William Barnes v. The American Tobacco Company

In this suit against the major American tobacco companies, we must decide whether a medical monitoring class should be certified under Federal Rule of Civil Procedure 23(b)(2). The District Court decertified a proposed class of cigarette smokers on the grounds that significant individual issues precluded certification. After finding the statute of limitations had run with respect to the claims of five named plaintiffs and the sixth had failed to establish the need for medical monitoring, the District Court granted defendants summary judgment. We will affirm the District Court's decertification order and its grant of summary judgment.

Named plaintiffs William Barnes, Catherine Potts, Norma Rodweller, Barbara Salzman, Edward J. Slivak, and Ciaran McNally are Pennsylvania residents who began smoking cigarettes before the age of 15 and have smoked for many years. Plaintiffs filed suit against the defendant tobacco companies1 in the Court of Common Pleas of Philadelphia County. Defendants removed to the Eastern District of Pennsylvania, and plaintiffs filed an Amended Complaint asserting claims of intentional exposure to a hazardous substance, negligence, and strict products liability on behalf of a purported class of over one million Pennsylvania cigarette smokers. In their prayer for relief, plaintiffs asked (1) that defendants fund a court-supervised or court approved program providing medical monitoring to class members; (2) for punitive damages to create a fund for common class-wide purposes, including medical research, public education campaigns, and smoking cessation programs; and (3) for other monetary and injunctive relief the court deemed just and proper.

The District Court found the class did not meet the requirements of Rule 23(b)(2) or (b)(3). See Arch v. The American Tobacco Co., 175 F.R.D. 469 (E.D.Pa.1997). The District Court rejected Rule 23(b)(2) certification because plaintiffs had not primarily sought injunctive or equitable relief, finding that "[p]laintiffs' medical monitoring claim is merely a thinly disguised claim for future damages" and that "the overwhelming majority of the relief sought by plaintiffs in their entire complaint is monetary in nature." Id. at 484. The court also found certification improper under Rule 23(b)(3) because issues common to the class did not predominate over plaintiffs' individual issues. In particular, the District Court found individual issues, such as addiction, causation, the need for medical monitoring, and affirmative defenses, made a class action unmanageable and not the superior method for fair and efficient adjudication of the case. Id. at 485-96.

The District Court suggested, however, that plaintiffs' request for a court-supervised program of medical monitoring to detect the latent diseases caused by smoking was the "paradigmatic" request for injunctive relief under a medical monitoring claim. Id. at 484. Specifically, the court stated:

The Court finds that it may properly certify a medical monitoring claim under Rule 23(b)(2) when the plaintiffs seek such specific relief which can be properly characterized as invoking the court's equitable powers. See [Day v. NLO, Inc., 144 F.R.D. 330, 336 (S.D.Ohio 1992), rev'd on other grounds, 5 F.3d 154 (6th Cir.1993) ]; see also Fried v. Sungard Recovery Serv., Inc., 925 F.Supp. 372 (E.D.Pa.1996). In reaching this decision, the Court perforce rejects defendants' argument that a medical monitoring claim can never be characterized as injunctive.

The dispositive factor that must be assessed to determine whether a medical monitoring claim can be certified as a Rule 23(b)(2) class is-what type of relief do plaintiffs actually seek. If plaintiffs seek relief that is a disguised request for compensatory damages, then the medical monitoring claim can only be characterized as a claim for monetary damages. In contrast, if plaintiffs seek the establishment of a court-supervised medical monitoring program through which the class members will receive periodic medical examinations, then plaintiffs' medical monitoring claims can be properly characterized as claim seeking injunctive relief.

In Day, Judge Spiegel cogently articulates the fine distinction between a medical monitoring claim that seeks monetary relief in the form of compensatory damages and a medical monitoring claim that seeks injunctive relief in the form of a courtsupervised medical monitoring program. Judge Spiegel explains:

Relief in the form of medical monitoring may be by a number of means. First, a court may simply order a defendant to pay a plaintiff a certain sum of money. The plaintiff may or may not choose to use that money to have his medical condition monitored. Second, a court may order the defendants to pay the plaintiffs' medical expenses directly so that a plaintiff may be monitored by the physician of his choice. Neither of these forms of relief constitute injunctive relief as required by Rule 23(b)(2).

