Entergy Gulf States v. Butler et al., 069900082CV

• Citation: 25 S.W.2d 359
• Decision Date: 04 May 2000
• Docket Number: 069900082CV
• Parties: In The Court of Appeals Sixth Appellate District of Texas at TexarkanaENTERGY GULF STATES, INC., ET AL., Appellants V. BILLY JOE BUTLER, ET AL., Appellees On Appeal from the 172nd Judicial District Court Jefferson County, Texas Trial CourtBefore Cornelius, C.J., Grant and Ross, JJ. Opinion by Justice Ross Concurring Opinion by Justice Grant O P I N I O N This is an accelerated appeal in which Entergy Gulf States, Inc., et al. ("Entergy") appeals an order granting class certification to Billy Joe Butler, et al. ("Butler"). Entergy contends that class certification is improper because individual issues will predominate over common issues, certification of the class is not the superior method for resolving this controversy, the named plaintiffs' claims are not typical, and the named plaintiffs are not adequate representatives of the class. Additionally, in its motion for rehearing, Entergy also claims that the class is improper as certified because the trial court has created a fail-safe class. We overrule these contentions and affirm the trial court's order granting class certification. In January 1997, many customers of Entergy in the Southeast Texas region suffered substantial power outages. These outages were triggered by the occurrence of a major ice storm moving through the area. The class proponents claim, however, that due to Entergy's failure to properly maintain the system before the storm, the power outages lasted an unreasonably lengthy period of time, and this interruption caused them to sustain various damages. These utility customers, who were without power for varying periods of time, sought class certification. After hearing the certification evidence, the trial court signed an order granting class certification to "all Texas customers of Defendant Entergy whose electrical service was interrupted between
• Court: Court of Appeals of Texas

25 S.W.2d 359 In The Court of Appeals Sixth Appellate District of Texas at Texarkana No. 06-99-00082-CV ENTERGY GULF STATES, INC., ET AL., Appellants

V.

BILLY JOE BUTLER, ET AL., Appellees On Appeal from the 172nd Judicial District Court Jefferson County, Texas Trial Court No. E-156,275

Before Cornelius, C.J., Grant and Ross, JJ.

Opinion by Justice Ross

Concurring Opinion by Justice Grant

O P I N I O N

This is an accelerated appeal in which Entergy Gulf States, Inc., et al. ("Entergy") appeals an order granting class certification to Billy Joe Butler, et al. ("Butler"). Entergy contends that class certification is improper because individual issues will predominate over common issues, certification of the class is not the superior method for resolving this controversy, the named plaintiffs' claims are not typical, and the named plaintiffs are not adequate representatives of the class. Additionally, in its motion for rehearing, Entergy also claims that the class is improper as certified because the trial court has created a fail-safe class. We overrule these contentions and affirm the trial court's order granting class certification.

In January 1997, many customers of Entergy in the Southeast Texas region suffered substantial power outages. These outages were triggered by the occurrence of a major ice storm moving through the area. The class proponents claim, however, that due to Entergy's failure to properly maintain the system before the storm, the power outages lasted an unreasonably lengthy period of time, and this interruption caused them to sustain various damages. These utility customers, who were without power for varying periods of time, sought class certification. After hearing the certification evidence, the trial court signed an order granting class certification to "all Texas customers of Defendant Entergy whose electrical service was interrupted between January 11, 1997 through January 22, 1997, and who have sustained damages as a result of said disruption of service." Findings of fact and conclusions of law were filed along with this order. Entergy contends, in this interlocutory appeal, that the trial court erred in granting this class certification, that the certification constitutes an abuse of discretion, and that the class must be decertified.

A trial court has broad discretion to determine whether to grant or deny class certification, and once this decision is made, the appellate court should not overturn the decision to substitute its judgment for that of the trial court. American Express Travel Related Servs. Co. v. Walton, 883 S.W.2d 703, 707 (Tex. App.?Dallas 1994, no writ). In any review of a class certification, the reviewing court should reverse the certification order only if the record shows a clear abuse of discretion. St. Louis Southwestern Ry. Co. v. Voluntary Purchasing Groups, Inc., 929 S.W.2d 25, 29 (Tex. App.?Texarkana 1996, no writ), citing Walton, 883 S.W.2d at 711. A trial court abuses its discretion when the order is arbitrary and unreasonable. See Simon v. York Crane & Rigging Co., 739 S.W.2d 793, 795 (Tex. 1987).

In order to obtain certification, a party must satisfy the four requirements of Rule 42(a), as well as one of the requirements of Rule 42(b). See TEX. R. CIV. P. 42(a), (b). However, before we review whether the trial court abused its discretion by making this determination, we will first consider the appropriateness of the certified class definition. Entergy claims that when the trial court defined this class, it abused its discretion by creating a fail-safe class. See Intratex Gas Co. v. Beeson, 43 Tex. Sup. Ct. J. 489, 2000 WL 266700 (March 9, 2000). This contention, though, is made for the first time in Entergy's motion for rehearing, and a complaint which is initially brought to the court's attention in such a motion is untimely. See Thornton v. D.F.W. Christian Television, Inc., 925 S.W.2d 17, 21 (Tex. App.?Dallas 1995), rev'd on other grounds, 933 S.W.2d 488 (Tex. 1996). Therefore, we are not required to address this claim. However, since the Texas Supreme Court has recently spoken on this specific issue, we will nonetheless address Entergy's additional complaint.

