Oliveira v. Amoco Oil Co.
| Decision Date | 09 February 2000 |
| Docket Number | No. 4-98-0199.,4-98-0199. |
| Citation | 726 N.E.2d 51,311 Ill. App.3d 886,244 Ill.Dec. 455 |
| Parties | Mark OLIVEIRA, Plaintiff-Appellant, v. AMOCO OIL COMPANY, a Corporation, Defendant-Appellee. |
| Court | United States Appellate Court of Illinois |
Joseph W. Phebus, Phebus & Winkelmann, Urbana, Michael B. Hyman (argued), Much Shelist Freed Denenberg Ament Bell Rubenstein, Chicago, Edward A. Grossman, Seth Lesser, Bernstein, Litowitz, Berger & Grossmann, LLP, New York, NY, Ann D. White, Robert Eisler, Liebenberg & White, Philadelphia, PA, for Mark Oliveira.
Richard C. Godfrey (argued), Scott W. Fowkes, Steven C. Coberly, Kirkland & Ellis, Chicago, Richard L. Thies, John E. Thies, Webber & Thies, P.C., Timothy L. Moorehead, Amoco Oil Company, for Amoco Oil Company.
Plaintiff, Mark Oliveira, appeals the dismissal of his complaint based on the Illinois Consumer Fraud and Deceptive Business Practices Act (Act) (815 ILCS 505/1 et seq. (West 1996)) against defendant, Amoco Oil Company, and also appeals from the denial of class certification. Plaintiff contends (1) the trial court erred in dismissing his complaint because it failed to state a cause of action by finding he failed to allege proximate cause under the Act; and (2) the trial court erred and abused its discretion in denying class certification to his cause of action by ruling the Act did not apply to consumers outside Illinois, by not finding Illinois law applied, and failing to find common issues of fact or law predominated. We affirm in part and reverse in part.
Plaintiff is an Illinois consumer who first brought a complaint against defendant in November 1996 seeking certification as a class action on behalf of a nationwide class of all purchases of "Amoco Silver and/or Amoco Ultimate gasoline" (Amoco premium gasolines). This complaint alleged defendant's advertisements for its premium gasolines were false and plaintiff and others had purchased those premium brands because of the ads. Defendant asserted four causes of action: (1) breach of express warranty; (2) breach of implied warranty; (3) fraudulent misrepresentation; and (4) a violation of the Act.
At an evidentiary hearing in March 1997, the trial court denied class certification because, whether Illinois' or another state's law was applicable, the cause of action based upon reliance on advertisements required separate factual findings as to each class member's reasons for purchasing gasoline.
Plaintiff filed an amended complaint in May 1997, in which he dropped all claims except consumer fraud under the Act. The amended complaint alleges plaintiff and the class he claims to represent have a claim under the Act and were damaged simply by purchasing Amoco premium gasolines regardless of whether they saw the advertisements plaintiff alleges were misrepresentations. Plaintiff requested certification of a class he defined as "[a]ll retail purchasers in the United States who purchased Amoco Ultimate and/or Amoco Silver gasoline during the class period, November 6, 1991, through January 2, 1996."
The amended complaint alleged defendant began a multi-state advertising campaign on November 6, 1991, which falsely represented:
The complaint alleges defendant knew these statements were untrue. While not included as an allegation in the complaint, the end date chosen for the class period, January 2, 1996, was the effective date of a consent decree between defendant and the Federal Trade Commission (FTC) as a result of which defendant stopped its advertising. The consent decree settled an action filed against defendant by the FTC based upon the same alleged deceptive advertising campaign.
Plaintiff alleges the result of defendant's deceptive advertising campaign was to increase demand for its premium gasoline thereby enabling it to command an inflated and otherwise unsustainable price for the premium gasolines that all consumers of the gasoline paid whether or not they had relied upon or seen the advertising campaign. Thus, plaintiff argues all consumers who purchased defendant's premium gasolines during the class period were damaged by defendant's misrepresentations in its advertising campaign.
In support of his motion to certify a class action, plaintiff submitted the affidavit of Dr. William R. Latham III, professor of economics at the University of Delaware, and Dr. James E. Haefner, professor of advertising at the University of Illinois. Dr. Haefner's affidavit had to do with the effects of advertising on consumer demand.
In Dr. Latham's initial and second affidavit, he assumed (1) defendant's premium gasoline did not provide the benefits touted by its advertising campaign and (2) the ad campaign had an effect on consumers and influenced their choices. He then stated, due to the increased demand created by the advertising, defendant was able to charge a higher rate for its premium gasolines than without the advertising. This higher rate was paid by all consumers and not just those who heard and relied upon defendant's advertising. Dr. Latham stated it can be determined, using econometric analysis, the precise extent of the inflated price attributable to defendant's advertising.