However, a court may also establish an elaborate medical monitoring program of its own, managed by court-appointed court-supervised trustees, pursuant to which a plaintiff is monitored by particular physicians and the medical data produced is utilized for group studies. In this situation, a defendant, of course, would finance the program as well as being required by the Court to address issues as they develop during the program administration. Under these circumstances, the relief constitutes injunctive relief as required by Rule 23(b)(2).

Day, 144 F.R.D. at 335-36; see also Fried, 925 F.Supp. at 374 (implying that under medical monitoring case law, a creation of a medical monitoring program would be equitable in nature). Based on Judge Spiegel's insightful distinction, it is apparent that relief requested under a medical monitoring claim can be either injunctive or equitable in nature.

To determine whether the named plaintiffs in this case seek equitable relief under their medical monitoring claim, plaintiffs' specific request for relief under this claim must be closely scrutinized. Plaintiffs seek the establishment of a court-supervised program through which class members would undergo periodic medical examinations in order to promote the early detection of diseases caused by smoking. This portion of plaintiffs' request is the paradigmatic request for injunctive relief under a medical monitoring claim.

Arch at 483-84.

Accordingly, the District Court granted plaintiffs leave to file an amended complaint. In their Second Amended Complaint, plaintiffs brought only one claim against defendants--medical monitoring.2 Moreover, plaintiffs eliminated all requests for smoking cessation programs, medical treatment programs, punitive damages, and restitutional damages; the only relief they sought was a court-supervised fund that would pay for medical examinations designed to detect latent diseases caused by smoking. Plaintiffs sought certification under Rule 23(b)(2) for "[a]ll current residents of Pennsylvania who are cigarette smokers as of December 1, 1996 [the day the amended complaint was filed in federal court] and who began smoking before age 19, while they were residents of Pennsylvania."

The Second Amended Complaint alleged that plaintiffs and other class members had been exposed to proven hazardous substances through the intentional or negligent actions of the defendants and/or through defective products for which defendants are strictly liable. Plaintiffs alleged that as a proximate result of this exposure, they and other class members suffer significantly increased risks of contracting serious latent diseases and therefore need periodic diagnostic medical examinations. Specifically, plaintiffs contended that classwide expert evidence would prove that: (1) when cigarettes are used as defendants intended them to be used, the vast majority of those who use cigarettes become addicted and (2) cigarettes are the leading cause in the nation of cardiovascular disease, lung cancer, and chronic obstructive pulmonary disease, due to the exposure of the throat, heart, and lungs to tobacco smoke. Barnes v. The American Tobacco Co., 176 F.R.D. 479, 491 (E.D.Pa.1997).

In support of their claim, plaintiffs asserted the following: defendants have sold annually in Pennsylvania 22.6 billion cigarettes;

there are numerous hazardous substances in cigarette smoke;

defendants have known of the relationship between cigarettes and diseases but have concealed their research, publicly denied the relationship between cigarettes and disease, and continue to aggressively promote and sell cigarettes;

defendants have known for many years of ways to make safer cigarettes but have intentionally chosen not to do so;

defendants have known for many years that nicotine is addictive but have publicly denied both the fact that nicotine is addictive and their knowledge of this fact;

defendants have intentionally controlled the level of nicotine and other toxic substances in the cigarettes in order to preserve the dependence of smokers on cigarettes;

defendants have used additives such as ammonia, as well as designs for which defendants have sought patents, to make cigarettes a 'package' for the delivery of nicotine;

defendants have intentionally avoided researching or developing cigarettes that would not cause dependence or addiction in those who use them; and

defendants have spent millions of dollars each year in advertising and promoting cigarettes and have geared their efforts particularly to teenagers and children through such efforts as the "Joe Camel" advertising campaign because defendants have allegedly known that unless a person begins smoking before the age of twenty, the person is unlikely ever to begin.

