Opinion
NOT TO BE PUBLISHED
APPEAL from an order of the Superior Court of San Diego County, Super. Ct. No. 37-2008-00093086- CU-NP-CTL Richard E. L. Strauss, Judge.
HUFFMAN, Acting P. J.
From late October through early November 2007, eight wildfires raged across large portions of San Diego County, California. Among these were the Witch Creek (Witch), Guejito, and Rice Canyon (Rice) fires, which gave rise to numerous related lawsuits brought by several sets of plaintiffs, including this proposed class, all seeking recovery of property damages or other compensation from numerous defendants, chiefly the utility providers, defendants and respondents San Diego Gas & Electric Company and its parent company, Sempra Energy (together SDG&E or Defendants). Among the parties seeking recovery against Defendants are numerous individuals, businesses, property insurers and governmental entities, as well as this and another proposed class of plaintiffs. (Code Civ. Proc., § 382.)
All further statutory references are to the Code of Civil Procedure unless otherwise noted. Under section 382, an ascertainable class and a well-defined community of interest in the questions of law and fact affecting the parties to be represented must be shown. (Linder v. Thrifty Oil (2000) 23 Cal.4th 429, 435 (Linder).)
During the past two years, the trial court has undertaken extensive and well designed coordination efforts to manage its calendar for all of these fire-related complex cases, including filing of pleadings, discovery, and motions. (§§ 128, 187; Cal. Rules of Court, rule 3.750.) In the proposed class action before us, which was designated as part of this coordinated complex litigation, the trial court denied the motion by plaintiffs and appellants Edith Cortez et al., who are the designated class representatives (Plaintiffs) seeking certification of a class action against Defendants, to redress class member claims for less than $7,500 each, for loss of use or living expenses. Plaintiffs defined their class as the "evacuee class, " whose 100, 000-plus members sustained such losses under that amount, upon being forced to evacuate their homes or workplaces by the Witch, Guejito or Rice fires (the three fires).
At the time of the hearing on Plaintiffs' motion, the trial court also had before it a companion motion brought by the other proposed class, consisting of those homeowners or business owners who sought to prove Defendants' substantial factor liability for all property damage and related expenses (displacement, etc.) sustained by the class, from the effects of the fires. (Downing v. SDGE (Super. Ct. San Diego County, 2008, No. 37-2008-00093086-CU-PO-CTL) (the "liability-only class").) That ruling is also on appeal. (D055820.) In January 2010, we issued an order accepting the parties' stipulation to coordinate these appeals for briefing, oral argument, and disposition. We expedited the appeals and now issue separate opinions on them.
In this appeal by Plaintiffs of the ruling denying certification of their proposed evacuee class, they first argue the trial court abused its discretion when it concluded that such a class was not sufficiently ascertainable as to number and identity of its members. They claim the trial court compounded such alleged error by determining this evacuee class "did not encompass a well-defined community of interest in which common issues of fact and law predominate." Plaintiffs argue their proposed class representatives' claims are typical of the class, and their representation will be adequate.
Two of the three proposed class representatives seek loss of use damages for the effects of the Witch/Guejito fire complex on them (Edith Cortez, Karen Leasum), and the other (Grace Hays) seeks damages based on the effects of the Rice fire.
Plaintiffs further contend the trial court applied the wrong legal criteria to conclude that class treatment would not be a superior mechanism for providing redress for losses suffered by the putative members of this evacuee class. (Sav-on Drug Stores, Inc. v. Superior Court (2004) 34 Cal.4th 319, 332 (Sav-on Drug); see Basurco v. 21st Century Ins. Co. (2003) 108 Cal.App.4th 110, 121(Basurco).)
Defendants, joined by respondent Cox Communications, Inc., et al. (a named cross-defendant in the SDG&E/Sempra cross-complaint for indemnification; sometimes collectively, Defendants or Respondents), argue on appeal that the trial court acted well within its discretion when it denied certification of the proposed wildfire class. Respondents take the position that certification of such an evacuee class was unjustified, because the class was not reasonably ascertainable, individual rather than common issues would predominate, and none of the proposed class representatives is typical in their claims. Additionally, Respondents contend there is no basis to conclude a class action would be superior to the pursuit of any individualized actions, similar to those coordinated actions that have been filed by numerous other individual and business plaintiffs (designated here the "Many Plaintiffs"; over 1, 088 in number, bringing over 72 consolidated individual and group actions).
Plaintiffs are alleging a single entity liability theory against defendants SDG&E and Sempra. For purposes of this opinion, we refer to these defendants collectively. These class plaintiffs did not name Cox in their master complaint, instead suing only the SDG&E defendants. Cox is participating in the appeal as a cross-defendant and respondent, separately filing its own briefs and collaborating in the preparation of the respondent's appendix. Plaintiffs have put forward no sufficient grounds to object to its participation.
We agree that Plaintiffs have failed to carry their burden of demonstrating that any of the applicable criteria for class certification are satisfied by their proposals. On this record, the trial court had the discretion to deny certification, when it assessed the evidence as lacking substantiality to show the class would be ascertainable from the use of official and other documents showing the evacuation zones and the residences or workplaces of potential class members. All 100, 000 or more proposed members of the class evacuated for different time periods, under different official orders, from different properties, each with their own unique characteristics, leading to significant difficulties in defining the identity of the class.
The court was likewise justified in finding individual issues will predominate over common issues on establishing any liability of Defendants for causation in fact of the displacement damages sustained by the various putative class members. (See Ali v. U.S.A. Cab Ltd. (2009) 176 Cal.App.4th 1333, 1346 (Ali).) The key issue of causation of class-wide harm, as part of the liability determination and as affected by Defendants' numerous affirmative defenses, could not feasibly be handled collectively.
Moreover, the trial court set forth an alternative, adequate basis for denial of the motion, i.e., lack of superiority of class treatment for the evacuee class proposal. Plaintiffs, as potential class representatives, proposed a statistical method for identifying the class and assessing its damages that the court justifiably found would have relied "on speculative, unsubstantiated and unsworn information as the basis for a judgment against Defendants. Plaintiffs' [proposed trial plan of] determining the amount of damage with this information and then requiring proof of injury after judgment is entered is unfair." Other forms of seeking recovery were not shown to be unavailable or unrealistic for any proposed class members.
On appeal, Plaintiffs have been unable to show any sufficient reason for this court to disturb the trial court's demonstrated, conscientious exercise of discretion in assessing their proposed proof for defining the class and resolving the liability issues. Nor have Plaintiffs shown how class treatment might provide a superior means to adjudicate their claims. (Basurco, supra, 108 Cal.App.4th 110, 121; Caro v. Procter & Gamble Co. (1993) 18 Cal.App.4th 644, 654-655.) The order denying class certification represents a correct analysis of the relevant legal principles and an appropriate exercise of discretion, and must be affirmed.
FACTUAL AND PROCEDURAL BACKGROUND
A. October-November 2007 Firestorm
From October through early November 2007, seven Southern California counties were enduring 11 major wildfires, driven by the notorious Santa Ana winds and other adverse weather conditions. In San Diego County, seven of the eight localized fires burned north of Interstate 8 (including these three), while one more (Harris) burned south of Interstate 8. Some of the fires merged with others and were designated as fire complexes by firefighters and responsible agencies, such as the state Department of Forestry and Fire Protection (Cal Fire).
In response to the spread of the fire complexes, starting October 21, 2007 and extending for 16 days, many evacuation orders were issued by the San Diego County Sheriff's Department and other entities, and were lifted at various times. Shelter was provided to evacuees by various governmental and nonprofit agencies. After extensive firefighting efforts, the fires were mainly contained by October 31, 2007, but some continued into early November 2007. These three fires burned at least 1, 424 homes and caused the evacuation of more than 300, 000 persons. Eventually, more than 20, 000 insurance claims were filed by various residents and businesses for property damage and loss of use.
