Ferrell v. Allstate Insurance

OPINION

{1} The issues raised by this appeal involve the intersection of two complex areas of law — multi-state class action lawsuits and conflict-of-laws principles. We hold that the correct standard for determining when an actual conflict ■ exists between states’ laws such that application of the forum state’s law is inappropriate for a class action is more than a mere hypothetical conflict or uncertainty based on the lack of foreign appellate precedent. Rather, proof of an actual conflict is required. Having so concluded, we reverse the Court of Appeals and remand for proceedings consistent with this Opinion.

BACKGROUND

{2} This appeal arises as a result of the district court’s decision to certify a multistate class in Néw Mexico for the purposes of litigating a class action lawsuit against Allstate Insurance Company (Allstate). Plaintiffs are Allstate insureds who contend that Allstate is liable for breach of contract for failing to include installment fees that are charged when an insured opts to pay the premium in monthly installments in the total premium calculation. Allstate counters that the installment fees are not part of the premium; instead, the fees are imposed when an insured chooses to pay the policy in installments rather than in one lump sum. 1

{3} Plaintiffs originally requested that the district court certify a nationwide class, but eventually narrowed the class to fifteen states, including New Mexico. The district court, in its Findings of Fact and Conclusions of Law, certified a class of thirteen states and found that there was no conflict among the laws of the thirteen states such that application of New Mexico law to the plaintiffs from those states was appropriate. The district court declined to certify the plaintiffs from either Hawaii or Washington because, unlike the policies from the other thirteen states, the insurance policies issued in those states contained specific information about installment fees. The district court “retain[ed] jurisdiction to create subclasses or otherwise alter or amend [the certification oi;der] before a decision on the merits.” Allstate appealed the class certification to the Court of Appeals pursuant to Rule 1-023(F) NMRA, which permits the Court of Appeals to hear an appeal arising from an order granting or denying certification of a class.

{4} The Court of Appeals first reviewed the laws of the states connected to the dispute and determined that the laws of the thirteen states potentially conflicted with one another, due to unresolved ambiguities in each state’s law. Ferrell v. Allstate Ins. Co., 2007-NMCA-017, ¶ 29, 141 N.M. 72, 150 P.3d 1022. Based upon this conclusion, the Court determined it would be inappropriate to apply New Mexico law to the entire multi-state class. Id. ¶30. Having determined that New Mexico law could not apply to the entire class, the Court undertook a conflict-of-laws analysis and determined that the laws of the state where each insurance contract was entered into would separately apply to the plaintiffs from that state. Id. ¶¶ 31^47. In other words, if the multi-state class action were to proceed, the district court would have to apply the laws of each of the thirteen states connected to the dispute. Id. ¶47. Because the “need to apply the ambiguous laws of the other class states would render [the] case unmanageable and not superior as a matter of law,” id. ¶ 47, the Court of Appeals decertified the class with respect to all out-of-state class members, ■ id. ¶ 54. The Court of Appeals affirmed the certification with respect to New Mexico class members only, and remanded the case to the district court to proceed as a single-state class action, subject to the district court’s discretion. Id. We granted certiorari to review significant, novel issues relevant to New Mexico class action jurisprudence that are implicated in the Court of Appeals opinion.

DISCUSSION

{5} The district court’s certification was appropriate if the court properly considered the requirements of our class action rule, portions of which can only be satisfied in a multi-state class action by considering conflict-of-laws principles. We begin our discussion with an overview of our class action rule, which forms the backdrop of this appeal. We then discuss the Court of Appeals’ determination that the laws of the thirteen states connected to this dispute conflicted. In so doing, we consider as a vital threshold inquiry whether the class proponent has the burden of affirmatively disproving a hypothetical conflict between the laws of the relevant states, as the Court of Appeals held, or whether the party opposing certification has the burden of affirmatively proving that the laws of the relevant states actually conflict.

Class Actions in General

{6} To put our discussion in context, we set out the relevant portions of our class action rule, Rule 1-023(A) and (B):

A. Prerequisites to a class action. One or more members of a class may sue or be sued as representative parties on behalf of all only if:

(1) the class is so numerous that joinder of all members is impracticable;

(2) there are questions of law or fact common to the class;

(3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and

(4) the representative parties will fairly and adequately protect the interests of the class.

B. Class actions maintainable. An action may be maintained as a class action if the prerequisites of Paragraph A of this rule are satisfied, and in addition:

(3) the court finds that the questions of law or fact common to the members of the class predominate over any questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy.