Plaintiffs' physician experts designed the monitoring program using objective medical tests and age-graded criteria. They stated that cigarette smoking was the principal cause of lung cancer, cardiovascular disease, and chronic obstructive pulmonary disease, the three diseases to be monitored.

On August 22, 1997, the District Court conditionally certified the class under Rule 23(b)(2). See Barnes v. The American Tobacco Co., 176 F.R.D. at 481-93. The court held:

Because defendants have been unable to demonstrate at this point in time that this case is beset with individual issues and manageability problems, the Court finds that plaintiffs' proposed case has the cohesiveness to survive as a Rule 23(b)(2) class. Plaintiffs allege that defendants, acting in concert or pursuant to a common design, have engaged in tortious conduct directed toward the entire class as a whole. Whether or not plaintiffs can prove that defendants have acted in concert or pursuant to a common design is not a proper question to be resolved in a certification motion, rather this merit-based question must be reserved for later proceedings. See [Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 178, 94 S.Ct. 2140, 40 L.Ed.2d 732 (1974) ]. However, for purposes of the instant issue sub judice, it is highly relevant that plaintiffs have alleged that defendants have acted in concert or pursuant to a common design. It is this allegation of concerted conduct that supports a finding that defendants have acted on grounds generally applicable to all members of plaintiffs' class. Although there may be individual variations with respect to each class members' relationship with the defendants, the common questions of defendants' liability, which are intimately connected with their concerted conduct, support a finding that defendants have acted on grounds generally applicable to all members of the proposed class.

Barnes, 176 F.R.D. at 492-93.

Subsequently, defendants asked the court to certify the class certification order for interlocutory appeal or, in the alternative, to reconsider the order. They also filed motions for summary judgment.3 The District Court denied defendants' request to certify or reconsider the class certification order but decertified the class under Rule 23(c)(1).4 See Barnes at 493-502. After reviewing the summary judgment record, the court held "the individual issue of addiction, which plaintiffs had previously represented as playing no part in this case, is still actually part of the present case"; defendants were not barred from asserting affirmative defenses; and these and other elements in the case presented numerous individual issues which "preclude[d] continuing this case as a class action." Id. at 500-02.

Specifically, the court found three individual issues precluded class certification: addiction, causation, and affirmative defenses. First, the court discussed the role of addiction:

When compelled to discuss the substantive issues in the case on defendants' motion for summary judgment, plaintiffs primarily focused on "addiction" and purported nicotine "manipulation...." As was explained in Arch, whether or not an individual is addicted is a highly individualistic inquiry:

Plaintiffs' own expert Dr. Burns recognizes that the assessment of addiction is an inherently individual inquiry.... Based on this statement, defendants argue that class certification under these circumstances would require a mini-hearing on the merits of each individual's case to determine injury. See Forman v. Data Transfer, Inc., 164 F.R.D. 400, 403 (E.D.Pa.1995). Importantly, the Court finds that nowhere in plaintiffs' voluminous submissions do they actually refute that addiction is an inherently individual inquiry. Instead, plaintiffs offer a solution to this massive problem of proving addiction on an individual basis. Plaintiffs propose that once the general issue as to whether cigarettes can cause addiction is resolved, the issue as to whether each and every class member is addicted can be resolved by having them answer a questionnaire, consisting of six simple questions. Defendants rejoin that this questionnaire cannot by itself determine whether a person is nicotine dependent.

The Court finds that even if the questionnaire were used to determine nicotine dependence, defendants would be permitted to cross-examine each and every class member as to their alleged dependence. Plaintiffs admittedly acknowledge that the plan they propose would be, at most, a prima facie indication of addiction. Plaintiffs' own experts concede that addiction is necessarily an individual inquiry. To refute plaintiffs' prima facie case, defendants would be permitted to cross-examine each individual about his specific choices, decisions and behavior, and defendants would be entitled to offer expert testimony about each person's specific circumstances and diagnosis.