B. Fire-Related Actions are Filed; October 2008 Case Management Orders
After the smoke cleared, numerous other plaintiffs filed individualized and group fire-related actions in the trial court against Defendants and others (including Cox and a contractor, Davey Tree Services), seeking recovery for property damage and/or personal injury. Other actions against Defendants were filed by property insurers and governmental entities, as well as this and the other class action. All actions were designated as complex litigation and in October of 2008, the trial court issued several case management orders (CMO). (Cal. Rules of Court, rule 3.750(c).)
In those orders, the court exercised its inherent powers and those granted by sections 128 and 187, to organize and coordinate the related wildfire complex cases. The court identified four groups or units of plaintiffs, (1) governments, (2) insurers, (3) Many Plaintiffs' individual actions, and (4) class actions. Liaison counsel were appointed for the most closely related fire complex, the Witch/Guejito fire complex, and also separately, for the Rice fire. The court organized pretrial discovery on the liability issues, with one discovery track per fire allowed, and set up a procedure for filing and service of pleadings, including the master complaints, answers, and other responsive pleadings.
In an additional order, the court provided that master complaints should be filed in each of the above categories, and existing cases would be consolidated with the relevant master complaints. Parties were permitted to adopt all or part of the master complaints and add to them. Two different sets of class representatives (this evacuee class and the "liability-only" class) filed their own pleadings and then adopted the master class complaints.
C. Master Class Complaint; This Class's Three Versions
The general allegations in the master class complaint state that government investigations and reports preliminarily indicate that Defendants' operation of its power lines for transmission and distribution of electricity substantially caused the ignition of the three fires. The chief governmental report was issued by the San Diego County Office of Emergency Services (OES), the "San Diego County Firestorms After Action Report, " and was prepared by a consultant, EG&G Technical Services, Inc. (the After Action Report). It is a 147-page compendium of 69 pages of text, analyzing the causes and response to the 2007 wildfires, together with tables of press releases and 12 pages of maps of the evacuation zones and fire perimeters, all of which are often referred to by the parties here. It also contains numerous other appendices, including organizational charts for emergency operation and recommendations for future improvements in fire responses. Separate Cal Fire investigations are also referenced.
According to such reports, the Witch fire ignited near Santa Ysabel, during a time of extreme drought, when two 69 KV lines came into contact and threw off sparks for an extended period, igniting everything nearby.
The Guejito fire was described in the reports as starting in the San Pasqual Valley, when an energized electrical distribution line came into contact with the lashing wire that was affixed to a communication line belonging to Cox, causing ignition in the area. The Guejito fire eventually merged with the Witch fire, all of which merged with another fire, which is not the subject of this action (the Poomacha fire).
The reports also indicated that the Rice fire started near Rainbow, when Defendants' power lines came into contact with excessive vegetation, causing sparking and ignition in the area.
The master complaint for the class plaintiffs additionally alleges Defendants, in operating their business as a single entity, were aware of environmental conditions giving rise to foreseeable fire danger during the late summer and fall months, such as drought, high temperature, low humidity, dry vegetation, and annual Santa Ana winds. Defendants allegedly were negligent in their operations under those conditions, and Plaintiffs claim the fire complexes created conditions of trespass, nuisance, and inverse condemnation.
Previously, the inverse condemnation claims for the evacuee class were disposed of by demurrers sustained without leave to amend.
The operative pleadings for the proposed evacuee classes were filed by Cortez and Leasum (Witch/Guejito) and by Hays (Rice), in the format prescribed by the trial court's case management orders, and were each amended several times.
As exhibits attached to each of the evacuee class complaints, Plaintiffs provided numerous OES maps of the progress of the fires and evacuation boundaries, and informal timelines of governmental evacuation orders, apparently for all eight of the fires.
The proposed evacuee class has been defined in several ways during the course of the pleadings and motion procedures, as will later be discussed. In general, the class representatives seek general damages of less than $7,500 each, for economic displacement expenses incurred due to the effects of the fires (not property damage).
It is important here to note that although the evacuee plaintiffs originally each adopted all of the standardized six causes of action from the master class complaint, and their operative pleadings continue to include those claims, they now, as of the time of the hearing and this appeal, represent that they seek to pursue only a negligence cause of action, and only for loss of use/living expenses/lost wages. No formal request to amend the pleadings or dismissals have been filed, however.
An individual action seeking less than $7,500 recovery may be brought either in the small claims court under section 116.221, or as a limited civil case in the small claims division, under section 87. We also note that although the Leasum version of the evacuee class complaint seeks general damages for anxiety, the evacuee plaintiffs as a class do not claim emotional distress damages.
D. Numerous Answers and Cross-Actions are Filed
In their answers to the class complaints, Defendants asserted numerous affirmative defenses that would pertain to negligence theories, including intervening and superseding causes, "Act of God and/or Vis Major, " "unavoidable accident, " comparative negligence of plaintiffs or third parties or failure to mitigate damages, and/or preemption under Public Utilities Code section 1759 (Cal. P.U.C. jurisdiction).
Defendants denied any negligence per se, based on alleged violations of particular regulatory provisions on the supply of electricity; it is currently unclear if the evacuee class plaintiffs are now pursuing that particular theory, and we need not summarize it. As to the general negligence claims, we note that Defendants' "vis major" defense, in the Oxford English Dictionary Online (2d ed. 1989), is defined as something with "such a degree of superior force that no effective resistance can be made to it." This can also be called an "Act of God" defense, as explained in 6 Witkin, Summary of California Law (10th ed. 2005) Torts, section 1199, page 577: "An 'act of God, ' i.e., an extraordinary natural force, that brings about harm different from that threatened by the defendant's negligence is a superseding cause; but if it merely increases or accelerates the results of the defendant's negligence, it is not."
Defendants filed a cross-complaint against Cox and others, alleging causes of action for equitable indemnity and contribution, contractual indemnity, breach of contract, and declaratory relief. Defendants cross-complained against Cal Fire for equitable indemnity and contribution. Cox answered the cross-complaint, as did other cross-defendants.
Numerous governmental entities filed their own actions against Defendants seeking recovery for property damage and destruction of natural resources, and for expenses of firefighting and other services rendered. Other coordinated pleadings were brought by property insurers (subrogation actions).
E. Motion: Proposed Evacuee Class and Opposition
Originally, Plaintiffs filed a joinder in an earlier motion to certify the related liability-only class. The court set a hearing for all class motions to be heard together, and Plaintiffs filed their own motion for class certification, which was heard in June 2009 with the companion motion. While the motion was pending, counsel for the evacuee class amended its proposed class definition three or four times, and proposed to do so again at the hearing.
As the operative class definition is now summarized in the ruling of the trial court, it includes: "All individuals who resided within an advisory or mandatory evacuation zone of [these 3] Fires, who evacuated at any time between October 21, 2007 and November 5, 2007, and who sustained damages occasioned by such evacuation." It defines the damages sought by the method of excluding numerous persons from the class, chiefly, those who sustained more than $7,500 in damages, as well as those who "sustained evacuation-related damages other than for loss of use of their residence, additional living expenses, and/or document[ed] lost wages." (Italics added.) Further, no class plaintiffs would be seeking recovery for any form of physical and/or emotional damage.
Also specifically excluded from the class were certain persons who might have a conflict of interest, as follows: "(d) employees, representatives, officers, or directors of Defendants; (e) Plaintiffs' and Defendants' counsel and their families; (f) all current members of the California judiciary, court employees and their families; (g) all federal, state and local governments or municipalities, including subdivisions thereof...." Those exclusions do not raise any particular issues in this appeal.
Next, with regard to additional persons to be excluded from the evacuee class, the proposed class definition specified the Many Plaintiffs and other potential "opt-out" parties, as follows: "(h) all individuals who, prior to the Certification of this proposed class, filed a non-class action civil lawsuit seeking damages from any Defendant listed in the various master complaints on file in this court, which relate to any or all of the [3] Fires; and (i) all individuals who timely 'opt-out' of this class using the correct protocol for 'opting-out' that will be formally established by this court."
