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F. 1 Stephen Yunker(CSBI 10159) Diegoo Califomia 92101 Saa (619)233-5500 3 Telephone: (619) Facsimile: 233-5535 Email:s{Y@yslaw. com 4 Suite1400 2 655WestBroadway, YIINKER& SCHNEIDER
N. Jr. 5 Joseph Kravec, @AID No. 68992) (Ldmittdpro hacvice) SPECTEREVANS o SPECTER &MANOGITE, P.C. Building The26* FloorKoppers 7 Pittsburgb, Pernsylvani 15219 z (412)6424300 I Telqrhone: Facsimile: (412)642-2309 com 9 Fmail:ink@ssem.
PeterS. Hecker(BarNo. 66159) Anna S. Mclean @arNo. LA:n$) IIBLITREHRMANLLP 333 Bush Street SanFrancisco, Califomia 94104-2878 (41 Telephone: 5) 772-6A8A Facsimile:(415) 772-068 Email@ [email protected] FrankBurt (Adnittdpro hacvice) DeniseA. Fee (Admrttedpro hac vice) Dawn B. Williams (Admittdpro hac vic) JORDENBURTLLP 1025ThomasJeffersonStueeL NW \{ashington, 20007-0805 DC Telephone: 40 Q02) 965-81 Facsimile:802) 965-8104 Email:
M. 10 James PieE@AID No. 55406)
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(Adnittd,pro hacvice) PIETZI-AW OFFICE MirchellBuilding 3M Ross Stree!Suite700 Pemnsylvani Pittsburgh, a 1,521,9 Telephone: 288-4333 {412) (412) Facsimile: 2884334 Email: ipietz@ipietzlawcom
for 15 Attomeys Plaintiff
Attorneys Defe,ndant for AMERICANSECURITY INSTJRANCE COMPANY
simil6dysifuatd and 16 herself all others
MICIIELIIE T. WAHL, onbehalfof
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UNTTED STATES DISTRICT COIJRT FORTM NORTHERN DISTRICT OF CALIT1ORNIA SAIITJOSEI'TVISION
MICffiLE T. WAHL, onbehalf ofherself all otlers similarly situare4
CaseNo. C0&00555-RS CLASSACTION JOINT CASE MANAGEMENT STATEMENT
INSIIRANCE 25 AMERICANSECI.IRITY
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COMPANY; DOESl-50, inclusivg and
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c
The pnrtieq by their undersigned counsel submit this Joint CaseManagrnent Statemert, prnsuant FederalRule of Civil Procedure and Civil Local Rule 16-9ald stafe: to 26 1. Jurisdiction and Service. The parties agreethat Plaintiff filed her Class Action
Complainton January25, 2008,andpersonalserviceof the Complaintand Summons wasproperly madeon DefendantAmerican Security lnsuranceCompanyf.ASIC,) through its registeredagent on February11, 2008. @ocket No. 7). Plaintitr believesthat this Court hasjurisdiction over this action basedon the provisionsofthe ClassAction Fairness Act set forth ai 28 U,S.C. $ 1332(dX2) as firther specifiedin her Complaint at paraglaph2. The padies disputewhetherthe Court bas subjectmalterjurisdiction over this action. Horrever, the Court deniedASIC's motion to dismiss Ptraintiffs claimsfor lack of starding. @ocketNo. 39). 2. of Statment Facts: A. Plaintiffs Staremen*Plaintitr brings this action on behalf of hemelf and a
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class of Califomia consumers who were bound to forced placed insurance('FPI) policies with ASIC. Plaintiff contendsthd hazard insurarrceon her and other Califomia residents' property contain a standmd form *Lenden Loss Payment Endorsement"fLLPE') which provides a policy will be continuedandthereafiercancelled contactual methodby which the hazardinsurance if the homeownerfails to make palm.entson the policy. This LLPE provid* that a policy shall re,mainin efect for al least 60 days after the first dale of non-payrnentof premilm, and shall nnlessand "ntil the lenderreceivesnotice in writing from the insurer continuein effeot fl[grsaifter paym.ent tho unpaid premiums,which notice may only be sent a.fter60 and before demanding of 120daysafter non-payment hazsrd insumnce,a lender can substitutetle After proper cancellafionof a homeoqrner'g with a FPI policy nrithout an overlaprn covrage. The EPI policy is paid for terminaredinsurance by the borrowereitherthrougbmoneywhich is held by the lenderin an essrowaccount,or by being addd to the loanprincipal asar additionalcost Plaintitr allegesthar many Califomia lenders hire ASIC to administer their FPI policy programs. In doing so, ASIC is given the responsibilityto monitor borrowers' hao;'rdinsurance and to purchasea policy from itself on behalf of the lender, using the borrower's money, when
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hazardinsurancehas been properly terminatedunder the terms of the original hazard insurance policy including the LLPE. However, ASIC disregardsthe LLPE's conhactual method of
continuing and terminaangthe hazwd insurancepolicy and issuesa F?I policy from itself while
4 coverage acceptable the lenderis still in-force. This conductby ASIC, Plaintiffcontends,creates to 5 an 'bverlap" of coverage between FPI policy andthe bonower's pre-existingpotcy. the 6
By the very terms of ASIC's FPI policn the policy automatically cancelsif and when
7 alternativeinsurancethat is acceptable the lender is in effect ASIC's FPI policy contractually to 8 promisesthat ASIC will reftnd any portion of the premium paid for cover:rge provided when not o polioy
the FPI is cancelled and does not contain m automatic reinstatemntprovision after
1 0 cancellation. Because ASIC's FPI policy is issuedwhile coverageacceptable the lender is still to 1 1 in-force pursuantto the original hazard insurancepolicy's LLPE, ASIC's policy automatically 1 2 terminates ASIC is contractuallyobligatedto retum the entirepre,mium,ASIC fails to disclose and 1 3 that its FPI policy is placedwhen coverage rmderanotherexistingpolicy tbat was andre,mained to 1 4 be acceptable the lender is in effect and fails to refimd the pre,miums paid for the coverage to not 1 5 providedwhe,n FPI policy is cancellecL the 16 17