{7} New Mexico’s current class action rule mirrors the federal rule upon which it is based. Compare Rule 1-023, with Fed. R.Civ.P. 23; see also Berry, 2004-NMCA-116, V 27 (noting that Rule 1-023 is “[ijdentical to its federal counterpart”). Thus, we may seek guidance from federal law applying the rule. Accord Romero v. Philip Morris Inc., 2005-NMCA-035, ¶ 35, 137 N.M. 229, 109 P.3d 768.

{8} The district court certifies a class in the first instance. Rule 1-023(C)(1) (“As soon as practicable after the commencement of an action brought as a class action, the court shall determine by order whether it is to be so maintained.”). The court “must engage in a rigorous analysis of whether the Rule’s requirements have actually been met.” Brooks v. Norwest Corp., 2004-NMCA-134, ¶ 9, 136 N.M. 599, 103 P.3d 39. In deciding whether the requirements of Rule 1-023 have been met, a district court may look beyond the pleadings. See Castano v. Am. Tobacco Co., 84 F.3d 734, 744 (5th Cir.1996). “This ‘probe behind the pleadings’ is necessary because the district court must understand the elements of the plaintiffs’ causes of action'—• and the likely defenses—in order to assess what kind of proof will be necessary to decide the issues.” Berry, 2004-NMCA-116, ¶ 50; accord Castano, 84 F.3d at 744. The district court may certify a class only for certain issues or may divide the class into subclasses. Rule 1-023(C)(4). Because, in this case, the district court’s decision to certify the class was appropriate only if the class met the requirements of Rule 1-023(A) and the requirements of at least one of the subdivisions of subsection B of Rule 1-023, we now turn to a discussion of those sections of our class action rule.

Rule 1-023(A): Prerequisites to a Class Action

{9} Rule 1-023(A) lists four prerequisites to certification of a class action:

(1)the class is so numerous that joinder of all members is impracticable;

(2) there are questions of law or fact common to the class;

(3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and

(4) the representative parties will fairly and adequately protect the interests of the class.

These four requirements are commonly referred to as numerosity, commonality, typicality, and adequacy of representation. See Berry, 2004-NMCA-116, ¶ 40; see also Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 613, 117 S.Ct. 2231, 138 L.Ed.2d 689 (1997) (same). In this case, the district court concluded that the class met the four requirements of Rule 1-023(A). Neither party appealed this finding, and the Court of Appeals did not address it. Therefore, we assume, without deciding, that the four threshold requirements of Rule 1-023(A) were satisfied.

Rule 1-023(B): Class Actions Maintainable

{10} In addition to meeting all of the threshold requirements of Rule 1-023(A), a district court may only certify a class if the class meets the requirements of one of the categories contained in Rule 1-023(B). See 1 Alba Conte & Herbert B. Newberg, Newberg on Class Actions § 3:1, at 210 (4th ed.2002). Of the three categories of Rule 1-023(B), only subsection (B)(3) is relevant to this appeal because it is the category that generally applies when class members seek monetary damages. See Rory Ryan, Comment, Uncertifiable?: The Current Status of Nationwide State-Law Class Actions, 54 Baylor L.Rev. 467, 472 (2002) (“As a practical matter, nationwide state-law class actions seeking damages invariably will be brought under Rule 23(b)(3).”). Rule 1-023(B)(3) provides that a class action is maintainable only if “the court finds that the questions of law or fact common to the members of the class predominate over any questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy.” “ ‘Subdivision (b)(3) encompasses those cases in which a class action would achieve economies of time, effort, and expense, and promote uniformity of decision as to persons similarly situated, without sacrificing procedural fairness or bringing about other undesirable results.’ ” 1 Conte & Newberg, supra, § 3:1, at 214 (quoting Rules Advisory Committee to 1966 Amendments to Rule 23); accord Berry, 2004-NMCA-116, ¶ 47.

{11} The requirements contained in subsection (B)(3) are commonly referred to as predominance and superiority. Our class action rule does not define predominance and superiority, but the rule contains several factors to consider when making a determination about whether predominance and superiority have been met. Those relevant factors include:

(a) the interest of members of the class in individually controlling the prosecution or defense of separate actions;

(b) the extent and nature of any litigation concerning the controversy already commenced by or against members of the class;

(c) the desirability or undesirability of concentrating the litigation of the claims in the particular forum;

(d) the difficulties likely to be encountered in the management of a class action.

Rule 1-023(B)(3).