Barnes, 176 F.R.D. at 500 (citing Arch, 175 F.R.D. at 487-88).

The District Court also found that causation was an individual issue precluding certification. Although plaintiffs had narrowed their theories of liability, the court found their claim for medical monitoring still implicated the same individual issue of causation their First Amended Complaint asserted in negligence, strict liability, and intentional exposure to a hazardous substance. "[I]nstead of completely dropping their claims for negligence, strict liability and intentional exposure to a hazardous substance, plaintiffs merely inserted these theories as the underlying theories of liability for their medical monitoring. Thus, these theories, with their attendant individual issues, are still in this case." Barnes, 176 F.R.D. at 500. The District Court then quoted its June 3, 1997 decision at length:

To succeed on their products liability and negligence claims, plaintiffs will also have to prove "causation," which the Court finds is not capable of determination on a class-wide basis in this case. Resolution of the "general causation" question of whether cigarettes are capable of being addictive "is not common under Rule 23(a)(2)." Kurczi v. Eli Lilly & Co., 160 F.R.D. 667, 677 (N.D.Ohio 1995). Unless it is proven that cigarettes always cause or never cause addiction, "the resolution of the general causation question accomplishes nothing for any individual plaintiff." Id.; see also In re "Agent Orange" Product Liability Litigation, 818 F.2d 145, 165 (2d Cir.1987) (the "relevant question is not whether Agent Orange has the capacity to cause harm," but rather the "highly individualistic" question of whether "it did cause harm and to whom").

* * *

Plaintiffs cannot satisfy the "causation" element of these claims by proving that all cigarettes can potentially cause the user to become addicted. This is a general causation issue. The resolution of this "general causation question" would accomplish nothing for any of the individual plaintiffs. See Kurczi, 160 F.R.D. at 677. Indeed, the jury would still be required to determine for each class member whether he or she is addicted to cigarettes, and, if so, whether defendants (and which defendant) caused that addiction. With respect to causation, the Court finds that this issue is highly individualized and does not lend itself to Rule 23(b)(2) certification.

To establish their strict products liability claim, plaintiffs will be required to prove a defect in defendants' products. This inquiry is also highly individualized. Defendants manufactured hundreds of different types of cigarettes over the years and have even made changes within each brand....

Plaintiffs claim that they can prove a common defect on a class-wide basis for all of defendants' products. Plaintiffs argue that all of defendants' products are inherently defective because they contain sufficient levels of nicotine to cause addiction and other hazardous substances. Thus, plaintiffs will attempt to establish a common defect by showing that this combination exists in all of the cigarettes sold by defendants. Nonetheless, the possibility that plaintiffs' common defect theory will fail and that the class will be splintered into various subclasses--creating manageability concerns--"weighs against a finding of predominance of common issues."

Barnes, 176 F.R.D. at 500-01 (citing Arch, 175 F.R.D. at 488-89 (footnotes omitted)). The court concluded, "[b]ecause plaintiffs intend to prove their medical monitoring claim by using the theories of negligence and strict liability, the individual issues, which are implicated by these theories still exist, and thus preclude class certification." Barnes, 176 F.R.D. at 501.

Finally, the court found that affirmative defenses available to the defendants raised individual issues.5 The court explained: "For example, the defense of assumption of risk requires this Court to examine whether each and every plaintiff was subjectively aware of the risk and/or danger.... In determining whether the statute of limitations precludes a plaintiff from suing on his claim, the Court necessarily would have to examine when plaintiff's injury accrued, and whether plaintiff knew or should have known of the injury and its cause. This is clearly an individual issue.... These issues clearly preclude certification." Barnes, 176 F.R.D. at 502.