B. Defendantosstatemed: Plaintiff Mcholle Wahl financedthe purchaseof her home by enteringinto a promissory
1 8 note and a Ded of Trust with EMC MortgageCorporationCEMC'). Ms. IMahl's contact with 1 9 EMC requiredher to secuxe maintainhazardinsuranceon the property an4 if shefailed to do and 20 so, the Deed of Trust authorizedEMC to obtain insurancecoverage.Ms. Wahl initially obtaineda
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fuzad l;awancepolicy which was carcelledby the insurer on January27,20A6 dueto Ms. Wahl's failure to pay premiums. That poiicy containedan LLPE ttrat provides:"[t]his policy shall remain in fulI force and effect as to the intrest of the Lender for a period of ten (10) days a.fterits policy . . . shall havebeenissuedby someinsurancecompanyard expirationtnlgss an acceptable accepted the Lender," by EMC secured te'mporary a binder of insurance the propertyfrom ASIC effectiveJanuary on 27,2006, the dareMs. Wahl's hazardpolioy was cancelled. EMC notified Ms. Wahl at leasttlree times tbat shecould purchase other insurance the propert5r, receivingno proof of acceptable on but
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EMC ultimately pucbaseda one-yearASIC policy on the propertyeffectiveJanuary27, insurance, 2006. EMC paid the prendum for this policy to ASIC. The named insured under both the telnportry ASIC binder and the ASIC policy was EMC, with Ms. Wahl listed as an additional insured- Coverage underfhe ASIC policy terminatedon July 19, 2007, whe,n Ms. Wahl purchased policy, anotler homeowner's 3. Legal Iszues: A. Plaintiffs StatemenfiThe primary legal issueson the merits of Plaintiffs
7
8 actionarewhetler ASIC's conducl(1) is a Breachof the FPI Polioy Contac! (2) is a Breachofthe I StatutoryDuty to Disclose basedon the Califomia InsuranceCode sections330-334and under 1 0 Califomia Civil Code section 1689(b)(7);(3) is a Constuuctive Fraud under Califomia Civil Code 1 1 section 1573; (4) constitutesa Failure of Consideration;(5) is a Violation of California's Unfair
Competition Law under Califomia Business& ProfessionsCode section 17200et seq; mid,(Q entitlesP1aintiffand the Classto DeclaratoryRelief. This Court grantedASIC's motion to dismiss as to Plaintiffs remaining munt alleging tlat ASIC's conduct is also a Violation of Califomia's Consumer Legal Re,rredies underCalifornia Civil CodesectionL750a seq.. This Court denied Act ASIC's motion to dismissfor lack of standingand for failure to statea claim as to all of Plaintiffs other claims.@ocketNo. 39). Defsldant contends below that theseclaims involve certainspecified"prominent'' defenses that should be decidedbefore fidl discovery on class oedification and the merits. The Plaint'rff respectfitlly disagrees. Defendant'spurported"prominent''
't2
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certification iszue of typicality, commonalityand adequacyof representation often enmshed are and closely relaJed- ,Seee.g. In Re ConnecticsSecurtty Litigation, 542 F. 2d 99, 1003-10M (N.D.Cal 2008). Similarly, the questionof whetherASIC provided 'duplicative coverage,o under
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will focus on ASIC's courseof conductpursualrtto its FPI contractsand the termsof the oontracts programsin California. Contractinterpretation,like the issueof classcertification, focuseson a
3 party's Cf,,Employers corlrseof performancepursuantto the standardform contract 4 Reinsurancet'. Sr,tperior Coun, 16l Cal. App. fr 906, g2L-922 (2d Dist 200s) and Atlapattah 5 Services, v. Enon Corp.,333 F3d 1248, 1261 (l,lth Cir.2003); Smilow v. Southwestern Inc. Bell
o Mobile Systens,323 F.3d 32, 3942 (lst Ctr.20O3); Steinbergv. NationwideMuatal Inswance Ca, 224 F.R-D.67, 79 (E.D.N.Y.2AM);Winklerv. DM, [nc.,205 F.RD. 235,[email protected]);and Kleiner v. First National Bank of Atlanta,97 F.R-D.683, 692 (N.D.Ga1983). Viewed accordingly, no bright line arists for distinguishing befweendiscoveryrelatedto the merits andclassissuesto be presented Plaintitrs andthe defenses be asserted Defendants. by by to As will be explainedbelow, beca::sethe class, merits and defenseissuesraised by the Parties are factually and legally intertwine{ Plaiilitrs raspectfully submit thar it would be an unduly burdensome needlessly and inefficient if not imFossiblerask,to aftemptto segregate class discoveryandnerits discoveryof Ms. $/all's individual clsims asDefendantsuggests without first knowing the preciseissuesandfactsrelatedto Ms. Wahl:* B. that arein disptjte. "1ui6s Defendant's StaJemenfi ASIC anticipatesthaf during the course of the