{12} Class actions involving plaintiffs from multiple states present particular challenges for district courts, and may “implicate the predominance and superiority requirements ... because of the combination of individual legal and factual issues that need to be determined.” 7AA Charles Alan Wright et al, Federal Practice and Procedure § 1780.1, at 202 (3d ed.2005). If too many separate state laws must be applied, then the class proponent may have a difficult time persuading the district court that common questions of law predominate and that a class action is the superior method of litigation. See Castano, 84 F.3d at 741 (“In a multi-state class action, variations in state law may swamp any common issues and defeat predominance.”). A determination that the district court will have to apply the laws of multiple states also impacts the court’s ability to manage the proposed class. See Rule 1-023(B)(3)(d); Berry, 2004-NMCA-116, ¶ 51 (“[I]f the forum state decides to apply the law of other states, the court must consider the difficulty of managing the trial of sub-classes to the same jury.”); 7AA Wright et al., supra, § 1780.1, at 211 (“[CJourts also have found that the class device is not a superior method to adjudicate the claims [of a multi-state class] because differences in state law make the action unmanageable.”).

{13} A decision to apply the laws of several states does not, however, necessarily foreclose class certification. A court may be able to manage a class through the use of subclasses or by grouping certain issues together that can be resolved by applying one state’s law. See In re Sch. Asbestos Litig., 789 F.2d 996, 1011 (3d Cir.1986) (affirming class certification under Rule 23(b)(3) because, even though “manageability [was] a serious concern, ... [manageability is a practical problem, one with which the district court generally has a greater degree of expertise and familiarity than does an appellate court”).

{14} Thus, a certifying court must first determine which law will apply to the class so that it can then assess the predominance and superiority of the proposed class action. See Wash. Mut. Bank, FA v. Super. Ct., 24 Cal.4th 906, 103 Cal.Rptr.2d 320, 15 P.3d 1071, 1077 (2001) (“Discerning the applicable law is an important task in class actions, for if the claims of nonresident class members will require adjudication under the laws of the members’ home states, the trial court must ascertain the degree of complexity arising from the need to apply those laws in order to make an informed decision on certification.”). Plaintiffs bear the initial burden of producing evidence of the various states’ laws and demonstrating ‘“that class certification does not present insuperable obstacles.’ ” Walsh v. Ford Motor Co., 807 F.2d 1000, 1017 (D.C.Cir.1986) (quoting In re Sch. Asbestos Litig., 789 F.2d at 1010). If the defendant wishes to contest the plaintiffs characterization of the laws of the relevant states, the defendant must “inform the district court of any errors they perceive.” Berry, 2004-NMCA-116, ¶ 80. If the defendant fails to bring any “ ‘clearly established’ contradictory law” to the court’s attention, the district court cannot be faulted if it concludes that the laws of the jurisdictions connected to the dispute do not conflict such that a single state’s law may be applied to the entire class. Id. (quoting Sun Oil Co. v. Wortman, 486 U.S. 717, 730-31, 108 S.Ct. 2117, 100 L.Ed.2d 743 (1988)).

{15} In this case, the district court’s decision to certify the class was proper if the district court correctly determined that New Mexico law applied to the entire class. A district court’s choice to apply forum law is appropriate if (1) the choice to apply forum law is constitutional or (2) an application of the forum’s choice-of-law rules leads to the selection of forum law. A forum’s choice to apply its own law is constitutional if the law of the forum does not actually conflict with the law of any other jurisdiction connected to the dispute. See Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 816, 105 S.Ct. 2965, 86 L.Ed.2d 628 (1985) (“There can be no injury in applying [forum] law if it is not in conflict with that of any other jurisdiction connected to this suit.”). Additionally, a forum’s choice to apply its own law is constitutional, even if the laws of the states connected to the dispute actually conflict, if the forum state has “ ‘a significant contact or significant aggregation of contacts, creating state interests, such that choice of its law is neither arbitrary nor fundamentally unfair.’ ” Id. at 818, 105 S.Ct. 2965 (quoting Allstate Ins. Co. v. Hague, 449 U.S. 302, 312-13, 101 S.Ct. 633, 66 L.Ed.2d 521 (1981)). The parties to this appeal have focused their arguments on whether the Court of Appeals correctly found an actual conflict between New Mexico law and the laws of the other twelve states. We will concentrate our analysis in a similar fashion.