The District Court also granted defendants' motions for summary judgment, finding the statute of limitations had expired for five of the six named plaintiffs and that the sixth plaintiff had failed to demonstrate a need for medical monitoring. Barnes v. The American Tobacco Co., 984 F.Supp. 842 (E.D.Pa.1997).6

Plaintiffs contended their cause of action was governed by the equitable doctrine of laches, not the statute of limitations. But finding the action "both inherently equitable and legal," the District Court held the statute of limitations "should apply to this action because plaintiffs could have brought this action at law or in equity." Barnes, 984 F.Supp. at 855.

Examining the theories of liability underlying a medical monitoring claim, the District Court applied a two-year statute of limitations. In Redland, the Pennsylvania Supreme Court held a plaintiff must prove defendant's negligence caused his exposure to a proven hazardous substance. For this reason, the District Court predicted the Pennsylvania Supreme Court would apply the two-year statute of limitations for negligence actions to medical monitoring claims. See Barnes, 984 F.Supp. at 856-57 (citing 42 Pa. Cons.Stat. Ann. § 5524). Furthermore, to the extent that plaintiffs base their claims on strict products liability or an intentional tort, a two-year statute of limitations would still apply. See id. at 857.

In deciding when the claim accrued, the court noted that generally, a plaintiff "is under a duty to use all reasonable diligence to be properly informed of the facts and circumstances upon which a potential right of recovery is based and to institute suit within the prescribed statutory period." Pocono Int'l Raceway, Inc. v. Pocono Produce, 503 Pa. 80, 468 A.2d 468, 471 (Pa.1983). A claim under Pennsylvania law accrues at "the occurrence of the final significant event necessary to make the claim suable." Mack Trucks, Inc. v. Bendix-Westinghouse Automotive Air Brake Co., 372 F.2d 18, 20 (3d Cir.1966). The "discovery rule" is, however, a "narrow exception to this general rule," Tohan v. Owens-Corning Fiberglas Corp., 696 A.2d 1195, 1200 n. 4 (Pa.Super. 1997), and tolls the statute of limitations during the "plaintiff's complete inability, due to facts and circumstances not within his control, to discover an injury despite the exercise of due diligence." Kingston Coal Co. v. Felton Mining Co., Inc., 456 Pa.Super. 270, 690 A.2d 284, 288 (1997). Under the discovery rule, the statute of limitations begins to run when the "plaintiff knows, or in the exercise of reasonable diligence should have known, (1) that he has been injured, and (2) that his injury has been caused by another's conduct." Bradley v. Ragheb, 429 Pa.Super. 616, 633 A.2d 192, 194 (1993) (quoting MacCain v. Montgomery Hosp., 396 Pa.Super. 415, 578 A.2d 970, 972-73 (1990)).

Because a claim under Pennsylvania law accrues at "the occurrence of the final significant event necessary to make the claim suable," Mack Trucks, 372 F.2d at 20, the court found the plaintiffs' medical monitoring cause of action accrued when the plaintiffs were placed at a "significantly increased risk of contracting a serious latent disease." Redland, 696 A.2d at 145. To determine when that event occurred, the court examined plaintiffs' expert testimony. According to the expert testimony, plaintiffs suffered this significantly increased risk when they reached the "twenty pack-year" level.7 The court found that five of the six plaintiffs were at that level. Thus, the court concluded, without applying the discovery rule, the medical monitoring claims of these five plaintiffs were barred by the two-year statute of limitations. Barnes, 984 F.Supp. at 859-61.

The court found that even applying the discovery rule would not save these five plaintiffs' claims because each "should have known that smoking cigarettes put him or her at a significantly increased risk of contracting a serious latent disease years before they filed the instant lawsuit.... When a Court is asked to apply the discovery rule, the relevant question is whether an ordinary person, exercising reasonable diligence, would have known or should have known of his injury and its cause. In this case, each plaintiff should have known or did know that smoking caused them to be placed at an increased risk of contracting a serious disease." Id. at 862-63.