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litigation certain legal issueswill take prominence. Thoseissuesinclude whether Ms. Wall has starding, whetherthe ASIC policy provided duplicate coverage,and whether Ms. Wahl's claims arezuitablefor classfueainxeqt. The first disputedlegal issueis whetherMs. Wahl has standingto sueASIC for the alleged conduotof her lender,EMC. ASIC also disputesMs. Wabl's standingto represent putalive class a programsin California If shehas standingto of all ASIC insuredsin all lender-placed insurance advaaceslaims againstASIC (rather than EMC) in the first instancg which she does not Mg Wahl's purportedstandingis limited to advancingcLaims relating only to the EMC lender-placed program, Plaintitr does not possess same tnteres,t has not suffered the sarnepurported the md tqjury as thoseallegedclassmembers whoseputative injury, if any, flows from claims relating to progmmsother rhan EMC's. dthough the Court deniedASIC's motion to dismiss lender-placed based lack of standing the iszueof standingis likely to takeprominenceduring the courseofthe oa
u
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litigalion, as notedby the Court in its order. (DocketNo. 39 ai 5) (*It may be the facts ultinately will support standingon some theoriesand claims but not others, and that some of the specific ran dutiesASIC is allegedin the complaintto havebreached only to EMC. Suchmatterscannotbe
4 parsed out at rhisjmcture.'). 5 The second overarching legal issue is whether the ASIC polioy duplicared covsrage
o provided by the policy Ms. WahI allowed to lapse. This Coud recognizedthat this issue is
7 significant a:d largely a question of law, but found tbat it was inappropriateto decide on the 8 pleadingswhether the ASIC policy provided duplicate coverage. @ocket No. 39 at O. It is o that,
ASIC's position
from its inception,tle ASIC policy purchased Ms. Wahl's lenderprovided by
1 0 substantialand nonduplicative coverageto both the EMC and to Ms, Wahl. This is so for two 1 1 altemativereasons. First by procuring the ASIC policy, EMC waived any coverageunder the '12 'n
Farmerspolicy LLPE. SeeCql. StateAuIo. Ass v. Policy Mgmt Sys.Co4p. No . C-934232 CW, ,
1 3 1996WL45280, at *7 (N.D. Cal. Jatt"9,L996); SpottElec. Co. y. Indas.Indem. Co.,30 Cal. App. 1 4 3d, 797, 806 (1973). Second,even if no cancellationby substitution occurred"the coverage 1 5 provided to EMC by the FarmersLLPE aad the ASIC policy was equitably apportioned between 1 6 the two insurersasa mattrof iaw. SeeCenturySur. Co. v. UnitedPac. Ins. Co.,109 Cal. App. 4th 1 7 1246,126AQ04r. 18 20
Another dispositiveissueis whetherthe claims asserted Ms. Wahl are suitablefor class by
1 9 lreatment ASIC's generalpositionon classcertification is discussed paragraph below. in 9,
Ofter potential issuesinclude whetherMl Wahl is estopped from bringing her calses of
2 1 action; whether Ms. lvahl has waived any of her slairns; $/hetherthe claims are ba:red by the 22 clocnineof lachesor the applicablestatutesof limitations; whetherthe filed raJedoctine bars Mg
slsims; whetherl{s. Wall's claims fall within the primary or exclusivejurisdiction of the 23 !V2fo1's Commissione6 whetherMs. Wabl's duty to readher policy forecloses and her 24 Califomia Insurance
25 claims. 26
Plaintiff arguesthat the Court should not allow an initial period of discovery and motion
27 practice limited to certain merits is$es thal are zubstantialand potentially dispositive. Her 28 argumentis basedon tle unsupportedassertionthal melits issueszuch as standingand contract
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interpretationare somehownsnmeshed" with the class certification tletermination"because they pursuantto its FPI relaf to "ASIC's courseof conduct a:rd policieg practices,and procedures contractsand programs in Califomia-" Plaintiff provides no example of how such "couxseof conduct' evidence would be relevantto ier standingor the meaningof &er contracts witl EMC and Farmers,or ASIC's with EMC, Nor can she. The only matter at issue in ASIC's proposed dispositive motion would be Wahl's claims. ASIC's "course of conduct" with respectto other policies and programsis simply not relevant and discoveryon suchissuescan be avoidedif there aredispositivedefenses Wahl's claims. on As ASIC has offeretl to stipulate to the issuesto be presentedin its proposedmotion, plaintiffs claim tlat she will be disadvantaged without knowing the precise issuesthat are in dispufeis unfounded- If there are disputesas to what discoveryis appropriate the initial phase, in the Court canrmdoubtedly handlethe,m. 4, Motions:
ASIC movedto dismissthe Complaint for lack of standingand for failure to sfafea claim
1 5 upon which relief oanbe granted. (DocketNo. 20). This Court deniedASIC's motion to dismiss 1 6 Plaintif s slaims, except for Cormt Seven alleging tlat ASIC's conduct violates Califomia's
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Legal Remedies Consumer Act under Califomia Civil Codesection 1750et seq. which the Court dismissed with leaveto amend. @ocketNo. 39). judgmelrt on"inter alia, the policy interpretation ASIC interulsto file a motion for summary issuesthe Court determined were "largely questionsof law- but thal could not be resolvedon the recordbeforeit on ASIC's Rule 12(b)(6)motion to dismiss. (DocketNo. 39 at 6, lines 6-8). ASIC believesthat there are no genuineissuesof material fact asto suchissues,and that they will likely be dispositiveofthe case. Plaintiffwill fle a Motion for ClassCertification after a period of discoveryrelatedto class iszuesandthe medts of Plaintiffs' slaims,which Defendant will oppose.Until the partiescomplete the class-related discoveryo partiesare uftble to statethe preciseissuesthat will be contested a on motion for classcertification
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5.