Conflict-of-Laws

{16} The Court of Appeals in this case adopted the “false conflict” doctrine as the initial step that a district court must undertake when making the determination about what law applies to the claims of a multi-state class. 2 Ferrell, 2007-NMCA-017, ¶ 40. Under this analysis, when the laws of the relevant states do not actually conflict, the court may avoid a conflict-of-law analysis and may apply forum law to the entire class. See Phillips, 472 U.S. at 816, 105 S.Ct. 2965 (“We must first determine whether [forum] law conflicts in any material way with any other law which could apply. There can be no injury in applying [forum] law if it is not in conflict with that of any other jurisdiction connected to this suit.”). If, however, the laws of the relevant states actually conflict, or if the laws of certain of the relevant states conflict, then the forum court must resolve that conflict using the choice-of-law rules contained in the forum state’s eonflict-of-laws doctrine. See Ferrell, 2007-NMCA-017, ¶ 40.

{17} A district court’s conclusion that the laws of the various states do not actually conflict is particularly important in multi-state class actions. If the law of a single state can be applied to the entire class, it is more likely that the class will meet the predominance and superiority requirements of our class action rule. The converse is true as well. If the laws of the states connected to the dispute actually conflict, and if the court’s choice-of-law analysis provides that the laws of several states must apply to the class, then it is less likely that the class will meet the certification requirements.

When can the laws of the interested states be said to actually conflict such that application of forum law is inappropriate?

{18} In the instant appeal, the Court of Appeals concluded that a district court may only apply forum law to class members from other states if the laws of the states connected to the dispute “ ‘are identical, or different, but produce identical results.’” Ferrell, 2007-NMCA-017, ¶ 9 (emphasis added) (quoting Scoles et al., supra, § 2.9, at 28 n. 16). While acknowledging the apparent similarities among the states’ laws, the Court of Appeals was nevertheless troubled because “[n]one of the class states [had] appellate court opinions interpreting the statutory definition of premium or otherwise deciding whether fees constitute premium in the context of a breach of contract issue.” Id. Despite the lack of evidence that the difference in state law would actually influence the outcome of a trial on the merits, the Court of Appeals concluded that where the laws of the relevant states “could produce different results,” id. ¶ 21 (emphasis added), it would be inappropriate to apply New Mexico law to the entire class, id. ¶ 30.

{19} The Court limited its analysis to a comparison of the statutory definition of premium, id. ¶¶ 16-17, and to the issue of whether fees constitute premiums, id. ¶¶ 20-30. The Court noted that six states “have a statutory definition of ‘premium’ that is materially the same as the definition found in New Mexico’s Section 59A-18-3.” Id. ¶ 17. The Court further stated that three states “have statutes that essentially define premium as ‘the consideration for insurance’ but do not provide the list of examples that New Mexico’s statute does.” Id. And, while three states did not have a statutory definition of premium, the Court acknowledged that two of those states had appellate opinions “holding that fees charged by insurance companies for the privilege of paying in monthly installments constitute ‘gross premium’ for purposes of statutory or constitutional provisions that require insurance companies to pay taxes on the ‘gross premiums’ collected.” Id. (citing Allstate Ins. Co. v. State Bd. of Equalization, 169 Cal.App.2d 165, 336 P.2d 961 (1959), and State ex rel. Earle v. Allstate Ins. Co., 221 Or. 371, 351 P.2d 433 (1960)).

{20} Relying on Berry, 2004-NMCA-116, and Sun Oil, 486 U.S. 717, 108 S.Ct. 2117, Plaintiffs argue that the Court of Appeals “applied a substantially higher burden for certification of multi-state class actions” when it held that a New Mexico court may only apply New Mexico law to class members from other states when the law of the other states can be shown to produce identical results. Rather than requiring identical results, Plaintiffs argue that they need only demonstrate that the laws of the states connected to the dispute are substantially similar. Importantly, a New Mexico court need not wait for an appellate decision construing the particular statute in question. Rather, the forum court should only consider the laws of the relevant states in their current form; it should not be required to speculate on the form those laws may take in the future. Finally, Plaintiffs argue that, even where the law is uncertain, a district court may nevertheless apply New Mexico law under certain circumstances.

{21} The question before us, then, is whether an actual conflict exists when the laws of the other states could hypothetically produce different results or whether an actual conflict requires a showing of something more. In answering that question, we examine whether the uncertainty created by the lack of appellate precedent necessarily creates an actual conflict. We also consider who must demonstrate the existence of an actual conflict and who carries the burden of failing to prove that an actual conflict exists.