Plaintiffs' motion for certification asserted that their proposed class was sufficiently ascertainable from the detailed governmental reports about the origin and spread of the fires, together with records of Defendants, county property records, and reverse-911 evacuation call records. Plaintiffs contended there is a well-defined community of interest in questions of law and fact among the class members, such that certifying the class would result in manageable, efficient and superior ways for proceeding with the action. They argued many individual small claims actions would be too cumbersome, and some unsophisticated plaintiffs might be unwilling to sue or unable to recover against large entities such as Defendants, which might result in a failure of justice, such as class actions are meant to prevent.
Plaintiffs contended they were proper representative plaintiffs, because different evacuation zones could be ascertained from public records, such as the After Action Report, and from records maintained by Defendants. Then, causation of all claimed displacement expenses could be clearly established as to the residents and workers within those zones, because it could be inferred that all class members evacuated because of the fires, so more individualized proof was unnecessary. Originally, Plaintiffs estimated that there might be as many as 300, 000 persons seeking such damages, but later, they changed the estimate to 100, 000. One proposed class representative, Cortez, estimated her damages for loss of use of her property and incidental expenses at $600.
In support of the motions, Plaintiffs submitted expert evidence from professionals in the litigation field, as well as declarations by proposed class representatives about their willingness to serve. Plaintiffs' expert statistician Dr. James L. Gibson provided a declaration describing how widely accepted statistical methodologies could be utilized to determine whether damages were sustained by individual class members in each evacuation zone, and to what extent. Dr. Gibson stated that statistical sampling through telephone and other surveys of around 2, 000 persons could be used for accurate determinations of what percentage of the proposed class had suffered damages related to evacuation, and in what types and amounts. This method would address both the fact of damages (whether and how many residents evacuated) and the amount of damages (costs of evacuation). He reviewed documents such as the After Action Report, which could be used by experts to determine the evacuation zones and how many people had evacuated in response to these three fires, and then the amount of damages that they suffered could be statistically extrapolated. A litigation notification program could then be designed and implemented to reach members of the class. Dr. Gibson explained that this information, together with a forensic accountant's expertise in calculating damages, would suffice to determine damages on a class-wide basis.
Plaintiffs' forensic certified public accountant, Robert Wallace, provided a declaration stating that based on demographic statistics, newspaper articles, and governmental reports, he expected to be able to reasonably estimate the number of persons evacuated, for how long, and what per day value of loss of use they had incurred, as well as a total loss of use damages figure, to make a determination of class-wide damages. Property values could be ascertained from recorded documents, to establish loss of use amounts. He would use average per diem amounts for lodging and food from available public sources, together with telephone survey information gathered by the statisticians, to accurately estimate total out-of-pocket damages claimed.
Plaintiffs also submitted expert legal opinion about the feasibility of a class action in these circumstances, but objections to the declaration were sustained.
Extensive opposition was filed by Defendants to the motion, challenging any contention that the proposed class members could be accurately identified or their claims estimated or resolved in any manageable way. Defendants provided extensive lodged documents, including the After Action Report, and their own expert declarations attacking the conclusions of Plaintiffs' expert statistician and accountant.
Respondent Cox relied on the declarations of its environmental hazards expert, geographer Dr. Thomas Cova, who studies wildfire evacuation analysis and modeling. Dr. Cova stated that his research showed that there was no true "mandatory" evacuation order, and that approximately 16 percent of persons ordered to evacuate will not do so. Within voluntary evacuation zones, 70 percent did not evacuate. Those who did may have done so in response to a particular order, or for more general reasons. His information states that up to 65, 000 people who lived outside any evacuation zone did evacuate. Respondent Cox specifically argued that it could not be ascertained which persons were required to be evacuated by the only fire in which Cox is sought to be held responsible (Guejito), particularly since that fire eventually merged with the Witch fire.
All Defendants pointed out that the discovery conducted so far had showed somewhat different behavior by potential class members in response to evacuation orders, as well as very different damages, based on their individual decisions on where to go and what to do. Numerous lodged documents were submitted in support of these contentions, including deposition experts from potential class members, and timelines of evacuations and maps. Defendants also supplied copies of legal advertising in which some of the Many Plaintiffs' counsel and others had sought new wildfire clients or publicized their efforts to recover damages from these Defendants.
According to Respondent SDG&E's expert statisticians, Dr. Edward A. Blair and Dr. Jessica Pollner, the method that the proposed class plaintiffs were proposing for assessing damages through sample surveys was problematic and unlikely to be accurate. Dr. Blair disagreed with Dr. Gibson's proposed sampling methods, as likely to create bias due to possible changes in local populations since the time of the fire, or due to lack of responses to the survey, or due to lack of memory about damages incurred, or due to how important the topic was to the responder ("topic salience"). Dr. Blair also examined some of the responses to interrogatories on damages given by the proposed class representatives, and noted that they were rough estimates and imprecise responses, and did not distinguish between net versus gross expenditures. There also might be damages reduction issues related to insurance settlements and any related recovery.
Dr. Pollner concurred, adding that it will be difficult to obtain reliable data and that Plaintiffs' proposals were too general and did not have adequate foundation to constitute generally accepted sampling and survey research design. Defendants additionally argued that Plaintiffs were unable to demonstrate the superiority of class certification in this context, where the trial court was already taking numerous effective steps to manage the numerous individual and group claims filed to date.
Opposition was also filed by the Many Plaintiffs. They are separately represented by different counsel and strenuously contend that they wish to remain in control of their own cases.
This group has been granted amici curiae status in the related appeal. Although Cox represents that there are now over 2, 000 individuals/businesses in the Many Plaintiffs group, this court will review the circumstances in the record as of the time of the ruling. (Reese v. Wal-Mart Stores, Inc. (1999) 73 Cal.App.4th 1225, 1237.)
In their reply papers, Plaintiffs submitted supplemental declarations of their own experts, to rebut the defense criticisms. Dr. Gibson reviewed his proposals and explained how they comply with current social science standards on how best to conduct surveys of samples of populations. He noted that Defendants were relying on some of the same type of survey data as he proposed to collect (telephone interviews using a random digit dial sample). Other surveys and reports have utilized similar ZIP code data and evacuation area information to draw conclusions about residents who were affected by the fires (e.g., reports by the San Diego Institute for Policy Research/Competitive Edge Research). Dr. Gibson would limit his analysis to statistics, thus properly relying on the expertise of other professionals regarding the origins or progressions of the three fires.
In Wallace's supplemental declaration, he defended his methodology and explained how damages calculations could be made more reliable and accurate. Plaintiffs also relied on their Attorney McGuire's declaration, attaching the county and state fire maps that Plaintiffs proposed to use to identify the class of plaintiffs by specific geographic areas that were evacuated, and for how long, and due to which fires.
Defendants were allowed to file further opposition. In sur-reply, Plaintiffs again amended their class definition, to delete any reference to class members "who sustained damages occasioned by such evacuation, " and to delete specific items of damage.
F. Ruling
Oral argument on the two certification motions was held in June 2009, about nine months after the initial CMO orders were made. The hearing was continued twice for further briefing, in response to the efforts by Plaintiffs' counsel to continue to amend the class definition, to accommodate objections raised by Defendants. Ultimately, the operative amended evacuee class definition focused upon the following proposed group of plaintiffs: "All individuals who resided within an advisory or mandatory evacuation zone of the [3 fires], who evacuated at any time [in the 16-day period], and who sustained damages occasioned by such evacuation [loss of use of residence/additional living expenses/documented lost wages, all amounting to less than $7,500, and excluding those claiming property damage, or physical/emotional damage, etc.]...."
At the hearing, counsel representing the group of insurers that had filed subrogation actions also opposed the motion. Insurance counsel explained that approximately 20, 000 insurance claims had been filed and mostly paid in the matters. Due to the different kinds of coverage afforded to homeowners in the wildfire areas, some insurance payments to homeowners for coverage of their damaged residences had been collected by banks and other trust deed holders. However, that was not true of other kinds of coverage, such as personal property and loss of use, which were not payable to financial institutions.