Amendmrrt Pleadinss: of A Plaintifs Statement Plaintiff proposes that fhe deadline for amended
pleadingsbe September30, 2008, subject to either party's rigft to seek leavo to amend their pleading pursualt to Fed-RCiv.P. 15 or basedon later discovered evide,nce goodcause or shown B. Defendant's Statement ASIC proposes tlut the dqdline for amended
pleadingsbe August l, 2008, subjectto eitherparty's dght to seekleaveto amendtheir pleadings thereafter basedon latr discovqed evidence goodcause or shown. 6. EvidencePrcervation: A. Plaintiffs PreservationEfforts: Plaintitr bas provided her counsel with
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copies of all documentsbelieved to be relevant to her claims that she believes were itr her possession the time her lawsuit was filed. Those documentsshall be retained by Ptaintiffs at counselduring the pe,ndency rhis litigation of B. DefendantosPreservation Efforts: Shortly affer being served with the
Complaint ASIC preparedand disseminated docr:mentretention memorandumto employees a likely to have custodyor control of potentially relwant documents. ASIC's in-housssounsglhas documentretention with key personnelin order to ensurethat pote'ntialy responsive discussed documents retained. are 7. InitialDisclosures: The partiesproposethat they exchange initial disclosures requiredby Fed.R. Civ. P. 26(a)(1) July 23, 2008. by 8. Discovrv: A Discovery Taken to Date: Plaintiff has served a set of writfen document
rque.sts which Defendantha,s to servedwritten objeotionsand responses producedresponsive and documents,Plaintif is in the processof evaluatingthe sufficiency of Defendart's objectionsand r*ponses andwill meetandconferwith Defendantshouldshehaveany concems. B. AnticipatedDiscoverjn i. Plaintitrs Statement: Plaintiffproposesa period of discoveryrelating
to class issuesprocedingthe filing of Plaintiffs Motion for Class Certification with all merits
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discoveryooncludingthereafter. Altematively, Plaintitrproposesthat discoveryand expert-related judpent as to Plaintiffs individual claims ASIC be given 30 daysto file its motion for summary so that Plaintiff can see the precise issues,axguments facts relied on by ASIC, atrer which and Plaintiffwould be give,nperiod of time to take disooveryon the mattersraisedby ASIC's summary judgment motion before ffling her respo ie. Under this altemativeproposal,classand firll merits judpent would be scheduled discoveryandproceedings after the Court rules on ASIC's summary motion asto Plaintiffs individual claims. ASIC's proposal that it file iis summaryjudgment motion after Plaintiff takes discovery limited to the merits of Plaintiffs claims is unworkable. As explainedin SectionItr.A. abovg discoveryof classissuesand the merits of Plaintiffs itrdividual claims are inorhicably intertwined such that separatingthe two would be rmduly burdensomeand a needlesslyinefficierrt if not impossiblq task. Irdee4 in the parties' meet aad confer in preparationof fhis Joint Report ASIC judgmentmotion However, aftempted identify the legal ixux it intendedto raisein a summary to without Plaintitr knowing the precisearguments and facts upon which ASIC relies, ASIC's list of legal issuesimplicalesvirhrally the entiremerits of Plaintiffs claimsand by ortensionvirtually the entireuniverseofclass discoverysincediscoveryofthe two substantially overlap. judgmentmotion andbrief Plaintiffs alternativeproposalof having ASIC file its summary beforePlaintiff takesdiscoverywill causeASIC to speciS the preciseissues,argumnts and facts relied on by ASIC which will permit Plaintitr to assess precise faots at issue and then limit the discoveryto thosemaffersraised by the motion In absence a prior filed summaryjudgrnent of motion andbrief providing this specification,Plaintiffwill be forced to assume tlal all of the facts surrormding claims could be relied on or disputedby ASIC andthus will haveto take discovery her of the entire merits of Plaintiffs hdividual claims which discovery, of course,is inextricably intertwined with class discovery. In that eveng Plaintitr proposesdoing class and individual Plaintiffs merits discovery at the same time. Plaintiffs altemative proposed schedulesare includedar ![ 17A. herein. ii. Defendant'sStalement ASIC proposes period of discoveryrelated a
solely to the interpretalionof the contractsat issue,given this Court's acknowledgement such that
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issueswill likely turn on questionsof law. (Docket No. 39 at O ("policy interpretationissues largely presentquestions la$f). After the partiesandthis Court haveresolvedthosequestionso of if a they arenot dispositive,ASIC then proposes period of discoveryrelating to classissues, followed by plaintiffs notion for classcertification. Merits discovery,to tle extetrtnot taken in PhaseI,
5 would occurafter that motion had beenresolved. ASIC's proposedschedule in paragraph17@), is 6 below. 7 8
o 9, ClassAction: A to Plaintiffs Position:Plaintiff seeks certiS a classunderFedRCiv.P. 23(a)
who were additionalinsuredsunderan and (bX3) of all cunent and former Califomia homeowners ASIC FPI policy and who were charged prior for any period of FPI s/hich overlapped
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homeownerinsufturcestill in effect pursuantto ftre homeowners'LLPES.Plaintiffs proposed preis trial schedule includedat tf 17 hereinwhich providesdatesfor a classand limited merits related discovery pedo4 the filing of Plaintiffs Motion for Class Certification, ASIC's responseto Plaintiffs MotioD,andPlaintiffs Reply. Plaintiffbelieves a classis maintainable at leastthe following reasons: for i. The class is sufficiently numerouli in that Plaintitr believe that
