Smith, et al. v. Triad of Alabama LLC

Filing 102

ORDER: it is ORDERED as follows: 1) Dft's 81 motion for reconsideration is DENIED in part and GRANTED in part; 2) The motion is DENIED insofar as it seeks decertification of the class; 3) The motion is GRANTED insofar as it seeks redefiniti on of the class; and 4) The class is REDEFINED as follows: All non-hospital patients of Flowers Hospital, as defined on page four of the certification order, whose personal identifying information or protected health information was stolen or may hav e been stolen from Flowers Hospital by Kamarian Millender and/or his accomplice(s). Excluded from the class are the (i) owners, officers, directors, employees, agents and/or representatives of Dft and its parent entities, subsidiaries, affiliates, successors, and/or assigns, and (ii) the court, court personnel, and members of their immediate families. Signed by Chief Judge William Keith Watkins on 8/31/2017. (wcl, )

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF ALABAMA
SOUTHERN DIVISION
BRADLEY S. SMITH, JULIE S.
MCGEE, ADAM PARKER,
MICHAEL HALL, and JACK
WHITTLE,
Plaintiffs,
v.
TRIAD OF ALABAMA, LLC,
d/b/a FLOWERS HOSPITAL,
Defendant.

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CASE NO. 1:14-CV-324-WKW
[WO]

ORDER
Before the court is Defendant’s Motion to Reconsider Class Certification
Order. (Doc. # 81.) In its motion, Defendant Triad of Alabama (“Flowers” or the
“Hospital”) makes three arguments in support of denying certification to the nascent
class: first, that a typo in the court’s certification order compels reconsideration;
second, that the breach-of-contract subclasses will create administrative and
evidentiary headaches; and third, that the implied-contract theory is just strict
liability by another name. Upon careful consideration, and having the benefit of
well-reasoned briefs from both parties, the court finds that the motion is due to be
denied.

Each of Defendant’s three arguments will be addressed in turn. First, on page
eighteen of the certification order, the court referred to Kamarian Millender’s first
month of employment with the Hospital as June 2012 rather than June 2013. (Doc.
# 78 at 18.) Flowers jumps on this error and claims that (to paraphrase the old
proverb) for want of a keystroke, the opinion was lost. 1 But this is not so. The
misstated date is clearly a typo, as evidenced by the earlier reference to Millender’s
actual start date of June 2013. (Doc. # 78 at 4.) Moreover, the inferences that
Flowers complains about only make sense when drawn from the intended-to-betyped date of June 2013. (Doc. # 78 at 18 (explaining that Millender’s start date
came after April 15, 2013, the deadline to file returns for tax year 2012).) And,
despite the Hospital’s protests, these inferences remain sound: Even though he did
not start at Flowers until after tax day, Millender could have filed for and received
fraudulent returns using the identities of patients who requested extensions or
otherwise filed late returns. The typo, while unfortunate, is no basis to reconsider
certification.
Second, Flowers points to the “administrative and evidentiary issues” that
supposedly inhere in the breach-of-contract subclasses. (Doc. # 81 at 2.) This
argument works along two tracks: that administrative issues would make the class

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Cf. Benjamin Franklin, Poor Richard’s Almanack 22 (The U.S.C. Publishing Co. 1914)
(1732) (“For want of a nail the shoe was lost . . . .”), which itself has been used as a reference to
the horseshoe on King Richard III’s horse, lost during the Battle of Bosworth Field in 1485.
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unmanageable, see Fed. R. Civ. P. 23(b)(3)(D), and that individualized evidentiary
issues defeat predominance, see Fed. R. Civ. P. 23(b)(3).
Addressing the evidentiary argument first, the court stands by its conclusion
that Plaintiffs have satisfied the predominance prong of subsection (b)(3). Flowers
pushes on the varied relationships between the Hospital and the class members,
arguing that a finding of liability hinges on individualized aspects of those
relationships.

The certification opinion addressed the minor nature of these

individual issues, which “orbit around” the common questions of contractual
formation and breach. (Doc. # 78 at 41, 30–35, 38–42); Brown v. Electrolux Home
Prods., Inc., 817 F.3d 1225, 1239 (11th Cir. 2016) (explaining that predominance is
not a matter of “counting noses”). Flowers fails to identify any individualized
factual issues that cannot be resolved along with causation and damages in the
second phase of this case. Its arguments therefore do not affect the conclusion that
Plaintiffs have established 23(b)(3) predominance.
Manageability is no harder to decide. Before certifying a 23(b)(3) class, the
court must determine that “a class action is superior to other available methods for
fairly and efficiently adjudicating the controversy.”