At the time of the hearing in June 2009, the insurers were in the process of settling their subrogation actions against Defendants.
During the hearing on the liability-only motion, while all counsel were present, the trial court invited both plaintiff and defense counsel to offer input on how to avoid the necessity for each individual plaintiff claiming property or other damage to have an individual trial on Defendants' liability for causing the fires. The court stated: "We are going to find a way so we won't have thousands of lawsuits. Rather than mandate that way, I've dealt with all of you in a way [that] I want your suggestions in how that's going to happen. No one wants to try this over and over and over again.... [¶]... [¶] I can say this: we are not going to try origin and causation and point of origin and causation a thousand different times. It's not going to happen. I don't think any of you want it to happen."
During the hearing, counsel for the proposed evacuee class explained its trial plan, to establish zones to define who belonged in the evacuee class, depending on which fires caused which evacuation. Notification of class members would then take place, perhaps of about 100, 000 class members. Loss of use and possession damages could then be established (such as $50 million aggregate), based on a pure negligence cause of action, since no other causes of action were going to be pursued. Claims procedures would follow.
Plaintiffs argue there is no overlap between their evacuee class, asserting limited loss of use damages, and the liability-only class representatives, since they also assert property damage, and are therefore excluded from the evacuee-only class (although they likewise claim loss of use, in the related motion and ruling also on appeal). The two classes appear to be mutually exclusive. It is a closer question how the evacuee class relates to the Many Plaintiffs group, since that group was also presumably evacuated, but is already represented and claims much greater types of damage, and is opposing the certification of this class.
In opposition, Defendants disputed that there would be any failure of justice if the proposed evacuee class were not certified, because they said over 1, 088 private parties had already brought lawsuits, and they were the actual victims with the actual claims, who were motivated to pursue them. Defendants did not believe that the evacuee class belonged within the complex coordinated actions, since small claims or private proceedings were also available.
After hearing argument from all sides, the trial court confirmed its tentative order denying the requested class certification. After analyzing the evidence, the court concluded Plaintiffs did not carry their burden of showing that there was either an ascertainable class, or any "well-defined community of interest in the questions of law and fact involved affecting the parties to be represented." Nor had Plaintiff established that in any meaningful way, class treatment would be superior to alternative methods of adjudication.
The trial court prepared detailed findings and conclusions of law to support the ruling, which we will set forth in full in the discussion portion of this opinion. Plaintiffs appealed.
DISCUSSION
I
STANDARDS OF REVIEW AND INTRODUCTION
Class certification requires proof of a well-defined community of interest and a showing of how certification will provide substantial benefits to litigants and the courts, such that proceeding as a class would be superior to other methods. (Fireside Bank v. Superior Court (2007) 40 Cal.4th 1069, 1089.) Here, the trial court's order denying certification of the proposed class addressed all of the many basic criteria that have been developed on that question, and we will address these in turn.
On review, "In determining whether there is substantial evidence to support a trial court's certification order, we consider whether the theory of recovery advanced by the proponents of certification is, as an analytical matter, likely to prove amenable to class treatment. [Citation.] 'Reviewing courts consistently look to the allegations of the complaint and the declarations of attorneys representing the plaintiff class to resolve this question.' [Citations.]" (Sav-on Drug, supra, 34 Cal.4th at p. 327.) "Class actions are provided only as a means to enforce substantive law, " and these procedural issues are subject to that rule. (San Jose, supra, 12 Cal.3d at p. 462.)
A trial court ruling that is supported by substantial evidence normally will not be overturned " ' "unless (1) improper criteria were used [citation]; or (2) erroneous legal assumptions were made [citation]" [citation].... "Any valid pertinent reason stated will be sufficient to uphold the order." ' [Citations.]" (Sav-on Drug, supra, 34 Cal.4th 319, 326-327.) The stated reasons must be supported by the evidence or by any properly implied findings. (Evans v. Lasco Bathware, Inc. (2009)178 Cal.App.4th 1417, 1421-1422 (Evans); Massachusetts Mutual Life Ins. Co. v. Superior Court (2002) 97 Cal.App.4th 1282, 1287-1288.)
Before turning to the specific arguments, we first address the suggestions by the evacuee class on appeal that the trial court's ruling did not sufficiently accommodate all the changes Plaintiffs were making in their proposed theories of recovery and also in their proposed class definitions. Plaintiffs also complain that Defendants' arguments in opposition to their proposed class definitions, as amended, amount to a moving target, and contend that Plaintiffs are only seeking to fine tune their definition.
These charges by Plaintiffs are undermined by the record. Up until and during the time of the hearing, counsel for the proposed class was continuing to change the theory of recovery to be pursued (apparently ultimately limiting it to negligence), and also was continually redefining the class. In fact, Plaintiffs' counsel proposed to simplify it so greatly that no causation of loss requirement remained, nor any specification of damage. In its ruling, the trial court properly utilized the previous class definition language that would tie the claimed damages (lost use) to the evacuations actually made.
It is a fair assessment of this record to say that it was Plaintiffs who were constantly presenting "moving targets" on both their theory of recovery and definition of the class, making it difficult for the other parties involved and the trial court to understand the issues presented. The court nevertheless displayed extreme patience and discipline in allowing continuances of the hearing and in exhorting Plaintiffs to settle upon a workable proposed class definition. From the perspective provided on appeal, we find it most unseemly for Plaintiffs to argue that the ruling incorrectly fails to accommodate all of their changes (e.g., when the ruling discusses nuisance and trespass issues, to the extent that Plaintiffs were still appearing to pursue them). It is appropriate for this court to review the record as of the time of the ruling, and to examine whether there was an abuse of discretion demonstrated on the record provided. (Reese v. Wal-Mart, supra, 73 Cal.App.4th 1225, 1237.)
Although Respondents generally contend the record is insufficient to demonstrate the validity of any appellate claim of lack of substantial evidence to support the ruling, we find no such deficiencies in the record provided, and will accordingly address the merits of the arguments.
With those cautionary notes, we turn to the issues concerning the motion's proposal for an ascertainable evacuee class (pt. II). Next, we examine Plaintiffs' contentions they showed a sufficient community of interest, with respect to predominant common questions of law and fact, as well as "typicality" of the class representatives' claims and adequacy of the representation. (Sav-on Drug, supra, 34 Cal.4th 319, 334-335; pt. III).)
We can then focus upon whether the proposed class action was shown to be superior to other procedural frameworks for resolution of the class claims (pt. IV). On each of the main grounds for the ruling, we first set forth the reasoning of the trial court in its order, and then analyze the record support for the ruling in light of the applicable principles of law.
II
ASCERTAINABLE CLASS
A. Reasoning of Ruling
For a class to be ascertainable, Plaintiffs must demonstrate they have an objective and feasible way to identify the proposed class members. (Lockheed Martin, supra, 29 Cal.4th 1096, 1104.) In its ruling, the trial court summarized its conclusions on this criterion as follows:
"The amended class definition limits the class to persons who resided in an evacuation zone and were actually evacuated. While the change in definition makes the class more ascertainable than the original definition, it does not remedy all the problems. Plaintiffs assert it will be easy for a putative class member to determine if they are a class member by determining whether they live in an evacuation zone. Plaintiffs contend the [After-Action Report] identifies each advisory and mandatory evacuation zone and the fire with which it is connected. However, a review of the [After-] Action Report reveals not every evacuation order was associated with a single specific fire. For example, Sunday, October 21, 2007 at 2210, there is a mandatory evacuation of Ramona but does not identify the fire with which the evacuation is associated. This conclusion is also supported by Cox's [environmental hazards] expert. Plaintiffs also suggest that by looking at the 'Approximate Evacuation Zone Maps, ' putative class members can determine if they are class members. However, even utilizing these tools, the amended class definition still renders the class unascertainable. These maps are not specific and are only approximate and do not set definitive perimeters by which a putative class member could determine membership. Therefore, there is not an ascertainable class." (Italics added.)
