Marvin Smith et al., v. Illinois Central Railroad Company

Opinion filed November 30, 2006

Brief Summary
The plaintiffs filed an action in the circuit court of Perry County against the Illinois Central Railroad Company on behalf of themselves and those persons and businesses who allegedly sustained personal injuries and property damage as a result of a train derailment in Tamaroa, Ill. The circuit court granted the plaintiffs’ motion to certify the case as a class action and the appellate court affirmed. 363 Ill. App. 3d 944.

The Illinois Supreme Court reversed the judgments of the appellate and circuit courts, and remanded the cause for further proceedings, concluding that the common issues of fact and law do not predominate and that therefore, class certification was improper. The court reasoned that although proof of the cause of the derailment will be relatively straightforward, proof of proximate causation and damages will be highly individualized and will consume the bulk of the time at trial. Because the statutory requirement of predominance cannot be met in this case, the Supreme Court concluded that the circuit court abused its discretion in certifying the class.

To obtain a copy of the Supreme Court's decision, click on Download PDF at the end of the complete summary.

Complete Summary
On Feb. 9, 2003, 21 cars of a north-bound freight train owned and operated by the Illinois Central Railroad Company (the “Railroad”) derailed in Tamaroa, a small rural community in southern Illinois. Tank cars containing hydrochloric acid, vinyl chloride, methanol, and a methanol/formaldehyde mixture ruptured during the derailment, spilling a portion of their contents onto the ground. Some of the cars containing methanol also caught fire. As a result, more than 1,000 individuals were subjected to a mandatory evacuation. Additional chemical discharges occurred on Feb. 20, 2003, and May 7, 2003.

Shortly after the derailment, the Railroad initiated a claims process and, in exchange for written releases from liability as to all known claims, reimbursed numerous individuals and businesses in and around Tamaroa for a variety of alleged losses relating to the spill and evacuation.

On June 16, 2003, plaintiffs filed a complaint in the circuit court of Perry County containing counts for negligence, negligence based on res ipsa loquitur, nuisance, abnormally dangerous activity and trespass. The complaint alleged that the proposed class plaintiffs “were injured and damaged” in one or more ways, including by breathing the harmful chemicals and causing present and potential future damage to their lungs and other bodily organs and tissues; the pollution and contamination of their food and water supplies; evacuation of their homes and business, resulting in some cases, expense and/or loss of income, etc.

The plaintiffs filed a motion to certify the class. The circuit court granted class certification, defining the class as:

“All persons, firms, and legal entities residing, maintaining a place of business, owning property, employed, attending school, or otherwise present in or in the vicinity of Tamaroa, Illinois, or its environs on or after February 9, 2003, February 20, 2003, or May 7, 2003, and who or which have sustained legally cognizable compensatory or punitive damages or may incur or may claim to have incurred legally cognizable compensatory or punitive damages as a proximate result of the Canadian National train derailment which occurred on February 9, 2003, in Tamaroa, Illinois.”

The Railroad filed a petition for interlocutory review pursuant to Supreme Court Rule 306(a)(8) (210 Ill. 2d R. 306(a)(8)). The appellate court denied leave to appeal. The Railroad then filed a petition for leave to appeal to the Illinois Supreme Court (the “Court”). The Court denied leave to appeal, but entered a supervisory order directing the appellate court to hear the appeal. Smith v. Illinois Central R.R. Co., 212 Ill. 2d 554 (2004) (supervisory order).

On appeal, the Railroad argued that personal injury actions should not be certified as class actions because such actions would trigger an unworkable array of fact-intensive, claimant-specific questions that would inevitably result in numerous mini-trials that defy class treatment. In rejecting this argument, the appellate court noted that while courts historically have been reluctant to employ class certification in mass tort cases because significant questions regarding damages and affirmative defenses would require multiple mini-trials, more recent federal and state decisions have found class certification to be appropriate for actions based on a single catastrophic incident such as train derailments, and for mass tort actions alleging exposure to hazardous substances. The appellate court found that such cases demonstrate that the commonality requirement can be met despite the differences in individual claims of injuries and damages. 363 Ill. App. 3d at 951.

The Railroad also argued on appeal that the circuit court abused its discretion in finding that the plaintiffs satisfied the commonality requirement for class certification in the present case. The appellate court disagreed, finding that the liability issues, which the court found could be determined on a classwide basis because the claims arose from a single catastrophic event with a common nucleus of operative facts, were predominate. The appellate court reasoned that the only issues distinguishing the class members were the extent of each member’s exposure to harmful contaminants and the resulting personal injuries and property damage sustained, and that if differences in the amount of individual damages would make a class action improper, a class action would never be possible because variations in the amount of damages among class members is almost inevitable. 363 Ill. App. 3d at 953.

The Railroad also argued that the class definition was “unworkably overbroad” because the terms “vicinity” and “environs” were not defined by geographic borders and that limiting membership to those who have sustained legally cognizable claims made membership contingent on whether a given person’s claim was meritorious, and not objectively ascertainable without individualized fact-finding. Noting that the circuit court did not have the opportunity to address these arguments and that a preliminary review of the record demonstrated that these deficiencies could be corrected, the appellate court remanded the cause to the trial court to consider the Railroad’s objections to the class definition and to make appropriate modifications. 363 Ill. App. 3d at 956.

Justice Welch dissented, arguing that questions such as the existence of damages, the proximate cause of damages, and the extent of damages are so individualized and so predominate over any common issues of law or fact that class certification was not appropriate. 363 Ill. App. 3d at 956.