of thousands personsresiding in Califonia have had insurancepolicies forced placedwith ASIC wbile they had othErinsurancecoverage in-force to protectthe lender's intrestsin their mortgage propsrty. Moreover,it is believedthat ASIC has recordsidentiffing eachof theseconsumers, the dateandbilling address eachFPI policy entered for into during the ClassPerio4 andthe amountof premiumpaid underthosecontracts. ii. Plaintitr and her counsel are adequate representafives the Class. of
2a
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Plaintifl while residing in Calihmia during the ClassPeriod"was issueda FPI policy by ASIC pmviding that the policy would cancel automaticallyand refrmd any premiumsif she had other insurancein place to protect the lender's interestsin her mortgageproprty like all other class members, md Plaintiff has no interestsantagonistic the C1ass.Moreover,Plaintiff hasretained to undersiped co"nsel who have years of experiencerepresentingconsumersin class actions generally,andin insurance-related classactionsspecifically.
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in.
Commonissuesof fact andlaw predominate sincePlaintiffs action is
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contracts readily availablerecordsshowingthat and basedon uniform provisionsof form insuranoe eachClassMemberwas teated in a uniform mamer, Lendersrequireborrowersto obtain hazard insurancewith marerially similar LLPE terr:s, including the contractral method by which the policy will be continuedand thereaftercancelledif the homeownerfails to make hazardinsurance palrneds on the policy. Additionally, ASIC's FPI policies are materially uniform in ttrat they all to automaticallycanceland requirepre,miums be refundedif and whsn altemativeinsurance thaf is to acceptable the lenderis in effect. Further,ASIC uniformly failed to disoloseto borrowersthat it underanotherenistingpotcy that q/asand remainedto be had issuedits FPI policy when coverage to acceptable tle leirderwas in effect and failed to refund tle premiumspaid for the ooverage not providedwhenthe EPI policy was cancelled the policy's own terms. by Plaintiff believesASIC meintains oopiesof the hazrrt insurancepolicies issuedto Class Memberswhich oontain the LLPE and the FPI policix it iszuedto class 6snx6em. ASIC also maintainsrecordsshowing ASIC's common conduct including the datesClassMembers' hazard was cancelled the amountof premiumspaid, the dateASIC's FPI policies were issued" insr:rance and the amount of any premiumsrefimded" Theseuniform form policy irsr:rznce contractsand recordswill allow Plaintiff to prove on a class-widebasishow ASIC brsachedall ClassMemberso contracts otherwiseyiolated Califomia law' and iv. A class action is superiorto other availablemeansfor the fair and
effcient adjudicationof this dispute. The d'mages sufferedby eachindividual classmemberlikely will be relatively small, especiallygiven the burdqr and expense individual prosecutionof the of complex insnance litigation necessitated ASIC's conduct by Thuso it would be virtually
imFossiblefor the Class Mmbers individuafly to effectively redrws the wrongs done to them. Moreover,evenifthe classmembrs could afford individual actions,it would still not be preferable to class-wide litigation. Individualized actiors present the potential for inconsiste,lrtor
judgments. By confoasta classactionpresents fewer manegemnt contradictory far dfficulties and providesthe benefts of single adjudication,eoonomies scalq and comprehensive of supervision by a singlecourt.
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I
v.
In the altemativq fte Class may be certified undff Fed-RCiv.P.
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23(b)Q) becameASIC bas acted or reftsed to act on grormdsgenerallyapplicableto the Class, thereby maki'rg appropriateprelininary and final eguitablerelief with rcspectto the class as a whole. B. DefendantosPosition
to Ms. Wabl's claims are not zusceptible class-wideadjudication For orample, EMC is only one of many lendersto which ASIC providesinsuranceservices. Consequendy, Wahl's Ms. intractionwith EMC is not representative the experiences the other pulative classmembers. of of and termsof any clauses similar to Ms. Wahl's FarmersLLPE' as well as Moreover,the existence the conduct of policyholders and lenders pursuant to those clauses, will require individual determinations. 10. Related Cases:The parties are unawareof any related casesthat asserrt same the
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by claim or classasthat asserted Plaintiff. 11. Relief: Plaintiffs complaint seeks for herself and all other Class Memben
compensatory damages restihrtionretef in the amountthey paid for ASIC's FPI for any period or of coverageafter the policy cancelledrmder the expresstenns of the FPI policy. If liability is eseblishedon t.hisbasis,damages should be calculatedas the entire amormtof prendumpaid to ASIC plus interest AlXematively,Plaintiff seekscompensatory darnages restitution relief for or herself and all other Class Membersin the amount they paid for ASIC's FPI for any period of covragewhen there was other insuance acceptable the lender was in-force. If liability is to on established this basis,damages shouldbe calculaledby the pro rata portion ofthe prenriumpaid while other insurancewas in-forcq plus interest. Plaintiff also seeksdeclaratoryand i{u:rctive relief preventingASIC from to issueFPI policies prior to the actual cancellationofa
pursuant the termsof the LLPE, and an Order erfoining ASIC from borrower'shazardinsurance to practices. continuingits unlawful anddeceptive 12. Settlementand ADR: The parties agreethat settlementdiscussionsare currently
pteznafrtre. If and when sefilementdiscussions becomeapprqriafe, parties have agreedto the following ADR process: mediation.
