C.R.S. § 10-4-710; and Reforming every Prudential car insurance policy issued during the class period to include the enhanced PIP benefits identified in Colo. Rev. Stat. § 10-4-710(2)(a) and declaring that all insureds, resident relatives of the named insured, passengers, and pedestrians, as defined by Colo. Rev. Stat. § 10-4-707, who sustained injuries in a covered occurrence (motor vehicle accident) are entitled to the enhanced PIP benefits identified in Colo. Rev. Stat. § 10-4710(2)(a).

· ·

Plaintiff seeks reformation for the class as a whole. (See Compl., Prayer for Relief, ¶¶ B, D, and E.) This claim requires a determination of the legality of

Prudential's practice--a practice that has adversely affected every member of the class in a like manner--and then, if Plaintiff succeeds, reformation of the automobile insurance policies to benefit the entire class. The suit meets all of (b)(2)'s requirements. Other courts have certified (b)(2) classes seeking benefits and declaratory and injunctive relief. See Bailey v. Kemper Cas. Ins. Co., 83 S.W.3d 840 (Tx. Ct. App. 2002); Lebrilla, supra; Shelley v. Blue Cross of Washington and Alaska, 1993 WL

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724700 (W.D. Wash. 1993); Sutton v. Medical Serv. Ass'n of Penn., 16 Emp. Ben. Cas. 2528, 2531 (E.D. Pa. 1993). Furthermore, courts have upheld the applicability of Rule 23(b)(2) if both the injunctive relief and damages were important elements of the case. Jones v. Diamond, 519 F.2d 1090 (5th Cir. 1975); Williams v. Lane, 129 F.R.D. 636 (N.D. Ill. 1990); Ventura v. New York City Health & Hosps. Corp., 125 F.R.D. 595 (S.D.N.Y. 1989); National Treasury Employees Union v. Reagan, 509 F. Supp. 1337 (D.D.C. 1981); Women's Committee for Equal Employment Opportunity v. National Broadcasting Co., 71 F.R.D. 666 (S.D.N.Y. 1976); Braxton v. Poughkeepsie Housing Auth., 382 F. Supp. 992 (S.D.N.Y. 1974). Thus, even though plaintiff seeks damages in the form of the enhanced PIP benefits that she is owed, those claims are sought only on an individual basis. The reformation claim here is not an incidental portion of a damages claim, since no claim exists absent reformation of the policy. It is not until this reformation occurs that there can even exist any damages claim, so it is not incidental ­ it is necessary. No damages claims are sought to be certified herein. Under 23(c)(4), the court has discretion to fashion the certification to suit the case. Here, Plaintiff respectfully requests that this Court certify Plaintiff's First Cause of Action, Reformation of Contract. In that count, Plaintiff asks this Court to acknowledge the violation of Colo. Rev. Stat. § 10-4-710 and reform the contract to comport with Colorado law. Such a certification is appropriate on these facts, see Bailey, supra; Lebrilla supra; Church v. Consolidated Freightways, Inc., Fed. Sec. L. Rep. (CCH) ¶ 96, 162, at 90, 899 (N.D. Cal. 1991), and within the Court's authority under Rule 23.

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In addition, Plaintiff asks this Court to provide notice under this subpart, assuming this case is not conditionally or alternatively certified under (b)(3). Notwithstanding that 23(b)(2) classes are not required to have individual notice, Plaintiff believes that notice should be provided, especially given the failure by Prudential to notify its insureds of the potential additional coverage at issue or of its failure to comply with the statutory offer obligation. Such discretion is fully within this Court's power. See MANUAL FOR COMPLEX LITIGATION (4th ed.), p. 287 § 21.311. 2. Rule 23(b)(3): Questions of law or fact, to the members of the class, dominate over any questions affected only individual members, and a class action is superior to other available methods for the fair and efficient adjudication of the controversy

Notwithstanding that Plaintiff's claim should be certified under subpart 23(b)(2), Plaintiff asks that this Court certify the same claim under subpart 23(b)(3), either coextensively or alternatively. Regardless of the decision by this Court on 23(b)(2) certification, certification is also appropriate under Rule 23(b)(3). a. Common Questions Predominate

The common questions of law and fact surrounding Prudential's standardized, uniform automobile insurance policies predominate over any individual questions because the alleged coverages available for sale by Prudential were the same for all members of the class. Esplin v. Hirschi, 402 F.2d at 99; see, e.g., Harris v. Palm Springs Alpine Estates, Inc., 329 F.2d 909, 914 (9th Cir. 1964). Here, not only is it predominate, it is exclusive. Plaintiff, to prove the claims of the class would (1) identify the policy documents available to be used in Colorado during the class period; (2) identify the enhanced PI coverages contained in those policy documents,8 and (3) if no coverage compliant with § 10-4-710 exists, then no offer was
8 This refers only to policy forms, not explanatory forms or brochures or selection forms. Only policy forms are relevant. See Brennan at 555.

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made and reformation is mandated. Thereafter, the criteria posited in Clark v. State Farm Mut. Auto. Ins. Co., 319 F.3d 1234, 1243 (10th Cir. 2003) ("Clark I") would determine the effective date of reformation. Those criteria are predominantly, if not exclusively in this context, Prudential-based. Indeed, this Court's analysis, as well as that of the Court in Clark v. State Farm Mut. Auto. Ins. Co., 292 F. Supp. 2d 1252 (D. Colo. 2003) ("Clark II"), focused entirely on facts that would be the same for each class member ­ facts relating to why Prudential did what it did and when did it know about certain facts or obligations relating to the law and its form policies. There is nothing else necessary for the reformation claim. When common questions represent a significant aspect of a case and they can be resolved in a single action, class action status is appropriate. See 7A Wright, Miller & Kane, FEDERAL PRACTICE
AND

PROCEDURES, § 1788 at 528 (2005).

The common

questions, however, need not be dispositive of the entire action, because "predominate" as used in the rule should not automatically be equated with "determinative." Id. at 52829. Rather, "[w]hen one or more of the central issues in the action are common to the class and can be said to predominate, the action is proper under 23(b)(3), even though other matters will have to be tried separately." Villa Sierra Condominium v. Field Corp., 787 P.2d at 665 (quoting School Asbestos Litig., 789 F.2d 996 (3rd Cir. 1986)). As leading commentators have observed, courts have held that [a class action] can be brought ... even though there is not a complete identity of facts relating to all class members, as long as a `common nucleus of operative facts' is present .... The common questions need not be dispositive of the entire action .... Therefore, when one or more of the central issues in the action are common to the class and can be said to predominate, the [class] will be considered proper. 7A Wright, Miller & Kane, FEDERAL PRACTICE AND PROCEDURES, § 1788 at 528-29 (2005). Because plaintiff alleges that she was injured by Prudential's improper common practice, the focus of the predominance inquiry is on Prudential's conduct, not that of each class member. Typically, courts find the predominance requirement met under

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such circumstances. Again, the most compelling and apropos example of this is Bailey, supra, where the court of appeals affirmed a finding that the declaratory relief issue in a PI