Labrier v. State Farm Fire & Cas. Co.
| Decision Date | 19 April 2016 |
| Docket Number | No. 2:15–cv–04093–NKL,2:15–cv–04093–NKL |
| Citation | 181 F.Supp.3d 648 |
| Parties | Amanda M. Labrier, individually, and on behalf of all others similarly situated, Plaintiff, v. State Farm Fire and Casualty Company, Defendant. |
| Court | U.S. District Court — Western District of Missouri |
Christopher E. Roberts, David T. Butsch, Butsch Roberts & Associates LLC, Joe D. Jacobson, Jacobson Press & Fields PC, Clayton, MO, T. Joseph Snodgrass, Larson King, LLP, St. Paul, MN, for Plaintiff.
Heidi Dalenberg, Joseph A. Cancila, Jr., Patricia T. Mathy, Tal C. Chaiken, Riley Safer Holmes & Cancila LLP, Chicago, IL, Daniel E. Wilke, Wilke & Wilke, P.C., St. Louis, MO, for Defendant.
The primary issue in this case is whether Defendant State Farm Fire and Casualty Company properly depreciated labor when it made actual cash value payments for property damage. Subsequent to the Court's Order denying State Farm's motion to dismiss and holding that labor could not be depreciated, [Doc. 67], State Farm decided to stop subtracting labor depreciation for certain property damage claims that were paid after the Court's order. State Farm also started to retroactively pay previously withheld labor deprecation, and to communicate with its insureds about the nature of those payments. To date, those retroactive payments have been limited to actual cash value claims resolved after the Court's interpretation of State Farm's policy.1
In response, Plaintiff Amanda LaBrier has asked the Court to order State Farm to stop making retroactive payments and to instead set aside the money for such payments until class certification and the merits of the dispute are resolved. See [Doc. 88 and Doc. 91.] LaBrier argues that it would be inequitable for putative class members to be paid for essentially the same claims which LaBrier has asserted on their behalf, without sharing in the expense of pursuing State Farm in court. LaBrier argues that her requested remedy is mandated by the common fund doctrine or the equitable principles underlying the common fund doctrine. LaBrier also argues that the Court should supervise State Farm's communications with State Farm's insureds.
Taking into account that Missouri law controls, the Court finds that the common fund doctrine does not directly apply here because LaBrier has not shown that a common fund exists at this time. The Court did not finally resolve the merits of the dispute and therefore there is no specific fund that has been created by court order or otherwise. Lett v. City of St. Louis, 24 S.W.3d 157, 162 (Mo.Ct.App.2000) () However, the principles underpinning the common fund doctrine are based on equity. "[T]he common benefit doctrine permits recovery of attorney's fees when a successful litigant benefits a group of other individuals similarly situated." Id. Considering these equitable principles as well as efficiency, the Court concludes that a temporary cessation of State Farm's retroactive payments is warranted, pending the resolution of the merits and any issues related to class certification.
As to the equities, State Farm has acknowledged that it changed its labor depreciation practices in response to the Court's order interpreting LaBrier's insurance contract with State Farm. But for the work of the LaBrier, there is no evidence these changes would have occurred. Further, while no class has been certified, the class was identified at the time the lawsuit was filed and includes the putative class members who have been given retroactive labor depreciation payments by State Farm. Thus, this case is distinguishable from the Missouri cases where indirect beneficiaries of litigation not specifically referenced in a lawsuit were not required to contribute to the cost of a plaintiff's work.
Furthermore, permitting a defendant to pay putative class members after the defendant loses on a motion to dismiss has the effect of discouraging class actions. Class actions were designed to permit aggregate actions to prevent small amounts of money from being taken unlawfully without some consequence. Obviously, a plaintiff would be less likely to incur the substantial costs of a class action if "voluntary" payments by a defendant would effectively prevent a plaintiff from recovering a fair share of the cost of the litigation from putative class members. Further, if that possibility existed, a judge might defer ruling on a motion to dismiss to avoid any procedural posturing and the potential inequities outlined above. Such a decision would not promote efficiency but would promote fairness.
The Court does recognize that State Farm has a legitimate concern as well. State Farm fears being subject to vexatious refusal to pay claims if it does not change its labor depreciation practices, now that the Court has interpreted the disputed language in State Farm's insurance policy. But the concerns of both LaBrier and State Farm can be addressed by putting the disputed...
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