The Illinois Supreme Court granted the Railroad’s petition for leave to appeal. On appeal, the Railroad argued that the circuit court abused its discretion in granting plaintiffs’ motion for class certification. Specifically, it argued that (1) the common issues of law and fact do not predominate over the individualized injury and causation issues; (2) the class definition will require individualized claim reviews to determine class membership; (3) numerous expert and governmental reports demonstrate the lack of connection between the derailment site and the amorphous geographic area incorporated by the class definition; and (4) the proposed class is insufficiently numerous.

Section 2–801 of the Code of Civil Procedure (735 ILCS 5/2–801 (West 1998)) provides that an action may proceed as a class action only if the circuit court finds: (1) the class is so numerous that joinder of all members is impractical; (2) there are questions of fact or law common to the class, and those common questions predominate over any questions affecting only individual members; (3) the representative parties will fairly and adequately protect the interest of the class; and (4) the class action is an appropriate method for the fair and efficient adjudication of the controversy. Decisions regarding class certification are within the discretion of the trial court and will not be disturbed on appeal unless the trial court abused its discretion or applied impermissible legal criteria. Avery v. State Farm Mutual Automobile Insurance Co., 216 Ill. 2d 100 (2005). However, “ ‘[a] trial court’s discretion in deciding whether to certify a class action is not unlimited and is bounded by and must be exercised within the framework of the civil procedure rule governing class actions.’ ” Avery, 216 Ill. 2d at 126, quoting 4 A. Conte & H. Newberg, Newberg on Cla0ss Actions §13:62, at 475 (4th ed. 2002).

The Railroad noted, as did the appellate dissent, that never before has an Illinois appellate court decision approved class certification in a mass-tort personal injury case. In fact, there is little Illinois authority dealing with class certification in personal injury cases. However, Illinois’ section 2–801 is patterned after Rule 23 of the Federal Rules of Civil Procedure (Fed.R. Civ. P. 23), and federal decisions interpreting Rule 23 are persuasive authority with regard to the question of class certification in Illinois.

Rule 23(a) sets forth four prerequisites for maintaining a class action: (1) the class is so numerous that joinder of all members is impossible; (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. Fed. R.Civ. P. 23(a). If these requirements are satisfied, the court must then find that the class action fits into one of the three categories of class actions set forth in Rule 23(b).

Excluding Rules 23(b)(1) and (b)(2) as not relevant to its analysis, the Illinois Supreme Court focused on Rule 23(b)(3), which allows a plaintiff to maintain an action as a class action if he can demonstrate that: (1) the questions of law or fact common to the class predominate over any questions affecting only individual members; and (2) that a class action is superior to other available methods for the fair and efficient adjudication of the controversy. Fed. R. Civ. P. 23(b)(3). The purpose of the predominance requirement is to ensure that the proposed class is sufficiently cohesive to warrant adjudication by representation, and it is a far more demanding requirement than the commonality requirement of Rule 23(a)(2). In its analysis, the Court stated that the test for predominance is not whether the common issues outnumber the individual ones, but whether common or individual issues will be the object of most of the efforts of the litigants and the court.

Determining whether issues common to the class predominate over individual issues requires the court to identify the substantive issues that will control the outcome, assess which issues will predominate, and then determine whether these issues are common to the class. Such an inquiry requires the court to look beyond the pleadings to understand the claims, defenses, relevant facts, and applicable substantive law. Satisfaction of section 2–108’s predominance requirement necessitates a showing that “‘successful adjudication of the purported class representatives’ individual claims will establish a right of recovery in other class members.’” Where the predominance test is met, “‘a judgment in favor of the class members should decisively settle the entire controversy, and all that should remain is for other members of the class to file proof of their claim.’”

The Court continued to say that, historically, certification of mass tort personal injury cases has been disfavored. The advisory committee notes to Rule 23(b)(3) state that “[a] ‘mass accident’ resulting in injuries to numerous persons is ordinarily not appropriate for a class action because of the likelihood that significant questions, not only of damages but of liability and defenses of liability, would be present, affecting the individuals in different ways. The Court reasoned that in these circumstances, an action conducted nominally as a class action would degenerate in practice into multiple lawsuits separately tried.” Fed. R. Civ. P. 23 advisory committee’s note, subdivision (b)(3), 39 F.R.D. 69, 103 (1966). Although Rule 23 does not categorically exclude mass tort cases from class certification, the committee’s note indicates that certification in such cases should be the exception rather than the rule.

In its analysis, the Court cited “persuasive” and “excellent” decisions in cases such as Southwestern, where the Texas supreme court provided an explanation of the unsuitability of the class action device for mass tort personal injury cases, and Steering Committee v. Exxon Mobil Corp., No. 05–30781 (5th Cir. August 18, 2006), wherein the court held that “where individual damages cannot be determined by reference to a mathematical or formulaic calculation, the damages issue may predominate over any common issues shared by the class.”

The Court determined that the class action device is unsuitable for mass tort personal injury cases, stating “We agree with the reasoning and conclusions in Southwestern and Steering Committee. The lower courts in this case erroneously equated liability for the derailment with liability for the alleged health consequences arising from exposure to the chemicals. However, the vast majority of the damages flow not from the derailment itself, but from the exposure to the chemicals spilled. Proof of proximate causation in this case will involve highly individualized variables, including whether and to what extent, and to which chemicals each member was exposed, location at the time of exposure, age, activity, medical history, and credibility. Plaintiffs seek a variety of types of damages, including loss of money or personal property resulting from the evacuation, current and future illness as a result of the chemical exposure, emotional injury, contamination of real and personal property, and diminution in value of real property. Not only will each individual plaintiff be required to prove the amount of damages, he or she will also have to prove which types of damages were incurred. Clearly, individual issues of proximate causation and damages will consume the great bulk of the time at trial. Consequently, the common issues do not predominate.”

To obtain a copy of the Supreme Court's decision, click on Download PDF.

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