Defendant filed a motion to strike the affidavits of both Latham and Haefner. Defendant argued Latham's opinions were premised on assumptions contrary to undisputed facts; his theory of liability was novel and contrary to Illinois law; and his opinions were speculative, unsupported by evidence and lacking foundation for admissibility. Defendant provided affidavits from experts of its own that criticized Latham's theories as not supported by the facts, which showed that during the class period demand for defendant's premium gasolines actually decreased, as did prices charged. Defendant argued Latham's theory did not comply with the requirements of the Act and was both (1) too speculative and (2) an example of "fraud on the market" theory, which has been adopted only in securities fraud cases and not in cases of consumer fraud.
As Dr. Latham's second affidavit pointed out, however, he was not contending demand for defendant's premium gasoline actually increased as compared to previous time periods nor that the prices it charged increased from previous periods. Instead, Latham's contention is defendant's apparently deceptive advertising kept demand and prices higher during the class period than they would have been otherwise. He does not disagree other factors also influence demand and prices charged but maintains an econometric analysis can be designed to isolate the effect of defendant's advertising on the actual demand levels and prices during the relevant time period.
Defendant also filed motions to dismiss plaintiff's complaint pursuant to section 2-615 of the Civil Practice Law (Law) (735 ILCS 5/2-615 (West 1996)) and section 2-619 of the same Law. Defendant also contested plaintiff's second motion to certify the class.
The trial court denied defendant's motion to strike the affidavits of Drs. Latham and Haefner and the section 2-619 motion. The court found plaintiff had no cause as to Amoco Silver gasoline because he did not actually purchase it but stated the case was not being dismissed on that ground. Instead, the trial court granted defendant's section 2-615 motion because plaintiff's complaint did not plead proximate causation adequately under the Act. The court rejected the marketing theory pleaded by plaintiff, i.e., defendant's misleading advertising caused inflated prices for its gasoline. The trial court also denied certification of a class action stating again it rejected the "marketing scheme theory" proposed by plaintiff. The court noted a lack of predominance of common issues of fact because of the variables that would cause a consumer to purchase gasoline, including whether a consumer believed defendant's advertising claims. The court also found no common questions of law existed because the Act did not extend to consumers outside Illinois. This appeal followed.
We first address defendant's motion to strike portions of plaintiff's reply brief. Defendant contends in its opening brief plaintiff claimed the trial court's denial of class certification and dismissal of the complaint were erroneous for three reasons. However, defendant argues plaintiff, by reply brief, raised several arguments originally raised in the trial court but not in plaintiff's opening brief. Defendant notes Supreme Court Rule 341(e)(7) provides any points not argued in an appellant's opening brief "are waived and shall not be raised in the reply brief." 155 Ill.2d R. 341(e)(7). Defendant argues that by raising these new points for the first time in his reply brief plaintiff is attempting to preclude it from responding to those arguments.
We believe the arguments raised by plaintiff in his reply brief were in response to arguments raised by defendant in its opening brief. Defendant was not precluded from responding to arguments raised...
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Oliveira v. Amoco Oil Co.
...court's dismissal of plaintiff's cause of action and affirmed the circuit court's denial of class certification. 311 Ill.App.3d 886, 244 Ill.Dec. 455, 726 N.E.2d 51. Plaintiff and defendant filed petitions for leave to appeal from the appellate court's decision. 177 Ill.2d R. 315. We grante......
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Avery v. State Farm Mut. Auto. Ins. Co.
...our appellate court has also divided over the question of how best to interpret section 1(f). In Oliveira v. Amoco Oil Co., 311 Ill.App.3d 886, 244 Ill.Dec. 455, 726 N.E.2d 51 (2000), vacated in part & rev'd on other grounds, 201 Ill.2d 134, 267 Ill.Dec. 14, 776 N.E.2d 151 (2002), the Fourt......
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People v. Whitfield
...his or her opening brief, to anticipate every argument that may be raised by an appellee. See Oliveira v. Amoco Oil Co., 311 Ill.App.3d 886, 891, 244 Ill.Dec. 455, 726 N.E.2d 51 (2000), rev'd in part, 201 Ill.2d 134, 267 Ill.Dec. 14, 776 N.E.2d 151 (2002). Thus, we hold that defendant's dou......
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Avery v. State Farm Mutual Automobile Insurance Company, Docket No. 91494 — Agenda 7 — May 2003 (IL 8/18/2005)
...district courts, our appellate court has also divided over the question of how best to interpret section 1(f). In Oliveira v. Amoco Oil Co., 311 Ill. App. 3d 886 (2000), vacated in part & rev'd on other grounds, 201 Ill. 2d 134 (2002), the Fourth District of our appellate court declined to ......
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Obtaining relief for deceptive practices under FDUTPA.
...a denial of class certification as plaintiffs had failed to provide sufficient evidence of causation. In Oliveira v. Amoco Oil Company, 726 N.E.2d 51 (Ill. App. 4 Dist. 2000), the court affirmed the denial of certification of a nationwide class because the laws of other states might require......