Opinion
C.A. No. 00C-06-010 WLW
Submitted: August 19, 2002
Decided: September 3, 2002
On Plaintiff's Application for Judicial Reassignment or Recusal.
Denied.
John S. Spadaro, Esquire, and Roger D. Landon, Esquire, of Murphy, Spadaro Landon, Wilmington, Delaware for the Plaintiff.
Nicholas E. Skiles, Esquire, of Swartz, Campbell Detweiler, Wilmington, Delaware, Curtis P. Cheyney, III, Esquire, Pro Hac Vice, James C. Haggerty, Esquire, Pro Hac Vice, for the Defendant.
ORDER
Upon consideration of James M. Crowhorn's (hereafter "Crowhorn" or the "plaintiff") Application for Judicial Reassignment or Recusal, Nationwide Mutual Insurance Company's (hereafter "Nationwide" or the "defendant") Answer to the same, as well as correspondence to the Court and oral arguments of the parties, it appears to the Court that:
1. On July 10, 2002, this Court issued a Memorandum Opinion (the "Opinion"), which held that, with respect to the plaintiff's allegations of Nationwide's fraudulent pre-certification and prior impairment reduction practices, this Court did not have jurisdiction to certify a class action because the plaintiff did not have standing, individually, or under the "overarching-scheme" theory he set forth. Specifically, this Court held that as to these two types of alleged harm, only, the plaintiff did not have individual standing to bring any of the causes of action set forth in his complaint. The Court further held that the plaintiff's overarching- scheme or shared-injury theory under the two undisputed material facts of this case, without more, could not provide such requisite standing for purposes of certifying a class action for trial (as opposed to certifying a class action for settlement). In reaching these conclusions, the Court found that the predominance requirement of Superior Court Civil Rule 23(b) was not met with respect to only three matters: (1) the alleged pre-certification fraud; (2) the alleged prior impairment reduction fraud; and (3) the common law fraud claim pled as a class action.
Crowhorn v. Nationwide Mut. Ins. Co., 2002 WL 1767529 (Del.Super.).
The plaintiff describe the alleged pre-certification fraud by stating that:
Nationwide sometimes takes the position that pre-certification of coverage is unavailable under its PIP products; with the result that Nationwide's PIP insureds are sometimes deprived of necessary medical treatment. . . . Nationwide tends to take this position in cases where the anticipated treatment is an expensive one, or where the total amount of PIP benefits paid to a particular claimant begin to approach the reserve established by Nationwide for the subject claim.
The plaintiff charges that when an IME doctor concludes a permanency rating has been previously attributed to the situs of a current injury, then Nationwide will fraudulently reduce its current level of benefits by the percentage of the prior rating.
Stuart Kingston, Inc. v. Robinson, 596 A.2d 1378, 1382 (Del. 1991) (standing entails "the right of a party to invoke the jurisdiction of a court to enforce a claim or redress a grievance").
In the Opinion, non-material factual matters were discussed simply as an attempt by the Court to comprehend the allegations of the parties; however, the only undisputed facts upon which the Court based its Opinion were: (1) that Mr. Crowhorn had never experienced Nationwide's pre-certification practices; (2) nor had he ever had his benefits reduced on the basis of a prior impairment.
See Gaffin v. Teledyne, Inc., 611 A.2d 467, 474-75, n. 8 (Del. 1992) (emphasis added) (holding that "[a] class action may not be maintained in a purely common law or equitable fraud case since individual questions of law or fact, particularly as to the element of justifiable reliance, will inevitably predominate over common questions of law or fact," and distinguishing these cases from federal securities law cases where the federal courts have certified securities claims with pendant state law equitable fraud claims if the pendant claims derive from the same course of conduct); cf. Affiliated UTE Citizens of Utah v. United States, 406 U.S. 128, 151-153 (1972) (outlining the elements of a federal securities claim under Section 10 of the Securities Exchange Act Of 1934, 15 U.S.C. § 78j (a species of the federal line of cases distinguished by Gaffin, to which a pendant equitable fraud claim might attach even though the federal cause of action did not include an element of reasonable reliance); Press v. Chemical Inv. Servs. Corp., 988 F. Supp. 375 (1997) (dismissing pendant state common law claims where plaintiff could not establish federal claim); accord Zirn v. VLI Corp., 621 A.2d 773, 783 (Del. 1993) (allowing class certification to proceed on the basis of another cause of action besides fraud-the class action was proper under breach of fiduciary duty claim-and for the reason that defendants failed to cross-appeal on the issue of certification as in Gaffin); Oliver v. Boston Univ., 2000 WL 1091480 (Del.Ch.) (interpreting Gaffin to mean that fraud claims cannot be certified as a class action even when there are other claims pled in addition to fraud).