Reviewing the evidence, the court concluded that Barnes, Potts, Rodweller, Salzman, and Slivak had all had notice of the dangers of cigarette smoking for more than two years. Id. With respect to the sixth plaintiff, McNally, the court determined that, since she had only been smoking for 11 years, her claim could not have accrued until sometime last year. See Barnes, 984 F.Supp. at 861 n. 14.8

But the District Court granted summary judgment against McNally on a different ground, finding she failed to demonstrate a need for medical monitoring. With regard to McNally, the District Court found:

Under the Burns Program, Ms. McNally is only entitled to participate in the first level of the proposed medical monitoring program. Under the first level, Ms. McNally would be entitled to receive, annually or biannually, a physical examination, cardiovascular risk assessment and an EKG. However, Ms. McNally herself does not seek monitoring in the form of an EKG. (Defs.' Mot. Summ. J. Medical Monitoring Ex. 1 Pls.' Resp. Interrog. 10). Thus, the only monitoring that Ms. McNally seeks, and would be qualified for under the Burns Program, is a physical examination and cardiovascular risk assessment.

* * *

Because annual physical examinations and cardiovascular risk assessment are routinely recommended to all persons in the absence of exposure, the Court finds Ms. McNally can not establish that "the prescribed monitoring regime is different from that normally recommended in the absence of the exposure." [Redland, 696 A.2d at 146].... The substance of this requirement is to ensure that "a plaintiff may recover only if the defendant's wrongful acts increased the plaintiff's incremental risk of incurring the harm produced by the toxic substance enough to warrant a change in the medical monitoring that otherwise would be prescribed for that plaintiff." [Id. at 144 (citation omitted) ].

Here, Ms. McNally only seeks monitoring for two tests which would be recommended for her even if she did not smoke. Any increase in Ms. McNally's incremental risk of incurring the harm produced by the allegedly hazardous substances in cigarettes would not warrant a change in the medical monitoring that would be prescribed for her. Indeed, in the absence of exposure, it would be recommended that she receive the tests she seeks under her medical monitoring claim. Thus, she cannot satisfy the sixth element of Redland.

Barnes, 984 F.Supp. at 871-72.

Plaintiffs appealed from the final judgment.

The District Court had jurisdiction under 28 U.S.C. § 1332. We exercise jurisdiction under 28 U.S.C. § 1291.

We review the District Court's decision to decertify the class for an abuse of discretion. See Baby Neal v. Casey, 43 F.3d 48, 56 n. 15 (3d Cir.1994). We exercise plenary review of a grant of summary judgment Wicker v. Consol. Rail Corp., 142 F.3d 690, 696 (3d Cir.1998) (citation omitted), and apply the same test as the District Court; namely, we must determine if there is a "genuine issue as to any material fact" and if "the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). In so doing, we must view all evidence and draw all inferences therefrom in the light most favorable to the nonmoving party. Wicker, 142 F.3d at 696 (citation omitted).

The crucial issue is whether plaintiffs' medical monitoring claim requires inquiry into individual issues. We begin by briefly describing the evolution of this cause of action and its elements.9

In In re Paoli Railroad Yard PCB Litigation, 916 F.2d 829 (3d Cir.1990) (Paoli I), we predicted the Pennsylvania Supreme Court would recognize a cause of action for medical monitoring. We reaffirmed that prediction in In re Paoli Railroad Yard PCB Litigation, 35 F.3d 717 (3d Cir.1994) (Paoli II).10 The issue of medical monitoring first reached the Pennsylvania Supreme Court in Simmons v. Pacor, Inc., 543 Pa. 664, 674 A.2d 232 (Pa.1996), where the unanimous court recognized medical monitoring as a viable cause of action under Pennsylvania law. In Simmons, the court permitted plaintiffs with asbestos-related asymptomatic pleural thickening to recover for medical monitoring. It was not until Redland Soccer Club v. Department of the Army, 548 Pa. 178, 696 A.2d 137<