In one of the first court opinions applying Dukes v. Wal-Mart Stores, Inc, 2011 U.S. LEXIS 4567 (U.S. 2011), a Michigan state court ruled in Henry v. Dow Chemical Co., Case No. 03-47775 (Saginaw County, Mich.), that plaintiffs could not certify a class of property owners accusing Dow Chemical of negligently releasing dioxin into a river floodplain. In Dukes, the U.S. Supreme Court issued a landmark ruling last month addressing various aspects of class certification in the employment discrimination context. We posted an in-depth report on Dukes on the date of the decision here, predicting that both federal and state court judges were apt to apply Dukes in a wide variety of class action contexts. To that end, Henry is one of the first rulings that applies Dukes in an on-going class action lawsuit in a state court non-employment class action setting.
In Henry, Plaintiffs sought to represent a putative class in an action against defendant, Dow Chemical Company, alleging that Dow negligently released dioxin, a synthetic chemical that is potentially hazardous to human health, from its plant in Midland into the Tittabawassee River flood plain. Plaintiffs sought class certification under Michigan Court Rule 3.501(A)(1), which articulates prerequisites for class certification similar to those reflected in Rules 23(a) and 23(b)(3) of the Federal Rules of Civil Procedure.
Previously, on October 21, 2005, the court had granted plaintiffs’ motion for class certification. Thereafter, Dow appealed, and the Michigan Supreme Court held that the court’s analysis of the numerosity, commonality, and superiority requirements was sufficient but remanded for the court to “clarify its reasoning” on the other elements and “reanalyze” the numerosity, commonality, and superiority prerequisites if it determined that it had not used the proper standards. Henry v. Dow Chemical Co., 484 Mich. 483 (2009). Two years after the Michigan Supreme Court’s remand in Henry, the U.S. Supreme Court released its decision in Dukes v. Wal-Mart Stores, Inc., 2011 U.S. LEXIS 4567 (U.S. June 20, 2011).
On remand, the court in Henry noted that, despite the focus in Dukes on Rule 23 of the Federal Rules of Civil Procedure, it nonetheless “has far-reaching implications for certification of class action lawsuits, including the present case.” Indeed, based on the Supreme Court’s decision in Dukes, the court reversed its earlier decision and determined that plaintiffs had failed to provide sufficient information to establish the commonality prerequisite to class certification. The court reasoned that, like the plaintiffs in Dukes, plaintiffs in this case failed to establish any “glue” to hold their claims together. The only common question was whether Dow released dioxin into the Tittabawassee River flood plain; but, even assuming that Dow negligently did so and that it contaminated the soil on plaintiffs’ properties, “whether and how the individual plaintiffs were injured involves highly individualized factual inquiries regarding issues such as the level and type of dioxin contamination in the specific properties, the different remediation needs and different states of remediation for different properties, and the fact that some of the properties have been sold.” The court found that plaintiffs’ nuisance claims required similar individualized factual inquiries; “whether plaintiffs have suffered an interference with or loss of use and enjoyment of their property requires an individualized factual inquiry into each plaintiff’s use and enjoyment of [his or her] property.” Because plaintiffs failed to show a common contention capable of class-wide resolution, the court held that it was unnecessary to consider the typicality and adequacy requirements and denied plaintiffs’ motion for class certification.
As one of the first applications of Dukes, Henry is significant in demonstrating the new landscape of Rule 23 class certification and the higher bar for plaintiffs attempting to demonstrate commonality. The first courts applying Dukes have confirmed predictions of far-reaching effects for defense of employment class action litigation, as well as non-employment claims. Henry is illustrative of that trend and its wide-ranging application – even to an environmental tort class action in a state court.