2. As a result of this Opinion, the plaintiff has moved the assigned trial judge to recuse himself because the procedural history of this case suggests a "strong appearance of intellectual antagonism toward Mr. Crowhorn's claims." (The plaintiff also advances that there is an "institutional antagonism toward Rule 23 cases" in the Delaware Superior Court.) In the case sub judice, however, plaintiff states that there is an overwhelming appearance of substantive prejudgment on the class certification issue of "predominance" under Superior Court Civil Rule 23(b)(3).
As to the plaintiff's charges of institutional bias, a motion seeking recusal of all of the judges of the Superior Court is properly addressed to the President Judge, and this Court may not respond to such a motion.
3. In addition to the substantive prejudgment charge, there are also allegations of procedural unfairness. First, it is alleged that on one particular motion the plaintiff was denied relief from the four-page motion limit while the defendant was allowed to file (over the protests of the plaintiff) a single-spaced, small-font response. Further offense was taken by the plaintiff when the Court asked for additional briefing on the issues discussed in that very same motion. Second, the plaintiff alleges he has been chastised for an alleged failure to file a notice of motion on a consolidated application when the plaintiff alleges that reasonable minds might differ as to the necessity of such notice. Third, the plaintiff alleges that this Court allowed the defendant to notice an important motion only six days before it was heard, in violation of the Kent County Superior Court Civil Case Management Plan. The plaintiff believes this gave the appearance of retribution for plaintiff's filing of a recusal motion. Fourth, the plaintiff insists that the defendant has repeatedly argued in the District Court that Mr. Crowhorn's claims arise from a common nucleus of operative fact and they allege a fraudulent scheme. Yet, plaintiff is adamant that this Court refuses to accord proper significance to that fact. Plaintiff argues that there is no fair and reasonable explanation for such alleged refusal.
4. The defendant responds to the plaintiff's allegations by simply arguing that the plaintiff has failed to assert a legal basis to show why this Court is biased, or to show how it has treated (or will treat) the plaintiff unfairly. The defendant has argued that plaintiff's motion is, in essence, a discovery dispute and, simply stated, the plaintiff is dissatisfied with the Court's prior rulings.
Legal Standard
5. Canon 3(C) of the Delaware Judges' Code of Judicial Conduct provides that judges must be free from personal bias, and must be disqualified in a proceeding in which the judge's impartiality might reasonably be questioned. In Los v. Los, the Delaware Supreme Court set out a two-prong test to insure against personal bias, or its appearance under Canon 3(C). Specifically, when allegations are made (such as the allegations of "intellectual bias" that have been made in the instant matter) that are "not covered by one of the designated instances specified in Canon 3C, a judge must engage in a two-part analysis to determine whether disqualification is appropriate." First, the Judge, as a matter of subjective belief, must be satisfied that he or she is free of bias or prejudice concerning the plaintiff. Second, the Court must ensure that there is not an objective appearance of bias sufficient to cast doubt upon the Court's impartiality.
Canon 3(C) of the Delaware Judges' Code of Judicial Conduct provides in pertinent part:
(1) A judge should disqualify himself or herself in a proceeding in which the judge's impartiality might reasonably be questioned, including but not limited to instances where:
(a) The judge has a personal bias or prejudice concerning a party, or personal knowledge of disputed evidentiary facts concerning the proceeding;
595 A.2d 381, 384-385 (Del. 1991).
Stevenson v, State, 782 A.2d 249, 255 (Del. 2001).
Los, 595 A.2d at 384.
Id. at 385. The Court must be convinced, using both prongs of the Los test, that the Court is free from bias.
Discussion
6. In applying the analysis required under Cannon 3C, as set forth in Los, to the instant case, I find that the plaintiff's motion to recuse must be denied. The Court is satisfied that the first prong of the Los test is met in the instant matter. This Court, as a matter of subjective belief, determines that it is able to adjudicate the issues before it in a disinterested manner with no bias or prejudice toward any of the parties. Subjectively, this Court has reviewed its prior decisions, administratively and for content, and finds that no innocent or intentional bias can be found.7. The second Los prong is also satisfied. This Court has performed an objective analysis to insure that there is no appearance of bias under Delaware law. Plaintiff suggests that this Court cannot appear unbiased because it has made a ruling that affected his theory of the case. "[I]n determining whether a judge ha[s] the duty to disqualify him or herself, our focus must be on the reaction of the reasonable observer." "In the absence of genuine bias, a litigant should not be permitted to `judge shop' through the disqualification process." Moreover, simply because this Judge may have decided adversely against plaintiff in a prior motion, does not create sufficient appearance of bias to require recusal.
