Allapattah Services, Inc. v. Exxon Corp., No. 01-15575.

• Court: U.S. Court of Appeals — Eleventh Circuit
• Writing for the Court: Wilson
• Citation: 333 F.3d 1248
• Parties: ALLAPATTAH SERVICES, INCORPORATED, a Florida corporation, Robert Lewis, Inc., a Florida corporation, d.b.a. Trial Exxon, G.G.S.K.1, Inc., a Florida corporation, d.b.a. North Stuart Exxon, G.G.S.K., Inc., et al., Plaintiffs-Appellees, Cross-Appellants, Roy Page, Glebe Road Exxon, Incorporated, Plaintiffs, v. EXXON CORPORATION, a New Jersey corporation, Defendant-Appellant, Cross-Appellee. Allapattah Services, Incorporated, a Florida corporation, Robert Lewis, Inc., a Florida corporation, d.b.a. Northlake Exxon, d.b.a. Trial Exxon, G.G.S.K.1, Inc., a Florida corporation, d.b.a. North Stuart Exxon, G.G.S.K., Inc., et al., Plaintiffs-Appellees, Roy Page, et al., Plaintiffs, v. Exxon Corporation, a New Jersey corporation, Defendant-Appellant.
• Decision Date: 11 June 2003
• Docket Number: No. 01-16244.,No. 01-15575.

333 F.3d 1248 ALLAPATTAH SERVICES, INCORPORATED, a Florida corporation, Robert Lewis, Inc., a Florida corporation, d.b.a. Trial Exxon, G.G.S.K.1, Inc., a Florida corporation, d.b.a. North Stuart Exxon, G.G.S.K., Inc., et al., Plaintiffs-Appellees, Cross-Appellants,
Roy Page, Glebe Road Exxon, Incorporated, Plaintiffs,
v.
EXXON CORPORATION, a New Jersey corporation, Defendant-Appellant, Cross-Appellee.
Allapattah Services, Incorporated, a Florida corporation, Robert Lewis, Inc., a Florida corporation, d.b.a. Northlake Exxon, d.b.a. Trial Exxon, G.G.S.K.1, Inc., a Florida corporation, d.b.a. North Stuart Exxon, G.G.S.K., Inc., et al., Plaintiffs-Appellees,
Roy Page, et al., Plaintiffs,
v.
Exxon Corporation, a New Jersey corporation, Defendant-Appellant. No. 01-15575. No. 01-16244. United States Court of Appeals, Eleventh Circuit. June 11, 2003.

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John F. Stanton, Robert G. Abrams, Robert J. Brookshiser, Jr., Jerrold J. Ganzfried, Howrey, Simon, Arnold & White, LLP, Washington, DC, Larry S. Stewart, Stewart, Tilghman, Fox & Bianchi, P.A., Miami, FL, for Exxon Corp.

Jay Solowsky, Pertnoy, Solowsky & Allen, P.A., Eugene E. Stearns, Stearns, Weaver, Miller, Weissler, Alhadeff & Sitterson, P.A., Miami, FL, for Plaintiffs-Appellees, Cross-Appellants.

James E. Cecchi, Carella, Byrne, Bain, Gilfillan, Cecchi & Stewart, Roseland, NJ, for Amici Curiae, States of NJ and MD and Com. of VA.

Appeals from the United States District Court for the Southern District of Florida.

Before WILSON and FAY, Circuit Judges, and GOLDBERG^*, Judge.

WILSON, Circuit Judge:

This case arises out of a class action suit filed by approximately 10,000 Exxon dealers who alleged that Exxon Corp. breached its dealer agreements by overcharging them for fuel purchases. Following a second trial, a jury returned a special verdict in favor of the dealers. After entering a final judgment for the class representatives and denying the dealers' motion for the entry of a class-wide judgment, the district court certified the following two questions for interlocutory appeal: (1) whether it properly exercised supplemental jurisdiction over class members whose claims did not meet the jurisdictional minimum amount in controversy requirement; and (2) whether an aggregate compensatory and prejudgment interest award could be entered for the class before the claims administration process. Additionally, the court urged us to consider all of the legal issues raised by both parties relating to the disposition of the case. Thus, we also consider (1) whether Exxon is entitled to participate in the claims administration process; (2) whether Exxon may assert set-off claims against the dealers; (3) whether the district court abused its discretion by certifying the class; (4) whether

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the court erred when it admitted extrinsic evidence to supplement the Dealer Sales Agreements (dealer agreements); (5) whether the dealers' claims were barred by the statutes of limitations; and (6) whether the court abused its discretion by allowing the dealers' expert witness to testify at trial. We find no reversible error and accordingly affirm.

BACKGROUND¹

This suit was filed by a class of approximately 10,000 current and former Exxon dealers in thirty-five states who alleged that in connection with a marketing program known as the Discount for Cash (DFC) program, Exxon systematically and intentionally overcharged them for the wholesale purchase of motor fuel between March 1, 1983 and August 31, 1994. As a result of the overcharges, the dealers alleged that Exxon breached its obligations to them under the dealer agreements.