{22} We begin our discussion with Phillips and Sun Oil, two U.S. Supreme Court cases relied upon by Plaintiffs in this appeal, before turning our attention to Plaintiffs’ arguments premised on Berry, a ease similar to Ferrell, involving appellate review of a district court’s decision to certify a multi-state class. In Phillips, the U.S. Supreme Court reviewed the constitutionality of the Kansas court’s decision to apply principles of Kansas law to the claims of a multi-state class. 472 U.S. at 815-23, 105 S.Ct. 2965. As discussed above, the Court held that a court may apply forum law when that law does not “conflict! ] in any material way with any other law which could apply.” Id. at 816, 105 S.Ct. 2965 (emphasis added). Alternatively, the forum court may apply its own state law, even if forum law conflicts with the laws of the other states connected to the dispute, as long as the forum has “ ‘a significant contact or significant aggregation of contacts, creating state interests, such that choice of its law is neither arbitrary nor fundamentally unfair.’” Id. at 818, 105 S.Ct. 2965 (quoting Allstate Ins. Co., 449 U.S. at 312-13, 101 S.Ct. 633). “Given Kansas’ lack of ‘interest’ in claims unrelated to that State, and the substantive conflict with jurisdictions such as Texas, we conclude that application of Kansas law to every claim in this ease is sufficiently arbitrary and unfair as to exceed constitutional limits.” Id. at 822, 105 S.Ct. 2965. Having so concluded, the Supreme Court reversed the Kansas court’s decision to apply Kansas law and remanded the case for the Kansas court to apply the laws of the other states connected to the dispute. Id. at 823, 105 S.Ct. 2965; see also Sun Oil, 486 U.S. at 721, 108 S.Ct. 2117 (“We reversed that part of [Phillips ] which held that Kansas could apply its substantive law to claims by residents of other States concerning properties located in those States, and remanded that ease to the Kansas Supreme Court for application of the governing law of the other States to those claims.”).

{23} In Sun Oil, the U.S. Supreme Court had the opportunity to review how the Kansas court complied with the constitutional mandates set forth in Phillips. Sun Oil, 486 U.S. at 730-34, 108 S.Ct. 2117. The Kansas court in Sun Oil again chose to apply principles of Kansas law to the entire class to determine the prejudgment interest rate with respect to the plaintiffs’ claim for royalties. See Sun Oil, 486 U.S. at 722, 108 S.Ct. 2117 (stating that the U.S. Supreme Court was reviewing the Kansas court’s “decision that the other States’ pertinent substantive legal rules were consistent with those of Kansas”); see also Workman v. Sun Oil Co., 241 Kan. 226, 755 P.2d 488, 490 (1987) (district court reviewed the laws of the other states connected to the dispute and concluded that “ ‘[t]he laws of the other states do not conflict with the laws of Kansas on the interest rate to be used’ ” (quoting district court’s holding)). On appeal, to the U.S. Supreme Court, the defendant-oil company argued that the Kansas trial court had “unconstitutionally distorted” the laws of the other states when it concluded that the laws of those states did not materially conflict with the law of Kansas. Sun Oil, 486 U.S. at 730, 108 S.Ct. 2117.

{24} The U.S. Supreme Court acknowledged that the statutes of the relevant states were facially different, yet upheld the Kansas court’s decision to apply Kansas law to determine the prejudgment interest rate for the entire class. Id. at 731-34, 108 S.Ct. 2117. The oil company had failed to present the court with any clearly established ease law demonstrating that, under similar circumstances, the other states would apply their state’s statutory rate, rather than the rate chosen by the Kansas court. Id. The U.S. Supreme Court held that the Kansas court’s interpretation of unsettled law was valid, even though the highest court of a sister state had yet to rule on the issue. See id. at 731 n. 4, 108 S.Ct. 2117 (relying on a previous opinion where the Court had stated that “[t]here was neither allegation nor proof that the court of last resort in Louisiana had considered the question or made any ruling upon it, and so it became the duty of the Texas courts ... to decide the question according to their independent judgment” (quoted authority omitted)); see also Berry, 2004-NMCA-116, ¶ 78 (relying on Phillips and Sun Oil for the proposition that “the forum court [is not] required to try to match or divine the result of the case as if it were being decided in the other states”). Additionally, the Supreme Court noted that simply because a forum court must interpret the laws of a sister state does not necessarily mean that the forum court is foreclosed from applying forum law, if the court interprets that law to be similar to the forum law. See Sun Oil, 486 U.S. at 732-33, 108 S.Ct. 2117 (noting that the Kansas court was called upon to interpret a Texas appellate court decision and, in so doing, distinguished that case from the ease at bar based on the “eminently reasonable ground” that the disputes did not involve the same legal claim).