B. Criteria and Analysis of Ascertainability of Class
As outlined in Global Minerals v. Superior Court (2003) 113 Cal.App.4th 836, 858 (Global Minerals), the factors utilized for determining the ascertainability issue are " '(1) the class definition, (2) the size of the class, and (3) the means available for identifying class members. [Citations.]' [Citation.] Closely related to the identification question is the manageability question. [Citation.] [¶] In attempting to define an ascertainable class, the goal is to use terminology that will convey 'sufficient meaning to enable persons hearing it to determine whether they are members of the class plaintiffs wish to represent.' [Citation.] 'Ascertainability is not a problem limited to the determination of damages so that it could be solved by decertifying the class after the questions of liability have been resolved. Rather, it goes to the heart of the question of class certification, which requires a class definition that is " 'precise, objective and presently ascertainable.' " [Citation.] Otherwise, it is not possible to give adequate notice to class members or to determine after the litigation has concluded who is barred from relitigating." (Ibid.)
To apply these criteria, we look to whether Plaintiffs made a substantial showing that utilizing the tools provided, evacuation zone schedules and maps from the After Action Report and elsewhere, would result in creating an ascertainable class. Plaintiffs estimated that more than 100, 000 people were potential class members, and they argued that excluding the fire victims who also claimed property damage (i.e., the liability-only class) would sufficiently clarify the class definition. However, Plaintiffs did not rebut the problems that Defendants had identified in their proposed approach, that response rates of members of the public to evacuation orders varies to a large extent, and that evacuation orders may pertain to more than one fire at a time.
From the maps and records shown to be available, it would be difficult for many of the putative class members to determine whether they would be eligible to join in the class action. These documents are not sufficiently detailed to supply enough information to determine which evacuation orders were attributable to the negligence of the Defendants, and thus to draw class boundaries, within which the class would be able to prove their alleged displacement damages to any degree of certainty. It is unclear whether establishing subclasses would resolve those problems.
In fact, Plaintiffs' trial plan at the hearing suggested that a trial would be necessary to establish evacuation zones, and only then would the means available for identifying class members and giving notice become clear. This seems to propose a backwards procedure, and did not amount to a substantial showing that an evacuee class was reasonably ascertainable. (Global Minerals, supra, 113 Cal.App.4th 836, 858.) The amended class definition failed to meet the standards of a " 'precise, objective and presently ascertainable' " class that would be manageable in liability and damages litigation on the class members' rights to recover from these defendants. (Id. at pp. 858-860.)
III
COMMONALITY FACTORS
A. Basic Community of Interest Standards
To support certification of the class, Plaintiffs must demonstrate a well-defined community of interest in the questions of law and fact presented that affect the proposed class members. (Linder, supra, 23 Cal.4th 429, 435.) This "commonality" requirement depends on three factors: " '(1) predominant common questions of law or fact; (2) class representatives with claims typical of the class; and (3) class representatives who can adequately represent the class.' " (Lockheed Martin, supra, 29 Cal.4th at p. 1104.)
To satisfy their burden in moving for class certification, Plaintiffs must show not only the existence of common issues, but also provide substantial evidence that the common issues will predominate, over questions that affect only the individual members. (Lockheed Martin, supra, 29 Cal.4th at pp. 1104-1108.)
Even though class certification questions are essentially procedural in nature, the court cannot avoid some inquiry into the merits of the issues to be raised as a class, for purposes of evaluating whether the required community of interest has been demonstrated. (Lockheed Martin, supra, 29 Cal.4th at p. 1104.) " ' "[T]he issue of community of interest is determined on the merits and the plaintiff must establish the community as a matter of fact." [Citation.] A " ' "... class determination generally involves considerations that are ' "enmeshed in the factual and legal issues comprising the plaintiff's cause of action." ' " [Citations.] In sum, the fact some evidence relevant to a class action determination may have been relevant also to the merits of the lawsuit did not preclude the court from considering such evidence at the hearing on [the plaintiffs'] motion for class certification.' " (Global Minerals, supra, 113 Cal.App.4th at p. 849.)
In determining if common questions of law and fact predominate over individualized questions, "the trial court must examine the issues framed by the pleadings and the law applicable to the causes of action alleged." (Hicks v. Kaufman & Broad Home Corp. (2001) 89 Cal.App.4th 908, 916 (Hicks).) The main question is whether "the defendant's liability can be determined by facts common to all members of the class...." (Ibid.)
B. Ruling: Insufficient Community of Interest on Common Questions
In its ruling, the court set forth the following reasoning to support its conclusion that common questions of law and fact do not predominate: "Similar to the arguments discussed above [ascertainability], there is no way to determine which class member was evacuated because of a specific fire. In addition, the issue of damage, as an element of the cause of action, is not presumed and must be adjudicated on a member by member basis. This lack of commonality prevents class certification. Thus, the amended definition is not appropriate for class certification."
The ruling continues: "It [is] unclear whether Plaintiffs are abandoning their real property claim of nuisance. Regardless, Plaintiffs are still asserting a cause of action for trespass. To the extent Plaintiffs continue to pursue nuisance or trespass claims, these claims are not amenable to class treatment." As noted above, the court properly analyzed the pleadings before it, and the concessions that Plaintiffs were making at oral argument were confusing at best. Plaintiffs cannot properly claim error simply because the court thoroughly addressed all the issues currently presented by the pleadings. (See § 581, subd. (k) [dismissal requests by a certified class must be approved by the court].)
The trial court further commented in this commonality ruling: "In the Sur-Reply, Plaintiffs provide [a] second amended definition [re: damages sought that were occasioned by evacuation]. This definition suffers from the same problems as Plaintiffs' original proposed definitions. By not limiting the damages to living expenses, the scope of damages defeats commonality by including extra cell phone minutes, diapers, extra meals, meals bought for others, air filters for cars, car rentals, car washes and dog food. When the determination of each class member's damage is increasingly diverse, it defies common questions of law and fact. [Citations.] This is going to be an individualized inquiry, especially as to whether those damages were actually caused by Defendants." (Italics added.)
The class defines damages incurred as less than $7,500, and excludes those persons who "sustained evacuation-related damages other than for loss of use of their residence, additional living expenses, and/or document[ed] lost wages." Plaintiffs apparently would define "living expenses" very broadly. The court again discussed this diversity of damages sought, in connection with its finding that the class representatives did not have typical claims. (Part IIID, post.)
C. Analysis: Lack of Predominant Common Questions of Law and Fact
Plaintiffs now seek to restrict their claims to negligence only, and assume that this would avoid any individuality problems with class treatment of liability and damages claims. Plaintiffs essentially argue that even if there are some individual issues on the extent of damages, there are enough common issues so that class treatment would be warranted on whether such displacement damages were caused by the negligence of Defendants in conducting their operations.
The trial court had a substantial basis in the evidence to treat the commonality issue as closely related to the ascertainability issue, for purposes of determining which fire caused which evacuations. It begs the question for Plaintiffs to argue that the same forms of damages were sustained by all potential class members, even if at different levels. Plaintiffs are still required to demonstrate how a chain of causation can be shown by common proof, from any negligence of Defendants, to the evacuation orders, to the residences or workplaces of class members, and then to their compliance with the orders, leading to some certain degree of uniform types of loss of use/living expense damages.
The problems in establishing such commonality of factual and legal issues are shown by the declaration of Cox's environmental hazards expert, Dr. Cova, who studied wildfire evacuation patterns and essentially found that human behavior is very unpredictable in that situation, in response to particular evacuation orders or in response to perceived environmental conditions. Dr. Cova said there is no true "mandatory" evacuation order, and that approximately 16 percent of persons ordered to evacuate will not do so. Within voluntary evacuation zones, 70 percent did not evacuate, while many people who lived outside an evacuation zone did clear out.