Under the DFC program, Exxon encouraged its dealers to implement a pricing system under which retail customers who paid cash for gasoline would pay a few cents less than customers who paid with credit cards. In an effort to maximize dealer participation in the program, Exxon began charging dealers a three-percent processing fee on sales of gasoline to consumers who paid by credit card, but promised to offset the charge by reducing the wholesale price that each dealer paid for gasoline. Exxon kept this promise for approximately six months and reduced the wholesale price by 1.7 cents per gallon. In March of 1983, however, it stopped providing the offset without informing the dealers. The dealers allege that by removing the offset without informing them, Exxon was able to overcharge them for gasoline during the class period.

Upon discovering that the offset was no longer being provided, the dealers filed suit in May of 1991, and the case originally was tried to a hung jury in September of 1999. It was retried in January of 2001, resulting in a unanimous jury verdict in favor of the dealers. The jury found that Exxon breached its contractual obligations to the dealers and fraudulently concealed that breach. Following the return of the jury's verdict, Exxon filed posttrial motions for judgment as a matter of law and/or a new trial. The district court denied those motions, concluding that the evidence presented at trial was more than sufficient to support the verdict. The court further determined that, as a matter of law, the dealers were entitled to recover prejudgment interest in addition to their compensatory damages. Nevertheless, the court denied the dealers' motion for the entry of a final judgment for the class, concluding that it had no authority to enter an aggregate judgment because the jury had not awarded aggregate damages. Instead, the district court entered a final judgment for the class representatives and created an ad hoc claims process through which Exxon could contest each of the remaining class members' claims for compensatory damages.

Because the district court believed that its "order involve[d] a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation," it certified the case for interlocutory review pursuant to 28 U.S.C. § 1292(b), asking us to resolve the following questions: (1) whether it properly exercised supplemental jurisdiction over the claims of class members who

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did not meet the jurisdictional minimum amount in controversy; and (2) whether it was proper to enter judgment for the class representatives, but not for the class as a whole.

DISCUSSION I. Supplemental Jurisdiction

The first question certified for interlocutory review by the district court was whether it had supplemental jurisdiction over the claims of all of the class members, including those who failed to meet the minimum amount in controversy requirement of 28 U.S.C. § 1332(a). "[W]hether the district court had subject matter jurisdiction over [this action] is ... subject to de novo review." Darden v. Ford Consumer Fin. Co., 200 F.3d 753, 755 (11th Cir.2000).

The district court's question forces us to address whether 28 U.S.C. § 1367, the supplemental jurisdiction statute, overrules the United States Supreme Court's decision in Zahn v. International Paper Co., 414 U.S. 291, 301, 94 S.Ct. 505, 38 L.Ed.2d 511 (1973), that "[e]ach plaintiff in a Rule 23(b)(3) class action must satisfy the jurisdictional amount, and any plaintiff who does not must be dismissed from the case."²

Whether § 1367 overrules Zahn has been the subject of considerable debate among our sister circuits, which have split on the issue. See Rosmer v. Pfizer Inc., 263 F.3d 110, 114 (4th Cir.2001) (holding "that § 1367 confers supplemental jurisdiction in diversity class actions, so long as one named plaintiff" satisfies the minimum amount in controversy requirement), cert. dismissed, 536 U.S. 979, 123 S.Ct. 14, 153 L.Ed.2d 878 (2002); Gibson v. Chrysler Corp., 261 F.3d 927, 934 (9th Cir.2001) (holding the same), cert. denied, 534 U.S. 1104, 122 S.Ct. 903, 151 L.Ed.2d 872 (2002); Stromberg Metal Works, Inc. v. Press Mech., Inc., 77 F.3d 928, 930-31 (7th Cir.1996) (holding that § 1367 authorizes a district court to exercise supplemental jurisdiction over a party that does not satisfy the minimum amount in controversy);³ In re Abbott Labs., 51 F.3d 524, 528-29 (5th Cir.1995) (holding that as long as the class representatives meet the amount in controversy requirement, a district court may exercise supplemental jurisdiction over the members of the class who do not). But see Trimble v. Asarco, Inc., 232 F.3d 946, 962 (8th Cir.2000) (holding that Zahn remains

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viable and that each member of a class must meet the requisite jurisdictional amount in controversy); Meritcare Inc. v. St. Paul Mercury Ins. Co., 166 F.3d 214, 222 (3d Cir.1999) (finding the text of § 1367 ambiguous and relying upon legislative history to hold that § 1367 preserves Zahn); Leonhardt v. W. Sugar Co., 160 F.3d 631, 640 (10th Cir.1998) (holding that § 1367 unambiguously preserves Zahn). Upon our own review, we agree with our sister circuits that have held that the language of § 1367 clearly and unambiguously overrules Zahn and allows a district court entertaining a diversity class action to exercise supplemental jurisdiction over class members whose claims do not meet the jurisdictional minimum amount in controversy requirement.⁴

In addressing this question, "we begin by examining the text of the statute to determine whether its meaning is clear." Harry v. Marchant, 291 F.3d 767, 770 (11th Cir.2002) (en banc). "In construing a statute we must begin, and often should end as well, with the language of the statute itself." Merritt v. Dillard Paper Co., 120 F.3d 1181, 1185 (11th Cir. 1997). This is so because "`[we] must presume that a legislature says in a statute what it means and means in a statute what it says there.'" Id. (quoting Conn. Nat'l Bank v. Germain, 503 U.S. 249, 253-54, 112 S.Ct. 1146, 117 L.Ed.2d 391 (1992)).

Section 1367(a) provides,

Except as provided in...