"For a class to be sufficiently defined, it must be precise; the class members must be presently ascertainable by reference to objective criteria." Beeson, 2000 WL 266700 at *4. In Beeson, the Texas Supreme Court held that a class definition which rests on the resolution of the ultimate liability question fails to meet this criteria because it is not objective or precise and the members cannot be ascertained until after the liability issue has been determined. Id. at *5-6. They determined that such a class, appropriately named a fail-safe class, is unacceptable because it inevitably creates one-sided results. Id. at *6.

If the defendant is found liable, class membership is then ascertainable and the litigation comes to an end. A determination that the defendant is not liable, however, obviates the class, thereby precluding the proposed class members from being bound by the judgment.

Id. at *6.

In the case at hand, however, this is not the situation presented by the certified class definition. The trial court defined the class as "all Texas customers of Defendant Entergy whose electrical service was interrupted between January 11, 1997 through January 22, 1997, and who have sustained damages as a result of said disruption of service." This class is precise and ascertainable by reference to objective criteria. It can easily be determined who had their service interrupted in this time period and who claims to have suffered damages as a result of this interruption. In fact, every plaintiff who asserts any type of civil claim must be able to assert in their original pleadings the relief they are seeking as a result of the defendant's alleged wrongdoing. See TEX. R. CIV. P. 47.

While we can see how a fail-safe class, as defined in Beeson, could potentially disallow class definitions that rest on the determination of legal conclusions besides liability, we believe that the class definition in this case is clearly not such a class. There is no ultimate legal conclusion which must be made in order to ascertain the class, and a finding of liability or nonliability on the part of Entergy for the said interruption will bind all class members and prevent them from bringing another suit. Fail-safe classes are not allowed because they present a means of risk-free litigation for the potential members of the class. Beeson, 2000 WL 266700 at *6. The present certified class definition, however, does not present such a situation. This point of error is overruled.1

Since the trial court's certified class definition is proper, this Court must now determine whether the trial court abused its discretion by finding that all of the requirements for class certification had been met. In this case, the trial court found that all requirements for class certification had been met under Rule 42(a) and Rule 42(b)(4). Rule 42(a) requires class proponents to prove that (1) the class is so numerous that joinder is impracticable, (2) the class has common questions of law or fact, (3) the representatives' claims are typical of the class claims, and (4) the representatives will fairly and adequately protect the interests of the class. TEX. R. CIV. P. 42(a). In other words, class proponents must prove numerosity, commonality, typicality, and adequate representation. See Forsyth v. Lake LBJ Inv. Corp., 903 S.W.2d 146, 150 (Tex. App.?Austin 1995, writ dism'd w.o.j.). Rule 42(b)(4) requires 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." TEX. R. CIV. P. 42(b)(4).

Entergy's first contention is that the common issues do not predominate over the individual issues, as required under Rule 42(b)(4), and that as a result, class certification was improper.2 The test for evaluating predominance is "not whether the common issues outnumber the individual issues, but instead whether common or individual issues will be the object of most of the efforts of the litigants and the court." Glassell v. Ellis, 956 S.W.2d 676, 686 (Tex. App.?Texarkana 1997, pet. dism'd w.o.j.), quoting Life Ins. Co. of Southwest v. Brister, 722 S.W.2d 764, 772 (Tex. App.?Fort Worth 1986, no writ).3

Entergy claims that the numerous individual issues surrounding causation and damages will assuredly predominate every asserted cause of action.4 The law is clear, however, that certification will not be prevented merely because damages must be determined separately for each member of the class. Central Power & Light Co. v. City of San Juan, 962 S.W.2d 602, 610 (Tex. App.?Corpus Christi 1998, pet. dism'd w.o.j.), citing Angeles/Quinoco Sec. Corp. v. Collison, 841 S.W.2d 511, 516 (Tex. App.?Houston [14th Dist.] 1992, no writ).

Entergy contends that this law does not dispose of the issue at hand because every member of this class would not only have to separately prove their damages, they would also have to individually prove that Entergy caused that damage. Entergy argues that this would result in a series of mini-trials, rather than one collective trial, and as such is not a case that should be certified as a class action. See LaFleur v. Entergy, Inc., 737 So.2d 761 (La. Ct. App. 1998); Brown v. New Orleans Pub. Serv., Inc., 506 So.2d 621 (La. Ct. App. 1987, writ denied). Entergy believes that since both LaFleur and Brown specifically deal with class certifications against utility companies after the occurrence of a severe weather event, those cases provide guiding principles that should be followed by this Court.

It is true that the LaFleur case arose out of the same ice storm and that the surrounding facts, participating parties, and alleged...