il
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13.
to Consentto Magistrate for all purgoses:ASIC and Plaintitr filed thEir conserxt
proceed beforeYour Honor for all proceedings,@ocketNos. 18,24). 14. are OtherReferences: partiesdo not believetlat any references necessary this The at
4 time. 5 15. Narrowine of Issues: The parties have discussed the possibility of entering 6 stipulationsor providing atrdavits that would minimize the needfor depositionsand documentary 7 discoveryon the issueof classcertificationandpossibility on the merits aswell. The partiesintend I to cooperatively work to detennineif any suchsheamliningof discoveryis mutually acceptable. 9
16. Expedited Schedule:The parties do not believe that an expedited scheduleis
1 0 approprialefor this classaction'|,1
17. Scheduline:
12 13
A
Plaintiffs Prooosal:
Defendant'sproposedScheddethat seeksto limit or stay classald merits discoveryis not
1 4 in accordwith Ninth Circuit legal standards principles of expeditiousand economicalhandling and 1 5 of complex litigation under the Manual For Complex Utigation, Fourtb" (FederalJudicial Center 1 6 2008). An order tbrf limits or staysdiscoverymust be basedupon'good cause"and a "strong 1 7 showingl'as to why discovery shonld be not bken, not lq)on mere speculationor conclusory 1 8 stateme,lrts a ftture dispositvemotion would prevaiL Gray v. Fi.rst WinthropCa4p.133F.RD. that 1 9 39, 40 (N. D.Caf. 1990). Moreover,an order thal seeksto limit or precludediscoverybasedupon a 20 distinctionbetweenclassandmedts discoveryis rmworkableandinefficient because bright line no 2 1 existsbetw@nthesetypes of discoveryand ongoing supervisionwould be requiredto make such 22 determimtionsId. il 41. See also, WaterburyHospital v. U.S.FoodSentice, 2007 WL 328899
the 23 @.Com- 2007)('Ltke in its request0o stay discovry,USF here seeksto argu.e merits of an
24 udled motion. The cor:rt declinesUSF s invitaiion to prejudgethe matter. Moreover, tle court 25 doesnot seetlat the distinction betweendiscoverylimited to the namedplaintitrs and discovery
and is 26 relatedto uDnamed uncertiied classme,mbers asbrigltly tined asdeferdantsuggests').
27
The schodulingof this matter shouldbe basedupon recornmendations the Manual For of
28 ComplexLitigation, Fourtb, $ 21.14which counsels:
Case 5:08-cv-00555-RS
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1 2 3 4 5 6 7 I I 10
of ' Generalln discoveryinto certifioationissuesperlainsto the require,ments Rule 23 and tests whether the claims and defensesare susceptibleto class-wideproo$ discovery into the medts pstains to the shength or wealnessesof the claims or defnses tsts whetler they are likely to succeedand There is not always a brigbt line betweenthe two. Courtshave recopized tlat infomration about the nature of the slaims on the merits and the proof that they require lg imJtortantto deciding certification Arbitoary insistence on the medtdclass discovery distinction sometimes thwads the informed judicial assessrnent current class cenification tlal practicee,rrphasizes. permittirg the partiesto take discoveryof Accordingly, this Court shouldentsra schedule classandthe merits of Plaintiffs individual claimsat the sametime followed bv the submission of judgmentmotions. classcertification andsummary Altematively, as explainedin Section 8.8.i. above, if ASIC fi1es its summaryju'o-ent
1 1 motion and brief as to Plaintiffs individr.ralclaimsbefore Plaintiff takesdiscovery,it will rcsult in 1 2 ASIC specifying the precise issues,argumentsand facts relied on by ASIC which will permit 13 14 15
motion. In absenceof a prior filed summary judgment motion and brief providing this plaintiffwill be forcedto assr:me all of the facts surrounding claims could be that her 1 6 specificatio4 judglent motion Thus,Plaintiffwould have to take 1 7 relied on or nisputedby ASIC in a summary fhe Plaintiff to assess precisefacts at issueand then limit discoveryto thosemaltersraisedby the
1 8 discovery of the entire merits of Plaintifs individual claims which discovery, of course, is 1 9 inextricably intertwined with class discovery. Ir thal evelrl, Plaintiff proposesdoing class and 20
individual Plaintitrs meri8 discoveryat the sametime.