Even if Plaintiffs would pursue only a negligence claim, instead of their discarded nuisance or trespass theories, the authority of San Jose, supra, 12 Cal.3d 447, was still properly considered by the trial court. In San Jose, class certification was denied regarding plaintiffs who sought nuisance damages for decreased property value (airport noise and dust). "[A] class action cannot be maintained where each member's right to recover depends on facts peculiar to his case.... The rule exists because the community of interest requirement is not satisfied if every member of the alleged class would be required to litigate numerous and substantial questions determining his individual right to recover following the 'class judgment' determining issues common to the purported class. [Citation.]" (Id. at p. 459.)
Here too, significant individualized issues on causation of losses suffered by potential class members are addressed by certain affirmative defenses, such as intervening or superseding causes, third party conduct, or the lack of mitigation. Also, cross-defendant Cox's communication lines were evidently involved in only the Guejito fire, although that fire ultimately merged with the Witch fire. Even on a preliminary analysis of the merits, it is obvious at the class certification stage that various individualized issues are presented on causation of evacuee class damages, as well as the type and amount of damages. (Lockheed Martin, supra, 29 Cal.4th at p. 1104.)
It is unpersuasive for Plaintiffs to contend that their claims of an entire temporary loss of use, as distinguished from ongoing nuisance damages, are most suitable for class treatment. The same lack of common issues on causation by Defendants, of these particular loss of use damages, still exists. All 100, 000 or more proposed members of the class evacuated for different time periods, under different orders, from different properties, each with their own unique characteristics, leading to different levels of loss of use damages. Those circumstances remove the commonality of facts necessary for determining Defendants' liability. (San Jose, supra, 12 Cal.3d at p. 459.) We have discussed the significant causation problems regarding property damage in the companion opinion, Downing v. SDG&E (D055820, app. pending), and have no occasion to do so here, where only personal loss of use damage is pled. Nevertheless, Plaintiffs cannot convincingly show the required commonality of essential factual and legal questions on the right to recover on the evacuee class claims. (San Jose, supra, at p. 460.)
D. Analysis: No Adequate Showing of Typical Claims
Commonality requirements also include a showing of adequate class representation and typical claims. (Lockheed Martin, supra, 29 Cal.4th at pp. 1104-1108.) Plaintiffs attack the additional portions of the ruling that found no typical claim or adequate representation had been shown, and that state:
"Based upon the above discussion, no class representative will have a typical claim because it is unclear what constitutes a typical claim. Further, all of the class representatives are claiming damages beyond the scope of the amended definition of 'other than for loss of use of their residence, additional living expenses and/or documented lost wages.' Leasum claims new air filters and pet food. Cortez claims damages from added cell phone minutes. Hays claims she sustained damage from overdraft fees."
We have already noted the inconsistency in whether Leasum, as a class representative, seeks emotional distress damages, even though the definition excludes such damages from class damages. The court adequately dealt with this as follows: "In the Sur-reply, Plaintiffs contend Leasum's claims would not rise to the level of emotional distress, but that is irrelevant. Leasum is still claiming emotional distress damages."
Plaintiffs do not believe that this type of diversity of loss of use, living expenses, or lost wages damages among potential class members would lead any one of the proposed class representatives to pursue his or her own claims individually, at the expense of the common issues. (See Fireside Bank, supra, 40 Cal.4th 1069, 1090-1091.) Alternatively, they suggest that if these proposed representatives do not adequately represent the class, the trial court or this court should permit them another opportunity to find another representative, or to amend the class complaints, for purposes of redefining the class or modifying the theories on which they seek to recover, to ensure that any meritorious class claims can be pursued. (Kagan v. Gibraltar Savings & Loan Assn. (1984) 35 Cal.3d 582, 596; disapproved on another statutory ground in Meyer v. Sprint Spectrum L.P. (2009) 45 Cal.4th 634.)
In the respective showings by the statisticians, various proof problems were discussed on how to identify class members and also on how to estimate their loss of use damages in any reliable way. Plaintiffs have not offered any meaningful way to administer the proposed class claims to avoid problems with overbroad or excessively vague damages claims. From the respective evidentiary showings, and in light of the theories asserted and discarded, the trial court had a substantial basis to disregard Plaintiffs' claims that only uniform harms had been inflicted or uniform damages sustained by all of the proposed class members. (We discuss those evidentiary issues further in pt. IV, post.)
When the trial court cited in the ruling to such examples of the diversity of damages sought, it was justifiably concluding that they seriously undermine any claim by the three class representatives that their claims are typical. These examples also illuminate how difficult it would be to provide adequate representation to such a class, and Plaintiffs impliedly conceded this when continuing to change their proposed class definitions, throughout several amendments. Due to their evident difficulty in outlining a class definition that will include only potentially meritorious claims, their contention is unpersuasive, that an erroneously overinclusive class definition could be cured, by allowing parties that do not want to participate to opt out of the class format.
A class action " ' "will not be permitted... where there are diverse factual issues to be resolved, even though there may be many common questions of law." ' " (Ali, supra, 176 Cal.App.4th 1333, 1347, citing Block v. Major League Baseball (1998) 65 Cal.App.4th 538, 542.) The record does not reveal any abuse of discretion when the trial court determined that individual issues of fact and law predominate over common issues. (Global Minerals, supra, 113 Cal.App.4th 836, 857.) " '[W]e will not substitute our judgment of the suitability of class treatment for that of the trial court, as long as the trial court applied the proper legal principles and assumptions, and the ruling is supported by substantial evidence.' " (Ali, supra, at p. 1353.) On the commonality issues, the ruling is well grounded in the record and in the law.
IV
LACK OF SUPERIORITY OF CLASS TREATMENT
A. Basic Standards
" '[O]ne must not lose sight of the fact that the class action statute "is based upon the equitable doctrine of virtual representation, which ' "rests upon considerations of necessity and paramount convenience, and was adopted to prevent a failure of justice." ' [Citations.]" ' [Citation.] Accordingly, a class action should not be certified unless ' " ' "substantial benefits accrue both to litigants and the courts'' ' " ' [citation], and the moving party proves a class action is 'superior' to separate lawsuits by class members.' " (Ali, supra, 176 Cal.App.4th 1333, 1352-1353.) Even where a case may include predominating common questions of law or fact, a court has the discretion to evaluate class certification as inappropriate, based upon unmanageability or unfairness in the proposed class proceeding. (Ibid.; Basurco, supra, 108 Cal.App.4th 110, 120.)
Questions of manageability of a proposed class action arise both with regard to ascertainability of membership and superiority of treatment. (Global Minerals, supra, 113 Cal.App.4th at pp. 849-850; see pt. II, ante.) The courts must evaluate the costs and benefits of adjudicating plaintiffs' claims in a class action, as compared to the costs and benefits of proceeding through numerous separate actions. (Sav-on Drug, supra, 34 Cal.4th 319, 339, fn. 10.)
Where liability can be established on a class-wide basis, such as where a defendant's employment policies affect employees in the same distinct way, statistical methods of proof are appropriately used for calculation of damages that are due to eligible class members. (Sav-On Drug, supra, 34 Cal.4th at p. 333; Bell v. Farmers Ins. Exchange (2004) 115 Cal.App.4th 715, 750 (Bell); Daar v. Yellow Cab Co. (1967) 67 Cal.2d 695 at pp. 706, 714, 716.)
In general, it is discretionary with the trial court to decide whether to accept such statistical evidence for proving damages. (Bell, supra, 115 Cal.4th at p. 751.) In any case, the offered evidence must meet the usual criteria for sufficiency, that it is " ' "of ponderable legal significance... reasonable in nature, credible, and of solid value." ' " (Sav-On Drug, supra, 34 Cal.4th 319, at p. 328.)
