Ohio's Twelfth District Court of Appeals Upholds the Rigorous Analysis Standard Applied in Class Action Lawsuits and Reverses and Vacates Trial Court Decision

On January 7, 2013, the Court of Appeals for the Twelfth Appellate District of Ohio reversed and vacated a trial court's decision certifying a class of residents of the Village of Camden, Ohio.  George, et al. v. R. Good Logistics, LLC, at al., Case Nos. CA2012-06-008, 009, 010, 2013-Ohio-16.  Jeff Ireland and I were instrumental in defending this lawsuit, and successfully obtained the reversal of the trial court's class certification decision.

In George, plaintiffs filed suit on behalf of themselves and the residents of Camden based on damages allegedly resulting from their receipt of the Village's public water system.  Plaintiffs sued Rod Good and his related business entities, as well as Cargill, Incorporated and Central Salt, LLC.  Good was hired as an independent contractor by Cargill and Central, respectively, to store and manage their respective road deicing salt.

In August 2010, residents of Camden began complaining of salty-tasting water.  The Ohio EPA found elevated levels of chlorides and ordered the Village to find an alternative water source for its residents.  The Village failed to heed warnings from the Ohio EPA that its aquifer was highly susceptible to contamination – warnings that predated Good's management of salt in Camden by nearly a decade.  Further, the Village failed to have a back-up water supply in the event of an emergency.  The Village ultimately hooked up to a local source of water known to be high in dissolved iron (the "Klapper well") and provided its residents with water from the Klapper well after the expiration of the Ohio EPA's temporary approval.

Plaintiffs alleged claims of negligence, nuisance, strict liability and trespass.  In March 2012, they moved to certify a class of all Camden residents and businesses from August 1, 2010 through "the present."  Despite several identified concerns, including the ability to identify class members and disparities among residents' alleged damages, the trial court certified the class and issued a conclusory decision.  Cargill, Central and Good appealed the trial court's decision, in large part, because the trial court failed to conduct the requisite "rigorous analysis" of the Rule 23 requirements.

The Twelfth District agreed with the defendants and found that:

"[t]he trial court's opinion in the case at bar is similar to the one analyzed in Howland, as the trial court summarily dismissed the majority of Cargill and Central Salt's arguments without articulating any factual analysis."

The Court reversed and vacated the trial court's decision.  George v. R. Good Logistics, LLC, 2013-Ohio-16, at ¶39.

The Twelfth District's analysis is consistent with prior precedent from the Ohio Supreme Court and with other authorities that have found it difficult to certify class actions involving environmental contamination.

As I posted last summer, the Ohio Supreme Court accepted jurisdiction of Cullen v. State Farm Mut. Auto. Ins. Co., Case No. 2012-0535.  (Oral argument to be heard on February 26.)  The Court's acceptance of Cullen provides it with the opportunity to (1) clarify further the requisite "rigorous analysis" of Rule 23, which the Court mandated over a decade ago in Hamilton v. Ohio Sav. Bank (1998), 82 Ohio St. 3d 67, and reaffirmed in Howland v. Purdue Pharma L.P. (2004), 104 Ohio St. 3d 584; and (2) align Ohio law with the U.S. Supreme Court's recent decision, Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2551 (2011).  In light of recent federal court decisions, like Dukes, as well as decisions from Ohio's courts of appeals, like George, Cullen is likely to reinforce the rigorous analysis that trial courts must conduct when evaluating a motion for class certification.

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Erin Rhinehart | Faruki Partner