21 ?2 23 24
Plaiotif thereforc respectftrily submits that either of tle following altemative proposed schedules entered: be PLAINTIFf,'IS PROPOSED SCHEDULE _ IIRST ALTERNATTVE
25 EVENT 26 Initial Disclosures 27 Amendment Pleadings of and Merits 28 Class-relaied Plaintiff s Individual
Case No.: C 08*m555 RS Joht Case Mamgremsnt Statemsnt
PROPOSEDDEADLINE Ju1y23,2008 September 2008 30,
Case 5:08-cv-00555-RS
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1 2 3 4
5
RelatedDiscovery Plaintiffs Motion for ClassCertification of andsuppodingMeanorandum Law Motion For Sr''rnmary Judgment Defendant's Defendant'sOppositionto ClassCilification
Decenrber 2008 5,
Dece,mber 19,2008 Dece,mber 19,2008 January 20,2009
6 7 Plaintiffs OppositionTo The Motion I
For S"mmaryJudgme,nt
January 2009 20,
10 11 12 13 't4 15 16 17 18 19 20 21 22 23
o plaintitrg Psply in FurtherSupportof Class Certification Hearingon Plaintiffs Motion for Class CertificafionandDefndant'sMotion For SummaryJudp.ent Mediation* Merits Dscovery Completion* ExpertReports* Reports* Supplemental ExpertDiscoveryCompletion* DispositiveMotion Deadline* A11 OtherPre-tial Motions Deadline* Final Pre-fial Conference* Pre-trialBrieft* Trial*
February 2009 3,
February 18,2009 May15,2009 October 8,2009 Ociabet23,2009 November 2009 9, November 2009 30, December 2009 30, December 2009 30, January__,2010 January 15,2010 February,2010
24 25 26 27 28
'r' Plaintiff believestlat the Court shouldschedule CaseManagement a Conference following its detennination classcertificationto determine any changes of if neeii to be madeto the remaininE in scheduled deadlines light ofthe Court's classcerrificdrionniing. PLHNTTX'F'S PROPOSED SCEEDULE _ SECOND ALTERNATIVE EVENT Initial Disclosures
PROPOSED DEADLINE Iuly 23,2008
Case No.: C 08{0555RS Jotnt Case Mamgement StateEent
Case 5:08-cv-00555-RS
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Amendment Pleadings of Motion for Summary Judgment Defendant's MaterialsAs To Plaintiffs And Supporting Individuat Claims DiscoveryRelatedto Defendant'sMotion For SummaryJudgment Motion Plaintitrs Oppositionto Defendant's gnmmnryJudgment Psl Defendant'sReply In SupportOf Its Motion psl gummFryJudgmefilt Oral ArgumentOn Defendanl'sMotion For SummaryJudgment
September 2008 30,
August 15,2008 November 14,2008 Decemher 2008 1, Dece,mbe! 15,2008 JanuaryT,2009
* Plaint'rffproposes the Court hold anothercasemanagetnent thal confere,nce it rules after judgme,nt on Defendant'ssummary motion to schedule additionalclass,merits andother all pre-fial proceedings. re,maining B, Defendant'shooosal:
The Court has acknowledgedboth tlaf policy interpretation issues 'olargely present questions law," Order Grantingin Part and Denying in Pail Motion to Dismiss (DocketNo. 39) of Corde/) at 6, and that rfiether Wabl has standingto bring someor all of her claims nay depend on factualmatterssuchaswho paid the premi 'ms for the ASIC policy andto which party, EMC or IMahl,ASIC's dutiesrar- Order at 4,5 & n2, Judicial economywould be servedby resolving as legal issuesas possibleearly on Even if not dispositiveof the e,ntirelawsuit -
2',1 many of thce
which ASIC believesmay well be the case- narrowingthe claims on which classdiscoverymay be necessary likely streamlinethe classcertification process. For examplg if tho Court is able will to eliminate certain claims, such as the Insr:rance Code discloqne claims, discovery about communicationsmade to putative class membels wil likely become irrelevant and thus a
substntial economy will bavebeenachieved.At a minimum, threwould be no prejudiceto either
CaceNo.: C 0&@555 RS Joint CaseManagementStatement
Case 5:08-cv-00555-RS
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I 2 3 4
c
party by proceedingwith limited merits discoveryon thesepotentially dispositiveissuesfirst, and the possibility of a substantial benefit. Accordingly, ASIC proposestbree phasesto the schedrling plan First a period of
discovery and summaryjudgment briefing limited to confractintrpretationand standingiszues. Second,a period of discoveryand b'riefing on class certification issues. And finally a period of
7 I 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28
merits andenpertdiscoveryin preparationfor trial. Plaintiffs counselhas expressed concemtbat they would be prejudicedin the first phaseof discovery if they did not knorv the issues that would appear in ASIC's motion for summary judgme,nt In response, ASIC has proposedthat the prties stipulatein advanceto thosePhaseI ContractInterpretafion/Standing issues, follows: as l. Whether plaintitr has standing to advanoe the claims pled in the First Amended Complaint including whetherWahl derivesstandingbasedon who paid the premiumsfor tle ASIC polioy or how they werepaid; whetherWahl derivesstandingfrom the ooverage allegediyprovided to her over and abovethe arnormtof her mortgage;and whetler the duties,if any, owedby ASIC undereachof plaintiffs glaimsran to plaintiff or her lender, EMC. Whethertle Farme6' LLPE provided coverage EMC after the insurance to was cancelled as to Wahl as of January27,2006, and whetherthe terms of the Farmers' LLPE permit any continuing covenge to be waived tbrough the lender's procurement of other policy. acceptable insurance that is not a renewaloffhe Farmers WhetherEMC waived coverageunderthe Famrers'LLPE by purchasingand paying the premium for insuranceooveragefrom ASIC tlat comme,noed January27,20A6, nd on whether EMC's coverage under the ASIC policy was effective (and not simply "backdated) asofJanuary 27,2006. Whether the ASIC potcy was terminaJedat inception as a result of any continuing coverage EMC may bavebad underthe Farmers'LLPE. tlat Whetherany continuingcoverage that EMC may havehad rmderthe Farmers'LLPE a.fter Iammy 27,2006 met EMC's requirements the Deedof Trust ll 5. in Whether any continuing covemgethat EMC may have had rmder fhe Fanners' LLPE would be equitablyapportioned with EMC's coverage underthe ASIC policy in the event ofloss occurringafter Jan;rlry27,2A06.