Id.

In making this

determination, Rule 23 directs courts to consider “the likely difficulties in managing
a class action.” Fed. R. Civ. P. 23(b)(3)(D). This is a relative consideration.
Williams v. Mohawk Indus., Inc., 568 F.3d 1350, 1358 (11th Cir. 2009). The inquiry
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is not “whether this class action will create significant management problems,” but
rather “whether it will create relatively more management problems than any of the
alternatives” to class resolution. Id. (quoting Klay v. Humana, Inc., 382 F.3d 1241,
1273 (11th Cir. 2004)). Although manageability sits first chair in the superiority
analysis, “[t]here exists a strong presumption against denying class certification for
management reasons.” Buford v. H&R Block, Inc., 168 F.R.D. 340, 363 (S.D. Ga.
1996); see also In re Visa Check/MasterMoney Antitrust Litig., 280 F.3d 124, 140
(2d Cir. 2001) (Sotomayor, J.) (“[F]ailure to certify an action under Rule 23(b)(3)
on the sole ground that it would be unmanageable is disfavored and ‘should be the
exception rather than the rule.’”) (citation omitted). And because predominance of
common issues makes class resolution more desirable, a court “would be hard
pressed to conclude that a class action is less manageable than individual actions”
after finding predominance. Williams, 568 F.3d at 1358 (quoting Klay, 382 F.3d at
1273).
This is not the rare case where manageability concerns bar certification. For
one, the court has already found that common issues predominate, and it follows
from this conclusion that “a class action will likely be more manageable than and
superior to individual actions.” Id. And, maybe more importantly, it cannot be
forgotten that manageability is but a factor to be considered in evaluating the
superiority prong of subsection (b)(3). This is likely a “negative value” case, where
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the costs of prosecuting individual cases would exceed the expected recovery. See
Castano v. Am. Tobacco Co., 84 F.3d 734, 748 (5th Cir. 1996). As such, “[a] class
action is not only superior to other forms of litigation; it is the only form of
litigation.” William B. Rubenstein, Newberg on Class Actions § 4:87 (5th ed. 2017).
Flowers’s second argument, therefore, does not compel decertification.
Third, Flowers argues that a finding of liability under Plaintiffs’ impliedcontract theory would effectively and unjustifiably impose strict liability on the
Hospital. This goes to the merits of Plaintiffs’ claims and will not impact the
common or individualized character of the evidence presented; accordingly, it is not
properly before the court at the certification stage. See Brown, 817 F.3d at 1234
(forbidding consideration of the merits beyond the extent to which “they are relevant
to determining whether the Rule 23 prerequisites for class certification are satisfied”)
(quoting Amgen Inc. v. Conn. Ret. Plans & Trust Funds, 133 S. Ct. 1184, 1195
(2013)).
Beyond decertification, Flowers’s motion asks for other sundry administrative
relief. First, it asks that the class definition be tweaked to embrace those individuals
whose information “may have been stolen” rather than whose information “was
stolen.” (Doc. # 81 at 1 n.1.) Plaintiffs have suggested a middle ground: adding the
“may have been stolen” language to the preexisting definition, so that the class is

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composed of those individuals whose information “was stolen or may have been
stolen.” (Doc. # 92 at 5 n.4.) The class will be redefined as suggested.
Flowers also requests that a proof of claims form be included with the class
notice or that, alternatively, Plaintiffs foot the bill for the Hospital to sort the class
members into the express- and implied-contract subclasses. These requests will be
dealt with in a separate order, along with the parties’ proposed class notice and notice
plan. (See Docs. # 93, 94.)
Accordingly, it is ORDERED as follows:
1.

Defendant’s motion for reconsideration (Doc. # 81) is DENIED in part

and GRANTED in part;
2.

The motion is DENIED insofar as it seeks decertification of the class;

3.

The motion is GRANTED insofar as it seeks redefinition of the class;

4.

The class is REDEFINED as follows:

and

All non-hospital patients of Flowers Hospital, as defined on page four
of the certification order, whose personal identifying information or
protected health information was stolen or may have been stolen from
Flowers Hospital by Kamarian Millender and/or his accomplice(s).
Excluded from the class are the (i) owners, officers, directors,
employees, agents and/or representatives of Defendant and its parent
entities, subsidiaries, affiliates, successors, and/or assigns, and (ii) the
court, court personnel, and members of their immediate families.

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DONE this 31st day of August, 2017.
/s/ W. Keith Watkins
CHIEF UNITED STATES DISTRICT JUDGE

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