Stevenson, 782 A.2d at 258 (internal citations omitted).
Los, 595 A.2d at 385.
Weber v. State, 547 A.2d 948, 952 (Del. 1988).
8. The Delaware Supreme Court said that "the bias envisioned by Canon 3C(1) is not created merely because the trial judge has learned facts or made adverse rulings during the course of a trial." In Weber v. State, for example, the criminal defendant was charged with various crimes including kidnaping, theft and assault. The judge assigned to the current trial had presided over the defendant's previous trial for second degree murder, and the defendant had been convicted in the previous trial. For this reason, the defendant wanted the judge to be recused because the defendant "would feel `more comfortable' if another judge presided." The Delaware Supreme Court did not find this sufficient justification for recusal.
Id. at 952 (citations omitted).
Weber, 547 A.2d at 951.
Substantive Bias Analysis
9. The Delaware Supreme Court has refused to require recusal of a judge where the litigant seeking recusal "made no claims concerning the conduct of [a judge] . . . apart from the discharge of [his] official duties in implementing court rules or State law." Plaintiff's motion to recuse is based upon that section of this Court's prior Opinion which makes a legal determination of the plaintiff's standing.
Los, 595 A.2d at 383.
10. The objected-to portion of the Opinion was a judgment as to whether or not the plaintiff had standing, a basic legal prerequisite to the right to redress a grievance. "Standing is the requisite interest that must exist in the outcome of the litigation at the time the action is commenced." It would be improper to allow discovery where there is no standing. "The test of standing is whether: (1) there is a claim of injury in fact; and (2) the interest sought to be protected is arguably within the zone of interest to be protected or regulated by the statute or constitutional guarantee in question."
See supra, note 4.
General Motors Corp. v. New Castle County, 701 A.2d 819, 823 (Del. 1997) (emphasis added).
Gannett Co., Inc. v. State, 565 A.2d 895,897 (Del. 1989) (citing Assoc. of Data Processing Serv. Org., Inc. v. Camp, 397 U.S. 150, 153-54 (1970)).
11. The July 10th Opinion applied settled Delaware law regarding the issue of standing and held that, with respect to alleged pre-certification and prior impairment practices, the plaintiff did not have an actual injury. Accordingly, as to these two practices only, the plaintiff had no right "to invoke the jurisdiction of [this] [C]ourt to enforce a claim or redress a grievance." Thus, he could not obtain discovery regarding these two practices. In addition, the Opinion's holding that a common law fraud case could not be certified as a class action, because individual issues of reliance would predominate, was a straightforward application of Delaware Law.
The Court never found that the plaintiff did not have an interest within the zone of the statutorily and constitutionally guaranteed causes of action alleged in his complaint.
Stuart Kingston, Inc., 596 A.2d at 1382.
See supra note 6.
12. Due to these holdings, the plaintiff states that this Court has prejudged the final outcome of this matter. This Court does not agree. Although it may be true that the prior Opinion limited the scope of the class action in this case, the Court does not agree that a reasonable person would believe that the possibility of a class action is precluded with respect to the claims for which Mr. Crowhorn has shown the requisite legal standing. This Court has made no determination, nor should any dicta be interpreted as being determinative, of any other issue except with respect to standing, as limited in the July 10th decision.
13. Plaintiff utilizes one out-of-context sentence from the thirty-three page Opinion, which plaintiff labels the "critical passage" (and which passage the plaintiff admits is technically dicta), as proof that this Court has ruled, with finality, that it will never find for the plaintiff on the issue of predominance under Rule 23(b)(3). Thus, it is plaintiff's argument that the possibility for class certification has been precluded in this case. That one sentence stated:
The Court is somewhat puzzled. If the plaintiff thought one sentence out of thirty-three pages determined the outcome of this case, it may have been appropriate to seek reargument under Superior Court Rule 59(e). However, plaintiff chose not to do so.
"For these reasons, and because the underlying claims are heterogenous (sic) and very dissimilar regarding the facts of liability, the Court cannot find that questions concerning one `common scheme' or shared injury predominate over questions regarding the six alleged practices in this case."