{25} We now turn to a discussion of Berry, which Plaintiffs cite as additional support for their position that they only need to demonstrate that the laws of the relevant states are substantially similar. In Berry, the district court certified a nationwide class seeking damages against a life insurance company based on breach of contract and breach of the duty of good faith. 2004-NMCA-116, ¶ 1. In its confliet-of-laws analysis, the Berry court relied on Phillips and Sun Oil as a framework for determining whether the district court appropriately considered the differences between the laws of the various states when it decided to apply New Mexico law to the claims of the entire multi-state class. Berry, 2004-NMCA-116, ¶¶ 76-78, 82. From those eases, the Berry Court distilled several overarching principles that a court should consider when making a determination about whether a conflict exists.

{26} The Court noted that, as an initial step, “courts dealing with multistate class actions must consider and evaluate how the laws of other states apply to the class claims.” Id. ¶ 78. While “[t]he forum state cannot simply assume that its law will govern!}] ... the forum court [is not] required to try to match or divine the result of the ease as if it were being decided in the other states. The forum court is only bound by ‘clearly established’ law brought to its attention.” Id. (quoted authority omitted). After setting forth these general principles, the Court then utilized them to analyze the plaintiffs’ claims arising under both breach of contract, id. ¶¶ 82-88, and breach of good faith and fair dealing, id. ¶¶ 89-94.

{27} With respect to the breach of contract claim, the Berry court focused on the significance of the demonstrated conflicts, not on potential conflicts. Rather than requiring an affirmative showing that the laws would produce identical results, the court noted that “the law in this area [was] uniform enough,” there was “no significant variation in the eases from the standard approach to interpretation of insurance contracts,” id. ¶ 82 (emphasis added), and there were “no fatal contradictions of law,” id. ¶ 87 (emphasis added). Significantly, the Berry court rejected the defendant’s argument that it would be improper to apply New Mexico law to the entire class because a determination of “whether the policy would be deemed ambiguous ‘could’ vary from state to state.” Id. ¶ 88.

{28} The Berry court rejected this argument for two reasons, which we find persuasive. Id. First, the court noted that the district court had yet to decide that an ambiguity existed. Id. Second, the court stated that it saw “no significant variation among the states concerning how [the] decision [about ambiguity] is made.” Id. Thus, the court rejected the defendant’s argument — that the laws could potentially produce different results — because “there is no need to forecast how the inquiry would actually be resolved in any other court because the ease is here, and the decision is to be made here in accordance with reasonably uniform rules.” Id. Because the laws of the relevant states were sufficiently uniform to allow the application of New Mexico law, the Court affirmed the district court’s certification decision with respect to the breach of contract claim. Id. ¶ 102.

{29} The Berry court’s discussion of the breach of good faith and fair dealing claim is illustrative of the level of proof required by a defendant to establish that an actual conflict exists. See id. ¶¶ 89-94. In its analysis, the court relied on actual variations among the laws of certain states in making the determination that the laws of the various states were not sufficiently uniform to apply New Mexico law. Id. ¶¶ 90-94. Significantly, the defendant cited established cases from the class states with holdings that were contrary to New Mexico law. Id. Because the laws of the states were not sufficiently uniform, the court decertified the class with respect to the breach of good faith and fair dealing claim. Id. ¶ 94.

{30} Having reviewed both Ferrell and Berry, it is clear that the two New Mexico Court of Appeals’ opinions set forth conflicting standards for what constitutes an actual conflict. Plaintiffs argue that Berry and Sun Oil set forth rules that a court should follow when determining whether the laws of the states connected to the dispute can be said to conflict. The Ferrell court disagreed and did not rely on Sun Oil for what constitutes an actual conflict, because that court concluded that Sun Oil “does not say anything about when the laws of two jurisdictions can be said to ‘conflict.’ ” Ferrell, 2007-NMCA-017, ¶ 37.

{31} Because the court was not persuaded that Sun Oil applied, the Court of Appeals turned to two non-class action cases from other jurisdictions for guidance. Ferrell, 2007-NMCA-017, ¶¶ 24-26. In both Fioretti v. Massachusetts General Life Insurance Co., 53 F.3d 1228 (11th Cir.1995) and Duga