B. Superiority/Manageability Ruling
In addressing the superiority issue, the trial court analyzed Plaintiffs' proposals as follows. Regarding the planned statistical analysis, using a telephone survey of about 2, 000 persons to determine the class identity and damages, the court discussed the opinions of Plaintiffs' expert, Dr. Gibson, as relying on a previous, original class definition, "which had a pool of persons who resided in the evacuation zone. The problem with this basis is the population of putative class members in the evacuation zone is not known. This problem is exacerbated with the amended definition which limits the pool to persons in the evacuation zones who were evacuated and had additional living expenses and/or lost wages. In addition, there are a number of persons excluded from the pool. Dr. Gibson does not explain how this pool will be determined other than by conclusorily stating he would use stratified random sampling."
The trial court's ruling found other problems with Plaintiffs' plans for proving what damages were incurred on a class-wide basis: "Plaintiffs' experts are relying on speculative, unsubstantiated and unsworn information as the basis for a judgment against Defendants. Plaintiffs' [proposed trial plan of] determining the amount of damage with this information and then requiring proof of injury after judgment is entered is unfair. The Second Circuit discussed similar issues in McLaughlin v. American Tobacco Co. (2d Cir. 2008) 522 F.3d 215 [(McLaughlin)]. The court found that using statistical analysis to estimate damages and then requiring proof of damage would result in an exorbitantly high damage award and violate defendants' due process rights. (Id. at pp. 232-233.) While the opinion is not binding, the reasoning is persuasive and applicable [to] the current motion. Further, Plaintiffs have provided no authority this type of information can serve as the basis for a damage award against Defendants. [¶] In addition, the evacuee plaintiffs have viable alternatives for recovery other than filing a claim in small claims court. Evacuee Plaintiffs could join individual plaintiffs in the current litigation. [Citation.]"
Finally, the court's ruling states, "Plaintiffs suggest the certification should be granted on the discrete issue of determining whether Defendants caused the fires. Limiting class certification to the issue of fire origin does not make class litigation a more viable option. That is the same question being asked by each Plaintiff in each of their respective cases. Further, for the reasons set forth in the discussion on the motion for class certification of a liability only class, this is not a superior method to adjudicate these claims. These Plaintiffs provide no plan or strategy describing how to deal with hundreds of thousands of individual determinations on damages even if the class were certified as to the issue of causation of the fires."
C. Criteria for Superiority/Manageability Analysis
On this point, we continue to inquire if " ' "(1) improper criteria were used [citation]; or (2) erroneous legal assumptions were made [citation]" [citation].... ' " (Sav-on Drug, supra, 34 Cal.4th 319, 326-327.) As discussed previously, we cannot fault the trial court in concluding that (a) the proposed evacuee class was not ascertainable, (b) no sufficiently common questions of law or fact were "predominant, " and (3) typicality of claims was absent. We next address the additional ground for the ruling, (4) that class certification would not provide a procedurally superior method of resolving the dispute.
To determine whether that ruling is supported by the record, we apply well accepted criteria for assessing any substantial benefits to the courts and the litigants. (Evans, supra, 178 Cal.App.4th at p. 1427; Basurco, supra, 108 Cal.App.4th 110, 118; Ali, supra, 176 Cal.App.4th at pp. 1352-1353.) Federal Rules of Civil Procedure, rule 23(b)(3) (28 U.S.C.) (Rule 23), allows class certification on a similar basis as argued here, if findings can be made that "the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy."
California law utilizes the same basic criteria for considering the appropriateness of class certification, as well summarized in Basurco, supra, 108 Cal.App.4th 110, 120, and in Ali, supra, 176 Cal.App.4th 1333, 1353: " '[(1)] The interest of each member in controlling his or her own case personally; [(2)] The difficulties that are likely to be encountered in managing a class action; [(3)] The nature and extent of any litigation by individual putative class members already in progress involving the same controversy; and [(4)] The desirability of consolidating all claims into a single action." (Basurco, supra, at p. 121 [here, designated as "criterion No. _"].)
By comparison, Rule 23(b)(3) has the same basic material to be considered, stated in a different order: "(A) the class members' interests in individually controlling the prosecution or defense of separate actions; [¶] (B) the extent and nature of any litigation concerning the controversy already begun by or against class members; [¶] (C) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; and [¶] (D) the likely difficulties in managing a class action."
In our case, the main disputed issues on appeal on the superiority issues relate to the above criterion No. (2), regarding the difficulties likely to be encountered in managing a class action. Specifically, there are dueling expert declarations with regard to the reliability of Plaintiffs' proposed statistical approach, both for identifying the class and for proving its loss of use damages through extrapolation or formula.
To a lesser extent, Plaintiffs argue that under criterion No. (4), certification is desirable, since claims of $7,500 or less may not be worth pursuing in litigation on an individual basis, in small claims court or elsewhere, so that a group action must be justified, particularly for proving causation or origin of the fires. The parties dispute any applicability of criteria Nos. (1) and (3), because these evacuee class members would not necessarily fit into other existing groups of plaintiffs, such as those who sustained property damage (the liability-only class) and/or the Many Plaintiffs, who claim greater damages and are separately represented in related actions.
D. Statistics as Proof: Identity of Class Members or Extent of Damages
The difficulties in managing the proposed class action were the subject of competing expert declarations provided by statisticians, a forensic accountant, and an expert on environmental hazards, specifically on the behavior of populations during wildfires with respect to evacuating their homes. Plaintiffs' attorney McGuire also provided a reply declaration about his consultation with such experts and his Internet research.
In the trial court's findings about lack of superiority or manageability of the proposed class, the court relied on a false advertising case involving tobacco, McLaughlin, supra, 522 F.3d 215, 231-233. There, the federal court criticized the claimants' proposed use of statistics and surveys both to define the class (smokers who had purchased "light" cigarettes over a long period, believing they were less harmful), and to estimate its recovery for misrepresentations. We observe that this federal case must be distinguished, insofar as it expressly disapproved any class "fluid recovery" theory, since section 384 would permit fluid recovery here, in a proper case. However, the federal court in McLaughlin makes other applicable points about the problems of using statistical evidence to establish the size of a proposed class that seeks to hold certain defendants liable for certain widely effective conduct (there, advertising). For example, in deciding whether issues susceptible to generalized proof "outweigh" individual issues, the courts must ensure that certifying a class will include only that number of plaintiffs actually injured by defendants, and the courts may only permit recovery that has a direct relationship to the amount of "economic harm actually caused by defendants." (Id. at p. 231.)
Section 384 allows for the distribution of unpaid residual damages in class action litigation, according to court order and a reporting process.
Here, as in McLaughlin, it makes no sense for a court to allow the " 'class as a whole' " to be substituted for the individual members of the class as claimants, at the liability stage, since "then the number of claims filed is of no consequence and the amount found to be due will be enormous, " and possibly unjustified. (McLaughlin, supra, 522 F.3d at p. 232.) The court in McLaughlin explained: "Roughly estimating the gross damages to the class as a whole and only subsequently allowing for the processing of individual claims would inevitably alter defendants' substantive right to pay damages reflective of their actual liability." (Ibid.; see also In re Pharmaceutical Industry Average Wholesale Price Litigation (1st Cir. 2009) 582 F.3d 156, 196-197 [in which McLaughlin was found distinguishable in its disallowance of common proof for establishing both class reliance and causation, because in the Pharmaceutical opinion, an antitrust/unfair business practices case, there were fewer individualized circumstances of reliance, and class-wide proof of liability was permissible].)
This court discussed other case authority on the problems of statistical proof of liability and/or damages in the class action context in Evans, supra, 178 Cal.App.4th 1417, with reference to Bell, supra, 115 Cal.App.4th 715. In the employment practices context (e.g., Bell), the class members' rights to recover can be established through common proof, and then statistical approaches are appropriately utilized for establishing individual damages amounts. (Evans, supra, 178 Cal.App.4th at pp. 1431-1432; see Hicks, supra, 89 Cal.App.4th at p. 916.) The same is true in the antitrust context. (See Evans, supra, at pp. 1431-1432; In re Cipro Cases I & II (2004) 121 Cal.App.4th 402, 414-416.)