The "reasons" intimated in this passage included approximately six pages of discussion regarding how a shared-injury theory could not create standing where there was no standing as to the alleged pre-certification and prior impairment frauds.
Crowhorn v. Nationwide Mut. Ins. Co., 2002 WL 1767529 at *8.
14. That sentence from the Opinion, and the section from which it was taken, dealt specifically and only with the two practices referred to as the pre-certification fraud and the prior impairment reduction fraud. In that full section of the Opinion, the Court found that based on the two undisputed facts of this case, the plaintiff had suffered no injury from these alleged frauds; therefore, as to these two practices only, where there could be no individual question of liability, it necessarily follows that no question of liability could predominate as between these two practices and all six of the practices alleged. This Court made absolutely no inference that it was denying the existence of predominant questions as between all four of the alleged practices for which the plaintiff alleged he actually suffered harm.
15. Basically, the sentence quoted by the plaintiff meant, in the context of the full section in which it was found, that one cannot allege an actual injury without suffering an actual injury, and mere allegations that these two practices exist under an over-arching scheme "theory," without more cannot substitute for an actual injury so as to tie all six alleged harms together. Moreover, Benning v. Wit Capital Corp., does not provide the authority to allow a party to substantiate mere allegations through discovery, because in Benning all prospective plaintiffs shared the same injury, and were simply seeking to find the number of those who shared it with them. The plaintiffs were not seeking discovery about injuries or harm they had not experienced.
2001 WL 1388544 (Del.).
16. The Court does not believe that the plaintiff's claims concerning the conduct of this Judge can be distinguished from the discharge of his duties to implement court rules or State law." The July 10th Opinion held that with respect to alleged pre-certification and prior impairment practices, the plaintiff did not have an actual injury nor could an over-arching scheme substitute for one; therefore, the plaintiff did not have standing to seek discovery on these matters. The Court does not believe that this should be the basis for recusal.
Los, 595 A.2d at 383.
The Court never found that plaintiff did not have an interest within the zone of the statutorily and constitutionally guaranteed causes of action alleged in his complaint.
Procedural Bias Analysis
17. Frankly, this Court is somewhat perplexed at some of the plaintiff's contentions pertaining to intellectual bias and perceived unfairness in the relaxation of this Court's civil management plan. First, with respect to the plaintiff's allegation that on one motion he was denied the opportunity to exceed four pages, but Nationwide ignored the limits by filing a single-spaced, small-font response, this Court has reviewed the entire docket of all submissions filed by the parties. On balance, the Court finds that the plaintiff has been fairly treated. Moreover, the plaintiff has submitted a number of motions which could be considered as exceeding the four-page limit, which this Court has accepted without a request from the plaintiff to increase the page limit.
18. As to the alleged chastisement for not filing a notice of motion, the Court's comments in that regard were related to the confusion created by the plaintiff filing an application for interlocutory appeal with a motion for recusal. The Court found that the consolidated document was undifferentiated with respect to each motion and merely pointed out that if the motion had been noticed and filed separately, some of the confusion could have been avoided. The Court even asked the plaintiff to file separate motions so that it knew, clearly, what sections were to be considered as part of the motion, and which sections were part of the interlocutory appeal. The Court simply would have appreciated the notice of motion in light of the procedural confusion caused by the consolidated filing.
19. With respect to the six-day filing by Nationwide, this motion covered an issue upon which the parties had submitted motions previously, and the Court was familiar with the issues. The Court did not treat this as a significant rules violation in light of the prior filings on the same issue. The decision of the Court to hear the motion was not evidence of an intent to favor one party or the other.
20. Finally, the plaintiff argues that there is no fair and reasonable explanation for the failure of this Court to accord proper significance to the defendant's federal pleadings and arguments in this matter, which purportedly establish that Mr. Crowhorn's claims arise from a common nucleus of operative fact and fraudulent scheme. The Court has made no ruling on this matter with respect to the four harms properly alleged by the plaintiff. The Court also notes that the plaintiff does not appear to have propounded requests for admissions on this issue. Because the Court has made no findings on this issue, nor has the plaintiff propounded requests for admissions, the Court cannot accept the charges that it is biased nor accept the allegation that it refuses to accord proper significance to the defendant's federal pleadings.
Therefore, for all of the reasons set forth above, plaintiff James M. Crowhorn's Application for Judicial Reassignment or Recusal is denied.
IT IS SO ORDERED.
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(e) . . . or has expressed an opinion concerning the merits of the particular case in controversy.