2.
3.
4. 5.
6.
ASIC thereforerespectfrrllysuggests the following proposed thaf schedule entered: be
T6
CaseNo: C 08-00555RS Joitrt CaseM agemetrtStatement
Case 5:08-cv-00555-RS
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1 2 3 5 6
Initial Disclosures AmendPleadings Phase Contact-Interpretation I Discovery C\.ttotr Event ProposedDeadline
July23,2008 August 1,2008
120daysfollowing entry of the CaseManagemeirt Order 150daysfollowing entry of the CaseManagement Onler 180dala following entry of the Case Management Order 210 daysfollowing entry of CaseManagernent Order
ASIC'sMotionfor Summary Judp.enton Issues ContactInlerpretation 7 to I Plaintifs Opposition ASIC'sMotionfor on Summary Judgnent Contact Interpretation Issues
I 10 11
ASIC's Reply in Supportof its Motion for SummaryJudpent on Conbart InteroretationIssues
on 12 Hearing ASIC'sMotionfor Summary
(if Interpretafion on Issues Judgme,:rt Contract deiredby Court) 13
(As deternined Court) by
14 15 16 17 18 19 20 21 22 23 24 26 27 28
Second Scheduling Conference
To be setby Court following Orderon ASIC's Motion for SrlmmaryJudgment Contact on Interpretation Issues (As detennined Court) by Deadlinesfor succeeding Phases, ifnecessaryor appropriate depending the Orderon ASIC's on Motion for Srnmary Judgment, run from the to dateof Secood CaseManagement Order.
Second CaseManagement Onler Certiication DiscoveryCutoff (non-expert)
Experts Expert Certification Reports Discovery Certification Expert Cutoff
Motion for ClassCertification Response Motion for ClassCertification to ofMotion for Class Reply in Suprport Certification
MeritsDiscovery Cutoff
Mediation ExpertReports- Merits
Joint Case Management Strtemsrt
Case 5:08-cv-00555-RS
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1
Event
Propased Deadlhe
2 ExpertDiscovery Cutoff- Merits 3 DisoositiveMotions 4
b
OtherMotions (otherthen Motions in limine)
(hearing motions on in PretrialCoderence: instructions verdict limine,agreedjury and 6 proposed direquestiols) voir forms,
Pre-fial Brieft Triat Dale
7 8 9 10 11
18.
Trial: Plaintiff seeksa tial by jury on all countsfor which it is available. Plaintitr
12 13
14 15 16 17 18 19 20 21 22 23 24 25 26 27 28
of believos at this s0age the proceedingsthaf her case in chief will take t to 2 woeks. ASIC that will take2 weeks. antioipates its defense 19. Disclosureof Non-party InterestedEntities or Persons:Plaintiff se&s that she has
no non-party interestede,ntitiesor prsonsto disclose. ASIC statesthal other entities knovm to have eitlr: (i) a financial interst in the subject matter in confiovensyor in a party to the proceeding or (ii) any other kind of intoest that could be substantiallyaffectedby tle outcomeof the proceedinginclude EMC and the direct and indirect parentsof ASIC, Interfinancial Inc, and Assurant, Inc. DaJedJu1y8,2008 SPECTERSPECTEREVAI\IS &MANOGUE,P.C. By: dJose,phN. Kravec"Jr. JosephN.Kraveo,Jr. (Pa.LD. #68992) The 26e Floor, KoppersBuilding Pittsbrugb,PA15219 (412)642-nAA Telephone: Facsimile:(412)642-2309 Email: jnk@ssem-com HELLEREHRMANLLP By
slP*erl,Iiecker PeterS. Hecker
Arna S. Mclean, Esquire 333BushSteet SanFrancisco, CA9410+2878 Telqrhone:(415)772-6080 Facsimile:(415)7724268 Email@ [email protected]
Jolnt CaseManagement Sta&ment
Case 5:08-cv-00555-RS
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M. James Pieta Esquire ID No. 55406) @A PWTZLAW OFFICE ldtchell Building 304Ross Steelt'Suite700 Pifisbugb,PA 15219 (412)2884333 Telephone: Facsimile: (412)2884334 F-ail: jptetz@ideklqnrcom Yunker, Esquire Steve YUNKER& SCHNEIDER Suite1400 655WestBroadway, SanDiegq CA910l (619)233-5500 Telephone: (619)233-5535 Facsimile: F.mail SFY@,yslaw,com : ATTORT{EYS PLAINNFF FOR
Fmrk Bu( Bsquire Denise Fee, A" Esquire DawnB. Williams,Esquire JORDENBURTLLP 1025 Thomas JefersonSteet,NW Washingtoa 20007-0805 DC Telephone: Q02)965AUA Facsimile: 965-8LM QO2) Fmail: feb@jord@usacom da@jordelrusaoom ilbw@jordelrusacom ATTOR'{EW FORDEFBAIDANT
1(l
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