In the property damage context, it is more difficult to establish that each class member has a right to recover through the use of common proof. In Evans, supra, 178 Cal.App.4th at pages 1430 through 1431, we explained that establishing liability to the class or to class members may depend both on proof of a defective product and also on proof of certainty of damages (i.e., whether each individual's property was actually damaged by the defective product, a shower pan). The amounts of damage attributable to the product defects also would likely differ, to such an extent that the use of a formula to extrapolate damages to a defined class was not suitable. (Id. at pp. 1431-1432.)
Likewise, in Frieman v. San Rafael Rock Quarry, Inc. (2004) 116 Cal.App.4th 29, in which a proposed class sought nuisance damages from noise generated by the defendant's quarry operations, certification was denied, for lack of uniformity in the type and degree of impact among the neighboring class members. (Id. at pp. 41-42.) Expert witnesses established that there were many differences among potential class members on the issues of liability to them for nuisance, "as well as in the nature of the damages suffered." (Ibid.) No abuse of discretion was found in denial of certification, since there was such a potentially wide disparity in the amount of damages recoverable by each class member, and individual issues almost certainly predominated over any common issues. (Ibid.)
In our case, the class manageability issues revolve around (1) how the pool of potential class members will be determined, based upon telephone surveys and the maps and records of the evacuation zones, and upon statistical analysis of that pool, to determine who resided in those zones and who was not specifically excluded from the class; and (2) what extent of loss of use, living expenses, or lost wages claims were actually suffered by each potential class member, also to be determined through telephone surveys asking about sample amounts of self-reported damages. Major problems exist in so defining the evacuee class, in that the unrebutted expert testimony was that evacuation orders are not universally obeyed. Other problems arise in creating any persuasive, reliable showing that loss of use damages were incurred on a class-wide basis, when both overall and specific damages estimates would evidently be based on surveys that took in only "speculative, unsubstantiated and unsworn information" as the basis for computing a class member's right to recover, and for how much.
The trial court additionally relied on its related ruling on the motion for class certification of a liability-only class, to conclude that an evacuee class would also be an inferior method for adjudicating these claims. This was a correct analysis of the issues, and likewise relates to the court's finding of a lack of meaningful commonality of legal and factual issues in this factual context. We find no abuse of discretion in the trial court's conclusion that even a finding of Defendants' liability for ignition of the original three fires would not resolve all the causation issues regarding the effects of the three fires upon those individuals who had to flee, whether or not they did so in response to an official evacuation order.
In Evans, this court stated that "although a trial court has discretion to permit a class action to proceed where the damages recoverable by the class must necessarily be based on estimations, the trial court equally has discretion to deny certification when it concludes the fact and extent of each member's injury requires individualized inquiries that defeat predominance." (Evans, supra, 178 Cal.App.4th at p. 1431.) Here too, "there is a potentially wide disparity in the amount of damages recoverable by each class member, " as shown by the statistics proposals, and we cannot find any abuse of discretion in the trial court's determination that class treatment of causation and damages issues was not feasible or superior. (Id. at pp. 1431-1432.)
E. Managing a Class Action
The evacuee class plaintiffs next argue that their trial plan for managing the litigation would obviate any potential difficulties in managing a class action, both as to liability and damages. They contend the trial court utilized improper legal criteria when it did not accept outright the proposed limitations on the theories of recovery that the class might now be pursuing. Plaintiffs additionally argue the trial court should not have found that the proposed class members would have any other viable alternatives for recovery, such as joining in other existing actions, or filing new claims in small claims court. Plaintiffs argue that this class action remains necessary because the evacuee class members would be unlikely to succeed in recovering against Defendants, without the assistance of counsel in small claims court, and they would not fit within other existing litigation, or could not afford it.
First, with or without considering the suitability of the proposed statistical proof of liability and/or damages, Plaintiffs' trial plan still seems to put the cart before the horse, by seeking to establish through trial of facts who would be in the class and who would not (by showing which fires affected which evacuation zones, as a means of establishing the class membership). At the hearing, Plaintiffs' attorney McGuire said, "The [class] notice will not go out until we are satisfied that we are probably covering everybody who could be in this class." He argued that trial would clarify this, and that a per diem amount of damages could then be established, based on responses to the surveys about losses, and based on average property values in the area, etc. The trial court inquired what would happen if each of the statistical sample of 2, 000 recipients each claimed the maximum, whether or not that amount were individually supported, and Plaintiffs' attorney responded only that they were a fair sample, which did not answer the question.
Plaintiffs' attorney Schack agreed with cocounsel that the class should be identified through a trial process, based on survey and documentary proof of who had resided within any evacuation zone and who had evacuated, together with records kept by Defendants, county property records, and records of reverse 911 calls. Then, persons who wanted to opt out could do so, after receiving notice that they were potentially in the class.
Counsel for Plaintiffs further argued that the proposed statistical analysis would create a socioscientific, proven method to calculate aggregate damages, and once those damages are proven and if the jury awards them, then they would be distributed to the class, with any residue to be disbursed to some logical recipient (e.g., Cal Fire). (§ 384.) The trial court inquired why there would be any residue, if the class membership could have been accurately determined by statistics, and Plaintiffs' attorney responded that not all possible class members would come forward to claim their damages, but a different design of the survey might avoid that. This response raises concerns about the fairness of Plaintiffs' proposals. (Ali, supra, 176 Cal.App.4th 1333, 1352-1353.)
If Plaintiffs are essentially arguing for subclasses to be established, we acknowledge, as in Evans, that "class actions may be maintained with regard to particular issues and if necessary a class action may be subdivided into subclasses and each subclass treated as a class [citation], or a court may allow class members who wish to raise additional issues to opt out of the class action [citation]." (Evans, supra, 178 Cal.App.4th at p. 1434.) However, "whether these devices are sufficient or appropriate measures in any given action is a matter for the trial court to decide. In this case, the trial court could reasonably determine the interests of the class members were potentially diverse, an insufficient community of interest existed and class certification should be denied, which the creation of subclasses or the permitting of 'opting out' would not cure under the peculiar facts of this case." (Id. at p. 1434.)
In light of the unique facts of this case, and guided by the above analyses, we conclude the trial court had a substantial basis in the record to find that the evacuee class Plaintiffs had provided no adequate "plan or strategy describing how to deal with hundreds of thousands of individual determinations on damages even if the class were certified as to the issue of causation of the fires." Although Plaintiffs' statistician and accountant responded to criticisms by the defense experts of the proposed survey methodology, the trial court was not required to find that Plaintiffs had cured the fundamental problems that were identified in their proposed statistical proof of both liability and damages amounts.
We admit to some concerns about Plaintiffs' claim that this is the only feasible avenue of recovery for some evacuee plaintiffs who claim lost use, living expenses, or lost wages damages, for amounts below the small claims limits. (§§ 87, 116.221.) The trial court was mindful of those issues, when it asked defense counsel to address whether a failure of justice might result if the class were not certified. In response at the hearing, defense counsel argued there was nothing to prevent the evacuee plaintiffs from obtaining legal advice or proceeding to small claims court, on their particular facts.
It must be remembered that class actions are a procedural device intended to enforce substantive law, and the well-accepted requirements for showing ascertainability of a class and community of interest must be factored into the overall superiority determination. (San Jose, supra, 12 Cal.3d at p. 462; Lockheed Martin, supra, 29 Cal.4th at pp. 1108-1111.) These evacuee plaintiffs still have not shown that the conduct of Defendants uniformly impacted them, such that liability can be established and only a calculation of damages through a formula to be developed would be necessary to establish individualized recovery amounts. The experienced trial court applied the proper legal criteria and had an adequate basis in the record to determine that the proposed evacuee class could not realistically be managed or administered within the complex litigation scheme. (Basurco, supra, 108 Cal.App.4th 110, 122.) No substantial evidence supports Plaintiffs' claims that common issues predominate over individualized issues.
DISPOSITION
Affirmed. Each party shall bear its own costs on appeal.
WE CONCUR: McDONALD, J., McINTYRE, J.